In June 2007, Apple rolled out the first versions of its iPhone, with a price tag of $600. Two months later the price was $400, and by 2009, the sticker price of its latest phone, with twice the storage, was $200. Early adopters have a lot of fun, but it comes at a price.
In business, fun is nice but revenue and profit are essential. Early adoption feels like getting ahead of the competition, but at what cost? Money doesn’t grow on trees and anything spent today won’t be available for something that needs it tomorrow. Now, if that expenditure is investment in something that’ll yield positive ROI, then suddenly money does grow on trees.
Early adoption, however, is more a blind bet than it is an investment, and it’s a very costly bet too. Unlike with horses, early adoption comes with worse odds that are rarely matched by the potential win. Would you bet on an unknown at 3:1 if you could wait a year to see how it performed and still bet on it at 3:1 once it’s shown itself to be a winner? Furthermore, would you pay top dollar to buy that horse unproven?
Sure, the earlier option is fun, and winning on blind luck is a buzz, but it isn’t business. You could even convince yourself and others that you knew it would win, but you’d be wrong. Survivor bias is a thing. New technologies are like horses. They all look shiny in the right light, and they all run fast, but you can’t tell how fast or for how long until they’ve been thoroughly tested in the field. (I think I’ve stretched that simile far enough now).
That’s why early adopters are rarely winners. They’re skating to where the puck is, not where it’s going to be (to quote Simon Wardley). They’re playing 5 year old football. The real winners are the fast followers and the early majority. They wait until the larger scale experiments are done and the winners have started to reveal themselves. Then they invest. They might not win the lottery, but then again who does. (Survivor bias again). But they will win, because every dollar they spend comes back with dividends
And they have another advantage over the early adopters. They have more money to spend because they haven’t wasted it on blind bets. Their cash isn’t tied up in obsolete early versions and outdated immature practices. They skated to where the puck was going to be and met it on its way through. Now they’re ahead of the early adopters and heading towards the goal.
So, by all means be an early adopter, but do it because it’s fun to learn; not because it “gets you ahead of the competition”. Experiment for sure, but keep those experiments small, measure well and find out what works and what doesn’t. Look before you leap, and never take what you’re told in good faith. Ask for proof. People are wrong more often than they’re right, and they rarely know it until it’s too late.
AI adoption is the unproven horse. In the right places and under the right conditions it’ll win. Make sure you know which is which before you place your bets.