From Information-based to AI-centric organizations: business process change and strategic leadership

 

The typical large and medium-size business has several levels of management. Today’s customary business will increasingly be knowledge-based. Companies have little choice but to embrace new computing technologies. Many internal and external forces demand early adoption. The workforce is increasingly comprised of knowledge workers who have many opportunities. Competitive and macroeconomic pressures dictate the need to innovate, increase productivity, comply with a web of legal regulations, and reduce costs. Advanced technologies produce an enormous amount of information. It is no longer sufficient to rely on traditional data processing technologies implemented as information portals, spreadsheet analytics, business-to-business (B2B), business-to-consumer (B2C), etc.

As soon as a company realizes that the amount of data produced and the growth rate, organizations tend to take the first tentative steps to infuse the decision processes, management practices, and the way work gets done with AI technologies. This process is quite similar to the data revolution that occurred when networking integrated computers into various client-server or peer-to-peer architectures.

To implement the transformation into AI-centric organizations, we need to consider the impact of new technologies on capital-investment decisions. The investment process analysis is well known but is not easy to implements. Typically, the characteristics that are necessary to analyze are the ROI, investment’s expected productive life, the risk in not investing, the cost of failed implementation, and the payout period.

All these aspects of the transition have been relatively more straightforward in the past. Today, evaluating an investment in AI requires an in-depth knowledge of existing products and organizational processes and a good understanding of the potential that new technologies bring to the table. The decision to change into an AI-centric organization presupposes a business strategy.  All this is means that critical decisions need to be done by a strong and visionary leadership team.