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Competing in the Age of AI: Strategy and Leadership When Algorithms and Networks Run the World
In industry after industry, data, analytics, and AI-driven processes are transforming the nature of work. While we often still treat AI as the domain of a specific skill, business function, or sector, we have entered a new era in which AI is challenging the very concept of the firm. AI-centric organizations exhibit a new operating architecture, redefining how they create, capture, share, and deliver value.
Marco Iansiti and Karim R. Lakhani show how reinventing the firm around data, analytics, and AI removes traditional constraints on scale, scope, and learning that have constrained business growth for hundreds of years. From Airbnb to Ant Financial, Microsoft to Amazon, research shows how AI-driven processes are vastly more scalable than traditional processes, drive massive scope increase, enabling companies to straddle industry boundaries, and enable powerful opportunities for learning—to drive ever more accurate, complex, and sophisticated predictions.
When traditional operating constraints are removed, strategy becomes a whole new game, one whose rules and likely outcomes this book will make clear.
Marco Iansiti and Karim R. Lakhani show how reinventing the firm around data, analytics, and AI removes traditional constraints on scale, scope, and learning that have constrained business growth for hundreds of years. From Airbnb to Ant Financial, Microsoft to Amazon, research shows how AI-driven processes are vastly more scalable than traditional processes, drive massive scope increase, enabling companies to straddle industry boundaries, and enable powerful opportunities for learning—to drive ever more accurate, complex, and sophisticated predictions.
When traditional operating constraints are removed, strategy becomes a whole new game, one whose rules and likely outcomes this book will make clear.
1 pages, Audio CD
Published March 1, 2021
29 people are currently reading
415 people want to read
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Displaying 1 - 16 of 16 reviews
September 5, 2025
AI-centric organisations exhibit a new operating architecture, redefining how they create, capture, share, and deliver value. Marco Iansiti and Karim R. Lakhani show how reinventing the firm around data, analytics, and AI removes traditional constraints on scale, scope, and learning that have restricted business growth for hundreds of years. When traditional operating constraints are removed, strategy becomes a whole new game.
I work in technology, and this was one of those books I picked up because of work context. AI is such a trendy topic right now and it’s mentioned in the same breath of almost everything!
This book was a great overall assessment on AI’s role in an established organisation, with all the existing people, processes and procedures. I liked that it offered a neutral tone on the coverage of how AI could be adopted in all aspects, including automation (productivity tool is one of those ‘safe’ quick wins when it comes to AI), data enrichment, etc.
Almost read like a textbook, this was thoroughly educational. I’d recommend checking this out if your organisation is curious about AI and is willing to embark on an open journey to possibilities.
See my bookstagram review.
I work in technology, and this was one of those books I picked up because of work context. AI is such a trendy topic right now and it’s mentioned in the same breath of almost everything!
This book was a great overall assessment on AI’s role in an established organisation, with all the existing people, processes and procedures. I liked that it offered a neutral tone on the coverage of how AI could be adopted in all aspects, including automation (productivity tool is one of those ‘safe’ quick wins when it comes to AI), data enrichment, etc.
Almost read like a textbook, this was thoroughly educational. I’d recommend checking this out if your organisation is curious about AI and is willing to embark on an open journey to possibilities.
See my bookstagram review.
August 26, 2022
Mahtava kirja! Olin ajatellut, että AI-kirjojen quota on jo täynnä ja alku etenikin hitaasti, sillä usein näissä kirjoissa on tullut vastaan saturaatiopiste. Mutta tämä kirja! Erinomainen analyysi + synteesi! Erityisesti viehätti "network business/effect" kuvaus (luku 9): kuinka liiketoiminnat muodostavat verkostoja (arvoketjuihin laajeneminen ja tämän esimerkit) ja miten tuo verkosto mahdollistaa ison skaalautumisen. Haasteena on mahdollinen monopoliasema, ja hidasteena osin onnistuneet verkoston skaalautumattomuus (esimerkkinä über). Toki suurin osa esimerkeistä oli tuttuja, mutta liiketoimintamalleja oli monessa kohdassa purettu niin hyvin ja "makroanalyysia" kuvattu niin hyvin, että pidin kirjasta todella paljon. Paras AI-kirja jonka olen tähän mennessä lukenut.
