The Rise of AI Service-as-Software, Why the Best Leaders Constantly Teach Their Culture - Tactician: #00109

Why will AI Service-as-Software be essential for remote workers?

It’ll join your meetings, take notes and even laugh at your boss’s jokes, so you don’t have to.

The Rise of AI Service-as-Software

• Why Read: 

  • This article outlines a massive $4.6 trillion opportunity for startups to leverage AI and automate high-skilled services, transforming how businesses operate.

• Featuring:

  • Joanne Chen , General Partner at Foundation Capital and Jaya Gupta, Partner at Foundation Capital

  • Link: 

    • “AI leads a service-as-software paradigm shift”

Key Concepts and Tactics:

1. The Article Introduces the Concept of Service-as-Software:

   • "AI companies are leading a transition from Software-as-a-Service to Service-as-Software, turning the table on the very essence of SaaS. In the software business, a company may sell access to its platform or tool, but customers are still responsible for using that tool to achieve the desired outcome. In the services business, responsibility for achieving the desired outcome sits with the company selling the service. Instead of QuickBooks, you offer tax services—in this case, conducted by an AI accountant."

2. It Highlights the Massive Opportunity of Service-as-Software:

   • "The upside of this change is huge—a $4.6 trillion opportunity, since the global services market dwarfs the software market in size."

3. AI Will Automate High-Skilled Jobs and Services:

   • "Automating work is not a new trend. But the scale changes when AI can do work that was once handled by whole categories of highly skilled workers."

   • "Global companies spend $1.1 trillion on sales and marketing salaries each year. The size of the opportunity for AI disruption is many multiples larger than Salesforce could ever be."

4. Quantifying the $4.6 Trillion Opportunity:

   • "We believe this is a $4.6 trillion-dollar question. Just a few market overview figures give a sense for what's at stake within the next five years. We look at the areas to be automated in two buckets: Salaries of jobs globally ($2.3 trillion in sales & marketing, software engineering, security, and HR), plus The amount spent on outsourced services and salaries—both IT services and business process services ($2.3 trillion, per Gartner)."

5. Disrupting Business Services from A to Z:

   • "What's important here is that as more companies roll out AI customer service agents, AI troubleshooters, and AI assistants of every stripe, the potential for AI to automate both full-time positions and services is enormous."

   • "In DevOps circles, companies have long wanted to integrate logs, incident management, and infrastructure management. In the service-as-software world, instead of selling tools for infrastructure management or monitoring, the focus shifts to the management and monitoring itself."

6. Transforming Sales, Software Engineering, and Cybersecurity:

   • "A sales rep is accustomed to writing outbound emails, scheduling demos, following up, and meeting clients for dinner. AI can now do everything but eat dinner."

   • "There are more than 30 million software engineers and data scientists globally, representing nearly $1 trillion in salaries. AI is transforming how those developers build and maintain software and data systems."

   • "In cybersecurity, AI can perform tasks that are both too complex and too time-consuming for human analysts, in an industry that's chronically understaffed."

7. Coexistence of SaaS and Service-as-Software Models:

   • "The arrival of AI-powered solutions and their push into services doesn't always spell the end for the SaaS model. In many markets, we're seeing a dynamic in which multiple business models coexist and thrive."

   • “One thing is certain: service-as-software represents a once-in-a-lifetime shift, with AI at the leading edge. This development points to a future where services are not just delivered as software but are constantly learning and evolving alongside us.”

Why the Best Leaders Constantly Teach Their Culture

Why Read:

• Provides a powerful framework for founders to proactively shape their company culture by making implicit values and norms explicit through consistent dialogue and reinforcement.

• Featuring:

  • Admired Leadership, Professional Training and Coaching

• Link: 

  • “Good Leaders Make the Implicit Explicit”

Key Concepts and Tactics:

• 1. Making the Implicit Explicit:

     • Point: Good leaders go to great lengths to articulate the values and norms that define the organization's culture and make them explicit and transparent.

     • "Good leaders go to great lengths to articulate the many qualities that define the organization's culture and to make them explicit and transparent for everyone to see."

     • "By constantly making the implicit explicit, the best leaders teach the culture rather than presuming it will manifest influence over time."

  2. Discussing Rules, Norms, and Standards:

     • Point: Leaders discuss the rules, norms, and standards of quality that shape engagement and performance within the organization.

     • "With every chance they get, leaders discuss the rules and norms that shape meetings and engagement. They call out and praise the behaviors that express key values. They also work hard to identify those actions that breach them."

     • "They teach others the standards of quality they expect by pointing out when those standards are met and unmet by the deliverables produced."

  3. Relying on Dialogue over Passive Communication:

     • Point: Leaders actively engage the team in discussing the details and practices that make the culture unique, rather than relying on passive communication methods.

     • "They don't rely on posters or graphic images to carry the weight of what it means to live the culture. Instead, they ask everyone to examine and share the details and practices that make the culture so unique and special."

     • "Do the team members in your organization know the norms and rules of meetings, disagreements, conflict, and professionalism? Do they share a deep understanding of the principles and values that the organization holds sacrosanct?"

  4. Applying the Explicit Approach Broadly:

     • Point: Making the implicit explicit should be applied to all essential building blocks of culture, including feedback, agreements, and performance expectations.

     • "Teaching culture begins by making the implicit explicit. In fact, good leaders commit to this idea for just about everything that goes unspoken, including feedback, agreements, and performance expectations, all of which are essential building blocks of culture."

     • "If culture is destiny for an organization, then making the implicit explicit is how that destiny best unfolds."

  5. Leadership Commitment to Explicit Culture:

     • Point: Great leaders are committed to making the implicit explicit as a means of shaping and teaching the organization's culture.

     • "Great leaders do their part."

     • "By constantly making the implicit explicit, the best leaders teach the culture rather than presuming it will manifest influence over time."

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