AI is a Journey

A Journey of Four Stages

If you worry that your organization is falling behind in its artificial intelligence initiatives, don’t feel so bad — just about everyone is still in the learning and piloting stages. And if it’s unclear whether there will be return on investment at the end of all this work, there is financial advantage as well, research out of MIT finds.

The Four Stages of AI Advancement

According to an analysis of 721 companies by the MIT Center for Information System Research (CISR), there are at least four logical stages in AI advancement. Most enterprises are still working through the experimental and pilot stages.

Stage 1: Experiment and Prepare (28% of organizations)

In this stage, enterprises focus on educating their workforce, formulating AI policies, becoming more evidence-based, and experimenting with AI technologies to grow more comfortable with automated decision-making. Company leaders start taking a look at how to address concerns such as ethics and skills to ensure a smooth path forward.

Stage 2: Build Pilots and Capabilities (34%)

At this stage, proponents “define important metrics, begin to simplify and automate business processes, and develop the enterprise capabilities they’ve learned.” At this stage, use cases are piloted, with work on leveraging enterprise data and developing APIs. Work with large language models also commences at this stage.

Stage 3: Develop AI-Driven Ways of Working (31%)

At this stage, AI essentially becomes industrialized, meaning it is available and replicable across the enterprise. This includes work on building a core platform for AI, ensuring transparency to decision-makers via dashboards, and ultimately transforming the organizational culture to encourage data-driven and innovative thinking. Foundation models and small language models are introduced and applied to enterprise opportunities.

Stage 4: Become AI Future Ready (7%)

At this achievement stage, “AI is embedded in all decision-making throughout the enterprise,” the researchers state. “They leverage proprietary AI internally, and many sell new business services based on this capability, the AI capability as a service, or both to other enterprises.”

Financial Advantage

The research out of MIT finds that enterprises in stages three and four have financial performance well above industry average — exceeding 10 percentage points. In fact, companies in Stage 4 averaged 10.4 percentage points above the industry average.

Conclusion

Successfully moving through these stages of AI growth requires a cross-enterprise collaborative effort, as the technology can recast and accelerate many parts of the enterprise. One thing is clear; AI success is a journey, and the ability to rapidly leverage and adapt resources and technology is key — as new technologies and capabilities keep arising almost every day.

FAQs

* What are the four stages of AI advancement?
+ Stage 1: Experiment and Prepare
+ Stage 2: Build Pilots and Capabilities
+ Stage 3: Develop AI-Driven Ways of Working
+ Stage 4: Become AI Future Ready
* What is the financial advantage of AI advancement?
+ Enterprises in stages three and four have financial performance well above industry average — exceeding 10 percentage points.
* How many organizations are in each stage?
+ Stage 1: 28%
+ Stage 2: 34%
+ Stage 3: 31%
+ Stage 4: 7%