Transforming to an AI company

The world of business is rapidly evolving, and the adoption of artificial intelligence (AI) is playing a significant role in shaping the future. For any company, it is becoming imperative to embrace an AI to stay competitive in the market. The recent article by Meta’s Nick Clegg on ET with headline: “Every tech firm will soon be an AI company” only corroborates this claim. Infact it is my belief that more and more companies, including both Tech and Non-Tech, will be joining the AI race simply because of the fact that AI holds the key to unlock the next set of growth opportunities.

AI holds the key to unlock the next set of growth opportunities.

AI holds great potential to disrupt existing business models in both tech and non-tech industries by enabling companies to automate processes, streamline operations, and reduce costs. For example, AI can be used to automate customer service, enabling companies to provide faster and more accurate customer service at a lower cost. AI can also be used to automate marketing and sales processes, allowing companies to reach more customers with more targeted messages and offers. The recent generative AI applications are coming close to becoming virtual knowledge workers. If we analyze the situation carefully, for companies with a long term view not investing behind AI transformation vision is not an option anymore.

“AI-first” strategy can help drive the change

In that regard “AI-first” strategy can help drive the change. So what does "AI-first" actually mean??An AI-first strategy is a business model that prioritizes the use of AI technology in every aspect of the company’s business operations.

Easier said than done, reaching the organizational goal of "AI-first" requires significant shifts at multiple levels and across areas. I believe the right place to start is by revisting the following - company's culture, skills set, incentives, operations, and AI responsibilities.

Company's Culture

To create an AI-first culture, the company must first establish a clear understanding of the benefits of AI. Employees should view it more of an opportunity than a threat.This can be done by providing training and education to employees, highlighting the potential benefits, and creating an environment that encourages AI based innovation. The company must also foster an environment that encourages AI experimentation and risk-taking. This approach will help to create a culture of innovation and continuous improvement.

AI value creation is an iterative process

Executive also need to learn to excercise patience as AI value creation is an iterative process. AI solutions built in a hurry can create initial euphoria but scalability and reliability could soon become a real challenge.

Skills Set

Next, the company must invest in training and development programs that can help employees acquire the skills needed to work with AI technology. The company should also recruit individuals who have experience working with AI technology. This will help to create a workforce that is skilled in AI technology and can help the company to innovate and improve operations.

AI-first is as much a mindset change as it is a business change

Incentives

Additionally, AI-first is as much a mindset change as it is a business change. To reinforce the AI-first mindset the company should reward employees who innovate and use AI technology to improve operations. The company has to incentivize right behaviors- reward the employees who are keen to learn and adopt AI. This will help to create a virtuous cycle of AI adoption.

AI incentives -> More people willing to learn & accept -> More AI initiatives -> More AI value creation -> More AI incentives.

Operations

For a company to call itself an AI company, it must leverage AI technology to optimize operations and improve customer service. Process Automation is a key component of this optimization, and the company should identify processes that can be automated using AI technology. This will help to free up employee time and enable them to focus on more complex tasks. Additionally, the company should invest in technologies that can automate tasks such as data entry, customer service, and marketing. Automation can help to reduce costs, increase efficiency, and improve accuracy.

Process Automation and Data are essential

Data is also essential for AI-driven decision-making, and the company should invest in technologies that can help to collect, store, and analyze data. This will enable the company to gain insights into customer behavior, product performance, and market trends. Investing in external data assets, and AI-powered UI/UX can further help in creating meaningful differentiation.?By leveraging AI technology and data, the company can optimize its decision support systems, and deliver superior customer experience.

AI Responsibility

Lastly, an AI-first strategy requires a clear understanding of the roles and responsibilities of employees. There should be clear guidelines for responsible AI use and guardrails have to be put around data privacy and security. This will help to ensure that the company is compliant with regulations and that customer data is protected. Data privacy has emerged as number one concern for most customers, especially when using generative AI technologies such as LLMs (e.g., ChatGPT). The company should establish clear guidelines for how AI technology should be used, what are the best practices for sharing data, and who is accountable for its use.

Final Remarks

To sum it up, an AI-first strategy is essential for any tech company that wants to stay competitive in the market. This strategy requires a fundamental shift in a company's culture, skills, incentives, operations, and AI responsibilities. By taking an AI-first approach, the company can improve efficiency, reduce costs, and drive innovation.

For a next decade or so for tech companies AI will be mainly fueling the narrative of growth. Only by thinking?“AI-first” can executives gain a clear perspective on AI and business interplay. The stakes are high and being prepared can help load the dice in your favour !

Thoughts and comments are welcome.

-Kapil Daga