How important is Artificial Intelligence (AI) technology for the digital transformation of your business? Here are some interesting statistics: AI-based digitalization is the top priority for 87% of senior business executives. 37% of CEOs invested in digital transformation initiatives during the COVID-19 pandemic. 70% of customer engagements will be influenced by AI-based intelligent systems in 2022. By 2030, 29% of existing jobs will be lost due to AI-based automation – and 13% of new jobs will be created by AI adoption. CEOs can successfully augment human capabilities with AI and other smart technologies. Here’s what CEOs need to understand about AI technology before starting their digital transformation program.
The first thing that CEOs need to realize is that AI is no longer a future technology – but is now an integral part of every digital transformation initiative. They need to educate themselves about the core capabilities, as well as the strengths and weaknesses, of AI tools and technology.
As a CEO, your company’s performance correlates with you and your executive team’s digital acumen and skills. A PwC survey on Digital IQ found that the leadership team of 54% of leading financial performers are digitally savvy – compared to 41% among other companies. Along with a base-level understanding of AI, you must develop a vision of how to integrate this technology across your business processes.
Due to their high initial costs, most CEOs hesitate to invest heavily in AI-based solutions. However, it’s important to understand and quantify how AI can reduce business costs in the long run.
For example, AI technology can help in automating processes previously performed by human employees. This, in turn, improves business efficiency and frees up your workforce to focus on high-value jobs. Additionally, the use of AI enables CEOs to track and optimize their business expenses across various departments.
Every AI initiative starts with business data. For CEOs, a well-designed data capture and management strategy is as important as AI implementation. With high-quality data, you can extract valuable insights to help you design and power a focused AI strategy.
To maximize your returns from AI solutions, you need a feedback system that allows you to iterate and improve the initial performance of your AI models. This in turn will inform your data strategy, help you get more out of automation and scale your business operations. Besides an effective data strategy, you must also focus on building Machine Learning models that can resolve specific business problems. Currently, only 36% of AI adopters can deploy the Machine Learning model beyond the pilot stage.
By using AI technology, CEOs can reduce workloads through automation and predictive analytics to save money. AI-enabled chatbots can interact with customers at any time of the day Automated solutions like chatbots can easily scale up to handle seasonal and unexpected demand: weather delays that affect airline flights across the globe, customer service inquiries stemming from questions that people have on the gifts they received during christmas AI-powered apps like Amazon and Uber can predict what customers are looking for and where they are looking to provide service and scale up or down the amount of goods close to a customer or show the amount of drivers in a certain area. Small business retailers can personalize their customer offerings with predictive analytics and recommend systems to offer more of a good or by offering enticing discounts to selected customers. Additionally, AI technology can assist marketing efforts by automating replies to customer emails or sending brand marketing emails through multiple digital channels.
Along with developing an understanding of AI capabilities, CEOs must realize the potential of Machine Learning (ML). According to McKinsey Global Institute, 45% of modern workplace activities can be automated – of which 80% can be automated using ML technology.
Effectively, ML technology is widely used in a host of business applications including natural language processing, image recognition, and business intelligence (BI). Here are 5 ways in which your business can benefit from adopting Machine Learning: Real-time business decision-making Intelligent process automation Reduced business operating costs Addressing the data security needs of your organization Redefining your business model to meet changing customer and market needs
As digital transformation continues to impact every business sector, CEOs must reevaluate their business processes and management practices and align them with new capabilities enabled by AI. To stay competitive, it’s simply not enough for them to adopt AI and Machine Learning technologies in “bits and pieces”. What is required is a commitment to a process to implement Machine Learning, which starts with building cross-functional teams, implementing best practices. Without digital transformational initiatives and a commitment to new ways of operating, organizations will be disrupted by competitors that use new technology more effectively to get an advantage.
CEOs must understand how AI technology can fit into their digital transformation strategy, and how to combine AI technology and human capital to create a competitive advantage in their industry.