Whenever individuals utilize wayfinding applications to navigate from one location to another, employ speech-to-text dictation, or employ facial recognition technology such as Face ID to unlock their phones, they are relying on artificial intelligence (AI). Simultaneously, companies spanning various sectors are increasingly relying on AI and making substantial investments to enhance customer service, boost operational efficiency, empower their workforce, and achieve numerous other objectives.
In the year 2021, among executives leading the world's largest 2,000 companies (based on market capitalization), those who included discussions about AI in their earnings calls experienced a 40% higher likelihood of observing an increase in their company's stock prices. This marked a significant rise from the 23% figure recorded in 2018, as revealed by an analysis conducted by Accenture.
However, despite the evident potential of AI and the resources invested, most organizations are merely scratching the surface when it comes to fully harnessing AI's capabilities and maximizing the returns on their investments. Recent research has unveiled a striking revelation: just 12% of companies have progressed sufficiently in their AI capabilities to experience remarkable growth and transformative changes in their business operations. These exceptional entities, referred to as Generative AI Achievers can directly attribute nearly 30% of their total revenue to AI integration, on average. Interestingly, even before the pandemic, in 2019, they were already enjoying a substantial 50% greater average revenue growth compared to their industry counterparts. Furthermore, they consistently outperform in aspects like customer experience and sustainability.
Trends highlighted by our machine learning models indicate a swift and substantial rise in the number of AI Achievers. It is projected to more than double from the current 12% to reach 27% by 2024. The advancement of AI maturity is no longer a matter of "if" but "when." This presents a profound opportunity that extends to every industry, every organization, and every leader. Our research underscores that there are compelling incentives to act swiftly and embrace AI transformation.
Empowering C-Suite Leaders: The Accelerating Impact of AI
According to a recent survey involving over 1,600 C-suite executives and data-science leaders representing some of the world's largest organizations, an impressive 75% of these companies have successfully incorporated AI into their business strategies. Additionally, these companies have made substantial adjustments to their cloud strategies to facilitate the achievement of AI-driven success.
Moreover, these businesses are not just formulating plans; they are actively implementing them. A notable 30% of all AI pilot projects are being expanded to yield a broad spectrum of benefits, ranging from expediting research and development timelines for new products to elevating customer experiences. Remarkably, 42% of the respondents reported that the returns on their AI initiatives exceeded their initial expectations, underlining the substantial value AI brings. Only a mere 1% reported that their AI endeavors fell short of their expectations. With these initial successes instilling confidence in AI's capacity to generate value, it is anticipated that AI transformation will transpire at a considerably swifter pace than digital transformation. In fact, it is estimated that AI transformation will occur, on average, 16 months more rapidly than the broader digital transformation initiatives.
What is AI Maturity?
AI maturity depends on the adept combination of essential capabilities across data and AI, as well as strategic organizational planning, fostering the right talent, and cultivating a supportive culture. Research has highlighted that achieving AI maturity is contingent upon the proficient development of a specific set of key capabilities, encompassing not only data and AI, but also organizational strategy, talent, and culture. These capabilities are categorized into two broad groups. The first group comprises "foundational" AI capabilities, such as cloud platforms and tools, data platforms, architecture, and governance. These foundational elements are indispensable for companies to stay competitive in the AI landscape.
The second group encompasses "differentiation" AI capabilities, including AI strategy and C-suite sponsorship, along with a culture of innovation. These differentiating factors have the potential to set companies apart from their peers. Companies that excel in both foundational and differentiation capabilities are referred to as "AI Achievers." On the other hand, "AI Builders" exhibit strong foundational capabilities but only average levels of differentiation capabilities, while "AI Innovators" demonstrate robust differentiation capabilities but average foundational capabilities. The survey results show that collectively, Achievers, Builders, and Innovators make up just 37% of the organizations surveyed, with Achievers accounting for 12%, Builders for 12%, and Innovators for 13% of this subset.
