Treating AI as a feature, not infrastructure
Most channel technology vendors are bolting AI onto existing products and calling it a transformation. A chatbot on a portal is not intelligence infrastructure. It is a feature. The difference matters because features can be copied in a quarter. Infrastructure takes years to build and creates compounding advantages.
The channel needs AI that learns from deal data, advisor behavior, and supplier outcomes over time. That requires a data strategy, not a model API call. The vendors who understand this are building something different from the ones who are just adding a chat interface.
Confusing automation with intelligence
Automating a broken process makes it faster and cheaper, but it is still broken. The channel has a lot of broken processes: recommendation engines that rank by payment, onboarding flows that generate paperwork instead of relationships, reporting that measures activity instead of outcomes.
Applying AI to these processes without rethinking the underlying logic just automates the dysfunction. The question is not how to use AI to do what we already do faster. The question is what we should be doing differently.
Underestimating the data problem
AI is only as good as the data it trains on. The channel has a data problem: most of the valuable information about deals, advisor preferences, and supplier performance lives in spreadsheets, email threads, and people's heads. It is not structured, it is not shared, and it is not being used.
Building intelligence infrastructure for the channel requires solving the data problem first. That means creating incentives for advisors and suppliers to contribute structured data, building the pipelines to capture it, and establishing the trust that makes people willing to share it.
Ignoring the trust layer
The channel runs on relationships and trust. Any AI system that advisors do not trust will not be used, no matter how technically sophisticated it is. Trust in the channel context means: transparent recommendations, explainable logic, and no hidden pay-to-play dynamics.
The vendors who will win in AI-powered channel technology are the ones who build trust as a core design principle, not an afterthought. That means showing advisors exactly why a supplier is being recommended, what data is being used, and what the supplier paid to be in the system.
Thinking this is a technology problem
The channel's dysfunction is not primarily a technology problem. It is an incentive problem. The pay-to-play model exists because it is profitable for the intermediaries who run it. AI does not change incentives. It amplifies them.
The companies that will use AI to genuinely improve the channel are the ones that have aligned their business model with advisor and supplier success, not just with transaction volume. Technology is the tool. The business model is the strategy. Getting the strategy right matters more than getting the technology right.