AI is an ecosystem, not a technology, says Michael Jacobides

Michael G. Jacobides, the Sir Donald Gordon Professor of Entrepreneurship and Innovation, and Professor of Strategy and Entrepreneurship at London Business School, is urging business leaders to rethink artificial intelligence, not as a standalone technology, but as an ecosystem that will reshape how organisations create and capture value.

Speaking to Graeme Scott on the GAEA Talks podcast, Jacobides argued that too many organisations are treating AI as a collection of tools or demonstrations rather than a catalyst for strategic transformation. "A sprinkle of technology... ain't strategy," he said.

Instead of focusing on isolated AI use cases, businesses should redesign end-to-end processes, rethink their operating models and reassess how they create value for customers. Drawing parallels with previous industrial revolutions, Jacobides argued that technologies only deliver productivity gains when organisations reinvent the way they work around them.

He also challenged much of the current AI narrative, warning that vendor-led hype and fear of missing out are obscuring where real value lies. While foundation models have captured attention, he suggested the biggest winners so far have been the companies supplying the infrastructure, from chips and data centres to energy, rather than those building or deploying AI applications.

For leaders, the priority should be understanding where AI can solve genuine business problems, strengthen competitive advantage and unlock new opportunities, rather than adopting an "AI-first" mindset.

Jacobides also highlighted broader concerns about the concentration of AI power, the growing gap between research and commercialisation, and the importance of preserving strong links between universities, industry and open scientific inquiry.

He closed with advice inspired by former US President Theodore "Teddy" Roosevelt: keep "your feet on the ground and your eyes on the stars". For organisations embracing AI, that means staying pragmatic about what the technology can deliver today while remaining ambitious about the new opportunities it could create tomorrow.

For the full interview, click here