Title: Stepping Through AI Evolution in Business: The Crawl, Walk, and Run Approach
In my role as a co-founder and partner at Michigan Software Labs, I frequently engage with executives about AI. I've observed that organizations progress through three stages: the crawl, walk, and run. Let's delve into these stages and their implications for modern businesses.
The Crawl
This initial phase often involves utilizing chatbots for customer service or marketing. McKinsey reports that approximately 65% of organizations implement this approach. Chatbots rely on robust data stored in a company's knowledge base. Without this essential support, they can frustrate consumers instead of aiding them.
Many companies across various industries excel at this stage. For example, Bank of America introduced their AI-powered chatbot, Erica, which assists customers by offering financial insights and managing accounts. In the hospitality sector, Hilton Worldwide has embraced Connie, a chatbot powered by IBM Watson, which assists guests by providing hotel information and services.
The Walk
During this phase, executives leverage AI to drive revenue or optimize margins using tools like smart pricing systems and recommendation engines. This usually necessitates a high level of customization and integration with existing systems, such as ServiceNow's Now Assist, Microsoft Copilot, or McKinsey's AI suite.
As a customer and technology partner of ServiceNow, NVIDIA makes use of Now Assist features such as case summarization and question-answering to boost operational efficiency. By leveraging AI-powered assistance, their teams can manage complex workflows more effectively, leading to faster resolution times. PayPal, in the FinTech industry, has adopted Copilot Studio for streamlining operations, reducing workload and costs for the support team, and boosting employee engagement and loyalty. Copilot Studio also powers a recommendation engine designed to recommend relevant products to users.
The Run
Few companies have reached this advanced stage, but it entails a few key elements:
Embracing Change
Enterprises in this phase will encounter technologies that challenge traditional business models. Consider AWS, which became a market leader by offering cloud services before competitors caught up. Similar to AWS, companies that reluctantly embrace change may struggle to progress beyond the walk phase.
Embracing Automation
The U.S. currently faces a shortage of approximately 10 million labor jobs. Companies that adopt automation more effectively than their competitors will be better prepared to advance to the run phase. This automation may involve humanoid robots in smart factories or entirely automated "dark" factories.
Investment in early automation technologies will likely have high upfront costs. However, these costs can help companies refine their approach while the workforce continues to age. Companies like Figure AI are developing scalable humanoid robots to address this need.
Removing Constraints
Every industry and company face constraints—whether related to data quality or supply chain issues. Companies that address these constraints proactively will likely thrive in the run phase. This may involve a comprehensive overhaul of data and systems, similar to spring cleaning an old garage.
Progressing in Your AI Journey
Leaders must possess a clear vision to proceed with AI. Understanding your organization's current position (crawl, walk, or run) will be crucial in determining the appropriate next steps.
Currently, I'm engrossed in The Mind’s Mirror: Risk and Reward in the Age of AI by Daniela Rus. This book illuminates AI's impact on the workplace and emphasizes the importance of a solid data strategy. Those keen on expanding their AI knowledge beyond tools like ChatGPT would find this book enlightening.
Using AI effectively involves persistence, not a race against time. While chatbots can create reports swiftly, generating true value necessitates long-term effort and learning from past failures. Isaac Newton, Thomas Edison, and Jane Austen all attained fame and success through years of failure, learning, and improvement. Their accomplishments were not the result of a single sprint or event, but rather multiple endeavors sustained over prolonged periods.
Our invitational community, the Website Technology Council, is designed for distinguished CIOs, CTOs, and technology leaders. Would I qualify?
Mark Johnson, as a distinguished technology leader, could potentially be a valuable addition to the Website Technology Council, given his experience in AI implementation and understanding of its impact on modern businesses.
In partnership with Michigan Software Labs, Mark Johnson might bring unique insights to the council discussions about AI, drawing on his experiences guiding companies through the growth stages of AI implementation, including the crawl, walk, and run phases.