Evaluating the worth of AI is a challenging task for numerous reasons. To approach this, it is beneficial to shift our perspective away from "artificial intelligence" and instead consider it as "Advanced Information Processing." This way, we can perceive this technology not as an independent thinking entity, but as a powerful tool. When we view AI as a tool, it provides us with the capacity to innovate and create new solutions.
AI Adds Value
Machine learning algorithms have revolutionized data processing, enabling capabilities that were previously unattainable due to the scarcity of data and computing power. While the underlying mathematical principles have existed for years, their practicality was limited by these constraints. Today, the landscape has evolved significantly. Machine learning empowers us to gather vast amounts of data by achieving two critical feats:
Identifying Causation: Machine learning can uncover causal relationships from extensive datasets, a task that was once considered impossible. This ability enables us to gain deeper insights into complex phenomena.
Automated Data Discovery: Machine learning can autonomously locate specific data points without the need for engineers to construct decision trees or elaborate rule-based systems. This streamlines the process of extracting valuable information from datasets.
Advanced information processing, which serves as the foundation of AI, introduces new value propositions for companies. It's essential to recognize that AI, at its core, is all about Advanced Information Processing. However, the utilization of AI tools varies among companies. Not every organization can harness AI in the same way. For instance, companies dealing with vast amounts of information can extract more significant benefits from AI, whereas those with less data to manage may find its impact less pronounced.
How to Adopt AI to Increase Business Value?
In today's rapidly evolving landscape, artificial intelligence has transcended theoretical concepts and has firmly established itself as an indispensable tool for businesses seeking to remain competitive," stated Nitin Mittal, who serves as the U.S. AI co-leader and principal at Deloitte Consulting LLP. "The AI Dossier has been designed to address the questions of business leaders who are keen to grasp the concrete contributions AI can make to their organizations, both now and in the foreseeable future."
“The AI Dossier" presents a comprehensive exploration of AI applications within six distinct industries, encompassing consumer-oriented sectors, energy, resources, and industrial operations, financial services, government and public services, life sciences and healthcare, as well as technology, media, and telecommunications. Within each industry, the report spotlights practical, business-ready AI use cases, providing insights into the core business challenges and opportunities these technologies can address, the advantages AI can offer, and the anticipated returns on investment. Furthermore, the report identifies the emerging AI use cases that are poised to exert a substantial influence on each industry's trajectory.
AI creating Business Values
AI outlining six primary ways in which AI can contribute value to businesses:
Cost Reduction: AI and intelligent automation solutions can be leveraged to automate tasks that are repetitive and of relatively low value, leading to reduced costs by enhancing efficiency and quality.
Speed to Execution: By minimizing latency, AI helps businesses expedite the achievement of operational and business outcomes, reducing the time required for tasks.
Reduced Complexity: AI enhances understanding and decision-making through proactive and predictive analytics, making it adept at identifying patterns in increasingly complex data sources.
Transformed Engagement: AI alters the way people interact with technology, allowing businesses to engage with individuals on human terms, as opposed to forcing human interaction to conform to machine terms.
Fueled Innovation: AI empowers innovation by enabling the development of innovative products, markets, and business models, ultimately redefining how and where a business can succeed.
Fortified Trust: AI plays a crucial role in safeguarding businesses from risks like fraud and cyber threats, while also improving quality and consistency. It enhances transparency, thus bolstering brand trust.
In conclusion, the pursuit of strategic advancement for AI maturity is not just a technological endeavor, it represents a transformative journey that impacts every facet of our society. As organizations and governments invest in AI technologies, they must consider ethical, legal, and societal implications. Achieving AI maturity is not merely about deploying cutting-edge algorithms; it requires a holistic approach that integrates responsible AI practices, data privacy, and ongoing monitoring and governance.
Moreover, collaboration among stakeholders, including businesses, researchers, policymakers, and the public, is crucial for steering AI development in a direction that maximizes its benefits while minimizing potential risks. Ultimately, the strategic advancement for AI maturity holds the potential to revolutionize industries, improve decision-making, and enhance the quality of life for individuals worldwide.
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