The AI Wedge
The goal of any business enterprise is to increase revenue, reduce cost and/or expand market share.
The challenge has been in the ‘how’ to do that. With many companies offering similar products or services, the ability to differentiate yourself in the market has become that much tougher. No sooner than you come out with a new product or service, a competitor does the same in a matter of months, weeks or days.
To do this, we argue that you’ll need a lot of help (AKA a lot of data and a lot of Artificial Intelligence). Artificial Intelligence (AI) and all the domains it subsumes (e.g., Machine Learning, Natural Language Process, Image Recognition, Neural Networks, etc) is how companies will be able to push their revenues up and costs down in the future.
We have reached, to some extent, the limits of human cognition when it comes to thinking strategically; there are simply too many data points for the brain to process.
In a recently released report by Gartner, “Forecast: The Business Value of Artificial Intelligence, Worldwide, 2017–2025”, they estimated that the global business value to be derived from AI will reach $1.2 trillion in 2018 and $3.9 trillion in 2022. Their definition of business value is about improving the customer experience along with developing an AI profit wedge; increasing revenues and reducing costs.
The challenge has now shifted towards finding new opportunities that others have yet to uncover or target. In our book, Sales Ex Machina: How Artificial Intelligence is Changing the World, we introduced a concept called ‘blue puddles’; a name derived from the concept of the book Blue Oceans. Today, finding Blue Oceans (places your competitors are not servicing) isn’t easy unless you serve up a major Joseph Schumpeter-like disruption.
Assuming you can’t, then the answer is to look for niche or smaller markets (i.e., blue puddles) that have gone unnoticed or under-served using an AI strategy.