Competing in the Age of AI: Strategy and Leadership When Algorithms and Networks Run the World
Marco Iansiti and Karim R. Lakhani
Harvard Business Review Press (January 2020)

The impact of artificial intelligence on businesses: how they will operate and how they will compete

Note: A few business books provide insights that are even more valuable now than they were when the book was first published. For example….

I agree with Marco Iansiti and Karim Lakhani : “AI is becoming the universal engine of execution. As digital technology increasingly shapes ‘all of what we do’ and enables a rapidly growing number of tasks and processes, AI is becoming the new operational foundation of business — the core of a company’s operating model, defining how the company drives the execution of tasks. AI is not only displacing human activity, it is changing the very concept of the firm.”

Moreover, “as such, the first truly dramatic implications of artificial intelligence may be less a function of simulating human nature and more a function of transforming the nature of organizations and the ways they shape the world around us.”

In this context, I presume to suggest that there are no AI issues; rather, there are only business issues.

Iansiti and Lakhani wrote this book in order to share their thoughts about how to “manage, transform, grow, and control our businesses in an era of virtually unbounded potential impact.” More specifically, they explain HOW TO

o Create, capture, and deliver value
o Develop a core that functions as a “decision factory” powered by software, data, and algorithms
o Sustain success with an enterprise architecture that accommodates continuous transformation or significant refinement
o Become and then remain an AI-driven company
o Select the most appropriate approach to crafting the right strategy
o Identify the broad implications and probable consequences of strategic initiatives
o Focus on the primary considerations when managing in an increasingly digital economy
o Think through “the broader, long-term patterns and gather the wisdom required to deal with newfound challenges”
o Select the right strategies to respond effectively to new challenges
o Develop high-impact leadership at all levels and in all areas of the given enterprise

In Future Shock (published in 1984), Alvin Toffler observes, “The illiterate of the 21st century will not be those who cannot read and write, but those who cannot learn, unlearn, and relearn.” I was again reminded of that while working my way through Chapter 9, “The New Meta,” in which Iansiti and Lakhani  urge their reader to pay careful attention to these emerging principles in The New Age:

Rule 1: Change Is No Longer Localized; It Is Systemic
Rule 2: Capabilities Are Increasingly HorizontaL and Universal
Rule 3: Traditional Industry Boundaries Are Disappearing; Recombination Is Now the Rule
Rule 4: From Constrained Operations to Frictionless Impact
Rule 5: Concentration and Inequality Will Likely Get Worse

“The Age of AI is once again creating new rules. and it is, once again, a time for wisdom.” My own experience suggests that the most valuable wisdom is obtained from failures, others’ as well as — and especially — our own. All five Principles are discussed in detail (Pages 204-211).

I commend Marco Iansiti and Karim R. Lakhani on a brilliant achievement. The information, insights, and counsel they provide in this volume can be of substantial benefit to almost any leader in almost any organization, whatever its size and nature may be. Bravo!