Generative AI: Business and Organizational Transformation rather than a superficial add-on

I recently listened to an excellent interview on the #HBR #IdeaCast podcast which you can find here https://hbr.org/podcast/2023/05/how-generative-ai-changes-productivity

In a conversation with Amy Bernstein, the editor of Harvard Business Review, Karim Lakhani, a professor at Harvard Business School, discusses the impact of generative #AI and how it changes #productivity. The development of generative AI technology has sparked a sense of déjà vu for Karim. He recalls a similar feeling when he first encountered the web browser and realized the cost of information dissemination was going to be reduced to zero. Now, with generative AI, he believes the cost of cognition and creativity will significantly decline. This breakthrough has profound implications for businesses and leaders.

Here are the top key points to remember (thanks to my Generative AI Copilot ??):

-????????? Cost of Cognition and Creativity: Generative AI technology reduces the cost of cognition and creativity. With the ability to generate text and images based on vast amounts of data, these systems can provide valuable insights and predictions, making tasks easier for employees.

-????????? Collaboration between Humans and Machines: Rather than replacing humans, machines with generative AI capabilities should be seen as copilots. While these systems possess extraordinary abilities, humans must understand their limitations and actively participate in the decision-making process. Combining human expertise with the superpowers of AI can lead to better outcomes and performance.

-???????? Quality Improvement: Generative AI raises the quality level in various fields. Studies have shown that introducing these technologies can uplift the skills of individuals across the spectrum, making them as good as the AI itself. This quality improvement has significant implications for writing skills, customer service, and more.

-????????? Risk of Overreliance: Overreliance on generative AI systems can have adverse effects. When individuals become too dependent on AI, they may overlook edge cases and lose attentiveness. This can lead to decreased performance and potentially detrimental outcomes. It is crucial for leaders to ensure that individuals remain vigilant and exercise critical thinking when utilizing these technologies.

-????????? Current and Future Applications: Generative AI is already being used for mundane tasks such as email responses, spreadsheet analysis, and textual summaries. It can generate meeting summaries, to-do lists, and OKRs (Objectives and Key Results). AI can identify talent gaps, train employees, and assist with communications and marketing efforts. It can also increase efficiency and productivity in factories through quality control and process automation.

-????????? Implications for Organizational Transformation: Generative AI requires a fundamental shift in the way businesses operate. It cannot be treated as a mere add-on or patch to existing processes. It necessitates rethinking business models, operating models, and organizational architectures. To fully leverage generative AI, executives need to go beyond isolated use cases and embrace holistic changes in how work is done.

-????????? Balancing Technology and Organizational Architecture: While generative AI offers individual users ease of access and usability, the true value lies in combining technology with organizational architecture. Roughly 30% of the transformation comes from technology, while 70% comes from reshaping organizational structures, processes, and mindsets. It is crucial to approach generative AI as a holistic endeavor that requires alignment between IT architecture and organizational architecture.

-????????? Lessons from Past Failures: To avoid becoming the next "Barnes and Noble" or "Kmart," companies must not treat generative AI as a superficial add-on. Previous examples show that simply adopting e-commerce or having a website is not sufficient for survival. Businesses must be willing to rethink and reimagine their operations, leveraging generative AI as a catalyst for organizational transformation.

As a conclusion, Generative AI holds immense potential to transform productivity and drive organizational success. CEOs should recognize the wide-ranging applications of generative AI, embrace holistic transformation, and strike a balance between technology and organizational architecture. By reimagining business models and processes, companies can leverage generative AI to enhance customer experiences, improve efficiency, and achieve sustainable growth…

Do not hesitate to contact us at KEPLER to exchange about your needs and how we can support your organization with our Power Your Business offer, leveraging IT, DATA, Digital, and therefore Generative AI to boost your performance.