AI and Strategy: Lessons from Real-World Cases

Name: AI and Strategy: Lessons from Real-World Cases (English version)
SKU: IN2053

Chan, Kim W.; Renee, Mauborgne; Mi, Ji

Product #:IN2053

Supplier:INSEAD

Discipline:Strategy

Details:Case (PDF) • 13 pages • 2025-05-12

Subjects:

Strategy Innovation Social media AI and machine learning Disruptive innovation Web-based technologies Technology and analytics

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Artificial intelligence (AI) has experienced explosive growth in recent years. With its applications increasingly integrated into production processes and commercial services, companies across industries are eager to adopt AI in their businesses. This has created an AI frenzy reminiscent of the internet boom of the late 1990s when many companies viewed the internet as a guaranteed path to business success, only to be proven wrong by reality. The ongoing fervor over AI also raises the following questions: Is AI truly a silver bullet? Can simply adopting AI provide a magic formula to create competitive advantages or even open new markets? Or are there deeper factors at play-factors beyond the technology itself-that determine whether AI adoption leads to meaningful outcomes? To answer these questions, this case examines several real-world examples of AI adoption-Senseye, Duolingo, Yunji Technology's hotel delivery robots, Quibi, Microsoft's Cortana, and Baidu's Apollo Go, presenting both successes and failures in an effort to uncover the factors that shaped their outcomes. In the meantime, the case also explores whether the widespread adoption of AI in business will inevitably disrupt existing markets and human jobs, as many believe.

Learning Objectives

1.To compare and contrast the strategic moves presented in the case and identify the commonalities behind their success or failure. 2.To understand the strategic logic of the successful moves and examine how AI fitted into the strategy and contributed to their success. 3.To analyse the failed strategic moves and understand how despite the use of advanced AI technology, the absence of a cohesive and aligned strategy led to poor outcomes. 4.To learn from both successes and failures in order to avoid the pitfalls of prioritizing technology over strategy by ensuring that technology serves as a supporting and enabling factor within a clearly guided strategy. 5.To distinguish between technology innovation and strategy: A sound strategy aligns value, profit, and people propositions. Technologies, whether existing or new, are tools that enable and advance strategic objectives, but they are not a substitute for strategy itself. When innovations are driven by technology alone, without being grounded in a sound and aligned strategy, they often fail to create and capture new markets, even if they earn praise or recognition in the technological domain. AI is no exception. 6.To explore pathways to creating new markets: Appreciate that even in a field often associated with disruption, like AI, it is possible to create blue oceans without disruption-i.e., to create new markets without displacing existing industries or businesses.