The Intelligent Era and the Value of Time

The more sophisticated technology becomes, the more value that people place on their time. Think about that for second. It’s true. With each new generation of tools, people have changed the way they live their lives. Activities—like going to the bank—that were once routines become a hassle.

Most strategists think about the relationship between new technologies and time in very simplistic terms. New tools are ‘conveniences.’ And that’s it. They don’t give much more thought to the matter—until their business model is threatened. And, then they start looking at new tools—PayPal, from yesteryear—as a threat. They do not understand the actual relationship between technology, time, and value creation.

As we enter into the intelligent era, strategists need to step back and see what is really going on. People are embracing artificial intelligence for reasons that go far beyond conveniences. More to the point, the more people embrace artificial intelligence, the more they will draw distinctions between solutions that are smart and solutions that are genius. One major distinction between smart solutions and genius solutions is how people think about the time they spend using the tools.

In a Havard Business Review article that my colleague Joe Pine and I wrote on the subject, we noted that ‘as digital tools proliferate and their capabilities multiply, one thing remains constant: what people don’t have more of it time.’ What we could have added to the article—had we had more space—is that the more intelligent a solution becomes, the greater the expectations that people have for how they spend their time with such tools. In fact, they expect genius solutions to give them superpowers.

For eight years, my colleagues and I have been asking people to imagine how technology will change their lives once gen AI become commonplace. Well before ChatGPT opened people’s eyes to the possibilities, our team was actively thinking through the implications of gen AI. Here are some of the things we know with a great amount of certainty.

1. Companies will still need customers who want to spend time with them.

2. People will spend their time in ‘modes.’

3. The intelligence your solution promises, the people will expect you to understand their context or situation

4. Smart solutions help people get multiple jobs done, but genius solutions create superpowers

Companies Need Customers Who Want to Spend Time with Them

Let’s cut right to the chase. If a person can use an AI to do what your company has been doing for them, then it’s game over for your business model. We watched it with dotcoms and apps, already. AI is the first technology that seems to be just as available to regular people as it is to solution providers.

Think about that. If your business strategy is the exploit AI to reduce human to human interaction, to simplify innovation, and to flood your channels with ‘smart’ capabilities, you are actually escorting your business toward bankruptcy.

But if your purpose in using AI is to get people to want to spend more time with your company and your people, well then you are likely to be successful. I’m going to use banking as a history lesson to explain what is going to happen with AI.

When the first ATMs came out, senior banking executives were giddy. The ATM did three things at once: it automated the distribution of cash; it eliminated the need for tellers to be involved in some cash transactions; and, there was a built in revenue stream of fees for ‘banking conveniences.’ What was there not to love! Banks could charge for a service that cost them less to execute than they previously offered. Banks began to look at the time employees spent with customers as a cost center. They rejoiced in providing ATM conveniences to customers, because, they argued, people should be able to combine shopping activities with ATM withdrawals. It saves people time.

And in some ways they were right. People did want access to their cash whenever and where ever they wanted to be. Afterall, going to a bank to get money is time wasted. (Remember, that argument only exists once the new technology—ATM—is widely adopted. Before ATMs it was a routine.) But what banks didn’t do was think through was what additional needs people would have that would create more value.

Let me say that a different way: when you automate some part of your business, you don’t actually create more financial value or even time value for your customers. ATMs made banking less valuable to customers—not more.

AI will make most business models less valuable to customers, not more. Automation is easily replicated, sets new expectations, changes behaviors so that customers actually spend less time engaging with the company—and even less time thinking about the thing that’s been automated. That, my friends, is what customers think the word ‘convenience’ actually means.

The user of the ATM couldn’t go out and just create his or her own personal way of distributing cash. But the user of gen AI very much can deploy the tool to do the exact same things that your business is doing with AI. And that makes AI even more disruptive to your business model.

Yesterday, Amazon CEO, Andy Jassy, told his employees that AI will lead to fewer people doing more work. Not only is that demoralizing for the 1.5 million people who work Amazon, it also means that Amazon will be automating many activities. Walmart will also automate those activities. So will every other retailer. The result will be that Amazon’s bottom line will decrease somewhat but its top line will decrease much more.

Instead, Andy Jassy should be realigning his workforce to find ways to make new solutions that people want to spend time doing. This is the company that built Prime Video, which has nothing to do with shopping, but has everything to do with time value. Amazon should be planning for certain types of work to be replaced by new types of work in new businesses that people can do with assistance from AI.

Because it doesn’t matter how big your company is, the more what you do is automated, the less your customers will pay for your business model. They will pay for time well spent. They won’t pay for time well saved, at least not for very long.