In fact, it’s changing the game, raising the stakes and ushering in a new frontier of value creation for the bold and ambitious.
Cuesta Partners recently hosted a select group of business operators, technologists, and PE leaders for our inaugural Cuesta Summits series on “Data First, AI Second,” which explored how enterprise insights and data hold the transformative key to unlocking new opportunities through AI. The participants shared real-world experiences, complex challenges and powerful success stories they are experiencing in their ambition to transform their own enterprises.
Based on the key themes discussed, here are five realities about the current state of AI that business and PE leaders should understand to accelerate programs and drive business impact at scale.
1. AI investment is outpacing value creation – The chart below shows there is a significant gap in the AI revenue required to justify the CapEx spend on such investments. The key take away is that AI investment will likely cool off over time and there is a need to unlock valuable use cases. Incubated projects and proof of concepts (POCs) have great potential to showcase value to key stakeholders, inspire leadership and keep investments flowing.
2. Demonstrating AI’s value on a P&L remains a priority – While teams can achieve individual efficiencies and pocketed successes in their workflows with generative AI tools like ChatGPT and Microsoft’s Copilot, it is essential to continuously showcase the measurable financial impact of AI solutions on the P&L. Numerous organizations have already realized substantial cost savings, streamlined operational tasks, accelerated time to market, and unlocked new revenue opportunities through AI. These benefits must be consistently identified, highlighted, and communicated to P&L owners, along with the identification of new opportunities and the building of compelling business cases, to sustain and scale AI investments.
3. Piloting AI solutions can build buy-in for more extensive programs. Piloting quick-wins can capture enthusiasm for AI while demonstrating the full potential of more significant enterprise-wide programs. Consider the “Gen AI Lite” solutions outlined below as low-cost, quick and commercially available solutions to pilot and learn – and to use as a basis for scaling opportunities.
4. Build versus buy decisions reflect companies’ existing technology maturity –Organizations with strong existing technical teams tend to build custom AI solutions in-house, while less technical organizations often gravitate towards procuring external AI capabilities that align with their existing technology stack. It’s important to be clear on where your own capabilities stand to pursue a path that can net you the fastest and most efficient ROI.
5. Clarifying what AI is can help achieve alignment between boards and executive teams – Today, Generative AI is making headlines, but other tools like machine learning, reinforcement models and natural language processing (NLP) all fall under the category of ‘traditional AI’ and can be tailored to meet an organization’s goals more effectively. Infusing knowledge and inspiring learning sessions across the highest levels of leadership can help drive synergies and buy-in, and also gain support for broader investments and value creation opportunities.
Unlocking Opportunity
In embracing AI, leaders are not just adopting a new technology for their enterprise, but are embarking on a transformative journey that requires strategic vision, aligned aspirations, and practical execution.
The future belongs to those who can seamlessly integrate data-driven insights with AI capabilities, driving innovation and fostering resilience. As the landscape continues to rapidly evolve, staying informed and adaptable will be paramount in leveraging AI’s full potential to redefine business success.
To learn more about Cuesta Summits, our exclusive, invitation-only inspiring events series for operators, technologists, and industry leaders, please visit cuestasummits.com
