Less than 5% of companies are using AI to reinvent how they do business, but the competitive intensity surrounding the technology suggests that a wait-and-see strategy could be a costly mistake. To get a share of the global profit pool of $1 trillion that AI will produce by 2030, the McKinsey Global Institute says companies should begin adopting it at scale within the next three years.

When pundits talk about the impact that artificial intelligence will have on the labor market, the outlook is usually bleak, with the loss of many jobs to machines as the dominant theme. But that’s just part of the story — a probable outcome for companies that use AI only to increase efficiency. As it turns out, companies using AI to also drive innovation are more likely to increase headcount than reduce it.

Virtually all human achievements have been made by groups of people, not lone individuals. As we incorporate smart technologies further into traditionally human processes, an even more powerful form of collaboration is emerging.

Businesses should use AI technology as a tool to improve customer service and processes, not just to imitate humans.

AI can do much more than augment human performance in the workplace.

Using industry examples and findings from the McKinsey Global Institute’s research, presenter Jacques Bughin describes the current state of AI and offers strategies for maximizing its potential.

Companies are adopting artificial intelligence at an accelerated pace — and learning that developing and deploying AI is not like implementing a standard software program. Before diving into AI systems, companies should consider three principles that can greatly improve the chances for a successful outcome. First, they need to recognize that humans and machines are in this together. Second, they need to teach the AI systems with a lot of data. And third, they need to continually test what the systems have learned.

As companies rely more and more on AI-driven chatbots to communicate with customers, they need to consider ways to make computers’ communication and understanding better and more natural.

Digital technologies will increase the high levels of ambiguity that executives must navigate. Aspiring leaders may respond by ignoring the challenge, which isn’t sustainable. A better response is to harbor healthy skepticism of the digital technologies they champion, develop values that will lead to better decisions, and work to institutionalize those values at the organizational level.

For more than a century, economies of scale made the corporation an ideal engine of business. But now, a flurry of important new technologies, accelerated by artificial intelligence (AI), is turning economies of scale inside out. Business in the century ahead will be driven by economies of unscale, in which the traditional competitive advantages of size are turned on their head.

Researchers are exploring how to create intelligent machines that work with us better as opposed to taking our place. Robots that can express human body language can have a positive effect on their human colleagues, enabling them to be more effective at their jobs, take on higher-level tasks, and realize psychological benefits. The overall result is a more productive human-robot team.

It’s possible that humankind has created complex, systemic problems that exceed our human capacity to solve them. Some companies, particularly the tech giants, are recognizing this possibility and looking to AI as a tool for solving environmental and social problems. One of these companies is Microsoft. In December 2017, it committed $50 million to its new “AI for Earth” program to fund innovators who are making progress in four critical areas — climate change, water, agriculture, and biodiversity.

AI’s most potent, long-term economic value may lie not in the thousands of new startups, but in the ability of AI to augment the discovery and pursuit of basic scientific advances that could be the foundations of new industry.

Systems using artificial intelligence increasingly match or surpass human-level performance, driving great expectations and soaring stock prices. Yet measured productivity growth has declined by half over the past decade.

The impact of artificial intelligence on the future of work and organizations was an especially popular topic on MIT Sloan Management Review’s website in 2017. But AI wasn’t the only subject on readers’ minds. Other widely read pieces of new content addressed timely issues like digital transformation and design thinking — as well as perennially important topics such as innovation, strategy execution, problem formulation, and negative emotions in the workplace.

Many countries experiencing fast growth in the aging of their populations, including Germany, Japan, and South Korea, are also experiencing growth in their gross domestic product. The most plausible explanation for this counterintuitive finding is that there has been a rapid adoption of automation technologies in countries with more pronounced demographic changes. In other words, technology isn’t just capable of offsetting potential negative effects of aging populations — it’s already doing so.

Artificial intelligence is beginning to replace many of the workplace roles that men dominate. The parts of those jobs that will have staying power are those that rely more heavily on emotional intelligence, abilities such as empathy, persuasion, and inspiration — skills in which women typically excel. In the AI economy, men won’t be as successful as women unless they embrace these differentiator skills.

As organizations explore how software robots — or bots — can help automate administrative tasks and decisions, it pays to keep in mind some of the risks that come with the territory.

Business has become too complex for boards and CEOs to make good decisions without intelligent systems. Just as artificial intelligence helps doctors use patient data to make better diagnoses and create individualized medical solutions, AI can help business leaders know more precisely which strategy and investments will provide exponential growth and value in an increasingly competitive marketplace.

A global survey by the McKinsey Global Institute finds that AI is delivering real value to companies that use it across operations. C-level executives report that when they adopt AI at scale — meaning they deploy AI across technology groups, use AI in the most core parts of their value chains, and have the full support of their executive leadership — they are finding not just cost-cutting opportunities, but new potential for business growth, too.