This morning another LinkedIn post crossed my feed promising that AI had already created everything needed to run a real estate investment office. Models, underwriting templates, valuation tools, management dashboards — the works. Maybe some of these tools are genuinely useful. In fact, many probably are. Used intelligently, they can save enormous amounts of time and streamline complex analysis. But they also raise a question that matters far more than speed:
During the mid-1980s I was a banker at J.P. Morgan in London. While this may seem somewhere between ancient and prehistoric, I am not at all sure it is irrelevant to today's world. As a young banker, I saw several talented and hard-working senior executives literally blow up their careers because they had only a limited understanding of what was really happening inside the financial models underpinning their businesses. After the second or third time I saw that happen to people I liked and respected, I made a rule for myself that I followed for the rest of my career:
You can't manage a business if you don't really understand what is going on. AI makes it easier than ever not to know what is going on. It also makes it easier than it has ever been to understand the details — if you want to. Ask for explanations. Understand the logic. Know why the assumptions are what they are. Understand how the inputs convert into outputs, and why.
The danger is not AI itself. The danger is creating a black box that quietly replaces your own judgment. Whether the tool is AI, Excel, Google Sheets, or something else entirely, the responsibility is still yours. The moment you stop understanding the numbers, you stop managing the business.
You abdicate that responsibility at your own risk.