Some thoughts on the report “The economic potential of generative AI” by McKinsey:
1. Generative AI is the new electricity. It is a general purpose technology that will have a significant impact across all industries sectors.
2. Companies looking to adopt generative AI should consider the following 4 business functions first — customer operations, marketing and sales, software engineering, and R&D. Three-quarters of the value generated by generative AI could come from these 4 areas alone.
3. AI and automation have the potential to automate up to 60-70% of today’s work activities. The key is to combine the natural language capabilities of generative AI with the technical capabilities of technologies like RPA to achieve straight-through automation.
4. Disruption to the nature of work is likely to accelerate given that half of today’s work activities is likely to be automated by 2045. Executives need to be mindful of the “boiling frog” syndrome — while the timeline seems far out, companies that fail to adopt and adapt now risk becoming obsolete in the future.
5. While traditional automation tends to impact blue-collar jobs, generative AI is likely to affect highly-paid knowledge workers more. Regardless, the challenge lies in supporting the reskilling and upskilling of the disrupted workforce to ensure sustainability and equity.
