These Are Not the (AI) Droids You Are Looking For

We're proud to bring you a diversity of opinions on what Artificial Intelligence is and can do for your business. After all, using AI inside large corporations is anything but simple.

Enjoy this two-part series on corporate versus employee efficiency by Chris T. , Kai Yen and Hudson Leung .

The time to start is now. Enjoy.

By Elke Boogert, Mach49 Managing Editor

These Are Not the (AI) Droids You Are Looking For

By Chris T. , Chief Strategy Officer; Kai Yen , CTO in Residence; and Hudson Leung , Partner Venture Strategy

Few – if any – business executives or leaders understand what AI does or is, to the degree and depth required to make strategic decisions. 

Instead, we believe that leadership of many corporations follow the simplistic cues of external influencers — from tech evangelists to cost-obsessed advisors — whose grasp of AI is no deeper, but far more assured. And who may be pursuing unstated agendas of their own. 

We know that we are not alone in this thinking. And we’re at a critical moment –  we need to grasp this notion in terms of workforce decision making. The lack of understanding of AI, coupled with the associated misinformation and disinformation, has resulted in hiring and layoff decisions across a wide range of companies that are likely going to be damaging to businesses in the long term. And in most cases are likely to also result in disillusionment with AI as a solution.

The core issue, in our opinion, is that business people see AI as "job replacement" in the sense that it's going to replace X% of Analysts, and Y% of Associates, etc. 

The problem is that AI doesn't fill "jobs"

That is a classic example of the risk of anthropomorphism. AI isn't human. LLMs and AI Agents are not people.

We know that a lot of people who work in AI are telling a good story about how AI is "your coworker". But in our humble opinion, that is not true, and saying that it is true is a huge problem. Rather than doing "a job" beside you like a coworker, AI performs tasks as requested and directed – by humans.

For example, AI may be increasingly effective at rote tasks like generating grounded models and presentations, but it cannot replace other relationship-driven parts of an analyst’s or associate’s job, such as storytelling for client impact or tailoring content to managements’ unwritten strategic objectives. 

If in fact AI is a "tasks and micro-tasks replacement" (rather than a full "jobs and people replacement"), then the ways in which companies have been going about doing organizational restructuring and staff reductions, and the tactics they are using for adopting AI, are all wrong. 

And worse yet – their expectations around what the outcomes and impact will be, are wildly wrong. 

As a result, we are now comfortable predicting what the trigger for AI entering the "Trough of Disillusionment" is going to be: 

"We were promised that AI would replace our people so we laid them all off and things fell apart because AI is all hype and doesn't actually allow us to get rid of our people."

What we are trying to say is this: the idea that AI can directly impact corporate efficiency – which is too often just a euphemism for reducing headcount – is problematic and untrue. 

That said – AI does directly impact employee efficiency, which improves velocity and productivity at a corporate level. 

AI should be applied strategically to work that is difficult or tedious for humans, leaving us to do higher value work that only humans can direct. 

The easiest way to wrap your head around this difference: 

Not "do the same with fewer people" but rather "do much more, much more quickly, with the same people."

To use AI to improve corporate efficiency you have to ask questions like:

• How should we organize our employees?
• How should decision-making work?
• How is "work" divided and assigned?
• What types of employees deliver the largest efficiency improvements when AI is applied properly?
• What completely new value-generating work can our employees be working on with the time saved?

When it comes to employee efficiency, here is the question you should ask yourself:  

"How does my company restructure to not just streamline, but to embed new incentives and governance that support AI-human collaboration and faster, smarter decision-making?"

And we believe that we have answers to this.

In the end, the big question is "How do we achieve maximum leverage?"

Because in the end, AI is leverage.

Whereas if you redesign your org, your processes, your roles and responsibilities and your policies in order to maximize the leverage of AI – you'll likely see exponential increases in corporate efficiency.

How do you go about achieving AI’s maximum leverage? What does that look like in practice?

Look out for part two – where we dive in deep to the topic of AI Leverage. 

Chief Strategy Officer CHRIS TACY is a respected expert in business model disruption and corporate venture transformation, who has spent over 25 years sharpening his skills at the crossroads of business, innovation, strategy, and entrepreneurship. He leads our Venture Strategy practice.

Chris has worked with many large companies, including Oracle, Google, Lockheed Martin, Sony, Viacom, and Nike. He's launched four successful startups; managed a $325M corporate venture fund; and participated in numerous profitable M&A deals and partnerships, amounting to over $2B in total contract value.

As an investor, his bets have yielded over $100M in returns on less than $7.5M in invested capital. Chris has also imparted his substantive knowledge in corporate entrepreneurship and disruptive growth to investors, large corporations, and high-growth startups across various sectors.

After consulting on Incubate and Accelerate efforts for Mach49 in 2017, Chris rejoined the firm full-time in 2020. He holds a BA in English from Wesleyan University. When work gets demanding, he finds balance in the calmness of caring for the fruit trees on the 2-acre farm in Hawaii where he lives with his partner, Valerie, who is also part of the Mach49 team.

CTO in Residence KAI YEN is a tenacious learner, prolific prototyper, and serial entrepreneur with a remarkable ability to leverage cutting-edge technology in solving complex business challenges.

A 10X engineer, Kai brings his exceptional speed and keen insights to crafting AI solutions. He excels at rapidly building value-added tools that propel ventures forward, consistently leveraging the newest, most cutting-edge, and most effective approaches in Generative AI. His unique talent lies in creating fast yet highly effective solutions to the idiosyncratic and novel problems that new venture teams encounter in their quest for product-market fit.

For Mach49, Kai's expertise is instrumental in developing and refining the platform's generative AI capabilities. He works tirelessly to ensure that AI solutions remain at the leading edge of AI technology, incorporating advanced techniques such as AI venture and risk identification and validation, vector search and advanced data retrieval, AI copilot services, synthetic data generation to accelerate the entire "0 to 1" process of venture building.

Before joining Mach49, Kai's entrepreneurial journey included serving as CTO and Managing Director, New York for JWT INSIDE, where he created world-class recruitment and employee communications programs for clients such as Comcast, Macy's, and the Department of Veterans Affairs. His startup experience is equally impressive, having co-founded and served as CTO for three venture-backed startups and one corporate innovation venture.

Kai holds a BS in Business Administration from the University of California, Riverside and currently resides in New York City.

Partner Venture Strategy HUDSON LEUNG brings over a decade of experience in financial services, economic development, corporate advisory, and venture building — across the US and Asia — to his role as Partner in the Venture Strategy practice. He specializes in providing strategic and operational guidance to new ventures, from "Day 1" startups to in-house ventures within corporations with thousands of employees. Hudson has worked across a number of US-based and international ventures in crowd financing, meal delivery, e-commerce, and marketplaces, notably facilitating an exit / acquisition at Kaidee — a C2C marketplace in Thailand with over 7 million users.

Prior to joining Mach49, Hudson served as Chief Strategy Officer at Transformational, a digital transformation advising and venture building firm based in Bangkok, Thailand.

Let us know what you think of the Venture Driven Growth Newsletter.