Artificial Intelligence (AI)
Artificial Intelligence (AI) technology enables computers and machines to acquire and apply cognitive skills that would normally require human intelligence. This includes skills like data analysis, reasoning, voice recognition, and more. AI can benefit businesses in many ways, such as enhancing their products and services, streamlining their operations and processes, and boosting their customer satisfaction/ loyalty. Moreover, AI can create new opportunities and markets for businesses by fostering innovation and creativity.
While AI has started becoming more prevalent in recent years, a large percentage of companies already utilize AI in various ways. A study from IBM found that 35% of companies are currently utilizing AI, while another 42% of companies are exploring AI solutions. Furthermore, companies utilizing AI chatbots to manage customer requests found up to a 70% decrease in inquiries, significantly reducing the need for customer service resources [3]. Despite some concerns such as data security and biases, AI algorithms leverage specialized parameters that are developed and fine-tuned to mitigate any potential issues.
AI encompasses a wide range of technologies such as Machine Learning, Neural Networks, and Computer vision, each having its own specific use cases. Machine Learning (ML) uses data and algorithms to find patterns, make predictions, and improve without explicit programming. ML is at the core of a variety of applications such as image & voice recognition, fraud detection, natural language processing (interpreting and manipulating human input), and more. Neural Networks use interconnected nodes (based on biological neurons) to efficiently run algorithms such as ML, deep learning, gradient descent, etc. to learn from data and recognize obscured patterns. Neural Networks can be leveraged in everything from stock market predictions to logistical optimization. Computer Vision uses specialized algorithms to allow machines to interpret pictures and videos, which drives applications such as AI medical diagnosis, production automation, facial recognition, and autonomous driving. While these are currently the main subclasses of AI, there is a variety of other divisions focused on providing various solutions.
One upcoming branch of AI is Artificial General Intelligence (AGI) which focuses on creating a machine that has the ability to understand/ learn any intellectual task that a human could, without explicit programming. While AGI has vast potential, such as automating human tasks or the ability to solve complex problems in fields such as medicine, finance, and engineering, AGI is still currently in the research and development phase. Due to issues with non-explicit programming and the possibility of the AI becoming uncontrollable, a functioning version of AGI is not yet available. However with prominent companies like OpenAI, Google, and Facebook Research working on the technology, AGI based applications are on the horizon.
Key Benefits:
While AI covers a wide range of technologies, many of the common benefits are shared across the various solutions. Some of AI’s most common benefits include: Reduced Human-Intensive Labor, Increased Productivity & Efficiency, Real-time & Predictive Analytics, Automated Workflows, and Enhanced Customer Experience.
Reduced Human-Intensive Labor: By leveraging AI programs/ technologies such as robotic process automation (RPA), chat assistants, and data management tools, organizations can automate repetitive and tedious tasks that consume a lot of time and human effort. This enables employees to focus on more creative and strategic tasks, adding value to organizations and reducing their operational costs. Furthermore, by leveraging data-driven algorithms to perform quality checks and detect anomalies, AI can reduce or avoid errors that stem from human fatigue, bias, or negligence.
Increased Productivity & Efficiency: By leveraging AI software to analyze business processes, identify patterns, and automate tasks, companies can optimize workflows and ensure operations are running at maximum efficiency. Furthermore, a study conducted by Accenture showed that utilizing AI technology can boost labor productivity by 40%, which in turn increases business output and profits.
Real-time & Predictive Analytics: AI can process and analyze large amounts of data in real-time to provide insights/ forecasts that can help businesses make better decisions. Additionally, AI utilizes pattern detection to identify anomalies, which helps reduce business risks and costs by predicting future issues and the best mitigation strategy. Since the analysis is done constantly (instead of daily, weekly, or monthly), these insights can significantly reduce the time to remediate incidents as well as provide consistent optimization opportunities.