August 10, 2023
Pleasant to read.
The authors take the reader by the hand when giving good examples from everyone's daily life on how AI/ML may support business models or operation models.
A must read for everyone working in digital or traditional companies.
The authors take the reader by the hand when giving good examples from everyone's daily life on how AI/ML may support business models or operation models.
A must read for everyone working in digital or traditional companies.
February 4, 2022
So relevant for all leaders. Some of what they predicted indeed happened after the book was published.
April 25, 2023
Super interesting content but dry read and hard to digest/make it all the way through
October 18, 2022
The book focuses on how AI is becoming the new operational foundation of business… it sets the context by describing the importance of the right operating models and reminds us that where a business model points to the potential of the firm, in terms of the value it could deliver, the operating model is the actual enabler of firm value and its ultimate constraint; and that the goal of an operating model is to deliver value at scale, to achieve sufficient scope, and to respond to changes by engaging in sufficient learning.
The authors use real examples (e.g Uber, Amazon, Alibaba, and others) to illustrate how digital, AI-driven processes are more scalable than traditional processes; enable greater scope (or variety), as they easily connect with a myriad of other digitised businesses, and they create powerful opportunities for learning and improvement, such as the ability to produce ever more accurate, complex, and sophisticated predictions and even gain fundamental understanding. And while the value of scale eventually begins to level off in traditional models, in AI-based ones, it never stops climbing and is therefore erasing deep-seated limits that have constrained organisational growth and impact for hundreds of years.
The authors emphasise that this requires a major shift in how a company operates and competes - the very fundamental nature - from changing the way it gathers and uses data, reacts to information, makes operating decisions, and executes operating tasks - a complete rearchitecting of how the firm works… a new approach to workflows - where processes are digitised and enabled by an AI factory that treats decision making as an industrial process; analytics systematically convert internal and external data into predictions, insights, and choices, which in turn guide by informing human insights or even automate a variety of operational actions. This is what enables the superior scale, scope, and learning capacity of the digital firm.
They describe the new architecture through a simple analogy - if the data is the fuel that powers the AI factory, then infrastructure makes up the pipes that deliver the fuel, and the algorithms are the machines that do the work. The experimentation platform, in turn, controls the valves that connect new fuel pipes, and machines to existing operational systems.
The book is easy to follow and the examples bring it to life. The key message is that embracing AI goes way beyond adopting a new technology… it is far more fundamental, and one that will impact every function and process. The biggest risk is the architectural inertia thus makes it difficult to achieve transformations that require organizing work in new ways.
The authors use real examples (e.g Uber, Amazon, Alibaba, and others) to illustrate how digital, AI-driven processes are more scalable than traditional processes; enable greater scope (or variety), as they easily connect with a myriad of other digitised businesses, and they create powerful opportunities for learning and improvement, such as the ability to produce ever more accurate, complex, and sophisticated predictions and even gain fundamental understanding. And while the value of scale eventually begins to level off in traditional models, in AI-based ones, it never stops climbing and is therefore erasing deep-seated limits that have constrained organisational growth and impact for hundreds of years.
The authors emphasise that this requires a major shift in how a company operates and competes - the very fundamental nature - from changing the way it gathers and uses data, reacts to information, makes operating decisions, and executes operating tasks - a complete rearchitecting of how the firm works… a new approach to workflows - where processes are digitised and enabled by an AI factory that treats decision making as an industrial process; analytics systematically convert internal and external data into predictions, insights, and choices, which in turn guide by informing human insights or even automate a variety of operational actions. This is what enables the superior scale, scope, and learning capacity of the digital firm.
