Technological innovation is nothing unless businesses know how to apply it to drive customer satisfaction and profitability. Here are the books to help you understand how to use big data, create useful artificial intelligence and make the right technology acquisitions for your business.
Competing in the Age of AI: Strategy and Leadership When Algorithms and Networks Run the World, by Marco Iansiti and Karim R. Lakhani
Artificial intelligence is a popular but little understood topic among many business executives. While scare mongering about machines taking over the world makes for good headlines, the kind of AI actually impacting business and jobs today is very different. Harvard Business School professors Marco Iansiti and Karim R. Lakhani write about “weak AI”, which is what they call a computer system which can make decisions and perform tasks previously handled by people.
Weak AI is already enabling companies to have massive scale at lower cost. They give the example of Ant Financial, which serves more than 10 times as many customers as the largest US banks with less than one tenth of the employees.
To put AI at the core of the business, the authors say you need to build an AI factory. The AI factory consists of four elements: a data pipeline, algorithms to crunch the data, an experimentation platform to test the algorithms and the technological infrastructure to connect the data and algorithms to internal and external users.
This book is a comprehensive guide to how artificial intelligence is built and can be easily understood by non-technical professionals. As AI and big data become ever more central to business success, this book is essential reading.
Invisible Women: Exposing Data Bias in a World Designed for Men, by Caroline Criado Perez
Data is the fuel for any AI system, but if the way that data is being analyzed and collected is biased in the first place, the AI system will just make bias scalable. Caroline Criado Perez’s book shows the (sometimes fatal) consequences of where homogenous teams have embedded bias into product and algorithm design.
Perez writes that when Apple launched its AI, Siri, the system could find prostitutes and Viagra suppliers, but if you told Siri that you had been raped, she replied ‘I don’t know what you mean by raped.’ These basic errors should be caught before a product is released with much fanfare.
Perez’s book also highlights that much of the general population data that we have is collected about men, whether that is data about behavior or health. This can be particularly problematic for investors, who need comprehensive data to make smart investment decisions. Perez writes “given the male domination of VCs, data gaps are perhaps particularly problematic when it comes to tech aimed at women.”
Technology can spread our ideas faster and cheaper, whether they are good or bad. To avoid embedding bias into your product and algorithms, read Invisible Women.
Go Tech or Go Extinct: How Acquiring Tech Disruptors is the Key to Survival and Growth for Established Companies, by Paul Cuatrecasas
Acquiring startups is a popular way for established companies to gain talent or new technologies. However, while many of those deals appear to be useful at the start, they often lose value at integration. According to various sources, including the Harvard Business Review, the failure rate for mergers and acquisitions sits between 70% and 90%.
Paul Cuatrecasas, an investment banker who advises technology companies, has written a guide on how traditional businesses can identify the acquisitions right for them and successfully integrate them. Cuatrecasas says “for traditional incumbents, technology is either a virus or a vitamin. The ultimate lever is a double-edged sword – you can use it to kill your competition, or it can be used to kill you.”
His book outlines twelve steps that traditional companies can use to work out what acquisitions they need to make, how to search for qualified startups, how to engage with them, close the deal and then welcome them, their technologies and culture into the larger business.
This is a useful book for larger companies to understand the acquisition process, and for startups whose aim it is to get acquired.
Out-innovate: How Global Entrepreneurs from Delhi to Detroit are Rewriting the Rules of Silicon Valley, by Alexandre Lazarow
Venture capitalist Alexandre Lazarow has written a counter-argument to the Silicon Valley startup model of fast growth at all costs. Lazarow writes about companies which begin their lives at what he calls the frontier – markets without economic stability or supportive startup ecosystems.
This does not only apply to emerging markets, but also to regions within economically developed markets such as the US, but without strong startup ecosystems, such as Detroit or Columbus. He writes that “even frontier regions in developed countries often lack indispensable resources such as angel investors, incubators, venture capitalists, an experienced employee pool, cultural support for risk and failure, interested acquirers, and public markets.”
The companies that launch in frontier markets and scale successfully tend to have different business models and challenges than those in Silicon Valley. “Where Silicon Valley strives to breed unicorns, [companies valued at over $1 billion], the frontier raises camels – organizations that can capitalize on opportunity but also can survive in a drought.”
This book is useful for investors, who want to look for success beyond the Silicon Valley model, and traditional companies interested in startup acquisitions.
What books on business innovation and technology strategy do you recommend? Tweet your suggestions to @sophiamatveeva