The best barometer for AI's enterprise value is not replacing the bottom 5% of workers. A better goal is empowering most employees to become 10x more productive. This reframes the AI conversation from a cost-cutting tool to a massive value-creation engine through human-AI partnership.

Business owners should view AI not as a tool for replacement, but for multiplication. Instead of trying to force AI to replace core human functions, they should use it to make existing processes more efficient and to complement human capabilities. This reframes AI from a threat into a powerful efficiency lever.

Just as Kaizen and “China cost” revolutionized physical product businesses over 40 years, AI is initiating a similar, decades-long optimization cycle for intellectual property and human-centric processes. Companies that apply this “digital Kaizen” to lean out workflows will gain a compounding cost and efficiency advantage, similar to what Danaher achieved in manufacturing.

Focusing on AI for cost savings yields incremental gains. The transformative value comes from rethinking entire workflows to drive top-line growth. This is achieved by either delivering a service much faster or by expanding a high-touch service to a vastly larger audience ("do more").

Unlike the cloud-era "digital transformation," which often didn't change core employee workflows, the AI transformation is universal. It changes how every knowledge worker operates daily, making the shift more profound and akin to the move from paper to computers, fundamentally altering the nature of work itself.

Most companies use AI for optimization—making existing processes faster and cheaper. The greater opportunity is innovation: using AI to create entirely new forms of value. This "10x thinking" is critical for growth, especially as pure efficiency gains will ultimately lead to a reduced need for human workers.

The true economic revolution from AI won't come from legacy companies using it as an "add-on." Instead, it will emerge over the next 20 years from new startups whose entire organizational structure and business model are built from the ground up around AI.

The most durable moat for enterprise software is established user workflows. The current AI platform shift is powerful because it actively drives new behaviors, creating a rare opportunity to displace incumbents. The core disruption isn't just the tech, but its ability to change how people work.

The most significant value from AI is not in automating existing tasks, but in performing work that was previously too costly or complex for an organization to attempt. This creates entirely new capabilities, like analyzing every single purchase order for hidden patterns, thereby unlocking new enterprise value.