Most organizations treat AI as a single decision. It is really two: Tactical AI, the near- term productivity gains most companies already have, and Strategic AI, the redesign of how the whole organization operates over the next several years. In this clip – with a little help from Sun Tzu – I explain why you need both at once, and why even your tactical wins have to be pursued strategically rather than left to individuals.
Video Transcript
The famed, legendary Chinese military theoretician Sun Tzu said: “Strategy without tactics is the slowest route to victory, but tactics without strategy is simply the noise before defeat.”
So let’s talk about what Tactical AI is.
Almost everything people are doing with these generative AI tools – like ChatGPT, Anthropic’s Claude, Google Gemini, and a number of other, lesser-known ones – almost all of it is tactical, in that it is increasing the productivity of individual people. That’s a good thing. There’s nothing wrong with that. As Sun Tzu said, you have to have the tactics in addition to the strategy.
Narrow focus, quick wins – things like chatbots, drafting documents, and so forth. A very powerful tool.
Some examples of tactical uses of generative AI in manufacturing: marketing and sales communications – that may be where some of you are using it already; I certainly do. Automating report generation. Customer support. And one of the areas with excellent, still tactical, application – in terms of incrementing the productivity of individuals or small teams – is in speeding up the prototyping and design of new products, processes, or systems. We’ll circle back around to that as well.
But most companies today are implementing Tactical AI, well – tactically. Not strategically.
I’m making a distinction between Tactical AI and Strategic AI. But even Tactical AI must be implemented in a way that is strategic. Because what most companies are simply doing is saying, “Here are a few guidelines and guardrails. Other than that, have at it. You all individually go out and figure out whether, when, and how we ought to be using these tools to do our jobs more efficiently.”
If you really want to take advantage of these tools, you need to be proactive with the adoption. You need to put training in place to scale. You need to help people understand how to use these tools. You need to come up with approaches that are consistent, so that teams of people who work together can use these tools in complementary ways. Think through the entire workflow of the process.
This is not a tool meant to be used like Google Search – “Oh, I need to know something, let me go ask; I have this one isolated task, let me do it.” Think through how, across the entire process of what you’re doing, you can incorporate these AI tools to maximize the speed and quality of the outputs at every step: where teams work together in a coordinated way, and where, across the enterprise as a whole, you have consistent approaches to using this as effectively as possible.
But that’s still different from Strategic AI. Because Strategic AI is not about maximizing the productivity of individuals or small teams. It’s about rethinking the way the entire organization works – looking at mission-critical business processes across the whole organization, and how we can rethink the way those processes and systems operate to provide exponential increases in quality, speed, and productivity.
Core manufacturing processes – now we’re talking about long-term transformation. For those smaller manufacturers under 100 people, we’re talking about looking two to three years down the road. For the larger ones, it could be three to five years down the road. Where do we want to be? How are we going to redesign key processes like production scheduling, supply chain management, and so forth, and use AI to enable much more effective, data-driven decisions?
So, while Tactical AI is a narrow focus with immediate impact – to boost productivity and save some costs – Strategic AI is a broad focus for long-term transformation, to enable new capabilities and new business models to emerge.
More videos in this series
From Weeks to 10 Minutes: Inside AI’s Near-Future Factory
The Autonomic Enterprise: How AI Will Run Your Business Like a Heartbeat
For more of Jack’s video visit the Video Archive and contact Jack Shaw to book for keynote speaking engagements and executive briefings. Also, check out Jack’s new book series The AI Imperative Series available now on Amazon.