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McKinsey wonders how to sell AI apps with no measurable benefits

theregister.com

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Re: McKinsey wonders how to sell AI apps with no measurable benefits

#41

Post by walkabout »

jmuguy wrote: post #14

I hadn't ever tried Notion before but I sort of vaguely understood it was a nice way to make some documentation and wiki type content. I had a need for something like a table that I could filter that I would normally just do in Google Sheets. So I go check out Notion and their entire site is focused on AI. Look at what this agent can do, or that. I signed up and the entire signup flow is also focused on AI. Finally I…

Approximately 95% of my experience using "AI" so far is as something I accidentally activate then waste a few seconds figuring out how to make it stop. What little I've seen of other people's experiences with it on e.g. screen sharing calls mirrors my own. I saw someone the other day wrestling with Microsoft's AI stuff while editing a document and it was comically similar to Clippy trying to help but just fucking things up, except kinda worse because it was a lot less polite about it.

(And I develop "AI" tools at my day job right now...)

Re: McKinsey wonders how to sell AI apps with no measurable benefits

#42

Post by bluefirebrand »

richardw wrote: post #11

First AI came for the artists And I did not speak out Because I was not an artist

Speak for yourself. I've been shouting against AI from minute 1, in defense of artists and anyone else

It doesn't matter. People are convinced it's a miracle technology, so I'm just a backwards luddite resisting progress

Re: McKinsey wonders how to sell AI apps with no measurable benefits

#43

Post by A4ET8a8uTh0_v2 »

btbuildem wrote: post #22
_fat_santa wrote: post #9

Earlier quoted context omitted.

I find it all quite strange: - AI companies of course will try and sell you that you can reduce headcount with AI - CEO's will parrot this talking point without ever talking a closer look. - Everyone lower down on the org chart minus the engineers are wondering why the change hasn't started yet. - Meanwhile engineers are ripping their hair out cause they know that AI in it's current state will likely not replace any…

I am still of the conviction that "reducing employee head count" with AI should start at the top of the org chart. The current iterations of AI already talk like the C-suites, and deliver approximately same value. It would provide additional benefits, in that AIs refuse to do unethical things and generally reason acceptably well. The cost cutting would be immense! I am not kidding. In any large corps, the decision ma…

One could argue that they deliver a better value than meat leaders.

Re: McKinsey wonders how to sell AI apps with no measurable benefits

#45

Post by alberth »

McKinsey has pitched my company on projects where their compensation is entirely outcome-based — for example, if a project generates $20 million in incremental revenue, they would earn 10% of that amount.

I have to admit, the results they demonstrated — which we validated using our own data — were impressive.

The challenge, however, is that outcome-based contracts are hard for companies to manage, since they still need to plan and budget for potential costs upfront.

So even when you have measurable benefits - it's still not so easy either.

EDIT:

To clarify the issue — companies are used to budgeting for initiatives with fixed costs. But in an outcome-based contract, the cost is variable.

As a result, finance teams struggle to plan or allocate budgets because the final amount could range widely — for example, $200K, $2M, or even $20M — depending on the results achieved.

Additionally, you almost then need a partial FTE just to manage these contracts to ensure you don't overpay because the results are wrongly measured, etc.

None of these challenges are insurmountable, but it's also not easy for companies either.

Re: McKinsey wonders how to sell AI apps with no measurable benefits

#46

Post by walkabout »

croes wrote: post #31

Quite ironic that that comes from McKinsey because their service also rarely has a measurable benefit

Our ability to measure management productivity in general is basically nonexistent. It's an area of academic study and AFAIK the state-of-the-art remains not much better than [shrug emoji].

Remember that when they're wrecking your productivity by trying to twist your job into something they can measure in a spreadsheet.

Re: McKinsey wonders how to sell AI apps with no measurable benefits

#47

Post by skeeter2020 »

itake wrote: post #24
_fat_santa wrote: post #9

Earlier quoted context omitted.

I find it all quite strange: - AI companies of course will try and sell you that you can reduce headcount with AI - CEO's will parrot this talking point without ever talking a closer look. - Everyone lower down on the org chart minus the engineers are wondering why the change hasn't started yet. - Meanwhile engineers are ripping their hair out cause they know that AI in it's current state will likely not replace any…

The incentive structure for managers (and literally everyone up the chain) is to maximize headcount. More people you managed, the more power you have within the organization. No one wants to say on their resume, "I manage 5 people, but trust me, with AI, its like managing 20 people!" Managers also don't pay people's salaries. The Tech Tools budget is a different budget than People salaries. Also keep in mind, for any…

Maybe 40 years ago or in some cultures, but I've always focused on $ / person. If we have a smaller team that can generate $2M in ARR per developer that's far superior to $200K. The problem is once you have 20 people doing the job nobody thinks it's possible to do it with 10. You're right that "there is an unlimited number of things to do" and there's really obvious things that must be done and must not be done, but the majority IME are should or could be done, and in every org I've experienced it's a challenge to constrain the # of parallel initiatives, which is the necessary first step to reducing active headcount.

Re: McKinsey wonders how to sell AI apps with no measurable benefits

#48

Post by rybosworld »

Looking at this from a software dev perspective:

- The moment AI is actually good enough to replace us, it will also be incredibly easy to create new software/apps/whatever. There could/would be a billion solo dev SAAS companies eating the lunch of every traditional tech org.

- People (Executives) seem to underestimate just how much of the work is iterating and refining a product over a long time. Getting an LLM good enough to complete a Jira task is missing the point.

- IMO LLM's are also completely draining the motivation of workers. A lot of software devs are intrinsically motivated by solving the problem. If your role is being watered down to "prompt the chat bot and baby sit what comes out", the motivation disappears. This also absolutely destroys any of the creativity/discovery that comes out of solving the task hands-on.

Re: McKinsey wonders how to sell AI apps with no measurable benefits

#49

Post by QuantumNoodle »

We have to accept that sometimes technology that was envisioned to change the future one way, may be beneficial in other ways instead - and that's okay. We are very clearly still in the phase of "throw AI at everything and see where it is useful." For example, just yesterday I was sent a contract to sign via DigiSign. There was a "Summarize contract with AI" button. Having read the contract in full, I was curious how good the summary would be. The summary was very low fidelity and did not go into the weeds of the contract and I would be essentially signing the contract blind. Although AI is pretty good at summarizing key point of things like articles and conversations, this was a very poor use case imho. But hey, they tried it and hopefully see it is a waste. Nothing wrong with iterating we just have to converge on acceptable use cases.

Re: McKinsey wonders how to sell AI apps with no measurable benefits

#50

Post by walkabout »

add-sub-mul-div wrote: post #29

It has to be tough for them. They can't not be in on the grift, it's too big and they're too big. But the grift doesn't really benefit them.

They're probably salty that the only jobs of theirs they can figure out how to automate away with AI are the too-cheap-to-bother-automating Indian workers who author their PowerPoint decks.
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