You Can’t Harness the Power of AI and Transform a Business on the Cheap

But that’s exactly what many businesses are trying to do, says AI Professor Andy Pardoe, founder of consulting firm Informed.ai.

It’s something Informed.ai sees repeatedly in its work with clients. And it’s a path that risks UK businesses falling further behind – as native AI startups and US-based firms move faster, scale quicker, and capture disproportionate value.

A recent Stripe report shows AI startups are hitting critical revenue milestones, such as annual recurring revenue (ARR), and expanding globally at unprecedented speed. New business models and monetisation strategies are reshaping not just what companies sell, but how transactions take place. Unsurprisingly, improving customer satisfaction is now the most common application of AI.

The business case is clear. So why are so many traditional UK organisations still dragging their feet?

“They’re trying to shortcut the process and do it on the cheap,” says Professor Pardoe.

Treating AI as an Upgrade Misses the Point

Many organisations adopt a use-case approach to AI. They run workshops, test isolated pilots, and tinker at the edges of the business while waiting for results. It feels safe. It feels manageable. And it’s often described as a “no-regret” strategy.

But this approach applies old reflexes to a fundamentally new technology.

Treating AI as an upgrade – rather than a strategic shift – limits ambition. It constrains imagination. And it almost guarantees incremental outcomes at a moment that demands bold thinking. The opportunity to rethink how the business operates, competes, and creates value is quietly lost.

Using AI primarily to improve administrative tasks, or relying on generic, off-the-shelf big tech tools that aren’t tailored to a company’s market, customers, or strategy, won’t build the ten-person, billion-dollar business leaders admire.

AI does not sit quietly inside existing systems. It is disruptive by nature. It reshapes how work happens, challenges where expertise sits, forces new workflows, and changes how decisions are made. Automating a bad process doesn’t create advantage – it simply scales inefficiency.

Budget for Speed, Not Safety

Gordon Brown, Head of Business Transformation at Informed.ai, believes the AI future is being held back by outdated budgeting models.

“It’s the same old cycle – the annual bun fight to allocate scarce resources, complete with politics, sandbagging, and short-term self-interest,” he says. “That approach anchors ambitious businesses to the past. It’s like designing a rocket ship with a quill pen.”

Traditional budgeting is finance-led, risk-averse, and optimised for control – not innovation. AI transformation, by contrast, demands speed, experimentation, and the freedom to pursue ideas that don’t fit neatly into last year’s cost centres.

Doing AI “on the cheap” is a false economy. Under-investing doesn’t reduce risk – it increases it. Worse still, many organisations allocate what little AI budget they have to business-as-usual activity, starving genuinely transformative ideas of the resources they need to succeed.

AI initiatives should be technology-led, not finance-led. Annual “live or die” plans are no match for a pace of change where opportunity looks very different six months from now. Rolling technology plans, shared ownership, and a willingness to back the strongest ideas - wherever they emerge - are essential.

Allocating AI spend at a departmental level is another common mistake. Transformation doesn’t happen in silos, and neither should investment. Without a unifying vision, budgeting defaults to protectionism – and ambition quietly disappears.

Don’t Trap AI With Linear Thinking

Professor Pardoe offers a clear warning:

“Don’t trap AI with linear thinking and throw away the future. Saying ‘we have no budget for AI’ – because we didn’t budget for it, didn’t budget enough, or allocated it all to business as usual – is a strategic failure.”

AI transformation is not about doing the same things slightly better. It’s about deciding what kind of business you want to become – and committing the resources, leadership, and courage required to get there.

Trying to do it on the cheap won’t just slow progress. It risks missing the opportunity altogether.

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