Introduction: Leading in the AI era
Artificial intelligence (AI) is no longer a future consideration — it’s a revolution upending business in the here and now. At L.E.K. Consulting, we understand that success with AI isn’t just a matter of adoption. Nor does it involve chasing the latest model. It’s about building the right capabilities to drive tangible business impact.
On the flip side, an AI implementation that falls short can destroy value. That means AI is both unavoidable and too risky to get wrong.
Our AI Delta concept makes clear that productivity gains alone will not determine the winners. The real advantage lies in how well companies leverage their proprietary data, refine operational processes and strengthen their organizational agility. The emergence of multiple new models in the first month of 2025 is a signal — waiting for the “best model” is not a strategy. Now is the time to act.
This pace of change reinforces our conviction: A strategically aligned, capability-driven approach is the key to unlocking lasting AI value. As we continue to track these rapid advancements, our focus remains on equipping leaders with the strategic insights and execution roadmaps needed to stay ahead. In an era defined by speed and disruption, those who move decisively but with clarity will set the standard for the future.
Signed: Alan Lewis, Darren Perry, Philip Meier, Chuck Reynolds, Stuart Robertson, Rob Wild March 2025
Most businesses today set growth trajectories that primarily rely on two things. One is building and executing on strategies for winning in their markets, and the other is finding innovations to create value. But the old ways of delivering on strategy and innovation aren’t enough to meet investor expectations going forward. The reason is that advancements in artificial intelligence (AI) have raised the bar on what’s possible.
And the impact of failure is greater as well. AI strategies require targeted investment and careful implementation to drive improvement. If companies swing and miss, fail to swing enough or swing too much — or don’t swing at all — value destruction could be significant.
The gap between these two scenarios — growth from successful AI adoption and erosion from poor strategy or execution — is something L.E.K. calls the AI Delta. The Al Delta is a value blind spot, by which we mean it’s a potentially existential unknown in a company’s prospects. This constitutes a strategic challenge with transformative implications for virtually all industry sectors, business functions and regions. In this Executive Insights, we’ll explore what the AI Delta entails and how enterprises can maneuver through it.
The accelerative potential of AI
The group of technologies known as AI promises to revolutionize business operations in several ways. It unlocks access to a vast amount of data. It equips computers to make humanlike decisions. And it allows feats of computation that can appear revelatory (or in the example of large language models, almost magical).
What’s more, AI models can operate in real time to produce decisions — and the decisions get better as new data comes in. These “intelligence” attributes present opportunities across all aspects of a business. By incorporating AI, companies can accelerate:
- Revenue growth by automating sales processes, enhancing customer engagement with AI-driven insights and unlocking new revenue streams
- Productivity gains by streamlining operational workflows and reducing manual labor through intelligent automation
- Cost reduction by optimizing resource allocation and reducing unnecessary expenses
However, these same investments are vulnerable to error and waste. Our research indicates that companies that invest in AI transformation can expect, on average, a valuation gain of 19% if they succeed and a loss of 9% if they fail (or do nothing at all). Figure 1 shows the asymmetry of these effects on a company’s growth trajectory.
