AI Is Oxygen

Companies that win with AI will be the ones that redesign their organization instead of optimizing it.

Most companies have managed through the "everybody's doing it" phase of AI adoption where licenses are purchased, somebody runs a lunch-and-learn, and a few months later there's a big fat line item nobody planned for. That may change as annual plans are rebuilt to include usage, so then the question will become, "Can we identify the impact?" We can see usage tiers easily, but we can't really see if what people are working on made any real impact. We may even wonder if they should be working on it at all.

Adding some friction to the usage allocations by asking, "What are you working on and what will it do for the business?" is a good place to start. Being conscious consumers of the ever-more-expensive tokens will help with our most conscientious team members. Beyond that, ROI gets murky. It's probably true that teams in most corporate functions can now operate with a few less roles, particularly in analysis and reporting tasks. It's probably true that an experienced professional can tap the latest chat bots to find patterns and suggest courses of action that reduce their "heads down" time. This frees them up to take on backlogged activities and improves capacity. Being more productive doesn't always translate to financial impact, but I think we know by now that AI is generally good for a variety of efficiency gains. Optimization through technology is familiar to us after several generations of advances from enterprise software, to cloud, to mobile, and now pre-trained generative chat. That's good but not great, considering the promises and investments that are being made.

Two ways to read the same opportunity

To get the most of AI, experts urge us to "start with the work" and see it more as a new team mate than a tool. That's a major leap in acceptance, and I'm not sure everybody's aligned on it yet. Most people I know, interpret it as: take the work we already do and make it faster. Maybe they can see Claude as a humanistic personal assistant, but most everyone I encounter is not thinking big enough about what's now possible.

Instead of simply making work flow faster, we can now reinvent work. We can rethink HR (or Finance, Marketing, etc.) from the user's perspective and design completely new workflows, practices, and operations. Back when I worked at IDEO (You may know them from the famous shopping cart video) we always had people asking, "What is the future of X?" That could be milk or transportation or even death. What's the future of workplaces? What if we didn't have HR at all? How might we deliver the things companies and individuals need to work together successfully? (brb, I have to go check with Claude…)

I've run more than a handful of leadership development programs where we try to push the limits of creativity and innovation to help businesses grow in new ways. Sometimes in a workshop we'd prompt with something like, "What if you had a magic wand to fix anything in your business?" Well now we do. I think we're in a new era of technology enablement that is about to affect organization design like no other era since the printing press (Imagine a 15th Century administrator wondering, whatever will we do with all of this paper?).

I've come to think about AI as an activating element in our companies, the same way the Great Oxidation Event unleashed the potential for complex life billions of years ago on our lovely planet Earth. Just as a sudden abundance of oxygen allowed entirely new biological systems to flourish, AI is fueling a proliferation of business capabilities that have never existed before. That's where we are. For the first time in about a hundred years, companies have to make real choices about how to organize, and the ones that treat AI as an optimization exercise are going to be out-evolved by the ones that treat it as a design problem.