#191 The Discomfort of Agentic AI's Disruption
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It's often said that a successful negotiation leaves all parties slightly dissatisfied—ideally, to an equal degree. This principle of shared dissatisfaction can also be applied to groundbreaking innovations. As we stand at the brink of a new era in artificial intelligence, it's worth considering how this notion manifests with the rise of agentic AI.
You may wonder how a disruptive innovation gains traction if it ultimately makes every stakeholder uncomfortable. The key lies in understanding the difference between the landing and expanding phases. The landing phase sparks excitement and draws people in, while the expanding phase—where the real value emerges—often introduces discomfort.
In the world of generative AI, the landing phase was next-token prediction, while the expanding phase is agentic reasoning. The ability to predict the next token was a monumental leap—on par with splitting the atom—but it merely laid the groundwork. The true evolution comes with agency: AI's capacity to make independent decisions and take meaningful actions based on its own understanding.
The Workforce Dilemma
Employees face a paradoxical situation with agentic AI. While it promises to enhance their capabilities and boost productivity, it also threatens to make certain roles obsolete, blurring the boundaries between human and machine contributions. As AI systems gain autonomy, workers struggle to articulate their unique value, fostering a mix of excitement and anxiety. This dynamic creates a relentless race where continuous upskilling becomes essential for humans to maintain relevance, especially in areas where AI demonstrates growing proficiency.
The most promising strategy for workers is to pivot towards roles that leverage uniquely human traits - creativity, emotional intelligence, and complex problem-solving. Although these positions may be fewer, they will be vital in shaping a future where human ingenuity remains indispensable. By embracing this shift, employees can carve out niches that not only ensure their continued relevance but also allow them to work in synergy with AI.
The Corporate Conundrum
Companies developing AI solutions find themselves in a deeply uncomfortable position. While excited by the surging demand for agentic AI, they're confronted with a reality they may detest: the need to adopt a services mindset. This isn't just unfamiliar territory; it's a fundamental shift that many product-focused companies and their venture capital backers view with disdain.
The promise of high-margin, scalable AI products is being tempered by the necessity for AI agents to first serve alongside humans rather than immediately replace them. This transition period forces companies into a hybrid model, resulting in a lower-margin, more complex business than pure product sales. The rapid pace of AI advancement demands constant innovation, making this reality far more challenging than effortlessly cutting licenses after finding product-market fit.
The Service Sector Shake-up
Traditional service companies, particularly in the IT sector, are finding their business models under threat. Agentic AI's efficiency in automating tasks and reducing completion times directly conflicts with the billable-hours model that has long been the industry standard.
These companies must now navigate a shift towards value-based pricing, a concept that's often harder to quantify and sell. Moreover, the reduced need for large teams on long-term projects challenges the very foundation of many service-oriented businesses.
The Innovator's Dilemma
Large technology corporations that have built empires on complex enterprise workflows now face a classic innovator's dilemma with the rise of agentic AI. These giants have long thrived on the intricacy of their systems, creating powerful network effects and high switching costs for their customers. Now, they confront a disruptive force that threatens to simplify and streamline the very complexity they've profited from.
On one hand, these companies are excited about the potential of agentic AI to enhance their offerings and create new revenue streams. On the other, they're deeply concerned about its potential to democratize enterprise software, making it more accessible and potentially eroding their market dominance. The prospect of AI agents simplifying tasks that once required their sophisticated platforms leaves these tech giants caught between embracing a technology that could undermine their current business model and risking obsolescence by resisting change.
In Summary
If you don't simultaneously love and hate agentic AI, you haven't been paying attention. This transformative technology is not just another innovation; it's a disruptive force redrawing the lines of business, labor, and innovation. From tech giants to individual workers, no one is immune to its paradoxical effects - promising extraordinary potential while threatening established norms.
Director, Growth & New Initiatives, Microsoft Cloud for Industry - Energy
1 个月Thanks for a thought-provoking analysis of agentic AI’s disruptive potential. Ethical implications, such as job displacement, privacy, and bias, must be addressed through robust guidelines and regulations. Agentic AI is set to revolutionize industries, and it will be interesting to see how different sectors adapt to it.
Principal Consultant / NITI's AIM/ATL Mentor
2 个月2007-8 recession gave rise to some new models Covid also changed the way we work Instead of hourly billing, it changed to work packet and the same person in a week or day would work on two different projects
Co-Founder of Altrosyn and DIrector at CDTECH | Inventor | Manufacturer
2 个月The tension you describe is real. Agentic AI's power to automate tasks fuels both excitement and fear. On a deeper level, this means we must rethink human roles in the future. How will prompt engineering evolve as agents become more self-directed and learn to optimize their own tasks?