The AI Native Enterprise: Principles for Success in the Age of Artificial Intelligence
In today's rapidly evolving business landscape, the integration of Artificial Intelligence (AI) is no longer a luxury—it's a necessity. But what does it truly mean to be an AI Native enterprise, and how can this approach deliver tangible value to your organisation? As a CXO, understanding these principles is crucial for steering your company towards a future where AI is not just an add-on, but a fundamental part of your business DNA.
What Does It Mean to Be AI Native?
AI Native refers to organisations that are designed and built from the ground up with artificial intelligence as a core component. These entities integrate AI deeply into their fundamental processes, decision-making, and user experiences. But being AI Native is more than just implementing AI tools—it's about reimagining your entire business through the lens of AI capabilities. Much like the Cloud Native movement of ~6-7 years ago and 12 Factor Applications, we believe there are 12 key principles that define an AI Native Business. Let’s break these down.
The 12 Principles of an AI Native Business
Innovation Focus and Customer Obsession - AI Native businesses are relentlessly focused on innovation, always asking how AI can be leveraged to solve customer problems in new and better ways. They use AI to gain deeper insights into customer needs and behaviours, enabling them to deliver hyper personalised experiences at scale.
Bold Technology Choices and Cloud Investment - AI Native enterprises make strategic technology decisions that support AI integration. This often involves significant investment in cloud infrastructure to ensure scalability, flexibility, and access to cutting-edge AI services.
Highly Skilled Multidisciplinary Teams - Success in the AI era requires diverse teams that blend technical expertise with domain knowledge. AI Native businesses prioritise hiring and developing talent across data science, engineering, and business domains. They finally recognise what the DevOps movement was testifying for and drive cross functional, co-located teams. Business and technology in unity, together.
AI Embedded in Business Processes and Customer Experiences - AI is not siloed in IT departments but is integrated across all business functions. From supply chain optimisation to customer service, AI enhances decision-making and automates routine tasks.
Strong Ethical Guidelines and Boundaries - AI Native organisations recognise the power and potential risks of AI. They establish clear ethical guidelines and are transparent about where and how AI is used, building trust with customers, stakeholders, regulators and government where needed.
Strong Data Culture and Automated Governance - Data is the lifeblood of AI. AI Native businesses foster a culture where data is valued, shared, and leveraged across the organisation. They implement robust, automated data governance to ensure quality and compliance. Metadata management is treated as a first class citizen and everybody is educated and versed in the economics of high quality data.
AI-Driven Architecture - The entire technology stack is designed with AI in mind. This means building systems that can easily ingest, process, and learn from vast amounts of data in near real-time.
Data-Centric Approach - AI Native businesses prioritise data collection, processing, and utilisation. They view data as a strategic asset and invest heavily in data infrastructure and management.
Continuous Learning and Adaptation - AI systems in these organisations are not static. They evolve and improve over time based on new data and interactions, ensuring the business stays ahead of market changes.
Personalisation at Scale - AI enables these businesses to provide highly customised experiences for each user, without the limitations of human-driven customisation.
Predictive and Prescriptive Capabilities - AI Native businesses move beyond reactive systems to those that can anticipate needs and provide actionable insights, allowing for proactive decision-making.
Seamless AI Integration - AI functionalities are woven into the user experience in a natural, often invisible way, enhancing rather than complicating the customer journey.
The Value of Being AI Native
AI Native businesses are positioned to deliver significant value across three key areas:
Making Money: By leveraging AI for personalisation, product recommendations, and predictive analytics, AI Native businesses can increase sales, improve customer retention, and identify new revenue streams.
Saving Money: AI-driven process optimisation, automation of routine tasks, and predictive maintenance can significantly reduce operational costs. As seen in the Walmart example, AI can dramatically increase efficiency, allowing companies to do more with less.
Reducing Risk: AI can enhance risk management through advanced fraud detection, improved compliance monitoring, and better forecasting of market trends and potential disruptions.
Real-World Examples
Don’t believe me? Various organisations are stealing a march on their industry competitors and are seeing AI capabilities that will power their businesses for the next Century and beyond. Here are a few examples.
JPMorgan Chase: By rolling out a Generative AI "Research Analyst" to 50,000 users and training all users in prompt engineering, JPMorgan is democratising AI across its workforce, potentially reimagining entire business workflows.
Klarna: This fintech company has leveraged AI to increase efficiency, resulting in a 73% increase in average revenue per employee over a 12-month period.
Amazon: Using AI for Java upgrades has saved Amazon from having to pay for 4,500 developer-years of work, equating to a $200 million annualised saving.
Walmart: By using AI to improve its product catalogue data quality, Walmart has significantly enhanced its customer experience while dramatically reducing the resources required for this task.
The Path Forward
Becoming AI Native is not an overnight transformation—it's a journey that requires vision, commitment, and often, significant change. As enterprise technology leaders, our collective role is to champion this transition, fostering a culture that embraces AI and ensuring that your organisation is built to thrive in an AI-driven future.
By adhering to these principles and fully embracing the potential of AI, your organisation can not only survive but lead in the age of artificial intelligence.
The future belongs to the AI Natives—is your organisation ready to evolve?
