This is a complicated topic. When I speak to executives and colleagues about Artificial Intelligence, our conversation runs the gamut: security risks and biases built into the model to whether or not tools such as Microsoft’s Copilot will replace software engineers for good. How all of this relates to an organizations’ strategy is a completely different story and normally results in a loss of color to a person’s face and maybe some words that sound a bit like, “well, we are evaluating how AI might impact our strategy and our go-to-market….blah…blah…blah” that continues until the individual runs out of breath or business jargon.
Photo by Miltiadis Fragkidis on Unsplash.
So, how can Artificial Intelligence impact a company’s strategy? And, maybe just as importantly, who should be driving the AI initiatives? Which ones should we start with? How do we measure ROI and overall impact?
The answer to these questions depend on your organization’s strategy and priorities. The problem arises with the fact that many organizations mistake initiatives and tactics for strategy. As Michael Porter discusses in his article for Harvard Business Review What is Strategy? : “Operational Effectiveness is not Strategy.”
Ok, so what does this mean in today’s race to implement AI? Many companies are exploring how AI can do one of two things:
Cut costs (with the use of automation and streamlining back office activities)
or larger and more complex activities that will deliver greater value to their customers (using GenAI to tailor unique experiences for individuals as an example).
Much like what happened with the agile initiatives of the early 2000’s and the move-to-cloud efforts of the 2010’s, there is now a focused push to adopt Artificial Intelligence. According to Jack Kelly’s article in Forbes, executives are looking to “solidify their competitive advantages and future-proof their organizations.” According to the Pulse Survey discussed in that article, a whopping 69% of the 1200 CEOs surveyed are redistributing funds to AI projects with another 23% raising new capital to do the same. Wow.
Ok, so what does this mean, exactly? In order to answer the question, I will be exploring what it means to use artificial intelligence to operate at a lower cost, deliver unique capabilities and experiences to the market, or both. And, oh by the way, that pesky security piece can’t be forgotten either.
I will be posting my first article in this series in the next week. I hope you’ll join me!