When looking at our P&L, our biggest expense is headcount, and we want to use AI to optimize it. How do we strategically decide whether to buy existing AI-powered SaaS solutions or build custom internal workflows to streamline our labor costs?

Question

Tyler Smith · Accepted Answer

Start with your P&L and your Accountability Chart. Look for the seats and departments where your team spends the most hours on repetitive, low-value tasks. As Erik Brynjolfsson and Andrew McAfee suggest, the greatest near-term productivity gains from AI come from augmentative technologies that free human workers from cognitive drudgery.

If the task is generic, such as basic bookkeeping, customer service routing, or initial drafting, buy off-the-shelf SaaS tools. Do not waste capital building custom software for non-differentiators. It is cheaper to subscribe to a tool and adapt your processes to fit its structure.

However, if the process touches your Three Uniques on your V/TO® or directly impacts your proprietary delivery model, that is where you build custom workflows. This does not mean writing code from scratch. It means building secure integrations and custom API stacks that connect your systems. This proprietary layer of automation is what drives up your enterprise value. When preparing for a Step by Step Exit, a buyer will look at your margins and want to see that your efficiency is driven by systems you own and control, rather than third-party subscriptions that any competitor can purchase.