Enterprise AI projects often derail when companies prioritize technology over people and organizational adaptation, according to Matt Domo, co-founder of AWS's database division and founder of AI consultancy FifthVantage.
“The number one reason these fail is because the business and leadership, and how work gets done and decisions get made, don't change in kind for the new way things are done,” Domo stated in an interview with The Register. He noted that this pattern has been consistent throughout his career, recalling the initial resistance to AWS cloud adoption, where people struggled to envision its utility beyond their existing operational constraints. “That's the biggest failure here,” he emphasized.
Domo proposes that the first step towards success is to step back and analyze the organization's objectives, identify who stands to benefit, understand how people might use the technology, and establish clear metrics for success.
Value Over Features: The New Paradigm
Companies, Domo argues, must shift their focus from a “feature war” to value creation. “The feature war is over,” Domo declared. “It isn't about features anymore. It's about value. Ask how many CIOs are happy with the eight-digit forklifts they did with software packages like CRM and what value came from it.”
From there, a methodical approach is needed to identify and implement the changes required to deliver the desired customer experience, and how employees can facilitate that experience. Such a review is crucial, Domo explains, because AI will accelerate processes and generate new signals that demand organizational adaptation. This involves a clean assessment of which signals truly matter and which should be downplayed or ignored.
Domo observes a widespread sentiment among leaders: “What I see is leaders are tired of the ‘robots are going to take over the world’ and the negativity.” He highlighted that 75% of CEOs are currently panicking about developing an AI strategy to avoid job loss. Domo projects an 86% increase in AI's share of IT budgets this year, with buyers expecting tangible results. “We've crossed from theory to ‘Stuff's gotta work now’. We gotta get value. People have to see ROI. We have to see benefits.”
While automation enabled by AI is important, Domo contends that processing business signals is the ultimate key. “The unlock is the ability to process signals and look around corners and make predictive decisions,” he said. “If you focus solely on automation, you miss the biggest unlock of the decade.”