The fundamentals of AI transformation (that most organisations are getting wrong) — Northshore -

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The fundamentals of AI transformation (that most organisations are getting wrong)

Jan 15

Written By Martina Hodges-Schell and Dr Shahzia Holtom

Originally posted on our new book website : https://www.thepurposefulaibook.com/blog/fundamentals-of-ai-transformation-that-most-orgs-get-wrong

Welcome to the Purposeful AI blog! Our aim is to bring a practical approach to adopting AI within your unique context to help you avoid the common blindspots and sidestep pitfalls. We’re co-authors Dr. Shahzia Holtom and Martina Hodges-Schell. We’re partnering up to write a book to share our hard-earned lessons and observations from decades of experience as AI and Product experts driving transformations at scale. If you’re a CEO, CTO, or anyone else looking to tap into AI’s transformative properties in a purposeful way, we invite you to follow along here or join our group on LinkedIn for all the latest updates on our research and the book’s progress.

We can usually sense when a new invention has the possibility to change the world. But we’re not always able to predict exactly how.<br>There’s a great example of this in scientific lore. When Michael Faraday presented his work on electromagnetism, a politician asked him, “What good is it?” Faraday responded by quipping, “What good is a newborn baby?”<br>Faraday’s point was that we don’t necessarily know how technology will evolve and what it will eventually be capable of. But we can still understand that it’s full of world-changing possibilities.<br>We’re at a similar inflection point with AI. We know that there’s infinite potential, but we’re still in the infancy of its application to business problems.<br>Laying the foundation: What direction are you setting?<br>Most organisations are experimenting with what AI can do for them. Much of this experimentation is organic with a ‘Let’s see what we can do’ approach. But scaling past this point requires more thought. As a CEO or CTO, you’re in a position to guide this experimentation, to shape the direction it takes your organisation in. And it all begins with the questions you’re asking.<br>While the early experimentation is focussed on “How can AI help us do our jobs better?”, the question that’s often overlooked is “How could AI help us create net new value?”<br>These two questions represent two different paths:<br>Optimisation: How can we do existing work faster or cheaper?

Value creation: What new problems can we solve - which are only now possible?

This shouldn’t be an either/or proposition: You can and should encourage your team to look for ways to accelerate their work or reduce the time they spend on low-value tasks. The key is not to stop there. The real opportunity for AI transformation comes when you take the value creation approach. But these aren’t the only two options. In the next section, we’ll take a look at a common progression we’ve seen with AI transformation efforts.<br>The altitude framework: What’s your ambition?<br>AI adoption within your organisation can be mapped to different altitudes or levels. The bottom levels involve less uncertainty and investment—but they also have smaller potential for impact. The higher levels have greater uncertainty and investment associated with them, but they also have the most potential for creating value.

Goal<br>Potential

New business model<br>More uncertainty and requires more investment, but also has the most value potential

Enhancement of current products/services and offering AI features<br>Innovation potential within the confines of current value propositions to the customer

Rethinking and Redesigning current processes with AI<br>How does AI change the workflow, not just speed it up?

Velocity enhancement to parts of your workflow without major changes to the workflow itself<br>Less risk, smaller investment, but smaller value potential. Often leads to patchy application of AI tools.

One way of looking at AI transformation is like learning to cook. There’s a wide gap between someone who can just follow a recipe and a Michelin chef whose knowledge and training allows them to prepare a comprehensive and well-balanced tasting menu customised to the unique local context. Our aim is to help you learn to cook with practical steps and blueprints.<br>How do you know if you’re ready?<br>Take our simple innovation maturity self-assessment, which you’ll find below. As a leader who sets the direction for your organisation, your goal should be to help your teams move up the levels so they can eventually focus their efforts on value creation. But it’s not as simple as just telling them to go find new problems to solve. You need to first ensure that your teams have the appropriate skills and support to do this effectively.<br>Go through the questions below to see how many apply to your organisation today. Use your gut feel (and follow up with a reality check) to score your organisation...