It’s nearly impossible to discuss business strategy or future trends without mentioning how AI and GenAI are transforming businesses and workplaces.
Leaders recognize the technologys’ potential to drive breakthrough business performance. And the numbers speak for themselves—McKinsey’s latest research estimates that generative AI could contribute between $2.6 trillion and $4.4 trillion annually across the 63 use cases analyzed.
Consequently, many organizations are including a focus on AI in their strategic plans, viewing it as essential for driving key priorities, strategic decisions, and operational and customer impact.
As AI’s potential continues to evolve, how prominently should it feature in an organization’s three to five year business strategy? What key factors should leaders consider when integrating AI into the organization’s long-term strategic plans?
Understand AI Maturity
Before incorporating AI as a key strategic investment in their strategic plan, leaders must conduct a comprehensive review or audit of their organization’s AI maturity.
According to Gallup research, many employees who use AI at least once a year report that their organizations have not provided any training on using AI at work. Only 6% of employees feel very comfortable using AI in their roles, while about one in six employees (16%) are very or somewhat comfortable using AI. Meanwhile, about a third of employees (32%) say they are very uncomfortable using AI in their roles.
AI is complex and multifaceted, so adopting it is not as simple as replacing legacy systems with new technology. Leaders would need to dig deeper to uncover barriers and opportunities. This can involve inviting external experts to discuss AI’s benefits and challenges, hosting workshops where team members can explore different case studies, or creating internal discussion groups focused on various aspects of AI technology and potential barriers to adoption. These insights can help create a compelling value proposition for the organization’s AI strategy, which should be reflected in the strategic plans. Here are some questions leaders might consider asking:
- What is the current level of AI adoption, and how does it align with our mission or vision?
- How reliable and comprehensive is the data used for AI applications? Where do we see gaps in data availability, validity, and fidelity?
- What obstacles can hinder AI adoption?
- Do we have the necessary talent to drive AI adoption?
- Will our organizational culture support the transformation that AI might bring? What significant barriers or resistance to new technology might we face?
Such reviews can help pinpoint what needs to be done to prepare for AI adoption and reflect that in strategic plans, including early gains, progress made, and long-term expectations. Conducting a SWOT (Strengths, Weaknesses, Opportunities, and Threats) analysis has always been part of good strategic planning. The same thorough and critical review needs to be applied to AI investments before including them in the strategic plan.
Align AI With Your Why
A strong strategic plan should clearly link prospective investments to the organization’s purpose and mission. For example, if customer centricity is central to the mission, any investment in new technology should directly connect to improving customer outcomes.
Demonstrating the expected impact of AI in the organization’s mission and vision also involves quantifying clear outcomes and ROI. Here are some examples of what could be included in the strategy plan to demonstrate potential impact:
- Personalizing customer interactions using AI can enhance customer lifetime value.
- Implementing automation can reduce operational costs or enhance quality while adhering to compliance standards.
- Data-driven decision making can substantially reduce risk or mitigate financial damage.
Leaders must also ensure that employees who use AI, or will use AI, understand how it can help them better drive the company and their own sense of mission. According to a Slack survey, nearly half (48%) of desk workers would feel uncomfortable admitting to their manager that they used AI, fearing it might be seen as cheating or a sign of incompetence.
Therefore, simply promoting AI as the next big thing in the strategic plan might be met with skepticism. Instead, also include personal stories of impact and use cases in the strategic plan to build confidence. These stories should clearly illustrate how AI applications have empowered employees or teams to achieve superior results and how they align with the organization’s mission or vision.
An Adaptive Strategy Roadmap
A strategy plan should not only outline planned AI initiatives but also provide a clear roadmap for implementation. Given that AI is still evolving, it’s crucial not to create a roadmap in isolation from ever-changing business challenges, market dynamics, or technological advancements.
In this context, an AI strategy roadmap should be emergent— meaning it should be grounded in key strategic intentions while also being flexible enough to adapt to unforeseen events or black swan occurrences that necessitate rethinking and adjustments.
Creating a rigid timeline for AI is clearly not feasible. Instead, outline key milestones for the next 3-5 years of AI adoption to provide clarity for leaders and managers. These milestones should include both short-term and long-term goals.
For short-term milestones, focus on immediate or quick wins and pilot projects that the organization can test and learn from. Creating specific, time-bound roadmaps for these short-term strategies can be useful. But for long-term milestones, outline a broader, more comprehensive vision with flexible, adaptive timelines that require regular review and adjustment in response to market, business, and technological changes.
Importantly, along with a roadmap for AI implementation, include the investments the organization is making in change management and the cultural and behavioral shifts needed to support the AI strategy.
Simply mentioning AI in strategic plans isn’t sufficient. To truly realize the value of AI investments, leaders must invest in effective internal communication, marketing, and change management. Adding superficial AI buzzwords to your strategy plan won’t cut it.
AI demands a multi-year, multi-pronged approach, not just a line item in your budget or strategy plan.