🤔 𝗪𝗵𝗮𝘁 𝗶𝘀 𝘆𝗼𝘂𝗿 𝗔𝗜 𝗦𝘁𝗿𝗮𝘁𝗲𝗴𝘆? Chasing single point solutions or exploring system-level AI solutions?

Yesterday I had the pleasure of listening to a great presentation by Chris Nosko. Among other important aspects, Chris touched on how AI technology represents a fundamental shift that requires system-level solutions.

Let’s dive into this, as it turns out to be key to defining your own AI strategy. 🧵 🎯 Single Point vs. System Level Solutions in Technology Adoption

𝗣𝗼𝗶𝗻𝘁 𝗦𝗼𝗹𝘂𝘁𝗶𝗼𝗻: Intended to solve one well-defined task or problem within a larger context, bringing immediate value. When adopting new technologies, it simply replaces specific parts of an existing system while keeping the overall system unchanged.

𝗦𝘆𝘀𝘁𝗲𝗺 𝗟𝗲𝘃𝗲𝗹 𝗦𝗼𝗹𝘂𝘁𝗶𝗼𝗻: Requires systems thinking and likely results in a completely new overall system based on the new technology.

⚡ 𝗟𝗲𝘁’𝘀 𝗟𝗼𝗼𝗸 𝗮𝘁 𝗮 𝗛𝗶𝘀𝘁𝗼𝗿𝗶𝗰𝗮𝗹 𝗘𝘅𝗮𝗺𝗽𝗹𝗲 A perfect example is electricity adoption in factories. Originally, factories were powered by centralized steam engines that converted steam pressure into rotary motion. This motion was transferred mechanically to drive various machines like textile looms and pumps. 🔧 𝗦𝗶𝗻𝗴𝗹𝗲 𝗣𝗼𝗶𝗻𝘁 𝗔𝗱𝗼𝗽𝘁𝗶𝗼𝗻: Replace the steam engine with an electric motor and keep everything else the same. While this worked in principle, it saw limited adoption because the overall solution remained brittle and expensive. 🏭 𝗦𝘆𝘀𝘁𝗲𝗺 𝗟𝗲𝘃𝗲𝗹 𝗦𝗼𝗹𝘂𝘁𝗶𝗼𝗻: Don’t just replace the steam engine—throw out all the brittle mechanical distribution systems and replace them with individual electric motors. This provided a much more stable and efficient overall solution.

📚 Chris built this part of his presentation on the book “Power and Prediction: The Disruptive Economics of Artificial Intelligence” by Ajay Agrawal, Joshua Gans, and Avi Goldfarb—which just landed on my reading list!

💡 𝗪𝗵𝗮𝘁 𝗗𝗼𝗲𝘀 𝗧𝗵𝗶𝘀 𝗠𝗲𝗮𝗻 𝗳𝗼𝗿 𝗬𝗼𝘂𝗿 𝗔𝗜 𝗝𝗼𝘂𝗿𝗻𝗲𝘆?

I still guide customers toward single point solutions if they’re in the early stages of AI adoption. In this phase, you need to build experience, learn the technology, and create significant business impact. A good approach is thinking about how AI Agents can support team members—then go build those first.

⚠️ 𝗕𝘂𝘁 𝗱𝗼𝗻’𝘁 𝗰𝗮𝗹𝗹 𝘁𝗵𝗶𝘀 𝗮 𝘀𝘁𝗿𝗮𝘁𝗲𝗴𝘆. 𝗜𝘁’𝘀 𝗻𝗼𝘁. 𝗜𝘁’𝘀 𝗵𝗼𝘂𝘀𝗲𝗸𝗲𝗲𝗽𝗶𝗻𝗴.

🎯 If you’re talking about strategy, you need to think about system-level AI solutions. These likely require you to step further back, rethink what you’re doing, and envision entirely new business processes.

🚀 𝗤𝘂𝗲𝘀𝘁𝗶𝗼𝗻𝘀 𝗳𝗼𝗿 𝗬𝗼𝘂:   - 𝗛𝗼𝘄 𝗱𝗼𝗲𝘀 𝘆𝗼𝘂𝗿 𝗰𝘂𝗿𝗿𝗲𝗻𝘁 𝗔𝗜 𝘀𝘁𝗿𝗮𝘁𝗲𝗴𝘆 𝗹𝗼𝗼𝗸?   - 𝗔𝗿𝗲 𝘆𝗼𝘂 𝗯𝘂𝗶𝗹𝗱𝗶𝗻𝗴 𝗽𝗼𝗶𝗻𝘁 𝘀𝗼𝗹𝘂𝘁𝗶𝗼𝗻𝘀?   - 𝗔𝗿𝗲 𝘆𝗼𝘂 𝘁𝗵𝗶𝗻𝗸𝗶𝗻𝗴 𝗮𝗯𝗼𝘂𝘁 𝘀𝘆𝘀𝘁𝗲𝗺-𝗹𝗲𝘃𝗲𝗹 𝘀𝗼𝗹𝘂𝘁𝗶𝗼𝗻𝘀?

• AI
• Architecture