Automated Workflows: AI can streamline workflows and processes by integrating different systems and applications, eliminating the extra time and resources that would be necessary if human intervention was required; research shows that by utilizing AI and Big Data technologies, businesses can automate up to 80% of physical work, 70% of data processing tasks, and 64% of data collection tasks [4]. Furthermore, AI can enable self-service options for customers and employees, which can reduce wait-times and improve convenience.
Enhanced Customer Experience: Utilizing programs such as natural language processing and chatbots, AI can analyze data from various sources and identify customer patterns to provide personalized and interactive services. AI can perform tasks such as answering common inquiries, offering tailored recommendations (such as suggesting relevant products or services), and providing feedback and/ or support.
Market Outlook:
The AI market is currently considered one of the most innovative and disruptive markets in the world, with a projected compound annual growth rate (CAGR) of 40% from 2021 to 2028. In 2021, the global AI market was valued at $47.9 billion and is expected to exceed $360 billion by 2028 [1]. Furthermore, AI applications are projected to create over $15 trillion in value for the global economy by 2030 (roughly 10% of the projected global GDP at that time) [2]. While AI has traditionally been a domain of the technology and financial industries, market sectors such as transportation, logistics, security, etc. are finding innovative applications for artificial intelligence.
Some key factors in the recent expansion of AI adoption include advancements in AI’s proficiency and accessibility with technology such as ChatGPT (Generative Pretrained Transformer), the enhanced ability to store and manipulate the large amounts of data required for AI functionality, and the increasing need to efficiently analyze large datasets generated by technologies such as IoT. Some of the leading providers in the AI market include Microsoft, OpenAI, Cisco Systems, IBM, and Amazon.
Additionally, with the release of ChatGPT 3.5 in December 2022 and the newly released ChatGPT 4, AI has become more functional and accessible than ever. ChatGPT 4 is an AI language model that has the ability to generate human-like responses, answer questions, and more while functioning not only on text based information but images as well. As such, the program is very versatile, powering chatbots, virtual assistants, and content creation. ChatGPT 4 is currently one of the most advanced AI models available and is already implemented in a variety of applications, such as Microsoft Bing’s search engine, Slack’s predictive writing features, and Amazon’s marketing. Furthermore, OpenAI has made ChatGPT very accessible by offering a free version of the application for individuals who are interested in testing/ utilizing its capabilities.
BwB Advisors' Methodology for Adopting New Technologies:
The business world and the technological world must evolve parallel to each other. No matter your organization’s industry, implementing new technology in an organization is vital for staying competitive in the dynamic markets of today. Nevertheless organizations should proceed cautiously in deciding which technologies are needed and how to implement them — one size does not fit all.
At the BwB Advisors, our Technology Adoption Methodology (TAM) follows a 6 phase process and provides a complete roadmap from identifying an advantageous technology all the way through its deployment so that your organization can ensure success.
To learn more about us and our Technology Adoption Methodology click here.
May 2023 / Insights / By: Michael T. Casarona
References:
[1] Grand View Research. (2023). Artificial intelligence market size & share analysis report 2030. Retrieved from https://www.grandviewresearch.com/industry-analysis/artificial-intelligence-ai-market
[2] McKinsey Global Institute. (2017). Artificial intelligence: The next digital frontier? Retrieved from https://www.mckinsey.com/~/media/McKinsey/Industries/Advanced%20Electronics/Our%20Insights/How%20artificial%20intelligence%20can%20deliver%20real%20value%20to%20companies/MGI-Artificial-Intelligence-Discussion-paper.ashx
[3] 25% of customer service operations will use VCAS. Gartner. (n.d.). Retrieved March 11, 2023, from https://www.gartner.com/en/newsroom/press-releases/2018-02-19-gartner-says-25-percent-of-customer-service-operations-will-use-virtual-customer-assistants-by-2020
[4] Brown, A. (2022, November 9). Utilizing AI and big data to reduce costs and increase profits in departments across an organization. Forbes. Retrieved March 15, 2023, from https://www.forbes.com/sites/anniebrown/2021/04/13/utilizing-ai-and-big-data-to-reduce-costs-and-increase-profits-in-departments-across-an-organization/?sh=759a45926af7
