Artificial Intelligence (AI) is revolutionizing various industries and changing the way organizations function. Let’s explore the various ways artificial intelligence (AI) is transforming operations and business models to help organizations remain competitive in the fast-paced digital world of today.

Enhanced data analytics by AI

AI’s role in data analytics marks a monumental shift towards handling vast datasets with precision. Traditional methods often struggle to handle large and complex datasets efficiently. Enter AI-powered analytics: a game-changer that processes massive amounts of structured and unstructured data swiftly.

By leveraging machine learning algorithms, businesses unlock hidden patterns, correlations and trends, leading to sharper predictions and strategic decisions. This capability not only leads to more accurate predictions and actionable insights but also facilitates informed decision-making processes and quick adaptations to changing market dynamics.

Personalising customer interactions

In today’s hyper-connected world, delivering personalised customer experiences has become increasingly important. AI plays a pivotal role in this regard by enabling companies to analyze vast amounts of customer data, including demographics, browsing behavior, purchase history, and social media activity. By leveraging AI algorithms, businesses can generate customised product recommendations, craft targeted marketing campaigns, and tailor offers to individuals. Personalisation strengthens the relationship between companies and customers, enhancing customer satisfaction , fostering loyalty and driving repeat purchases. 

Streamlining operations through intelligent automation

AI’s prowess in automating routine tasks transforms business efficiency and resource allocation. Robotic Process Automation (RPA), powered by AI, automates tasks like data entry, document processing, and customer inquiries. This not only frees up human resources to focus on more strategic activities but also reduces errors, enhances efficiency, and lowers operational costs. AI-enabled chatbots and virtual assistants, for example, are revolutionizing customer service by providing instant and personalised responses to inquiries. 

Optimising supply chains with AI

AI is redefining supply chain management, from demand forecasting to logistics, enhancing reliability and reducing costs. By analysing historical data and market trends, AI-powered tools provide precise demand forecasts, enabling optimised inventory management and streamlined supply chain operations.

AI algorithms analyze historical data, market trends, and external factors such as weather conditions and economic indicators to refine demand forecasts, enabling organizations to better align their supply with demand. This results in streamlined supply chain operations, reduced costs, improved customer satisfaction, and faster order fulfillment. 

Revolutionising maintenance with AI predictive analytics

AI transforms maintenance and operations, predicting issues before they arise and optimizing performance. Predictive maintenance algorithms analyse real-time equipment data, enabling proactive maintenance actions that minimise downtime and extend equipment life. Moreover, AI-driven optimization algorithms can dynamically adjust production schedules, resource allocation, and inventory levels based on demand forecasts, market trends, and operational constraints. This proactive approach to operations management minimizes costs, maximizes productivity, and enhances overall competitiveness.

New business models and revenue streams

AI is enabling the emergence of entirely new business models and revenue streams, disrupting traditional industries and creating new opportunities for growth. Companies are exploring AI-based subscription models, pay-per-use services, and outcome-based pricing models to capitalize on AI-driven innovations. These new business models not only transform existing industries but also pave the way for entirely new approaches to value creation and monetization. By leveraging AI to innovate and create new business models, organizations can unlock new revenue streams and drive sustainable growth in the long term.

Unquestionably, artificial intelligence (AI) is changing business structures and operations, revolutionizing how companies function and compete in the current day. Businesses may increase decision-making, expedite procedures, and open up new development and innovation opportunities by incorporating AI technologies.

Key Benefits of AI for Business

As organizations increase their use of artificial intelligence technologies in their operations, they’re reaping tangible benefits that are expected to deliver significant financial value.

Eighty-nine percent of organizations believe AI and machine learning will help them grow revenue, boost operational efficiency and improve customer experiences, according to research firm Frost & Sullivan’s “Global State of AI, 2024” report.

Those are only a few of the benefits AI can deliver.

Here are some benefits the technology brings to organizations across various industry sectors.

1. Better decisions

Organizations increasingly use AI to gain insights into their data — or, in the business lingo of today, to make data-driven decisions. As they do that, they’re finding they do indeed make better, more accurate decisions instead of ones based on individual instincts or intuition tainted by personal biases and preferences.

As an example, Kavita Ganesan, an AI adviser, strategist and founder of the consultancy Opinosis Analytics, pointed to one company that used AI to help it sort through the survey responses of its 42,000 employees. The technology analyzed narrative responses and presented summarized findings — an approach that let company officials effectively understand what workers wanted most rather than offering them options to rank via check-the-box choices.

2. Efficiency and productivity gains

Efficiency and productivity gains are two other big benefits that organizations get from using AI, said Adnan Masood, chief AI architect at UST, a digital transformation solutions company.

Masood said AI lets organizations handle tasks at a volume and velocity that’s simply not possible for humans to match, whether they’re using AI for search or to analyze data for insights, create software code or execute specific business processes.

AI not only works at a scale beyond human capacity, Masood noted, but it removes time-consuming manual tasks from workers — a productivity gain that lets workers perform higher-level tasks that only humans can do. He pointed to the use of AI in software development as a case in point, highlighting the fact that AI can create test data to check code, freeing up developers to focus on more engaging work.

This lets organizations minimize the costs associated with performing mundane, repeatable tasks that can be performed by technology while maximizing the talent of their human capital.

