How IT leaders can tell the difference between tech fads and genuine innovationAugust 01, 2023
In the rapidly evolving world of technology and software development, it is essential for IT leaders to distinguish between passing fads and true innovations. While it is wise to avoid jumping on every hype bandwagon, taking calculated risks can also pay off.
Artificial intelligence (AI) has been in development for decades, but it recently gained widespread attention with OpenAI's ChatGPT and the integration of generative AI into various processes worldwide. Jensen Huang, CEO of Nvidia, the leading AI chipmaker, emphasised the importance of agile companies leveraging AI to enhance their positions during a speech in May. This pressure to adopt AI has led to around 73% of companies prioritising AI investments over other digital initiatives, according to a survey by Accenture.
Despite the media hype surrounding generative AI and the transformative potential of large language models (LLMs) in multiple industries, businesses need to exercise caution before jumping on the AI bandwagon. Here are some strategies for businesses to avoid getting caught up in the next fad.
Understanding the problems that technology aims to solve is crucial. Often, the rush to invest in a hyped-up technology, whether it's AI, the metaverse, or Web3, stems from the fear of missing out (FOMO). Brian Fox, CTO at software supply chain management firm Sonatype, believes that generative AI has the potential to be a pivotal innovation. However, companies must be able to distinguish between genuine innovation and pure hype. Co-founder of software and product development studio Applifting, Filip Kirschner, advises businesses to assess how the technology applies to real-world problems and whether it directly improves people's lives.
Testing and seeking feedback are essential steps for IT leaders. They need to evaluate whether technology makes sense for its users and helps them perform their jobs more efficiently. Deploying technology without determining its suitability can lead to cost leakages and negatively impact employee morale, warns Ben Dilts, CTO of Lucid Software. CIOs should involve key decision-makers in their IT teams, especially non-technical members, to gain valuable insights into the practicality of a solution. Launching pilot schemes or sandboxes can help employees test new technologies before wider implementation.
Recognising the unpredictability of new technologies is crucial. Businesses often rush to adopt shiny innovations, driven by the immediate impact they can have on the company or their potential to attract new customers and secure contracts. However, not fully understanding a new technology can have negative consequences, as illustrated by Porsche's NFT launch, which drew criticism from the Web3 community. Additionally, new technologies may face teething issues that hinder a company's ability to leverage their value. IT leaders must acknowledge the novelty and unpredictability of these technologies and avoid completely relying on them. They should assess whether the technology has longevity or if it could be easily replaced by the next trend before integrating it into their technology stack.
Taking risks is an inherent part of achieving business breakthroughs. While caution is necessary, KPMG's 2022 CEO Outlook survey reveals that 72% of CEOs have an aggressive digital investment strategy aimed at securing first-mover or fast-follower status, despite financial pressures. Companies should strive to be seen as innovators by their customers. However, being a first-mover carries inherent risks. Companies can mitigate these risks by seeking outside validation from technologists before pursuing new technologies. Striking a balance between building on established strengths and taking calculated risks can lead to significant benefits.
IT leaders should be on the lookout for technologies and custom software solutions that align with their companies' growth while taking into consideration all these steps above. By understanding the problems a technology addresses, testing and seeking feedback, recognising unpredictability, and being prepared to take risks, businesses can navigate the ever-changing technology landscape successfully.