Paradigm Shift: A Revolution More Profound Than It Appears
The business world is undergoing a profound and significant transformation with the introduction of artificial intelligence into its “life.” Consulting and research firms estimate that by 2030, artificial intelligence is expected to contribute approximately $15.7 trillion to the global economy. On the way there, AI is challenging and disrupting the rules of the game not only at the operational and technological levels but, more importantly, at the organizational paradigm level.
How does this change feel?
An Exponential Rate of Transformation
Past technological revolutions were characterized by relatively gradual changes and a maturation pace that allowed organizations to adapt in a measured, responsible, and moderate manner. These changes typically had a focused impact on specific organizational layers or units.
In contrast, the AI revolution presents an entirely different reality: a technology that simultaneously transforms every organizational layer at an exponential pace, without a “winning formula” for successful adoption. It demands a fundamental rethinking of assumptions and organizational business paradigms for this new era.
A “Superpower” for Every Knowledge Worker
Moreover, generative AI and its unprecedented accessibility have, for the first time, made a profoundly transformative technology available to every knowledge worker at every level and role, seamlessly integrated into their workflow. This technology can dramatically enhance their effectiveness, quality, productivity, and creativity – from strategic planning and management down to individual tasks.
All this comes without requiring technological skills, software development, IT overhead, or the implementation of complex organizational systems. Just as it is unthinkable today for a knowledge worker not to be proficient in Office tools, soon every employee will rely on essential daily AI tools to significantly boost their productivity and creativity.
Democratization and Commoditization of the Software World
From the individual to the organization: we are witnessing an accelerated and profound commoditization of the software world. What was once a barrier to entry and a source of competitive advantage for the large, wealthy, and technologically talented is rapidly becoming an off-the-shelf, accessible, and economically viable product.
Traditional enterprise information systems are losing their intrinsic differentiating value. At the same time, accessible AI – sometimes even at the level of free open-source code for unlimited use – is emerging as a transformative force, fundamentally altering how individuals and organizations make decisions, manage risks, identify opportunities, and create value.
The Strategic Paradox: Why Many Organizations Miss the Real Opportunity
So much for the romanticized part.
While recent studies and reports (mainly from the U.S. and Europe) show that a significant percentage (35–60%) of organizations claim they are already “using” Gen-AI in some form, in reality, a very large portion of those making such claims are actually implementing it through one or a combination of two primary adoption paths:
A. The organization attempts to formulate a separate and independent “AI strategy.”
This approach, which treats AI as yet another technological domain requiring its own strategy, is in itself a form of strategic error.
The paradox lies in the fact that the significant potential benefits of AI are meant to integrate with and amplify the organization’s business strategy and core focuses. Rather than viewing AI as just another technological opportunity or separate discipline, it should be treated as a transformative force that can:
- Upgrade and accelerate existing business priorities
- Reimagine value propositions and business models
- Enhance the organization’s competitive advantages
- Dramatically improve decision-making and risk management capabilities
B. The organization promotes “islands” of tactical and isolated initiatives
Most organizations are already advancing or initiating moves and initiatives in the AI domain. Some are conducting pilots or POCs (Proof of Concept) for AI initiatives, offering training and workshops for some employees on using leading Gen-AI tools. Others are implementing point solutions, such as service bots or automations on the product and service floor.
Isolated initiatives and a standalone AI strategy = high likelihood of underutilization
A pilot is not a transformation, training does not create an AI mindset or widespread adoption, and deploying a service bot won’t “move the needle” in business priorities. A more updated perspective is required to realize AI’s transformative potential within the organization—from seeing AI as a mere operational enabler to recognizing it as a transformative tool.
The Core Challenge: Navigating Wisely Through a Stormy Sea of Exponential Change
The primary challenge for organizations seeking to overcome this organizational/strategic paradox is threefold:
Current Change Management Methods Are Linear – The AI Revolution Is Exponential
Most traditional change management practices and operational models are optimized for an era of linear, moderate changes, for which there is a proven playbook for adopting and integrating new technologies. However, in today’s era of exponential change, these tools are simply far less effective.
