AI’s strategic relevance is rising at a rapid pace. Many businesses are already experiencing the benefits of AI and thus will expand their operations as a consequence.
Every senior executive and board member must be aware of the main AI developments that will affect their companies.
As per ResearchAndMarkets.com, the worldwide AI market is anticipated to increase at a CAGR (Compound Annual Growth Rate) of 28 percent, an increase to $51 million in 2021 from $40 million in 2020. The market is projected to expand to $171 billion by 2025, growing at a 35% CAGR.
Companies that are AI leaders are constructing an AI flywheel that might allow them to extend their advantage over their competition. The flywheel effect is largely caused by AI systems are designed which perform well and generate additional data afterward, which aids the system is continuously improving its performance. A rival will eventually be unable to close the gap.
Another such flywheel effect is the capacity to recruit AI talent by creating an organization that can provide chances for advancement in AI for such talent.
Organizations that have completely adopted AI are mainly concerned with:
- Providing improved customer experiences
- Enhancing decision-making and
- Developing new services and products
COVID-19 encouraged several businesses to increase their operations in artificial intelligence. AI is utilized in strategic choices like workforce planning, scenario planning, supply chain resilience, and demand predictions, as per a PWC survey.
Most businesses do a strategic planning/annual scenario exercise. AI has the potential to make strategic planning a continuous activity. This strategic plan may be continuously updated by building AI models based on differences in supply, demand, operations, competitor movements, and more.
AI can assist a firm in moving away from past historical reporting and toward smart forecasting by detecting new risks and possibilities.
Organizations want to confront AI threats, but they are sluggish to respond. Strengthening privacy, explainability, prejudice reduction, as well as cyber protection are among the main priorities.
AI is powered by data, thus consumer protection and data privacy are critical.
AI can be a mystery at times. In some situations, it is necessary to understand why and how AI reaches certain decisions. In certain instances, it is unimportant. However, you must understand when it is necessary and when it is not.
AI can be subject to a wide range of bias concerns. The board of directors, as well as senior management, must comprehend how to reduce risk factors and ensure that the appropriate measures are implemented.
When government entities employ AI, cyber risks can grow more dangerous. It’s a never-ending battle.
Some jobs will be replaced by AI. However, the most significant aspect of AI is that it will replace numerous tasks. Assume a task consists of several tasks that can be completed more efficiently than by a human. That position is likely to be substituted in that situation.
If a job has certain activities that AI can do better and others that humans can do better, then AI can enhance and improve that human’s work output.
New employment will be generated in certain situations as a result of the creation, administration, and continuing maintenance of AI-based technologies. Creating these positions may be difficult, and each firm must identify the right method and the kind of people needed to succeed.
Furthermore, all employees will need to grasp how AI will affect their employment. Some may need to be taught whole new abilities, while others are required to understand that AI is not really a danger but an advantage. Everyone will be anxious about how artificial intelligence will affect their future.
The administration will need to convey the effects of AI on employment and the business as a whole extensively.
A culture transformation is required for a firm to properly capitalize AI. The organisation must become more data-driven. It must learn to share information, subject matter knowledge, and AI systems across the company, therefore breaking down conventional silos.
While automating regular activities is vital and provides a rapid return on the investment, it’s not a primary concern for firms that have implemented AI.
The highest-ranked AI applications for 2021, as per PWC, are:
- Risk, fraud, and cybersecurity risks management.
- AI ethics, bias detection, and explainability improvement.
- Assisting workers in making better decisions.
These apps are far-reaching and strategic, and they will benefit much from organizational change since they are developed, built, and deployed.
Whether or not you want to purchase or create your AI-based systems, ongoing communication between the board, project leaders, and senior management is required. Data scientists, line managers, AI developers, and solution users will need to work together even more.