At the CES 2018 held in Las Vegas, Steve Koenig, Senior Director of Market Research at Consumer Technology Association, presented on tech trends to watch. Outlining the big picture, he described 2018 as the beginning of the “data era of consumer tech”, with the heralds of that coming age being 5G, AI, and AR.
While most of us have heard of the term “AI” we only know it on a superficial level. Thus, in this post we will focus on the application of this particular technology in strategic planning.
What is AI?
Artificial intelligence (AI) refers to the autonomous intelligent behaviour of software or machines that have a human-like ability to make decisions and to improve over time by learning from experience.
When we think of AI, most of us first think of its implications for our personal lives: virtual personal assistants, self-driving cars, smart recommendations, and numerous other applications. Nonetheless, AI is also widely considered to be the “next big thing” in business, and corporate executives are starting to explore ways to use this disruptive technology to reshape their organizations.
Survey findings indicate that corporate leaders mostly view AI as a transformative tool to improve processes and offerings. It does not come as a surprise that AI is mainly a focus of CIOs and CTOs who are concerned with developing AI strategies, which often entail building advanced IT infrastructures and investing in relevant talent.
We seek to explore this topic from a different angle and would like to brainstorm on whether AI has the capacity to transform the overarching corporate strategy of an organization. In other words, can CEOs leverage AI as a tool for setting the strategic course of an organization?
Strategic Planning
There are many different frameworks and approaches to strategy planning. Regardless of what approach is chosen and pursued, a solid planning process is ultimately designed to answer the following three key questions:
- Where are we now?
- Where do we want to be?
- How do we get there?
The answers to the questions above help define an organization’s strategic course, and will be impacted by AI at different levels.
Where are we now?
Assessing the current state of an organization involves a substantial amount of information gathering and evaluation. Internal and external analyses are performed, interviews with key stakeholders are conducted, and key strengths and opportunities are identified. The proliferation of corporate data (e.g., financial metrics, non-financial information, industry and macro statistics) along with rapid advances in machine learning technology now means that AI can be deployed to access and interpret data, which can be used to produce a clearer picture of an organisation and its external environment.
Where do we want to be?
Setting the vision, mission, and values of an organisation is less a function of data and more a function of human factors such as ambition, energy, creativity, culture, and principles. Thus, managing people and their EQ will become increasingly important in setting the direction of organizations.
How do we get there?
Finally, strategic planning culminates with developing a roadmap for achieving its vision and objectives. This is where strategic trade-offs are encountered and choices need to be made about strategic priorities and the corresponding actionable initiatives.
Human input and AI capabilities will need to work hand-in-hand to develop a compelling strategic narrative. There’s a strong case for the use of AI in overlaying findings from Step 1 with inputs and parameters on vision and objectives from Step 2 to generate a way forward from a multitude of possible scenarios and strategic options. For example, insights derived from the initial data analysis steps can be used to understand the organization’s core competencies. This knowledge is critical when deciding which opportunities should be pursued, as well as areas of current weakness where further investment is required. Human involvement will be vital to align key stakeholders to the plan and ensure its implementation.
Final thoughts
Strategic planning aims to answer seemingly simple questions but these questions have many moving parts and demand a variety of inputs, exercises and assessments. It is precisely the intricate nature of the strategic planning journey, and the corresponding need for human judgement, that make us believe a synergistic relationship between human and machine will be necessary to achieve success.
Jason Oh is a management consulting enthusiast with past experience in helping F500 financial services clients with product management, go-to-market and distribution channel strategy.
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