Joel Ko | KrASIA

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There’s no doubt that artificial intelligence (AI) should be regarded as a game changer in your business or organisation. However, one recent survey from last year found that only five per cent of the respondents said they had adopted AI extensively in their business, compared to 22 per cent that had neither adopted AI nor had plans to.

I want to propose that it’s time AI moves from being a wishlist item to a checklist item for business; from an option to a necessity. In the beginning stages of the AI hype that has now come to dominate cross-industry debate, the technology was indeed regarded as an optional solution that could be bolted on willy-nilly here and there.

Now, however, AI has matured enough for it to warrant becoming a mandatory path down which business leaders and decision makers must take their organisations. The purpose? Renovating, reinvigorating, upgrading, automating, streamlining, innovating, and ultimately boosting growth to the top and bottom lines through smarter decision making and models.

Unfortunately, in most cases AI’s application is still limited to processes rather than at the business model level as a whole. At least, as an investor and entrepreneur that’s been my observation to date.

The Alexa factor

One of the big traps in adopting AI is to treat the technology only as a kind of process-improvement mechanism. Most of those adoption strategies conclude in the form of minor automation of some back-end cogs and sprockets. In these cases, where AI application is limited and restricted to such narrow areas, the outcome is usually not much of an improvement on non-AI automated businesses.

Let’s take an example: Amazon’s Echo. Echo is not a speaker, though its appearance looks like one and on the surface it seems to have many of the same functions. At a product design and functionality level, for industry regulators and consumers, Echo can be mistaken as just a “smart” speaker. Here's the point: Echo’s key component is Alexa, an AI-powered virtual assistant that has been evolving as an AI platform across a range of devices.

The reality is that Alexa is changing the entire paradigm of how we do business as it changes how customers communicate with Amazon to order products. And not just that, but the role and impact of Alexa expands deep into the heart of Amazon’s own business.

Amazon didn’t reach this point by stopping their AI efforts at the automation level; rather, they went further, they made AI core to their product, built into their flagship offerings, and now are benefiting from efficiencies of scale in terms of profits, user data, customer retention and satisfaction, and more - and all because they sold a “speaker” that was truly AI-first in design language.

In other words, if done effectively, introducing AI into the broader business model and at the product level can bring with it manifold and hitherto unimagined returns to shareholders.

You’re either an AI business or you aren’t

Traditional ways of categorising industry and business models are no longer meaningful in the application of AI technologies, since AI itself is disrupting borders and blurring lines.

It is increasingly becoming the case that you either are an AI business or you’re not, and that starts with a commitment at the top levels of the company, and works its way down from there. You can’t start at the bottom level, with the lowly processes, and expect the benefits of AI magically to work their way up to the boardroom. In exploring AI adoption in your own organisation, you should consider the following three criteria:

1. Reach of influence: to what extent will AI influence the value chain of your business?

2. Speed of change: how fast can your organisation respond to AI-led change?

3. Depth of impact: how deeply will AI drive transformation in your business strategy?

These considerations will help you adopt proper and holistic strategies and mindsets for AI implementation, not just at the process-automation level but across your business, as Amazon has so perfectly done.

Without it, you will be just another dumb speaker in a world of Alexas.

This piece was written by Joel KO, an investor and serial entrepreneur. Joel's lifelong goal is to invest in and support 10,000 innovative individuals and companies around the world.

As the President of Marvelstone Group, with a speciality in PE/VC investments, he develops various businesses and accelerates portfolio companies with a focus on AI, FinTech, and Smart City innovations. Recently, leveraging his experience as the co-founder of the world’s largest FinTech hub LATTICE80, Joel is passionately committed to launching an AI hub globally.

As an Affiliate Faculty at the Singapore Management University (SMU), he lectures on AI and FinTech. He also holds an MBA from the National University of Singapore Business School.

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