3. Improved speed of business

As fast as business moves in this digital age, AI helps it move even faster, said Seth Earley, author of The AI-Powered Enterprise and CEO of Earley Information Science. “It’s all about speeding up the clock of the enterprise,” he said. AI essentially enables shorter cycles and cuts the time it takes to move from one stage to the next — such as from design to commercialization — and that shortened timeline, in turn, delivers measurable ROI.

4. New capabilities and business model expansion

Executives can use AI for business model expansion, experts said, noting that organizations are seeing new opportunities as they deploy data, analytics and intelligence into the enterprise.

For example, autonomous vehicle companies could use the reams of data they’re collecting to identify new revenue streams related to insurance, while an insurance company could apply AI to its vast data stores to get into fleet management.

5. Personalized customer services and experiences

AI analyzes and learns from data to create highly personalized and customized experiences and services, said Brian Jackson, principal research director at Info-Tech Research Group.

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He said the most visible examples of this come from the consumer world, as streaming services, such as Netflix, and retailers use intelligent systems to study buying patterns, individual consumer data and larger data sets to determine what each customer prefers at any given time to suit their personal style, interests and needs.

However, AI delivers that personalization in numerous other areas, such as in healthcare, where it customizes treatments, and in work environments to support an employee’s individual requirements.

6. Improved services

AI creates interactions with technology that are easier, more intuitive, more accurate and, thus, better all around, said Mike Mason, chief AI officer with consultancy Thoughtworks. He cited a real estate site that employs generative AI so users can refine their property listing searches through conversational queries rather than clicking through boxes.

“The AI understands an unstructured query, and it understands unstructured data,” Mason explained. In other words, the technology can analyze a user’s request even when it’s given in plain, conversational language; analyze all the descriptive elements within each listing, including narrative notes added by real estate agents; and present the user with a finely tuned and highly accurate list of properties that meets their requirements.

7. Improved monitoring

AI’s capacity to take in and process massive amounts of data in real time means organizations can implement near-instantaneous monitoring capabilities to alert them to issues, recommend actions and, in some cases, initiate a response, according to experts.

For example, AI can improve quality control in manufacturing as well as use information gathered by devices on factory equipment to identify problems and predict needed maintenance. The latter prevents disruptive breakdowns and costly maintenance work performed because it’s needed rather than scheduled.

AI’s monitoring capabilities can be effective in other areas, such as in enterprise cybersecurity operations where large amounts of data need to be analyzed and understood.

8. Better quality and reduction of human error

Organizations can expect a reduction of errors and stronger adherence to established standards when they add AI technologies to processes. Furthermore, when AI and machine learning are integrated with robotic process automation — commonly known as RPA, which automates repetitive, rules-based tasks — the combination not only speeds up processes and reduces errors but can also be trained to improve upon itself and take on broader tasks.

As a result of that error reducing and higher quality, “AI improves the value proposition,” Earley said.

The use of AI in financial reconciliation, for example, delivers nearly always error-free results, whereas that same reconciliation when handled, even in part, by human employees is prone to mistakes.

9. Better talent management

Companies are using AI to improve many aspects of talent management, from streamlining the hiring process to rooting out bias in corporate communications. Moreover, AI-enabled processes not only save companies in hiring costs but also can affect workforce productivity by successfully sourcing, screening and identifying top-tier candidates.

As natural language processing tools have improved, companies are also using chatbots to provide job candidates with a personalized experience and to mentor employees. Additionally, AI tools can gauge employee sentiment, identify and retain high performers, determine equitable pay and deliver more personalized and engaging workplace experiences with less requirements on boring, repetitive tasks.

10. More innovation

As workers at all levels become more comfortable and confident working with AI, experts said they’re starting to use AI tools to help them be more creative and more innovative.

In her book, Ganesan described how a restaurant chain used the technology to power a mobile app that enables customers to craft their own cocktails based on their mood and food choices, with the tool concocting the recipe and then sending it to a human bartender to mix and serve.

Other industries use AI to support R&D activities, such as in the healthcare space for drug discovery work and the consumer product goods sector for new product creation.

11. Increased profitability

As they use AI in more areas of the enterprise — from personalizing services to aiding in risk management to supporting innovation — organizations will see improved productivity, reduced costs, higher efficiency and possibly new growth opportunities.

Taken together, the a business-savvy use of AI can deliver higher profitability, said Sreekar Krishna, U.S. leader of AI at professional services firm KPMG. “On the revenue side, its potential is exponential: You can keep growing as long as you’re bringing value to customers.”

12. Industry-specific improvements

In addition to the benefits listed above, AI can fuel the following industry-specific improvements:

• Retailers can use AI to better target their marketing efforts, develop a more efficient supply chain and better calculate pricing for optimal returns. At retail companies, AI helps predict customer requirements and appropriate staffing levels.
• The pharmaceutical sector can use the technology to perform drug discovery data analysis and predictions that can’t be done with conventional technologies.
• The financial industry can use AI to reduce risk and strengthen its fraud detection efforts.

It’s important to remember that, as companies find ways to use AI for competitive advantage, they’re also grappling with challenges. Concerns include AI bias, government regulation of AI, management of the data required for machine learning projects and talent shortages. In addition, financial gains can be elusive if the talent and infrastructure for implementing AI aren’t in place.