Stop running! Why you may be implementing AI pilots the wrong way

Four-step process to identify strategic advantage

Step 1: Identify the most promising opportunity

GenAI is a general-purpose technology with a spectrum of uses, from office productivity tasks to value-generation activities, such as identifying new business models, overhauling customer experiences, and domain reinvention (the end-to-end reimagination of work processes or functions). Office productivity is not likely to yield a competitive advantage. Enabling new business models using AI is an exciting opportunity, but may be difficult for companies selling products in which AI cannot be infused easily. Domain reinvention – which covers functions and processes – is an area of opportunity for almost any firm.

Step 2: Identify areas of lasting advantage

Whenever you deploy AI deeply, your goal should be to protect or enhance an existing competitive strength or to create a new advantage that is hard to copy.

Step 3: Choose the right sequence

GenAI can boost profits by enabling cost-efficiencies and growth. Should you prioritize efficiency, growth, or a combination of the two? When you’re going deep and narrow, starting with cost-efficiency gains within a single domain is often the smartest option, because you can typically reduce your costs more quickly than you can achieve top-line growth.

Step 4: Monitor the competitive landscape

Your competitors are also using GenAI to strengthen their competitive positioning. Can your top competitor replicate a valuable strength of yours by using GenAI? To avoid losing your advantage, you must deploy GenAI in ways that will increase the gap between you and your competitors.