Monday, June 5, 2017

Don’t Leave Strategy Behind!

The world is accelerating like never before.  Influenced by global evolutions in financial industries, logistics, and digital proliferation, the connected economies of the world are changing “ten times faster and at 300 times the scale” (Dobbs, Manyika and Woetzel).  Unfortunately for today’s industry, this global proliferation is bringing about more than just opportunities for year-over-year growth.  The immensely lucrative markets are stoking the fires of global competition.  As companies respond with an unprecedented pace of decision making, we will recall a significant threat to differentiation therein.

It should come as no surprise, that new technologies fuel this growth and productivity—one preeminent technology is machine learning and artificial intelligence.  Encouraged by decades of success in physical automation (e.g. manufacturing automation), and success in e-commerce (e.g. shopping recommendations), machine learning and artificial intelligence have become a common tool in global growth.  Appetite and imagination allow one to reasonably suspect that machine learning is poised to facilitate this growth by displacing the dependence on the “world’s more than 200 million knowledge workers” (Bughin, Chui and Manyika).  From a strategic perspective though, it’s important we recognize the very real risk of romanticizing this technology.

Although its roots may extend for decades, the era of machine learning is relatively young.  Its practical application is still being explored.  However, given the increased stakes of global market leadership, and its effect of “forcing executives to make decisions” (Dobbs, Manyika and Woetzel), introduces the very real risk of hyper competition.  In this context, the greatest risk is that “competition becomes a series of races down identical paths that no one can win” (Porter).  We begin to see companies imitate one another at the first glimmer of success.  In this sense, we can already see that the pursuit of artificial intelligence can “unwittingly draw companies toward imitation and homogeneity” (Porter).  For example, we see market leadership where Amazon introduced its Alexa and Echo home automation system.  In turn, this inspired Google to follow suit with Google Home.  Not far behind Google, comes Microsoft working with its partners to introduce Cortana speakers.  However, for all resources available to these global technology titans, we see nominal market place differentiation.  Worse than that, many consumers question the underlying utility and assume it a technical gimmick!

The world’s pace of change is forcing global competitors to imitate even the slightest competitive step forward.  Machine learning and artificial intelligence is an incredibly powerful enabler, but whose strategic and tactical strengths and weaknesses are yet to be realized.  Unchecked, corporations are at risk of making decisions which commoditize themselves.  It is more important now than ever before that strategy be firmly rooted, so that decisions are rich with intent.


Bughin, Jacques, Michael Chui and James Manyika. "Ten IT-enabled business trends for the decade ahead." (2013).
Dobbs, Richard, James Manyika and Jonathan Woetzel. "The four global forces breaking all the trends." McKinsey & Company (2015).
Porter, Michael E. "What Is Strategy?" Harvard Business Review (1996).

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