AI and the Castle Strategy

The Balanced Approach to Strategy in an AI World: Think Castles – Prioritize Defense, Then Offense With AI

I have lectured for decades on how AI will offer the means to upskill younger, less experienced staff to undertake tasks previously requiring older or more experienced staff. It has always been obvious that in many cases, AI would work with people rather than simply replace them. As everyone now understands that AI and humans will work together in partnership, it’s time to think of adding more refinement to AI strategy.

Many companies are eager to implement AI to gain a competitive advantage. However, the most effective strategy is to focus first on improving vulnerable areas where competitors could overtake you, before applying AI to amplify strengths. Think of it as the castle strategy.

Think of a castle wall – building up already-high sections doesn’t protect exposed gaps in defense. Companies need to identify their weak spots and use AI to fill strategic skill gaps, reduce risks, and shore up vulnerabilities, upskilling where possible, recruiting elsewhere, or just using AI in areas where it can manage fine alone. This provides a stable foundation before going on offense. Yes you can do both if resources are good, but priorities are still important if only in fabricating appropriate mindsets.

Upskilling workers is crucial to building resilience. Investing in developing talent to address weak areas makes a company’s defense stronger across the board. Once the most pressing gaps are filled, AI can then be used to optimize top capabilities, products, and services as a powerful offensive tool.

Agility is still important. AI can respond and help provide market analysis and strategies quickly, but that is of little use if corporate resources and procedures can’t be brought to appropriately respond quickly too. It’s important to recognize that as AI upskills people, it will somewhat level the field, typically reducing the gap between inexperience and experience. That actually amplifies vulnerability so defense becomes more important.

So leading with offense while major vulnerabilities remain is risky and short-sighted. It could create imbalanced skill sets, brittle processes, and a false sense of competitiveness. A competitor’s AIs can identify your weaknesses and quickly make them into their opportunities if your defenses are weak. Your attack teams could return to a burned castle. Solidifying foundations first brings balance and stability. This applies equally to individuals, teams and companies. Even a strong warrior can fight best knowing their armor is sound and their back is protected.

Of course, some offensive AI projects in parallel may be strategically useful. But generally, smart companies will focus first on using AI to protect against downside risks. Once defensive gaps are addressed, going on the AI offense allows sustainable growth from a position of strength. AI can sharpen that offense, especially if your competitors have been negligent maintaining their defenses.

So start thinking of the next stage AI strategy. Sure, you’ve understood how AI will partner and co-work with your staff where it can’t replace them, upskilling and enhancing them to offer even better service and products to keep your customers happy and returning for more. But you can’t rest. In a world where AI is transforming every business and the entire competitive landscape, we’re back to medieval corporate warfare. Territories are up for grabs, raiding parties will abound. We will need castles again. The balanced approach – defense first, offense second – allows companies to implement AI in ways that minimize risk and maximize long-term competitiveness.

How a business uses AI, not just that it uses AI, will be key to success.