The Generative AI Landscape

The latest Goldman Sachs article titled “Gen AI: too much spend, too little benefit?” sums up what many early technology adopters already know—extracting value from new technologies is hard. We saw this with the earliest internet adopters back in the late 90s, we saw this with the cloud computing revolution, the big data wave, and a dozen other technology trends in between. Now we’re seeing it with Generative AI. Yet there is no shortage of technology and product providers willing to promise the moon, especially in the early phases of an adoption cycle when knowledge is at its lowest. As Goldman Sachs has already surmised, these promises often don’t translate into ROI and dollars. 

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Real-World Challenges

One of the most common stories we hear from our clients is that their early AI explorations just aren’t panning out. One executive from a major enterprise client told us “We had high hopes for the native AI offerings from [a major CX ticketing platform] and forecasted around a 30% productivity increase going into the project. As we went through implementation it became clear that 30% was more like 15%, and now we’re not sure we’ll even get a double-digit improvement”. Of course, by then, the contracts have been signed, the bills paid, and the salesperson is nowhere to be found.

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So how does 30% become 15% and turn into 5%? And why do companies keep falling for it? 

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The Path to ROI

First of all, it’s important to clarify that these technologies will eventually deliver value. Just as the internet, cloud computing, and big data have proven their transformative powers in the intervening years, so will generative AI. It’s not wrong to want to invest, but it’s important to do it in the right way. Adopting new technology isn’t as simple as slapping it onto existing products and processes—there needs to be a fundamental rethink of how the technology enables new products and processes. 

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This isn’t comforting for most buyers—especially when there’s a fear of being left behind as competitors are investing at a breakneck pace. In a recent survey, 83% of companies state that using generative AI in their business is a major priority, and that’s just in the earliest days of gen AI adoption. This creates a tempting environment for technology and service providers to “ride the AI wave” and pressure their salespeople to make good on ever-growing quarterly quotas against products that are rushed to market and often can’t deliver against claims.

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In new technology environments, it’s crucial to put the responsibility for delivering value on the provider, not the buyer.

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One of the earliest challenges we had to overcome with Zanko was convincing clients to take our word that we could deliver the value we were promising. After a lot of iteration on different messaging and marketing strategies, we realized that we weren’t as good at selling a dream as our bigger competitors and decided we’d radically rethink our strategy—we would sell results instead.

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Design Partnerships: A Risk-Free Approach

Enter the Spring Labs Design Partnership Program. The idea behind the design partnership program is simple—if it doesn’t work, you don’t pay. As a result, we only take on projects where we have a high degree of confidence since we take all of the upfront risks in customization, implementation, and training costs. The average cost of delivering on a design partnership is well north of $100,000 before the client has spent a penny. Since the beginning of the program, we’ve only taken on around 30% of interested clients.

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On the one hand, this goes against the first rule of startups—never do anything for free. But on the other hand, we know more about our product capabilities than our buyers. We’ve seen more data and implementations, and we have a better sense of when it will work and what kinds of ROI it can deliver. The design partnership program was a simple and elegant solution for reducing information asymmetry on a high-quality product in a sea of questionable competitors. It’s a way of putting our money where our mouth is.

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Conclusion

Be wary of baseless claims and big upfront investments. Contact us today to learn more about our risk-free design partnership program.