2024-02-13 21:51:26
Generative Artificial Intelligence (Gen AI) is transforming the operation of companies. However, the excitement around Gen AI can distract business leaders from other essential needs.
McKinsey & Company highlights ten technology insights that are shaping the business environment. Some represent significant changes, while others are tied to business fundamentals often overlooked under the pressures of daily demands and technological trends.
1. Builders are changing the game
Building new digital products and services becomes increasingly accessible and affordable, opening up new opportunities for businesses of all sizes. It is crucial to focus on building something meaningful that creates a competitive advantage and build teams with proper incentives to build.
2. Innovators dominate the headlines, but scalers dominate the markets
More than 40% of digital and AI transformations stall in the scaling phase. It is essential to focus on the ability to scale from the beginning of any company to fully realize the value of technology.
3. Leaders Master the Composite Value of AI
The digital and AI maturity gap between leaders and laggards has increased by 60% in the last three years. Competitive advantage is built over time through technology solutions that work together to improve experiences and reduce costs.
4. Digital and AI leaders must be permanent transformers
Digital and AI transformation is a continuous journey to improve competitiveness. It is important to invest in new technologies and stay up to date with the latest trends.
5. If knowledge is power, data is knowledge
The knowledge economy becomes essential, and companies need a data strategy to succeed with AI and digital transformation. Data products can accelerate new business use cases by up to 90% and reduce total cost of ownership by 30%.
6. A Gen AI ‘superpowered’ workforce needs a human revolution
Gen AI acts as a co-pilot, but human beings need to have greater learning, reskilling and career management, which allows them to make the most of these tools. Productivity can increase by 50% to 75% for developers with sufficient training in Gen AI.
7. Every company will become a ‘neural business’
Small, agile and autonomous teams led by engineers become crucial for innovation and growth. Businesses need to function like a neural network to connect small teams and enable the speed needed to grow and adapt. The top half of companies in terms of the maturity of their operating models have 60% higher total shareholder returns than companies in the bottom half.
8. IT as a Service is the next generation of technology performance
For distributed innovation, technology functions must operate more like services. The value of IT will come from its ability to enable distributed innovation, moving from centralized management of large technological assets to providing small blocks of code. A global cloud microservices platform market could generate $4.2 billion in revenue by 2028.
9. The name of the game is the same: Courage
Digitalization and AI should focus on building value, not simply improving technology. Successful organizations set ambitious goals, deliver 2.7 times the initial estimated value, and maintain a clear focus on value creation.
10. The best companies will be the best testers
The ability to test continuously, cheaply and quickly is crucial in an environment of rapid change. Developments such as generative AI, automation and digital twin technologies allow for more effective and faster testing.
In summary, these ten ideas underscore the need for a comprehensive business strategy in a constantly evolving technological environment. By recognizing and addressing these principles, business leaders can strengthen the position of their companies and make the most of the opportunities offered by today’s technological revolution.