WHY INTERNAL AI DEPARTMENTS ARE BEYOND COMMON LOGIC

 
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AI models are more and more quickly taking their positions in companies decision making and development. They already represent key competitive advantage in some sectors while the number of those sectors is rising daily.


Within this development (as in any development) we can notice some activities beyond common logic. One of those is establishment of AI departments (or BI combined with AI) within some large companies. The reason is not easy to understand. But let us see where the logic is missing:

 

  1. Same or similar algorithms are developed in parallel on several places. The logic would direct to synergic thinking.
  2. The quality of the AI product cannot be better of the one made by a company which is doing that for market. In last case the product is proven several times and the producers have several times larger experience.
  3. The timeline of the project cannot be shorter as the one of a professional AI provider. First reason is readiness of the models. Second reason is even more interesting – the internal team won’t risk of losing the job, therefore the project must be a never ending one.
  4. Don’t ignore the price! An AI/BI department’s annual cost covers several iterations of professional provided solutions.
  5. Velocity of development. It is breathtaking, how fast AI is developing. You have to be on the market to keep the pace. Internal department – you get a seriously subpar product.

 

So where is the logic?

 

One should not be fortune-teller to predict that those companies are going to lose a lot of time, money and earn competitive retard. There is a simple evidence. Those who’s career counts about 25 - 30 years might remember the same situation with ERP (IS or IT that time). Companies were programming their magic Information systems by themselves. Never ending expensive projects were soon beaten by much cheaper and efficient solutions provided by experts. They even brought some fresh experience.

 

There is no particular difference between the former ERP and present AI magic. What could be the reason for the present situation? Maybe fear of firing people or the more common fear of changes? It is old saying: History is repeating itself. Maybe younger managers do not know what happened or managers of any age don’t believe they can learn from history? A survey of some management consulting company would be welcome.