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It's not surprising that any new transformational technology (from railways to electricity to computing to internet and beyond) did not immediately create a productivity boom. What IS surprising (or rather, infuriating) is the insistence (from various stakeholders, including, of course, the purveyors of said technologies, and their multiple investors) that productivity show up IMMEDIATELY, or at least in a relatively short time frame. THAT is what this article addresses, quoting the NBER paper https://www.nber.org/papers/w35275 that shows empirically the AI-driven productivity (or its lack) in SW development. It shows that while edits and PRs increased 300% (in the study), the actual SW releases only increased 30%, and the subsequent usage of those AI-developed apps did not increase meaningfully at all. Hence the hand-wringing over whether AI-driven value creation exists or not. As with any tech deployment, productivity boom really relies on *transformations* of orgs, org structures and business processes, and not merely by sprinkling the magic-sauce-du-jour. This is a well-known and well researched insight, and follows from various examples (e.g. introduction of computers in '70s and '80s for accounting, finance; industrial robotics; electrification; mass communication; etc) Why would AI-driven productivity be any different? Why would anybody expect IMMEDIATE payoffs? Real payoffs would take years, if not decades, to show meaningfully.
[This is what infuriates me, tbh] Until then, orgs will do what they have always done. Reduce headcount, bank the short-term gains, and claim "See? We are AI-native! Gimme more valuation!" |