Service firms should approach AI today like the early days of cloud computing. They must keep in mind that not every client, partner, or internal team is ready for it yet.
Artificial intelligence isn’t new. Manufacturers have been building AI into cars for years, media companies around the world use it to recommend content, and retailers use it to predict consumer behavior. But in the past few months, AI – and more specifically, generative AI – has captured the imagination of nearly everyone. Technology and digital services firms are no exception.
Data-oriented consultancies and digital engineering firms have been working with AI and Machine Learning for quite some time, but the release of ChatGPT and the broader accessibility of AI platforms have forced nearly every professional services firm to take notice. And for good reason.
AI is going to impact every aspect of this sector – from how work gets done, to the solutions that are delivered, to who they hire and train, and how they operate. AI is disruptive, which makes it both an opportunity and a risk. It’s an opportunity for those who can effectively use it and a risk for those who ignore it.
It feels very similar to the first wave of cloud computing in the late 2000s and early 2010s. A time when companies like Salesforce and Workday were disrupting long-standing enterprise players like Oracle and PeopleSoft. Consumer software companies like Adobe, Intuit, and Microsoft had started to shift business models and move their apps to subscriptions, and cloudwashing was in full effect.
However, there was also a sense of fear. Many enterprises didn’t think the cloud was secure or stable enough for what they needed. Vendors and VARs saw their business models in jeopardy, and IT leaders were scared for their jobs. We hear many of these same fears today around AI, and honestly, some of those fears are legitimate.
But the AI wave is coming – whether we like it or not. The technology will evolve and mature the way cloud computing did, but probably at a much faster pace.
We believe AI, particularly generative AI in the near term, will likely be an even bigger disruption and opportunity for services firms than cloud computing.
There is a reason why the global systems integrators are jumping into the fray with both feet. In the last few months alone, Deloitte launched its Generative AI practice expanding its strategic partnership with Google Cloud, Accenture acquired an industrial AI company to help clients get to their net zero goals faster, and Globant introduced an AI challenge awarding $200,000 for ideas on how AI can transform business.
Technology services firms across the board are finding ways to incorporate AI into their marketing and internal operations, in the solutions they develop for customers, and in how they help clients and partners adopt AI. But there are questions leaders need to ask themselves about where and how to incorporate AI before jumping into the fray, or they could get themselves into trouble.
Like cloud computing in the early days, not every client, partner, or internal team is ready for AI. Especially when it comes to AI solutions for large enterprises that have complex technical and compliance requirements. If you approach AI in the wrong way, you may find yourself distracting the business, wasting money, or worse, alienating customers and teams.
See also: McKinsey: AI Adoption Stagnating, Leaders Pulling Ahead
Here are five questions to ask yourself when developing your AI strategy:
1. Have I started using AI internally?
Before you start advising customers, make sure you’re drinking your own champagne. Using these technologies internally first will allow you to see the opportunities and risks before passing those along to customers. Showing customers how you’re benefiting from AI also makes the sales pitch a lot easier and makes every consultant smarter on the topic.
2. Where are my customers on the AI maturity curve?
Not every customer or use case is ready for AI. In fact, many aren’t. Cloud computing has been around for a quarter of a century, yet many mission-critical systems remain on-premises. You’d be surprised at how many of the Fortune 100 still use mainframes (don’t believe me, check out these stats!) The best businesses out there know the needs of their customers and how to bring them along.
3. What are my partners doing in AI?
Many services companies work closely with a select set of software vendors. Know what your partners are doing with AI in their own product set – not just what they’re talking about, but what is specifically on their roadmap. Knowing this will help you be a better advisor to clients who use these systems and may prevent you from spending valuable resources building an extension or add-on that could be coming to market shortly.
4. Where do I have permission to play?
Understand where your expertise lies and where clients and partners look to you for execution and guidance. In services, failure to focus breeds mediocrity. If you specialize in retail or manufacturing, identify the specific use cases where AI can have a big impact in the near term. If you are an SI for hyperscalers like Google or AWS, find ways to help their customers (and their sales people) use AI to get the most value out of those platforms. Identify the white space, and make that space yours.
5. Is my team prepared?
This question might be the most important one of all. It’s easy for a CEO, CTO, or CMO to paint a vision for what is possible, but if there isn’t a team capable (or willing) to execute on that vision, you won’t be successful no matter how much money you put in. Once you know the skills that are needed evaluate the team you currently have, where you can train or reskill, and where you may need to hire. And remember, it’s not just about skill set; it also comes down to mindset.
This is a meaningful moment in technology but for IT services especially. Businesses have relied on services companies for decades to be their Sherpa to the technology promise land, and this will be no different. Even if you aren’t actively investing in this area, make sure you’re thinking about how this technology will impact your team, your partners, your clients, and your business. Don’t wait, or you’ll be behind.
