Many of the current AI discussions focus at the extremes. (A recent BBC podcast was titled “AI and humanity’s future: chilling or thrilling?”). This doesn’t help a start-up or mature firm to build a practical AI strategy. What does help? The timeless, repeatedly proven, growth strategy fundamentals that I write, teach and consult with.

Let me re-visit previous blogs to illustrate how timeless fundamentals are as relevant as ever; and totally applicable in the AI era.

I wrote about sustaining and disruptive innovation. Look at how Microsoft, Salesforce.com, Workday, ServiceNow etc. are adding AI capabilities to their software products. Making established products better is the very definition of sustaining innovation. Then go to an app store and look at the AI lawyer and doctor apps. They are vastly inferior to the human version. BUT they are much cheaper and more accessible. And they clearly have the potential to improve and increasingly offer services currently only available from a human. This is the very definition of how a disruptive innovation starts. So, established providers (of all types of products and services) must monitor and correctly respond to genuine threats from disruptive AI innovations.

But, why would these inferior AI innovations grow in use? I wrote elsewhere how good strategy has a clear value proposition that defines its target market and that market’s needs. If a market’s needs are not being met because established products are too expensive or inaccessible, then new market entrants will offer something cheaper and easier that does meet those needs. The PC, inkjet printer, digital camera, smartphone, cloud computing, and software-as-a-service products were all initially inferior to established options but were cheaper and easier so rapidly grew in use. Why would new AI products not follow this proven path?

How can firms defend themselves against disruption? I wrote elsewhere about rigorously managing a firm’s Three Horizons of Growth so that it fully exploits current and near-term opportunities while building its own disruptive innovations for long-term growth. Many companies successfully do this despite their core products coming under constant attack by disruptive innovation. Microsoft, Apple, Intel, and HP do this well and have endured for many decades. Digital, Sun, Commodore, Atari and Siebel didn’t; and don’t exist anymore. See my other blogs for more.

I hope these simple illustrations re-confirm the value of using timeless fundamentals when developing strategy in the AI era and beyond.