There has been a lot of innovation since AI became mainstream with the arrival of ChatGPT. However, the rise of AI has not come without inconvenient side effects. One such side effect is companies selling false promises and vaporware in the name of AI – a trend called “AI washing.”
AI washing can be explained by looking at its predecessor, ‘greenwashing’. This is when an organization provides misleading information about whether its products, services, supply chain or practices are ethical and environmentally responsible. Greenwashing has become a well-known red flag that both consumers and businesses should pay attention to. AI washing, on the other hand, is much newer and therefore currently more difficult to recognize. But there are a few things buyers can keep in mind during their AI investment journey.
The AI mislabeling trap
The term AI covers a pretty broad spectrum, which is part of the reason why it’s so easy to make over-promises. Generative AI, for example, uses machine learning to generate content based on prompts, all in real time. For example, a generative AI product that can summarize complex conversations between multiple people requires a significant investment in large language models, a team of AI experts to train those models, and the ability to deploy them at scale.
By comparison, what many companies are currently selling is limited AI, like a phone’s virtual assistant, which is designed to perform very specific and limited tasks. While it can improve efficiency, it doesn’t have nearly as much power as the kind of generative AI that powers popular applications like ChatGPT. The reality is that few companies in the world are actually investing in generative AI. But many companies will charge high prices for products that claim to be built on proprietary AI technology, when in fact they are based on third-party AI technology or are still in the conceptual stages. Companies that own their own AI stack have greater control over data, privacy, security, performance and costs – currently major talking points by organizations and regulators.
Co-founder and Chief Technology Officer at Dialpad.
Ask the right questions
There are several ways companies can ensure that what they buy is genuine, provides value and fits the business well.
Is it available now? The term “vaporware” refers to software that is advertised but not yet generally available. This can sometimes be difficult to identify. Asking a direct question about product availability will confirm whether you are purchasing a real working product, or just queuing up for something still in development.
– Is there an additional fee? It is common for companies to advertise the availability of new AI features but not mention the additional cost per seat or per event. AI is expensive to use and most companies use a third party to do this, which incurs additional costs. Companies looking for new AI tools should focus on working with providers who are building their own AI technology to get more bang for their buck, including customizable options and greater data privacy.
– Can I get proof of ROI? AI products are expensive, so looking for an ROI report or calculator is critical. Especially when numbers can be inflated when combined with information about the main product, it becomes difficult to understand the value of the AI versus the ROI on the product itself.
– Can I schedule a live demo? When it comes to investing in AI capabilities, a presentation won’t cut it. Buyers should not settle for anything less than a live product demonstration before making any commitment; this should be considered a deal breaker.
Find the best AI for your business
Once it has been determined that a product actually does what it says on the tin, buyers still need to choose the right kind of AI to support their business goals. Fortunately, this is quite simple if you go back to the core principles.
First, they need to ask the question: Is this a good product regardless of AI? In many cases, people will buy traditional software enhanced by AI, rather than purchasing an AI-native product. It’s important to take a step back and think about why a product is being purchased in the first place. For example, if you buy a CRM and the quality of the core functionalities is lacking, but the AI seems good, it’s probably not worth it because the basics aren’t there. The AI doesn’t necessarily mean the CRM is better.
The second question to ask is: do I believe this supplier will continue to innovate? Investing in an AI product is also a vote to future-proof a company. So it’s not just about what the product does now, but also about how it will develop. For example, will upgrades be made available without the buyer having to migrate their data? Choosing a vendor with a proven track record in AI is like applying a safety net to a tech stack, and therefore to the entire company.
AI has the potential to improve efficiency, ROI and much more for any company that invests. However, it is critical that companies educate themselves and take steps to protect themselves from AI washing. With the right AI, companies can work faster, require fewer resources, and harness the collective brainpower of their workforce for innovative tasks. When deployed properly, AI can be truly transformative for any organization.
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