They describe the new architecture through a simple analogy - if the data is the fuel that powers the AI factory, then infrastructure makes up the pipes that deliver the fuel, and the algorithms are the machines that do the work. The experimentation platform, in turn, controls the valves that connect new fuel pipes, and machines to existing operational systems.
The book is easy to follow and the examples bring it to life. The key message is that embracing AI goes way beyond adopting a new technology… it is far more fundamental, and one that will impact every function and process. The biggest risk is the architectural inertia thus makes it difficult to achieve transformations that require organizing work in new ways.
July 12, 2022
You might be aware of Industrial Revolution, Microsoft’s desktop revolution in late 90s, internet boom of 2000s or smartphone revolution – AI is the next big thing, and it has only started.
Authors have done great job in explaining how firms are changing their business strategy and more importantly their operating model in this new era of Artificial Intelligence.
Book covers examples of many firms – Netflix, Tencent, Alipay, Microsoft, etc. – to show how they have adopted the new data centric models and are leading the way. Book also highlights network effects and how firms like Netflix and Facebook are capturing value from direct and indirect network effects.
Collision between these new age companies and traditional companies is natural and various examples have been covered by authors. AI is forcing change in traditional ways of working – some are accepting the change and others have been forced out of competition.
Authors have also covered negative sides of AI as well. For example, ethical consideration and inherent bias in AI algorithms. At the end, authors have left leaders with challenges which need to be considered keeping collective health of their ecosystems.
Authors have done great job in explaining how firms are changing their business strategy and more importantly their operating model in this new era of Artificial Intelligence.
Book covers examples of many firms – Netflix, Tencent, Alipay, Microsoft, etc. – to show how they have adopted the new data centric models and are leading the way. Book also highlights network effects and how firms like Netflix and Facebook are capturing value from direct and indirect network effects.
Collision between these new age companies and traditional companies is natural and various examples have been covered by authors. AI is forcing change in traditional ways of working – some are accepting the change and others have been forced out of competition.
Authors have also covered negative sides of AI as well. For example, ethical consideration and inherent bias in AI algorithms. At the end, authors have left leaders with challenges which need to be considered keeping collective health of their ecosystems.
October 27, 2024
This is not my usual fare of reading but I wanted to challenge myself. It took forever to get into a regular groove of reading this but I finally did. I was hoping for some kind of insight for the average person on how to compete and thrive in an age when AI is threatening to replace, as one study in the book posits, close to half of the working force. Once I accepted the fact that this was a meditation on how big companies are radically changing how business is conducted, I managed to get into the details of how business is changing through AI. The book is informative even today, if a bit impersonal. One example os something called ‘learning effects’ demonstrated an unexpected profitability path when their data discovered a connection of parents who bought diapers also bought beer (probably because parents with young kids don’t go out much). Fascinating, but it failed to address the ethics of profiting off someone who might be prone to alcoholism AND in charge of a young life. To be fair it does address flaws and problems this new way of business is ushering in, like lack of privacy, data leaks, and suggests courses of action. It’s a worthwhile read.
July 12, 2022
The book gave a good overview and intro to how AI and advanced digital capabilities might be used to help firms operate in the coming decade. The numerous examples also add to tool box of analogies that might be helpful for operators to think through how to evolve their own analog firms into digital firms.
May 19, 2022
Very well done, quite technical which o like, some parts even over my head, whi is not hard, but if you geek out on random little know facts as I do, this is the book for us.
👍👍👍
👍👍👍
June 23, 2022
The author does a great job exploring the key concepts of AI and why huge corporations continue to be agile with AI, marketing platforms and hubs.
September 24, 2022
A must read for all...To be or not to be (AI&ML Literate) is (no longer ) a question... Upskill/Reskill...else would be left behind...
Read
January 3, 2023DNF.
December 31, 2024
I am becoming a fan of Karim Lakhani increasingly!
April 11, 2023
This is a great book about digitalization trend in companies on how to use data and ML methods to transform into a data informed/driven entity.
Classical business book, value analysis, business models, operational models.
Classical business book, value analysis, business models, operational models.
Displaying 1 - 16 of 16 reviews