In a recent Harvard Business Review article, author Sangeet Paul Choudary argues that the true economic impact of artificial intelligence won’t primarily come from automating tasks, but from reducing “translation costs” — the effort and friction involved in making different teams, tools, data sets, and processes work together. Rather than simply speeding up isolated activities or making predictions, AI’s value lies in helping fragmented systems communicate and coordinate more effectively, enabling projects and organizations to achieve outcomes more consistently and with less waste. This shift broadens how we understand AI’s role in the economy and in organizational design.
Traditional discussions about AI have focused on automation — replacing repetitive or predictable work with algorithms — or on augmentation — helping humans do higher-value tasks more efficiently. But Choudary suggests these frames miss a larger effect: AI acting as a “translation machine” that converts messy, diverse inputs into structured, interoperable outputs. By extracting meaning and reconciling differences across systems and teams, AI lowers the coordination barriers that often slow progress more than the tasks themselves.
The article explains that this coordination capability can reshape business competition and strategy. When AI enables different parts of an organization — or even different organizations in an ecosystem — to align rapidly without forcing everyone onto the same standards or platforms, it opens the door to new business models and ways of creating value. The payoff isn’t just improved efficiency; it’s a new form of systemic responsiveness that can outcompete slower, more siloed rivals.
For leaders, this means rethinking how they invest in and deploy AI. Rather than concentrating solely on automating routine functions or boosting individual productivity, companies should look at how AI can orchestrate work across boundaries, accelerate workflows end-to-end, and break down the hidden costs of coordination. In doing so, they unlock deeper, organization-wide advantages that go well beyond simple task acceleration.
