The thought of implementing Artificial intelligence (AI) can be a source of both excitement and apprehension. If you have neither of these two, then you probably haven’t thought through what you’re about to do…
As a broad definition, AI is the theory and development of computer systems able to perform tasks normally requiring human intelligence, such as visual perception, speech recognition, decision-making, and translation between languages.
AI enables technical systems to perceive their environment, deal with what they perceive, solve problems and act to achieve a specific goal. The computer receives data, processes it and responds.
AI systems are capable of adapting their behaviour to a certain degree by analysing the effects of previous actions and working autonomously and are seen as a central to digital transformation.
Common forms of AI in use today range from digital personal assistants, music and video streaming recommendations, chatbots like virtual travel booking agents or for social media sentiment monitoring, through to more advanced AI solutions including cybersecurity, proactive healthcare management, automated financial investing, smart cars or smart homes, cities and infrastructure.
Analysis from PWC reveals how big a game changer AI is likely to be, and how much value potential is up for grabs.
“AI could contribute up to $15.7 trillion to the global economy in 2030, more than the current output of China and India combined. Of this, $6.6 trillion is likely to come from increased productivity and $9.1 trillion is likely to come from consumption side effects.
While some markets, sectors and individual businesses are more advanced than others, AI is still at a very early stage of development overall.”
Key factors that will drive the economic impact of AI on business include:
- Productivity gains from automating business processes, from the use of process automation robots through to autonomous vehicles). This initial phase of AI application mainly centres on enhancing what’s already being done, rather than creating too much that’s new.
- Productivity gains from augmenting the labour force with AI technologies including (assisted and augmented intelligence. Automation of routine tasks & augmenting employees’ capabilities can free them up to focus on more stimulating and higher value-adding work.
- Increased consumer sentiment and demand resulting from availability of personalised and/or higher-quality AI-enhanced products and services.
Almost all aspects of how we work and how we live – from retail to manufacturing to healthcare – have become increasingly digitised.
If you operate in a sector that is gearing up for fast adoption of AI, you’ll need to use AI technology to capitalise and ensure your business doesn’t lose out to faster-moving and more cost-efficient competitors.
No business will be immune from the impact of AI, so even if you’re in one of the sectors or economies where the disruptive potential is lower and adoption likely to be slower, AI will eventually be a factor.
AI is set to be the key source of digital transformation, disruption and competitive advantage in a fast moving environment.
Sectors with the biggest AI potential include:
- Healthcare
- Automotive
- Financial services
- Retail
- Technology
- Communications
- Entertainment
- Manufacturing
- Energy
- Transport and logistics
To realise the potential for AI in your business, firstly work out what AI means for your business through a strategic evaluation of the technological developments and competitive pressures coming up within your sector, how quickly they will arrive, and how you will respond.
It’s important to map the key process flows to be automated and decision flows to be augmented to help develop the cost-benefit analysis for automation or augmentation and develop the insights that help identify potential opportunities or risks.
Identify the operational pain points that automation and other AI techniques could address, what disruptive opportunities are opened up by the AI that’s available now, and what’s coming up on the horizon.
Consider how different AI options can help you to deliver your business goals and your appetite and readiness for change to formulate your AI strategy.
AI has the potential to disrupt any market through the creation of innovative new services and entirely new business models.
Creativity, collaboration and informed decision making can empower organisations from automating or accelerating existing capabilities through to doing things that have never been done before.
AI will not remove all the issues, AI will not remove all the competitors, AI will not remove the need to be an effective communicator, and nor will it remove the need for good business practices. AI will however make those practices easier and more effective, but you will still have to communicate to your teams, your suppliers and customers – and luckily, AI can help you do that as well.