Insights

Reframing disruption: What AI means for the future of your business

Eric Pilkington, General Manager, UST Evolve

In boardrooms around the globe, a familiar anxiety is gripping executives. It's not a sudden drop in revenue or an activist investor on the prowl. It's something more abstract—yet far more existential. It's artificial intelligence.

Since the public debut of ChatGPT in late 2022, a new urgency has permeated strategic planning sessions and C-suite conversations. Will AI displace our workforce? Will it collapse our margins? Will our industry, like those before it, face extinction at the hands of a technology we don't yet understand?

These are valid questions. But they're not the right ones.

Despite the breathless headlines and Valley-fueled forecasts, disruption is never a foregone conclusion. As with past technological waves—electricity, the internet, mobile, cloud—the question isn't if AI will reshape the business landscape. It's how, where, and for whom.

Some companies will be decimated. Others will adapt. A rare few will rise to define the next generation of category leadership.

The difference? Not just vision or velocity, but the ability to ask better questions.

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The myth of inevitable disruption

For many, AI evokes the ghosts of past failures—Blockbuster felled by streaming, Kodak undone by the digital camera, and Borders crushed by Amazon's relentless scale. These examples are easy to invoke, but often misunderstood. In each case, the downfall wasn't the technology. It was leadership's failure to understand its implications.

Disruption is not a technological outcome; it's a strategic one. The true disruptor isn't AI—it's misdiagnosis. When executives confuse optimization with obsolescence or mistake short-term hype for long-term transformation, they overcorrect, underprepare, or freeze.

As we read almost every day, too many leaders assume AI is inherently disruptive. That assumption is both dangerous and lazy. Disruption is highly contextual. In some industries, AI will act as a sustaining force, turbocharging productivity, refining customer insights, and enhancing decision-making. In others, it will unbundle the value chain, collapse margins, and render incumbents irrelevant.

But to know which side you're on, you need to do the work. Not react. Reflect.

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A new lens for understanding disruption

To understand AI's actual impact, we must first understand its mechanics. AI can impact businesses along two primary dimensions: the supply side (how we produce, deliver, and operate) and the demand side (how customers find, purchase, and experience value). These effects aren't equal, and they don't hit every business the same way.

Supply-side disruption is often quieter. It is characterized by automation, efficiency, and simplification. It rarely obliterates business models overnight. Instead, it eats away at redundancy and bloated costs, often strengthening the incumbent's hand.

Demand-side disruption, by contrast, is sudden and brutal. It changes the very nature of customer behavior. One day, students will pay for online tutors. Next, they ask ChatGPT for help. One quarter, a company like Chegg is a high-growth edtech darling. Next, its stock price collapses by 95%.

When AI can replicate the value customers seek—faster, cheaper, and on demand—it doesn't just compete; it also delivers. It replaces.

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Diagnosing your exposure: Ten questions that matter

If you want to know whether AI will disrupt your business, forget the generic industry benchmarks. Instead, ask these ten questions across three categories: supply, demand, and external forces. Your answers will offer a far more accurate—and sobering—read of your real risk and opportunity.

1. Are you doing old things better, or new things altogether?

When ChatGPT improves knowledge worker productivity by 25%, that's not disruption. That's optimization. Most incumbents thrive on this kind of change. The threat only emerges when AI enables a fundamentally new way to deliver the product or service.

2. Can AI rewire your value chain?

System-level innovation is rare—but powerful. Think of WeChat collapsing multiple services into a single user experience. Think of electricity reinventing factories. If AI forces you to redesign how your business works—not just what it produces—you may be entering disruptive territory.

3. Are your complementary assets still valuable?

Even in the face of technological leaps, some assets remain irreplaceable. Regulatory know-how. Distribution relationships. Data reservoirs. If you own these, you may be shielded—even as other parts of your operation evolve. This is why Big Pharma survived the biotech revolution. The drugs changed. The system didn't.

The real risk lies with your customer

If supply-side change is surgical, demand-side change is seismic. It strikes at the core of your customer relationship and your revenue model. And it's here—on the demand side—where AI is proving far more unpredictable.

4. Can AI do the job you're getting paid to do?

This is the existential question for virtual services. If AI can answer the same question, deliver the same outcome, or replicate the duplicate content, your business is at risk. Translation. Tutoring. Stock photography. These aren't theoretical casualties. They're already happening.

5. Is there still a role for human expertise?

The good news? AI isn't perfect. It hallucinates. It misfires. It lacks context and judgment. Innovative companies are leaning into these gaps—blending AI with human intelligence to create hybrid experiences. If you can double down on what only humans do well, you may find new relevance in an AI-rich world.

6. Can you still make money in the new model?

Even if you adapt, can you monetize your efforts? Many disrupted companies didn't lose relevance—they lost margin. The photography industry didn't die because people stopped taking pictures; instead, it evolved. It died because the profit pools disappeared. AI may also impact education, marketing, design, or media.

7. Physical products? Less risk—but not no risk

If you sell atoms instead of bits—goods instead of services—you're safer for now.

Will AI change how you sell and distribute?

Online channels, recommendation engines, and predictive pricing models are already shifting go-to-market dynamics. AI will accelerate this. The risk isn't extinction—it's disintermediation.

8. Will AI shape perception or preference?

TikTok influencers and AI avatars are increasingly defining what people buy. Your brand narrative is no longer solely yours to control. AI-fueled content could manipulate awareness in ways traditional marketing can't counter.

9. Can you use AI to bundle new services?

Innovative companies are enhancing their products with AI-generated value, such as pizza tracking apps. Smart home diagnostics. Personalized textbooks. These aren't novelties—they're competitive differentiators. AI doesn't have to replace your product. It can help reimagine it.

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The regulatory chessboard: Last mover advantage?

Finally, there's a third, often overlooked force at play: regulation. While startups may move faster, incumbents usually have the ear of regulators. History favors the established: banks navigating crypto, automakers stalling AVs, drug companies dominating biotech. AI policy is still in flux, but if you know how to play the game, governance may protect your flank.

The trick? Stay close to policymakers. Be part of the solution. Shape the rules before they're written.

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How to lead through the fog

The challenge for today's executive is not technical. It's strategic. You don't need to become a machine learning expert. You need to become an organizational cartographer—mapping the shifting terrain of your industry, identifying where new value will emerge, and determining how you'll capture it before others do.

Start here:

• Utilize the diagnostic framework to assess your risk across supply, demand, and regulatory factors.
• Make small bets. Don't commit to massive AI investments yet. Pilot. Learn. Adapt.
• Rethink your core offering. What human value do you offer that AI cannot easily replicate?
• Partner with disruptors—don't wait to be disrupted.
• Above all, reframe the narrative. You are not preparing for the end. You are preparing for the next version of your business.

Disruption is not inevitable. Reinvention is.

Artificial intelligence is not a wrecking ball. It's a litmus test. It reveals the rigidity of your operations, the fragility of your customer relationship, and the adaptability of your leadership.

Some will panic. Some will pivot. A few will pull ahead. But the choice isn't whether to fear AI or embrace it. The choice is whether to treat it as a threat to be managed or an inflection point to be mastered.

Learn how to assess risk, uncover opportunity, and lead with clarity in the age of AI. Connect with a UST expert to reframe your next move.