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Until recently, AI played mainly a supportive role in our lives, such as personalized advertisements, listening suggestions on Spotify, or virtual assistants like Siri and Alexa. The arrival of chatbot ChatGPT has drastically changed business opportunities. GenAI will bring a revolution, and the question is how we can best utilize this tool, which seems so frighteningly intelligent, for growing a sustainable business. EY, in collaboration with the University of Amsterdam (UvA), has explored how GenAI can add value to the business world. Driven by questions from colleagues, organizations, and customers about possible GenAI applications, we investigated the effectiveness and limitations of GenAI.
Ways in which GenAI can increase productivity or add value:
In the current GenAI era, the challenge is how we can teach and promote skills such as creativity and originality of thought.
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Read moreBecause in the future, more simple tasks will be outsourced to GenAI, the danger exists that the gap between rich and poor will grow even larger. However, GenAI can also offer less privileged communities and developing countries a chance to make progress. To realize this, countries must collaborate and agree on how to utilize and distribute the productivity benefits of GenAI in a fair manner. The challenge lies in using these benefits not to increase inequalities but to promote a more sustainable evolution of the global business world and economy.
If countries and companies can agree on how to account for and price in the negative external costs of their actions brought by their products and services, then the recovered funds can be used to compensate for negative impact. Catalyzed by the shift towards stakeholder capitalism, where a broader range of stakeholders is treated as shareholders and involved in both the benefits and responsibilities of business operations, this approach, utilizes the benefits arising from GenAI, and could lead to a more fair and sustainable business world.
The productivity gains from GenAI are a credit that we can invest. The choices we make can promote a more fair and sustainable future by leveraging GenAI.
Although GenAI is not a direct solution for the transition to capitalism 2.0 or a new generation economy, it does give us productivity gains, which we can utilize as credit to make improvements. The challenge lies in deciding how to use this credit. We can choose to continue to accelerate inequalities in wealth, or we can take a step back and consider the broader needs of society, the planet, and the business world in a more holistic manner. This approach leverages the real productivity gains from GenAI to create a more just and sustainable future.
In summary, GenAI is not a remedy for every problem. It works well in some scenarios and not in others. Human creativity and originality of thought are vital and should be nurtured and developed. The productivity gains from GenAI must be wisely used to prevent the wealth gap from growing wider and to promote a more sustainable business world. GenAI can be seen as giving us credit in the form of productivity gains. This credit represents extra resources that we can invest effectively to promote sustainability and reduce inequality. We are ready and excited to participate in discussions at all levels. Whether it's providing a perspective on policy-making discussions or helping to develop a business strategy to use GenAI sustainably.
The research revealed that GenAI has the potential to significantly boost the efficiency of employees, teams and organizations at large. However, these efficiency gains come at a certain cost, for example the convergence of knowledge across organizations and the crowding effect on originality and creativity.
In short-term, the adoption of GenAi will certainly pay off. The resulting productivity gains will translate into more efficient processes and higher profit margins. At the same time though, firms should invest in hiring and retaining the most creative employees that can create new, original solutions to emerging problems. As sources of innovative, original, and - at best - proprietary knowledge, they will be the most critical asset of organizations in the long run.
Looking to the future, our responsibility at the business school is to develop future leaders that will make a difference in business and society. With respect to Generative AI, students will be trained to use the available tools and applications in the most efficient and responsible way to contribute to the bottom line of future businesses. More importantly though, we want them to think critically and independently, to challenge conventions and entrenched practices, and to develop creative solutions that not only create value for the business itself, but society at large.
By Sebastian Kortmann – UvA
Would you like to know more about our research study in collaboration with UvA?
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In collaboration with the University of Amsterdam (UvA), EY investigated how GenAI can add value to business. Driven by questions from colleagues, organisations and clients about possible GenAI applications, we investigated the effectiveness and limitations of GenAI.
