Why First-Order AI Thinking Misses Systemic Change

How will AI change the size, shape, and structure of companies? Where will we see new leverage points in the AI economy? How does AI mobe beyond task automation and into coordination of tasks? How does a manager keep from becoming just a cog in a system of automations?

Sangeet Paul Choudary is a senior fellow at UC Berkeley, a consultant, and the author and co-author of several books. His latest work is titled, Reshuffle: Who Wins When AI Restacks the Knowledge Economy.

Greg and Sangeet discuss Sangeet’s latest book, as well as the work he co-authored, Platform Revolution: How Networked Markets Are Transforming the Economy and How to Make Them Work for You. Sangeet emphasizes how AI's transformative impacts extend beyond automating tasks to fundamentally altering industry structures, competitive advantages, and corporate strategies. The conversation also covers even broader implications of continued AI adoption like modularity in business, the shifting roles in professional services, and the creation of new economic control points. They provide a comprehensive look at how businesses can realign their strategies around AI as an engine driving innovation and competitive advantage for the future.

*unSILOed Podcast is produced by University FM.*

Episode Quotes:

AI as a tool vs. AI as an engine

22:28: The idea of using AI as a tool versus AI as an engine is that a tool is typically something that you bolt onto your existing workflows—pick a tool from the toolbox, and it helps you speed up a task, perform it faster, better, cheaper. But if you're really using an engine, you're constantly thinking about how to redesign your entire workflow and your entire organization, your business model, around the capabilities of the engine.

Bridging the gap in AI through storytelling and narrative

54:19: Storytelling and narrative, in general, are such important skills today because we are in an age where we are information-rich but attention-poor. And the way to harness that attention is to have compelling storytelling and narratives that bridge that gap.

How is the basis of competition shifting?

29:09: The impact of AI does not play out only at the level of tasks—tasks that are inside workflows. So workflows get transformed. Workflows are organized through organizational mechanisms, so new organizational systems will have to come into place. And organizations, essentially, compete in an ecosystem. They help firms compete in an ecosystem. And so the starting point would be to ask ourselves—with AI coming in and with other forces at play—how is the basis of competition shifting? What was the basis on which firms previously competed? What was our basis of differentiation and competition? And does that change? Do some of those assumptions no longer hold true? And on that basis, if we can lay out some clear hypotheses and heuristics on what’s changing in terms of the basis of competition, what does that mean in terms of the capabilities we need to have in place?...All of those need to come into question and need to be evaluated.

Show Links:

Recommended Resources:

• Walmart
• Shein
• Platform Economy
• Large Language Model
• TikTok
• Social Graph
• The Open Graph protocol
• Erik Brynjolfsson
• General Electric
• Perplexity AI
• OpenAI
• Best Buy
• Amazon Alexa

Guest Profile:

• Profile on Platform Thinking Labs
• Profile on LinkedIn
• Profile on Wikipedia
• Social Profile on X

Guest Work:

• Amazon Author Page
• Reshuffle: Who Wins When AI Restacks the Knowledge Economy
• The Fast Future Blur: Discover Transformative Interconnections Shaping the Future
• Platform Revolution: How Networked Markets Are Transforming the Economy and How to Make Them Work for You
• Platform Scale: How an emerging business model helps startups build large empires with minimum investment
• Medium
• Substack

Related unSILOed Episodes:

• Geoff Parker | Will Every Business Become a Platform Business?
• Marc Levinson | How the Container Changed the World

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