AI and Productivity Gains – My Observations

Over the past 2.5 years, I have immersed myself deeply in the AI space as a software engineering leader, building an AI platform for my company. A significant portion of this time has involved hands-on coding, augmented by various AI-powered code generation tools. My experiences have revealed a nuanced picture of AI’s role in software development—one that balances impressive capabilities with practical limitations.

When I provide AI tools with broad, high-level problem descriptions and grant them considerable autonomy, the results are often pretty interesting. The generated code frequently exceeds expectations, incorporating thoughtful error handling, modular design, and clean structure. Occasionally, it even suggests creative alternatives or optimizations that I hadn’t considered – sparking genuine innovation and serving as a valuable bonus.

That said, claims that AI-generated code is consistently “production-ready” have not held up in my experience. Subtle bugs or inefficiencies can creep in, sometimes proving elusive and time-consuming to diagnose—like searching for a needle in a haystack. While AI can assist in debugging, success depends heavily on the developer’s clear understanding of the expected behavior and potential issues.

My most reliable results come from a more structured approach: supplying highly specific and narrower tasks, detailed step-by-step instructions, known pitfalls, and explicit guardrails. This method yields consistently higher-quality output and reduces rework.

These observations led me to a few important observations:

  1. Domain expertise remains essential. To extract meaningful value from AI in a given area, one must already possess strong proficiency in that domain. This directly contradicts hyperbolic claims that AI will soon replace human experts.
  2. Productivity gains are real but measured. Assertions of “10x” productivity are overstated. Conversely, dismissing AI as a fleeting fad is shortsighted. In my work building production-grade product (as opposed to prototypes or experiments), AI has delivered a realistic 40–60% productivity improvement. This figure accounts for:
    • AI generating roughly 50% of the codebase.
    • Handling repetitive or less interesting tasks, such as writing unit and functional tests, refactoring code, and producing documentation.
    • This also accounts for the offset as a result of additional effort required to craft detailed prompts, review output, identify/fix issues, and occasionally revert suboptimal suggestions.

I have also observed that beyond raw efficiency, AI contributes meaningfully to creativity. While it cannot fully replicate the dynamism of human brainstorming sessions, it often introduces fresh perspectives I might not have explored independently. I estimate this creativity boost at 30–40%, which can prove to be immensely valuable in certain contexts.

I am confident that these gains will continue to grow as AI models evolve.

A Broader Perspective: AI as a Workflow Transformer

Another illuminating experience has been applying AI in different operational modes. Applying the AI into established workflows such as product development methodology (PDM) and software development lifecycle(SDLC) certainly enhances efficiency and yields tangible benefits. However, the most striking outcomes emerge when AI is leveraged from the ground up—starting with opportunity identification, ideation, and extending through the entire product lifecycle.

This approach explains the recent surge of solopreneurs. I have personally met founders who treat AI as their primary collaborator, describing it as a “cofounder” or even an entire virtual team. Some are experimenting with specialized AI agents to lead functional areas such as sales, marketing, or accounting. This represents a profound mindset shift: unsettling for traditional organizational structures, yet with a potential for unprecedented innovation and productivity.

Looking Ahead

I feel AI is not a magic bullet that eliminates the need for human expertise, nor is it an overhyped bubble destined to burst. It is a powerful force multiplier – one that rewards skilled practitioners with significant productivity and creative advantages, especially when applied thoughtfully and holistically.

I would love to hear from others in the community: How has AI impacted your productivity and workflows? What surprises—positive or negative—have you encountered? Which approaches have worked best for you? 

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