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Democratic artificial intelligence—now seen through OpenAI GPT, Microsoft Big AI, and Google Bard/Gemini—can be a wonderful thing. At the same time, since democratized AI is available to everyone, it means there is little competitive differentiation. Business leaders and entrepreneurs need to think beyond the efficiencies and cost savings that AI will bring.
Just before generative AI hits the market in late 2021, a paper heralds the imminent commoditization of AI, which is taking the path of previous generations of technology. Nicholas G. Carr documents “the increasing potential and ubiquity of IT, but the decreasing strategic importance of IT over time,” the researchers noted. Artificial intelligence will face the same fate as IT. In fact, the commoditization of artificial intelligence has already begun. “
Leveraging AI to achieve competitive advantage and maintain commoditization leadership will require accompanying business transformation, researchers say. “They have a very strong top-down leadership model where they set clear AI goals and then engage employees by motivating them to drive the AI journey.”
Thomas Smale, chief executive of FE International, said macro-thinking is to “see artificial intelligence not just as a tool to improve efficiency, but also as a catalyst for strategic transformation.” “It opens the door to new markets and innovative business models.”
Tommi Vilkano, director of RELEX Labs, said that by 2023, global investment will exceed US$100 billion, accounting for 24% of all corporate venture capital, “clearly indicating that artificial intelligence is driving the creation of new businesses.” Part of that formation comes from developing entirely new products and experiences, as seen at companies like Runway that are reshaping the world of art, entertainment and human creativity. “
Smail agreed, saying artificial intelligence is “transcending traditional analytical methods and significantly reshaping the business landscape.” “It gives new startups unprecedented insights into market dynamics and consumer behavior, effectively transforming them from emerging players to market competitors quickly.”
An important question every business leader or entrepreneur needs to ask is “How do we integrate artificial intelligence into the core operations of the company so that everyone can use it to achieve more?” Vilcano said. The second question is “How do we make AI a core part of the products and services we offer our customers?”
Vercano emphasized that the answers to these questions are not artificial intelligence per se. “The AI technology stack is quickly becoming a commodity. Intelligence is becoming like electricity—easily available, with the option to effortlessly switch to a better or cheaper supplier. Instead, most companies’ future The source of competitive advantage lies in the proprietary knowledge that powers its artificial intelligence systems.”
Amrit Jassal, chief technology officer and co-founder of Engyte, said that business leaders and entrepreneurs “should realize the important role of artificial intelligence in shaping business ideas, and investors favor the innovation and scalability of artificial intelligence-integrated enterprises.” “The impact of artificial intelligence spans the development stages from software design to deployment, thereby increasing efficiency and product adoption.”
Consider the risks of relying on generic AI solutions that many other businesses use across the board. “Over-reliance on AI can lead to an overly simplistic, one-size-fits-all approach that can misapply AI to inappropriate problems and lead to poor outcomes,” Jassal said. “Successful innovation in AI requires a comprehensive approach. strategy that combines a deep grasp of specific problems with thoughtful and balanced application of technology.”
Therefore, the challenge in achieving competitive advantage is “figuring out how to best capture, record and organize all domain knowledge effectively for your proprietary AI systems,” Vilkano said. “It involves identifying, capturing, organizing, storing and providing access to all explicit and tacit knowledge available to the organization.”
In a world of commoditized AI, another key component of competitive advantage is people—that is, using AI to build a business. “The AI opportunity for business leaders is to engage their employees in experimenting, innovating and managing AI systems,” said Rebecca Finlay, CEO of Partnership on AI. “Ultimately, artificial intelligence is only as good as the people who manage it.”
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