HDS CEO says the great GenAI experiment is over—it’s time to get serious

The great enterprise experiment with GenAI is over. According to Hitachi Digital Services (HDS) CEO Roger Lvin, firms are moving away from ad-hoc tests and back to proper planning.

Roger shared his view of the maturing market at HDS’ first London analyst and advisor event in September. He insisted HDS clients had finished their phase of proof of concept (POC) and pilots and were now looking at value creation versus the traditional H1, H2, and H3 horizon planning framework—which he noted had been abandoned by many firms in the initial rush to ‘do something’ with GenAI.

The H1, H2, and H3 strategy is a model often associated with McKinsey. In this model, enterprises should maintain a balanced innovation portfolio covering all three Horizons: H1—defending the core (sustaining innovation), H2—extending the business (disruptive innovation), and H3—transformative innovation. In the case of GenAI, the H3 transformation aligns with HFS’ vision of Generative Enterprise™. Firms are now figuring out where GenAI plays a role in each Horizon.

Enterprise demand for data maturity assessments is on the rise

Roger believes his business is well placed to support enterprise leaders as you get serious about GenAI—thanks to resources focused on engineering and data science and a built-in commitment to responsible AI reflected in dedicated Hitachi Application Reliability Centers.

The firm’s recent launch of its R2O2 AI framework is all about rapid deployment and operationalization of AI solutions. It doubles down on HDS’ commitment to reliability and responsibility, and the framework’s pre-built tools, models, and methodologies are intended to answer enterprise concerns about transparency and measurability.

Firms must be digitally mature to scale the GenAI impact

Roger told HFS his data scientists had never been busier, driven by demand for data maturity assessments from enterprises formalizing their GenAI plans intending to scale impact. Chief Strategy Officer Rajesh Rajappan added that customers moving most rapidly beyond POCs and pilots have a good level of digital maturity. In most cases, they have already established a track record of success with AI working with HDS, too.

Roger pointed to HDS’ deep domain expertise as an essential focus for the firm’s GenAI efforts. That means targeting solution development for the retail, insurance, manufacturing, energy, automotive, life sciences, and healthcare sectors. In this way, he believes HDS will be able to reassure enterprise leaders that it knows their industries and problems.

Safety-first will appeal to risk-averse industries—others may need convincing

Hitachi group’s brand heritage includes decades of engineering excellence in industries where overengineering for safety’s sake is second nature. This DNA appears to run through HDS’ approach in general and is reflected in the protections it’s building into its R2O2 offering, accelerators, and solution libraries in GenAI.

This safety-first approach will appeal to leaders in more risk-averse industries looking for a high commitment to safety and trustworthiness. Those with different risk profiles may need reassurance that HDS can keep pace with their demand for innovation in faster-moving markets.

Commitment to social innovation delivers OneEcosystem™ benefits

HDS, like the Hitachi group, is committed to innovating for good—with outcomes intended to benefit society. Its partnership with food waste prevention specialist OneThird on a project—predicting the weather—serves as evidence. The intended result is to help producers with supply chain issues, resulting in less food wastage—a social benefit in a world that wastes up to a third of food produced. HFS applauds this commitment to an HFS One Ecosystem™ approach —in which there are benefits far beyond an individual enterprise.

The Bottom Line: Integrate GenAI in your plans for BAU, disruption, and transformation—or get left behind in POC purgatory.

It’s time to move beyond ad-hoc experiments with GenAI. You must incorporate its use as part of your more comprehensive innovation portfolio planning, identifying where GenAI has a role to play in defending the core business, extending what you do through new and disruptive business models, and developing a view of how the technology will drive transformation—toward the HFS Generative Enterprise™. The alternative is yet another round of POC purgatory.