We’ve all seen it: the glossy press releases, the internal “Innovation Labs”, the endless hackathons. It’s called Innovation Theatre—a performance focusing purely on outputs (the number of new ideas, the models created) while neglecting the only thing that truly matters: outcomes (the tangible value delivered to the customer and the business).  This is the challenge I see over and over again, speaking with business leaders that are struggling to see the return from their technology investments, particularly as it relates to AI.

As a solution provider (product + services), the problem starts when we prioritize Value Creation (features) over Value Capture (revenue).

I was recently working with a large, multinational bank that was looking to reduce churn in high-net-worth, retail deposit accounts (aka. savings, checking, etc.).  The Bank bought and implemented an AI model that effectively evaluated a customer’s churn propensity, identifying opportunities to retain customer assets.  Value was created in the form of a target customer list, but that value wasn’t recognized until the model was approved by InfoSec, embedded into the data ecosystem, integrated with upstream and downstream systems (like Salesforce or Adobe), and enabled in marketing, customer success, business development, and advisor workflows.

There is a reason that 80% of all AI projects fail to reach production and/or deliver an ROI.  Most don’t consider the enterprise context, understand the job-to-be-done, or invest in mapping out the customer/end user journey as part of the design.  As seen at the bank, value capture can’t be a post-launch afterthought; it’s the heart of product strategy and the convergence of Product, Professional Services and Customer Success. It’s about operationalizing the innovation, aligning it with a viable business model, and rigorously evaluating market readiness. 

If you are looking for additional perspective, MIT SBR just published a great article on this topic (Business Model Innovation Essentials – MIT SMR).