Three Types of AI Value Creation

Most companies investing in AI are focusing on the wrong opportunities. Not because the technology isn’t useful. But because they’re solving the wrong type of problem.

In practice, they fall into three very different categories:

1. Automation: Replacing manual work
   • workflow automation
   • document processing
   • repetitive operational tasks
   • 👉 Improves efficiency
2. Augmentation: Improving how people make decisions
   
   • copilots
   • recommendations
   • decision-support tools
   • 👉 Improves effectiveness
3. Transformation & AI-Enabled Products: Creating new capabilities
   
   • AI-assisted customer support workflows
   • sales intelligence systems that guide next actions
   • learning platforms that adapt content to the user
   • 👉 Creates new value

All three matter. But they require very different:

• expectations for ROI
• rganizational alignment
• execution approaches

One pattern I see often: Teams start with automation — because it’s the most accessible — and assume that’s the full AI opportunity.

In reality, the highest-impact opportunities are often in the third category. Not just improving how the business runs… But changing how the business operates — or what it can become.

Before starting your next initiative, ask: Are we trying to improve efficiency, improve decisions, or fundamentally transform how this works?

That distinction tends to shape everything that follows.