Lesson 4: Enterprise's Slow Path from Automation to Disruption
The “Absorb” phase of enterprise adoption of new technologies and the reality of deployment timelines.
Enterprises are slow to adapt to change and new technologies. They are risk-averse, inefficient, and overcrowded with bureaucracy. In this lesson, we break down the three-part process enterprises take to adopt and deploy new technology,
Find all the lessons in the Economics of AI here and the previous lesson below.
Lesson 3: The Competitive Landscape of Generative AI
Lesson 3 breaks down the commoditization of AI models, the lack of competitive advantages between AI companies, low user engagement, and the strategies companies are using to develop long-term, durable advantages and moats.
Enterprise Adoption: The Slow Path from Automation to Disruption
Enterprises deploy transformative new technologies in a predictable, three-stage pattern: Absorb, Innovate, Disrupt
Historically, enterprises deploy transformative new technologies in a predictable, three-stage pattern: Absorb, Innovate, Disrupt. The initial “Absorb” phase involves automating obvious, existing tasks. The “Innovate” phase sees the creation of entirely new products and services. Finally, the “Disrupt” phase redefines entire markets. Currently, the vast majority of enterprise activity in generative AI is concentrated in the first phase.
The “Absorb” Phase: Automating the Obvious
Enterprises are primarily applying generative AI to absorb it into existing workflows where the return on investment is clear and immediate. The most common use cases are:
Coding: Automating software development and testing.
Marketing: Generating ad copy, images, and campaign ideas.
Customer Support: Powering chatbots and summarizing customer interactions. This phase is being heavily driven by consultants, with firms like Accenture reporting over $1.5 billion in new generative AI bookings per quarter as they help large companies identify and implement these initial automation opportunities.
The Reality of Deployment Timelines
Major technology deployments take time.
While the hype cycle is moving at lightning speed, the reality of enterprise technology adoption is far slower and more methodical. Several data points provide critical context:
