Smarter spending, stronger leadership, sharper decisions
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| | Brought to you by Alex Panas, global leader of industries, & Becca Coggins, global leader of functional practices and growth platforms
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| | | | | In the news. Companies are struggling to predict their AI expenses, The Wall Street Journal reports: Only 11% of nearly 400 organizations surveyed accurately forecast their spending. One reason is cheaper AI models don’t always end up costing less. In a study of more than 6,800 tasks, lower-priced options cost more than pricier alternatives nearly a third of the time, sometimes requiring more steps and tokens. Even the same model can generate different bills for identical tasks, depending on the steps and tokens used. Companies can’t control every cost, but training employees to match appropriate models to tasks can help avoid unnecessary spending. [WSJ] | | | |
| “It’s not just about cost per token. It’s about cost per task.” | | | |
| On McKinsey.com. The financial stakes can rise sharply as projects scale. McKinsey research finds that spending nearly quadruples, on average, when AI tools move from pilot to production. In a new McKinsey Explainer, Lari Hämäläinen, Wasim Lala, and Kaavini Takkar examine the costs that can go overlooked, from cloud computing and software subscriptions to human review of AI outputs. Their advice: Track what you’re spending, choose the right model for the job, and make sure the results justify the bill.
Make every AI dollar count | | | |
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| | | In the news. Corporate transformations can falter when leaders cling to rigid plans. Continuous experimentation and learning can help organizations adapt, using insights from early initiatives to refine priorities and chart a more effective path forward. [HBR]
On McKinsey.com. Transformation requires CEOs to own critical strategic decisions. McKinsey’s Andy West, Carolyn Dewar, Kurt Strovink, Michael Birshan, Tim Koller, and Whitney Zimmerman identify six strategy roles CEOs can’t delegate, from making tough resource allocation calls to knowing when to change course and rallying their organizations around new opportunities.
Make the tough calls | | |
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| | | In the news. AI is changing how cricket teams assess talent, track player development, and prepare for opponents. But the technology isn’t replacing coaches or analysts. Instead, it’s giving them more information to make better decisions. [Guardian]
On McKinsey.com. In collaboration with one professional cycling team, McKinsey and QuantumBlack, AI by McKinsey, are using AI to enhance human decision-making, helping coaches spot important developments and make better-informed tactical decisions.
Ride with AI | | |
| —Edited by Adam Swiderski, associate editor, New York
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