Digital Economy Dispatch #140 -- Move Beyond the Generative AI Hype to Drive Your Digital Transformation

Digital Economy Dispatch #140 -- Move Beyond the Generative AI Hype to Drive Your Digital Transformation
16th July 2023

The extraordinary interest in AI just keeps on growing. Recent releases of tools such as ChatGPT have put AI in hands of every internet user and given easy access to useful capabilities that millions of people have now tried. They bring useful general capabilities by being trained on vast databases of text and images to generate new text and images in response to a prompt. Hence, the impact of these machine learning capabilities in tools such as ChatGPT, Bing AI, DALL-E, and Midjourney is broad and widely applied. Over 100 million people have registered for ChatGPT.  A recent survey suggests that in the UK over 25% of all adults have now used generative AI solutions such as chatbots, and more than 1 in 10 use them every day.

As well as individuals, organizations of all kinds have also been rushing to put these new AI tools to use. In industry, Gartner points to several emerging use cases in areas such as drug design by pharma companies, material science by engineering companies, chip design by hardware companies, and parts design across many manufacturing and assembly scenarios. Governments and the public sector also sees many potential uses. Deloitte highlights several possibilities, from areas such as facility design and urban planning to policy creation and talent management. More broadly for empowering citizens, Microsoft refers to the importance of generative AI as providing a human co-pilot to help navigate interactions with state provided services.

These, and many more examples, have led to organizations defining new operating procedures, switching priorities, and making massive investment in generative AI in recent months. It has forced changes in digital transformation strategy and influenced the shape of the digital technology platform stack that supports it. Take, for example, the UK government’s use of generative AI. It has recently announced a further £100M to be spent on foundation models and safe operating procedures for generative AI. It also quickly released guidance for senior civil servants on the use of generative AI to increase understanding of where it should be deployed to add value and how to reduce its potential harm.

There Be Dragons!

Such excitement around new digital advances and their impact is to be welcomed. Many more people now have been switched on to the disruptive and revolutionary changes taking place as we undergo substantial digital transformation. More people are experiencing the opportunities AI can bring, and contemplating some of challenging issues that arise with its use.

Yet, there is also an argument for saying that all this focus on generative AI is as much a distraction in digital transformation as it is an accelerator. The excitement around generative AI, while significant and promising, can draw attention away from the more fundamental digital transformations taking place in business and society. Here's why:

1. Too much focus on novelty over practicality: Generative AI, with its ability to create realistic images, videos, or text, has captured public attention due to its novel and creative applications. However, this excitement sometimes overshadows the more fundamental digital transformations that are reshaping entire industries. These transformations involve implementing data-driven decision-making processes, optimizing operations, enhancing customer experiences, and integrating emerging technologies like blockchain, Internet of Things (IoT), or cloud computing. While generative AI has its place, it is crucial to prioritize these fundamental transformations that can have a broader and more profound impact on businesses and society.

2. Lack of alignment with core business objectives: Generative AI technologies often serve as research projects or experimental endeavours without direct links to core business objectives. While they can be interesting and generate buzz, organizations should prioritize digital transformations that align with their strategic goals and address critical challenges. This includes investing in technologies that improve productivity, enhance efficiency, reduce costs, or drive innovation in core business operations. Generative AI should be integrated into the larger digital transformation strategy and used where it provides tangible value.

3. Ethical and societal implications: Generative AI raises important ethical considerations, such as the potential for deepfakes, misinformation, and privacy concerns. While these concerns are valid and require attention, they should not overshadow the broader digital transformations needed to address complex societal challenges, such as sustainable development, healthcare access, educational equity, or economic inclusivity. Focusing solely on generative AI can divert resources and attention from these critical areas that require sustained efforts and collaborations.

4. Skills and infrastructure gaps: The excitement around generative AI can lead to a disproportionate allocation of resources, including talent and infrastructure, towards exploring and developing these technologies. However, digital transformations require a broader range of skills and capabilities, such as data analytics, cybersecurity, cloud computing, process optimization, and change management. Neglecting these essential elements while pursuing generative AI can hinder the overall progress of organizations and societies in adapting to the digital age.

Keep Your Eyes on the Prize

Interest in generative AI has brought huge opportunities to accelerate digital transformation efforts. However, while it is an exciting field with remarkable potential, it is important to maintain a balanced perspective on the role it plays without getting too carried away. It has immediate short term uses, and has opened up a broader debate on the digital future we all want to see.  But it is only part of the bigger digital landscape. By prioritizing and focusing on the more fundamental digital transformations, organizations and societies can build a solid foundation for long-term success while leveraging generative AI as a complementary tool within the broader context of their digital strategies.