On April 10, we hosted a session on the transformative potential of AI in reinventing businesses and brands. Led by Senior Partner Anne Olderog and CEO Dr. Erich Joachimsthaler, veterans of brand-led growth and new business models powered by new technologies, the discussion focused on AI’s role as a catalyst for business reinvention. They raised critical questions: How do we really think about the opportunity of AI? How do we approach changing the way we do business today? How will companies navigate the changing tides of value creation?

Discover key insights from the event:

1. AI and Business Reinvention: AI should be viewed as a tool for business reinvention, a process of rethinking how value is created for a firm or a brand. If AI is viewed in any other way, we risk missing some of the major challenges and issues that companies and brands face today.

2. Value Shift: The discussion highlighted how value is shifting and how AI can help us understand this shift. Dr. Joachimsthaler introduced the Vivaldi AI Model to illustrate this shift and how value is created in different industries. A key point highlighted by Olderog is that while AI enables dynamic customer journey management, using it simply to generate more ideas runs the risk of producing ineffective solutions. To truly create value, it’s critical to use AI to better understand the demand side. This will enable companies to move to a higher level of innovation and strategic insight, effectively driving value creation.

3. AI Deployment: Most AI deployments today operate at the productivity level, improving tasks and replacing labor. However, more value is created when AI is used to optimize an entire process (transactions) or when it aggregates data from various sources and shares it out (interactions).

4. Case Study – John Deere: The case study of John Deere illustrated how AI can be used to improve productivity (identifying weeds vs crops), optimize an entire process (fleet management), and create an interaction field (aggregating data from all farms and sharing it out).

Action Points for Businesses and Brands

1. Identify Core Decisions: Businesses need to identify the critical or core decisions that AI can enable. For example, in agriculture, the core decision is farm productivity and farm management.
2. Define Workflows: Businesses need to define the workflows that they can enable using AI. These workflows should be necessary steps in the management of the core decision identified.
3. Determine Necessary Intelligence: Businesses need to determine what intelligence is necessary to optimize the value on the identified workflows.
4. Understand Brand Relationships: Businesses need to understand their brand relationships and the positioning of their company. They need to ask if they have the permission to be a certain kind of company (e.g., a field management company).

Real Benefits of Interaction-Based Thinking

Businesses that follow the interaction-based thinking and model stand to gain significant benefits. These include increased productivity, cost savings, and the ability to create larger ecosystems that can lead to further improvements. For example, in agriculture, creating a larger ecosystem could increase farm productivity by over 50%.

AI is not just a tool for improving what we already do as humans. It is a tool for business reinvention, for changing how we do business today. It is about rethinking how value is created for a firm or a brand, and about understanding where value is shifting to. The businesses that can understand and leverage this will be the ones that succeed in the future.

AI’s Transformative Potential

Olderog left us with thought-provoking questions: Are you solely viewing AI as a means to cut costs and enhance productivity? Is AI seen merely as a substitute for human tasks, or are you exploring its potential to revolutionize workflows? Have you considered AI’s capacity to transform not only workflows but entire business models?

We hope this has sparked deeper reflection on AI’s pivotal role in shaping our strategies and industries. As you contemplate these questions, envision how AI can revolutionize workflows, reimagine business models, and propel growth. Together, let’s shape the future of business. Reach out to Vivaldi for continued dialogue on this transformative journey.