Why AI Adoption Isn't Driving Productivity | Lazy Leverage #92
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Why AI Adoption Isn't Driving Productivity | Lazy Leverage #92
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Have you ever bought new tech, spent months implementing it, and seen zero throughput improvement? You’re not alone. It's an age-old problem plaguing small businesses.
Whether it's switching property management software or adopting ChatGPT company-wide, the result is the same. Lots of disruption yet no meaningful change.
The culprit isn't the technology itself. It's how we deploy it. In the audiobook 'Beyond the goal', Dr. Eliyahu Goldratt identified four critical steps for technology rollout in the Theory of Constraints work, and most businesses overlook at least a couple of them.
Step one is easy: identify what the technology can do (it's on the vendor's website). Step two is to ask, “Does this technology diminish your actual constraint?”.
Step three is to identify old accommodations. These are the rules your team created to cope with historic limitations.
Step four is to identify new rules.
Technology becomes a burden if you keep operating under old policies. Companies spend millions on ERPs without updating the implicit rules designed around previous limitations, then wonder why productivity stays flat.
Jon extends this to the AI hype cycle, in which venture-backed firms are buying pool cleaning companies claiming AI will revolutionize operations. But until someone explains how AI solves managing $21/hour workers in wealthy homeowners' houses, it's just expensive posturing.
The constraint isn't following up on leads but managing low-cost local labor. Writing emails faster doesn't address that!
KEY TOPICS: (10:26) What to Do When A Lot of Work Nets Zero Results (16:01) Step One: Identify the Power (18:28) Step Two: How Does It Diminish the Constraint? (21:10) Missing the Step Between Goals and Rocks (28:17) Step Three: Identify Old Accommodations (33:45) Step Four: Identify New Rules (37:00) Why ChatGPT Adoption Isn't Driving Revenue Growth (46:45) You Must Be Intimately Familiar With Both Your Constraint and the Available Tools
Stay connected for more insights and strategies by following: Jon: @MatznerJon on X and at lazyleverage.beehiiv.com Peter: @pslohmann on X and at peterlohmann.com