Friday, April 4, 2025
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Hi, it’s Chad. Every Friday, I serve as your AI guide to help you navigate a rapidly evolving landscape, discern signals from noise and transform cutting-edge insights into practical leadership wisdom. Here’s what you need to know:
1. Paper Trail: AI Research Decoded
AI as Teammate: How Generative AI Transforms Workplace Collaboration
A recent Harvard Business School study reveals that generative AI can function as an effective teammate in workplace collaboration, matching traditional team performance while breaking down expertise silos and creating positive emotional experiences.. Key takeaways include:
- Individuals using AI matched the performance of traditional human teams
- AI helps democratize expertise across functional boundaries
- Contrary to expectations, AI interaction created more positive emotional experiences than working alone
Read our full analysis of each of these research papers at AI for the C Suite
2. Sound Waves: Podcast Highlights
Our newest episode releases this coming Monday, April 7, 2025 and features my chat with Ben Johnson, founder of Freya Systems. Listen in as Ben and I discuss the importance of identifying a company’s competitive advantage before adopting AI how to take a hybrid approach that combines internal talent with external expertise and much more. Subscribe for free today on your listening platform of choice to ensure you never miss a beat.
New episodes release every two weeks.
3. AI Buzz: Fresh Bytes
Here are a few interesting articles that caught my eye this week.
- Amazon unveils Nova Act, an AI agent that can control a web browser
- Emergence AI’s new system automatically creates AI agents rapidly in realtime based on the work at hand
- OpenAI launches OpenAI Academy, a free AI learning platform for everyone
4. Algorithmic Musings. The AI Productivity Hangover: Why Your Investments Haven’t Paid Off (Yet)
Remember when we all thought the cloud would magically transform our businesses overnight? CFOs everywhere were popping antacids as they approved massive IT investments that seemed to deliver about as much immediate return as a lottery ticket. Fast forward a decade, and try running your business without it. We’re watching the same movie with AI, only this time with way cooler special effects and a bigger budget.
That Awkward J-Curve Phase Nobody Warned You About
If you’re feeling like your AI investments are burning cash without turning up the heat on productivity, I have some good news and bad news. The bad news? Your productivity metrics might remain flatter than a pancake made by a steamroller. The good news? You’re exactly where you should be.
MIT researchers Brynjolfsson, Rock, and Syverson called this phenomenon the “Productivity J-Curve.” Their insight? When game-changing technologies emerge, productivity takes a nosedive before it soars skyward. It’s like that awkward teenage phase – unavoidable, uncomfortable, but absolutely necessary for growth.
“But Chad,” you might be thinking, “my board is already muttering about AI being all sizzle and no steak.” Trust me, I get it.
Why You’re Feeling the Pain More Than the Fortune 500 Crowd
Let’s get real about the middle market for a minute. Unlike the corporate behemoths with innovation budgets bigger than some countries’ GDPs, you feel every dollar of investment in your bones.
When you implement that fancy new AI system, you’re not just buying software – you’re investing in:
- Training people who’d rather not be trained
- Redesigning processes that nobody remembered existed
- Integration work that makes dental surgery seem pleasant
- Cultural adaptation that feels like turning a battleship with a canoe paddle
These “intangible investments” won’t show up on your balance sheet, but they’ll absolutely show up in your stress levels and short-term productivity metrics.
The uncomfortable truth? This productivity dip isn’t a weekend fling – it might crash on your couch for 12-36 months. But organizations that bail out early miss the sweet, sweet upswing when those investments start delivering returns that make your accountant do a double-take.
Your Reality Check for the Next 1-3 Years
If you’ve dipped your organizational toe into serious AI implementation within the last year, brace yourself for these realities:
- Your productivity will get worse before it gets better. Expect workflow hiccups as teams adapt. This isn’t failure – it’s metamorphosis. (Though it might feel more like indigestion.)
- Your talent will need new tricks. Your teams will need reskilling, creating temporary capability gaps that feel about as comfortable as those jeans from college.
- Your processes will scream for attention. You’ll discover dozens of processes that need redesigning around AI capabilities. Some haven’t been updated since people used fax machines unironically.
- Your data will expose its dirty laundry. Many middle market organizations discover their data foundations are shakier than a Jenga tower in an earthquake.
How to Bust a Move While it Rains Disruption
- Measure differently. Create metrics that capture both current productivity and progress on those invisible investments. Track things like “percentage of processes analyzed for AI integration” alongside traditional KPIs. Your board might not do backflips of joy, but they’ll appreciate the method to your madness.
- Tell the J-Curve story. Educate stakeholders about what’s coming. Nobody likes surprises – unless they involve winning lottery tickets or birthday cake.
- Start small to win big. Choose tight, focused use cases where you can measure the complete J-Curve in miniature. Document the initial dip and recovery to build confidence. Think of it as your organizational proof-of-concept.
- Budget for the invisible stuff. Explicitly allocate resources for training, process redesign, and change management – not just the shiny technology. The invisible stuff is where the magic happens.
- Find friends who’ve been there. Middle market organizations often lack specialized AI talent. Consider fractional expertise or external partnerships to bridge capability gaps and avoid reinventing wheels that others have already perfected.
The Payoff (Yes, There Actually Is One)
Looking beyond the 3-year horizon, organizations that persist will discover the steep upward curve of the “J” – where AI transforms from a money pit into a money machine.
The real game-changer hits when AI moves from being that weird tool in the corner that nobody knows how to use to becoming woven into your organizational DNA. That’s when productivity compounds rather than incrementing.
Remember when businesses seriously debated whether having a website was worth the investment? (I’m dating myself again, aren’t I?) That’s where we are with AI. The question isn’t whether middle market organizations should invest, but how to smartly navigate the inevitable productivity dip to reach the promised land on the other side.
Those who understand this pattern won’t just survive the AI transition – they’ll use it to leapfrog competitors who bailed too early. The J-Curve isn’t a bug in the system; it’s the roadmap to transformation.
5. Elevate Your Leadership with AI for the C Suite
Subscribe today because your organization deserves the competitive edge that only cutting-edge AI insights can provide.
Don’t let your organization fall behind in the AI race. AI for the C Suite’s insights and tools are designed to keep you ahead of the curve.
Questions or need personalized guidance? Reply to this email – we’re here to help.
As we navigate this unprecedented fusion of human and machine intelligence, remember: the best leaders aren’t just adapting to change – they’re actively shaping it. Until next week, keep pushing boundaries.
Chad