Lessons from Asia: Rewire for AI

While many of the headlines related to gen AI in 2024 have been about advances in the technology itself and the massive investments big players are making, Asian companies—particularly those in China—have been pointing the way to value by combining gen AI with analytical AI. Companies aiming to show strong ROI or productivity improvements for their AI spending may look to their Chinese counterparts as they think ahead to 2025. A close look at what leading Chinese companies are doing doesn’t reveal any magical solution. Instead, they are benefiting from a range of disciplined investments in building strong enabling capabilities and foundations. These include, for example, data infrastructure and management systems that can support advanced modeling; modular architecture to support a complete range of digital interactions with customers, which in turn generates more data that can be analyzed to drive a range of AI use cases; and automated workflow capabilities, such as speech to text, that support gen AI–driven process improvements. Within a particular business unit at one company, for example, smart speech robots provide over 80 percent of customer services. While many of these advances are happening in Asia, the lessons are universal, and tech leaders in 2025 should be clear about how to apply them. At a fundamental level, this is about rewiring the business to build out foundational capabilities, which is a continuous process. There is a lot tied up in that level of initiative (we wrote a whole book about it), but there are three important and practical steps to take in 2025. First is simply to focus on where the value is. CIOs should build out foundational capabilities where the business value is big enough to be worth the effort. Focusing on a customer journey alone is often not a big enough goal on its own, unless two things are true: the underlying data foundations, workflows, digitization, and AI modeling are tackled as well; and those capabilities can be applied to enough use cases to make a difference. This means thinking about scale from the beginning. Second, focus on the complete digitization of every interaction with a customer or user during any given journey. The benefits of data, AI, gen AI, and other technologies increase as processes, interactions, and workflows become digital. Break apart every step of a customer journey and ask yourself how each one can be digitized. And third, put in place KPIs that support (and enforce) the needed changes. This is an age-old best practice that often just doesn’t happen. Setting a KPI that tracks the percentage of customer interactions handled automatically through AI, for example, is the only way to understand if teams are implementing that initiative. Without it, they won’t.