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January 27, 2025

Use gen AI to unlock new revenue sources: 5 places to find trapped value

Impatient for returns on gen AI investment? Here’s how to speed things up.


This content was originally featured in a Fast Company article in January 2025.

The impact of generative AI has been immediate and powerful, but it has presented leaders with a dilemma. Our research shows that while leaders expect AI to pay dividends in four to five years (48% of survey respondents are piloting AI initiatives with that goal), they also expect it to affect revenue negatively over the next two years (42% anticipate a negative impact in that timeframe).

Investment always takes time to pay off, by definition, but given the newness and strangeness of gen AI it’s perhaps not surprising that some companies are hesitant about making a heavy investment now in this new technology. They shouldn’t be. Gen AI’s killer app, largely untapped so far, is revenue creation—unlocking the value already trapped within organizations and business models, often due to outdated processes or models. Businesses that embrace this vision will see their early investments pay off significantly, while companies that fail to act now risk falling behind.

In these early stages of leveraging gen AI, leadership is everything. CEOs, COOs, and other members of the senior leadership team must set the agenda and drive the business to unlock value in a strategic way. Let’s explore five key areas in which to do so. 

1.    Shorten the value chain

Netflix revolutionized the entertainment industry, first by bypassing the bricks-and-mortar stores that sold and rented DVDs and VHS tapes, then by cutting out the need for physical media altogether. Netflix didn’t just digitize the renting of movies, in other words; it thrived by eliminating whole links from the entertainment-delivery value chain.

Generative AI can facilitate that process within any business by automating workflows and interactions, resolving inefficiencies, and shortening the time between service and customer outcomes. In the healthcare sector, for example, AI chatbots can streamline patient intake, making physical paperwork obsolete and accelerating treatment. Similarly, insurers can use AI to automate claims, providing real-time decisions without involving human adjusters. By removing friction points, gen AI can help businesses deliver value faster.

2.    Develop new business models and revenue streams

In 2013, Microsoft began transitioning Office from licenses to a subscription model. This was a shrewd reading of the value chain and market conditions. Now you can buy everything from coffee pods to cat litter to word-processing software on a subscription basis, and gen AI will push this trend much farther.

Because gen AI allows for ongoing personalized and adaptive experiences, subscription-based business models will become a more plausible option for companies across the business landscape. Many large automakers are already looking at embedding gen AI in vehicles—seeking revenue streams beyond the core product by providing subscription-based services like advanced driver-assistance systems, enhanced navigation, even automated parking. Gen AI made this trend possible, and gen AI is going to accelerate it: analyzing relationships among billions of seemingly unrelated data points to discover features and services consumers are willing to subscribe to. With new subscription revenue streams identified, gen AI will then market them to consumers at a granular level.

3.    Disintermediate!

In the mid-2010s, a slew of fintechs and digital-native insurers—Oscar Health and Lemonade, for example—bypassed brokers and delivered direct-to-consumer solutions. More businesses should consider using AI to bypass traditional channels.

Gen AI makes disintermediation—a fancy term for cutting out the middleman—more feasible by allowing businesses to create personalized, automated, and scalable customer interactions without relying on human intermediaries. Think of retailers who can, already, create virtual shopping assistants to engage directly with customers, providing personalized styling advice, diminishing the need for retail partners and sales agents. Likewise, banks and insurers could consider creating AI-based lending advisors that analyze customer data and recommend loan structures, bypassing traditional financial agents.

And disintermediation isn’t just for consumer-facing businesses. Consider the myriad interactions between, for example, healthcare players (physician to insurer, lab to physician, specialist to lab, etc. Each of these interactions presents a potential opportunity for disintermediation, and every industry has its own plethora of contact-points that gen AI could, in many cases, remove.

4.    Enhance products and services

In the early 2000s, premium car brands began adding features like GPS and in-car entertainment to differentiate themselves from competitors and to justify higher prices. These features enhanced products without replacing them, adding value over time.

Across industries, generative AI will replicate this pattern, enabling ongoing improvements that justify premium prices. For example, Bloomberg is using AI to improve its Terminal product, generating more accurate insights more quickly. Many e-commerce platforms now feature AI-powered recommendations, and newer phones have automated image editing. Gen AI-propelled product enhancements will really take off once major players within industries begin putting pressure on one another. When Competitor X invests in the technology and gains market share, Competitor Z will surely follow suit.

5.    Find surprising innovations

Amazon Web Services emerged from Amazon’s struggle in the early 2000s to scale its own tech infrastructure. Realizing it was already very good at building reliable data centers, the company spun AWS into today’s $100 billion business. As gen AI alters the value of links in the value chain, other companies will similarly capitalize on assets in new ways. In some cases, the asset in question will be data, as in infrastructure services companies, for example. Trusted, consistent, anonymized information could soon skyrocket in value.


Act boldly to seize the opportunity

The opportunities I’m talking about won’t materialize without bold leadership and strategic vision. Companies that want to lead in their sector need to advance beyond pilot programs and tapping isolated pockets of productivity. They need to think big and move toward full-scale AI adoption. Here are guidelines for beginning this journey:

  • Analyze: Enterprises should first look critically at their value chain and consider ways the business could change over the next four or five years. This involves thinking about the customer experience, optimizing cost, and ways to enable faster time-to-market.

  • Optimize: Having envisioned a future for the business, leaders should next consider how their value chain must change to make that future happen, through the elimination or enhancement of the value chain’s multiple links. Effectively, they must get ready to create a new value chain by leaping forward. This requires inventive, creative thinking. After all, nobody gave Steve Jobs and Apple a list of requirements for the iPhone. That breakthrough only came through imagination and transformational thinking.

  • AI-enable: Finally, leaders must identify the calibration points at which AI can be used to drive the efficiencies and changes in customer experience that have been envisioned. Interestingly, gen AI itself can assist in this step. At Cognizant, our Neuro AI platform features an Opportunity Finder that helps businesses discover decision-making use cases.

While gen AI’s lack of immediate ROI may bring risks, being an early mover is essential. Leaders who take their initiatives to the next level now will shape the future landscape, setting the standard for those who follow. Generative AI presents a unique opportunity to unlock new value. Businesses bold enough to take the leap today will emerge stronger in the long run. Yes, this requires vision and courage at the top, but the rewards—new revenue streams, reimagined processes, and competitive advantage—are well worth the effort.
 



Surya Gummadi

Executive VP and President, Cognizant Americas

Surya Gummadi

Surya Gummadi is President of Cognizant Americas, responsible for the strategic direction and operational performance of Cognizant’s business in the US, Latin America and Canada. Additionally, he is responsible for the global large deals team.



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