With today's AI hype, some companies and organizations feel almost pressured to start using the technology. This rush to jump on the AI bandwagon has led to a form of institutional FOMO where there's simply a fear of falling behind. This fear of missing out, combined with a lack of understanding of how AI can contribute to organizational goals, however, risks that investments in AI won’t yield the desired effect for your business.
Many companies, especially traditional ones, are accustomed to investing in machinery for production lines, where the benefits and ROI are concrete, immediately noticeable, and measurable. A machine, for example, may increase production speed by X minutes per hour, which provides a clear economic benefit. Moreover, it’s a type of investment that the company makes over and over again.
When these companies then start investing in technology and digital solutions, such as artificial intelligence, the process looks completely different. While it’s obvious that a machine contributes with clear results, it may not be as concrete what the outcome of a digital solution will be. The advantages are often strategic, subtle, and only measurable over a longer period. It's not just about buying a solution; it's also crucial to understand the underlying goals that the technology aims to achieve.
If this understanding is lacking, the risk is that the focus will be on the digital tool itself, for example AI, and not the actual result of implementing it. Applying AI is not the result; instead, you must focus on why. Why does your business need AI? What is the actual reason you want to implement it?
This can be confusing for many who struggle to distinguish between the tool itself and the outcomes it produces. Which is not so strange when something is as hyped as AI is. "We need an AI strategy" is a call that often comes directly from the boardroom – too often based on the fact that everyone else has it and you don't want to be left behind.
That AI will contribute to miracles in all businesses seems to have become a collective perception. This has led to a form of institutional FOMO, where companies are afraid of what they are missing if they don’t implement AI. However, this is often without knowing what it actually is they are missing since they have not investigated how the technology can help them. Again, the focus is on the tool itself rather than on what value it can add, which can lead to poor investments. To avoid this, it's crucial to conduct a thorough needs analysis and a preliminary study to assess potential value and determine the most suitable solutions for your business.
We are not saying that AI doesn’t have the potential to revolutionize many industries, perhaps even yours – because it does. AI can optimize processes, improve decision-making, and tailor customer experiences – but it is crucial that companies understand how AI can add value to their specific business.
It is also important not to be blinded by the idea that AI is the technology that will solve every problem you have. There are plenty of other tools and technologies out there that might yield much better results than AI for your business.
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