Why AI Struggles with Long-Term Decisions

Large language models are the shiny toys of AI. They can chat, diagnose, predict, and even create art. But long-term resource allocation, like a CFO managing a company's finances over 11 years, these models aren't ready for prime time.

The Test: EnterpriseArena

Enter EnterpriseArena, a new benchmark that challenges AI models to do just that. It simulates a 132-month enterprise environment, mixing in real-world financial data and business documents. The models are expected to juggle resources while adapting to fluctuating macroeconomic signals. It sounds impressive on paper, but the reality is quite different.

Only 16% of runs made it through the full simulation. That's right, just a small fraction survived the test. And here's the kicker: larger models didn't necessarily outperform their smaller counterparts. So much for bigger is better.

Why This Gap Matters

Why should we care about AI's inability to allocate resources effectively? Simple. If AI can't manage long-range planning, it's not replacing human decision-makers anytime soon. Companies can't afford to put their financial futures in the hands of a system that can't even handle a simulated long-term strategy.

The real story here's about priorities. AI tools are being sold as the future of decision-making. But the gap between the keynote and the cubicle is enormous. Management bought the licenses, but nobody told the team about these limitations.

What's Next?

So what's the next step? Upskilling and refining these models is key. If AI is ever going to take on big decisions, it needs a deeper understanding of how to balance resource allocation under uncertainty. But don't hold your breath. The current adoption rate for such advanced functionality is slow.

In the meantime, companies should continue to rely on human intuition and expertise for complex decisions. Sure, AI can assist, but it's a long way from running the show. And until these systems can handle the pressure of long-term planning, the CFOs of the world can sleep easy, knowing their jobs are safe from automation.