AI's current strength lies in enhancing efficiency by handling tasks like summarization and data categorization. It is not suited for big-picture thinking or complex processes. The goal should be to make existing teams more effective—augmenting their abilities rather than pursuing wholesale replacement, which is a common misconception among business leaders.

As AI democratizes information, simply having knowledge is no longer a differentiator. The real expertise lies in its application. Use AI to quickly become an industry expert by identifying key trends, but reserve human effort for interpreting and applying that information for clients.

Even with vast training data, current AI models are far less sample-efficient than humans. This limits their ability to adapt and learn new skills on the fly. They resemble a perpetual new hire who can access information but lacks the deep, instinctual learning that comes from experience and weight updates.

By replacing the foundational, detail-oriented work of junior analysts, AI prevents them from gaining the hands-on experience needed to build sophisticated mental models. This will lead to a future shortage of senior leaders with the deep judgment that only comes from being "in the weeds."

With a significant error rate of 20-30%, AI cannot be seen as a one-to-one replacement for entry-level employees. This view is fundamentally flawed, as it ignores the necessity of human oversight and the value of on-the-job learning for newcomers. AI should augment, not replace, this talent pool.

In its current form, AI primarily benefits experts by amplifying their existing knowledge. An expert can provide better prompts due to a richer vocabulary and more effectively verify the output due to deep domain context. It's a tool that makes knowledgeable people more productive, not a replacement for their expertise.

Despite hype in areas like self-driving cars and medical diagnosis, AI has not replaced expert human judgment. Its most successful application is as a powerful assistant that augments human experts, who still make the final, critical decisions. This is a key distinction for scoping AI products.

Experts develop a "meta-level" understanding by repeatedly performing tedious, manual information-gathering tasks. By automating this foundational work, companies risk denying junior employees the very experience needed to build true expertise and judgment, potentially creating a future leadership and skills gap.

Don't blindly trust AI. The correct mental model is to view it as a super-smart intern fresh out of school. It has vast knowledge but no real-world experience, so its work requires constant verification, code reviews, and a human-in-the-loop process to catch errors.