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Exponential vs Linear AI Capability Development

Timeframe: Currently accelerating, major capability jumps expected every 6-12 months

What's Changing

AI capabilities are advancing exponentially rather than incrementally, making linear planning obsolete

Driving Forces

Compounding improvements in model architecture

Increasing compute and data availability

Cross-pollination between different AI capabilities

Winners

  • Organizations planning for exponential scenarios
  • Individuals who adapt quickly to new capabilities
  • Companies building on AI infrastructure rather than competing with it

Losers

  • Linear planners and traditional forecasting methods
  • Companies building AI-replaceable products
  • Organizations resistant to rapid change

How to Position Yourself

1

Plan for multiple exponential scenarios rather than single linear path

2

Build adaptable systems rather than optimized solutions

3

Focus on unique human value creation

Early Signals to Watch

AI model release frequency increasingCapability demonstrations exceeding expectationsIndustry disruption happening faster than predicted

Example Implementation

A software company stops building internal automation tools and instead focuses on unique product differentiation, knowing AI will handle most operational tasks within 12 months

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