Waiting for Maturity Means Falling Critically Behind
A “wait strategy,” which might appear cautious and responsible, risks creating an unbridgeable gap with competitors who have already embarked on their transformation journey. As with any technological revolution, early movers leverage the competitive advantage gained through AI to establish gaps, differentiation, market share, or valuable tangible assets—assets that retain their value even after other players adopt AI.
Hype and White Noise Complicate Decision-Making
The dizzying pace of developments in the field generates “white noise” that makes it difficult to make sound, validated strategic decisions. Organizations struggle to differentiate between significant trends and temporary hype, real opportunities and a premature, overcommitted adoption of proprietary technology or approaches.
In Summary:
The current situation shows that many organizations that are not inherently AI-based struggle to navigate the journey of adopting and embedding AI into the core of their business and workforce. They face the complexity of multiple general approaches, isolated initiatives and projects—few of which mature into production environments—vendors with “closed-garden” tool and platform paradigms, isolated adoption by employees, and a lack of clarity regarding the future landscape.
So, what’s the solution?
The Three Flywheels to Help Organizations Address the Challenges:
GAIN: A “Modern” Operating Model for Managing AI Transformation
We’ve established that the AI revolution poses a unique challenge for organizations: how to lead organizational transformation in an era with no proven playbook, where the pace of change is exponential, and the impact permeates every organizational layer.
Addressing this threefold challenge requires a new mindset—a modern operating model—based on three organizational flywheels that feed into and reinforce each other, leading the way to an AI-empowered organization.
We call this operating model GAIN (also the name of our rapidly growing AI practice at Strauss).
GAIN is built on the understanding that a successful AI transformation requires synergy among three critical components:
- AI Literacy and Broad, Responsible Adoption across all employees, units, and levels of the organization.
- Identification and Maturation of Leading AI Initiatives alongside the development of an “enabling” data/IT infrastructure.
- A Supportive Management Framework—a compass for smart organizational navigation during the transformation.
Each of these components is a necessary condition but insufficient on its own. Only their combination creates the organizational flywheel—the inertia required for successful transformation and strategic-level utilization of AI.
Let’s briefly review each of the flywheels:
The Synergy Between Flywheels: The Key to Successful Navigation
The three flywheels do not operate in isolation. They constantly feed into and reinforce each other:
- Broad AI literacy increases productivity, drives adoption, and promotes leading initiatives
- Success in leading initiatives creates momentum, accelerates widespread adoption, and enhances strategic projects
- A strong management framework ensures smart, responsible steering and leverages successes for measurable business achievements
What’s Next? The Path to an Exponential Organization
Navigating the exciting journey of organizational AI adoption through GAIN’s flywheel approach not only helps decision-makers steer the transformation effectively but also lays the groundwork for creating an “exponential organization.”
Such an organization has an updated managerial operating system capable of adapting rapidly and systematically to technological or business transformations, while continuously creating and leveraging opportunities at an accelerating pace—applying the same three flywheels for organizational, technological, and managerial adoption in a coordinated, synergistic, and fast manner.
Organizations that succeed in this mission will enjoy cumulative and growing advantages:
- Faster and more accurate decision-making, based on AI-empowered data
- Continuous innovation in processes and business models
- Competitive advantages grounded in strategic data assets (data, AI models)
- A corporate culture of constant learning and growth
GAIN: Nice to Meet You
GAIN, Strauss Strategy’s rapidly growing AI practice, was developed as a direct response to the unique challenges of the AI era. Our expertise is based on a combination of:
- Extensive experience in guiding complex organizational, digital, and business transformations
- Deep understanding of exponential change dynamics in the AI age
- In-depth familiarity with the challenges of AI adoption in large organizations
- A holistic framework that integrates technology, processes, and people
We invite you to explore how GAIN can help your organization successfully navigate the challenging journey toward an AI-empowered future—one where your organization not only adapts to change but leads it.
For more information on how GAIN can assist your organization with AI transformation, contact our expert team:
Hanan Eliav, Strategy VP: Hanan@s-strategy.com | 052-399-4958
Moti Krispil, Head of AI at Strauss Strategy: Moti@s-strategy.com | 052-556-5758
