Three AI Strategies To Ensure Profitable Growth
*This is a sponsored feature by Accenture.
Artificial Intelligence is more a futuristic technology that companies merely do pilots with, but is at the heart of digital-driven businesses today. AI can offer transformational business benefits if deployed in a business-centric manner.
Once confined to the realm of science fiction, AI is at the heart of business today – with multiple organisations in India leveraging the power of AI for at the core of their business. Moving beyond pilot projects to test the waters, Indian companies are clearly investing in AI to obtain real business benefits. An IDC study amongst 194 organisations across sectors in India reveals that 68.6% organisations are likely to deploy AI before 2020.
Another report published by KBV Research says that the AI market in China and India are expected to post a strong 42.1% and 49.3% growth during this period—India will grow faster than China when it comes to AI adoption.
AI and profitability
Nearly 64% of the companies surveyed by IDC said that AI can result in revenue augmentation due to improved targeting of offers and productive sales processes. Interestingly, an Accenture report, How AI boosts industry profits and innovation underlines the same with far more clarity. Accenture research reveals that with AI, 16 industries across 12 economies may potentially experience improvement in their profitability by 38%, amounting to a $14 trillion economic boost by 2035.
Harnessing AI’s true power
Going a step forward, Accenture has spelt out a few key cross-industry strategies to help businesses leverage AI to its fullest potential for real business advantage:
Ø Intelligent automation
In 2014, when a massive fire at a DRAM chip factory led to shortage of DRAM shipments, all the global customers of the chip-maker were severely hit by a resultant price-hike, except for customers of Elementum, an AI start-up. Elementum’s customers purchased stocks well before prices rose due to advanced warning that Elementum’s AI system provided.
With its ability to analyse 10 million+ incidents daily and products (manufacturing outputs and shipped goods) worth $25 trillion, Elementum helps organisations like Tesla and Johnson & Johnson with advance warnings and alternative solutions whenever any supply chain issue is anticipated. Thus, the intervention of AI-powered intelligent automation in critical business processes (such as supply chain) can help organisations stay ahead of competition even during challenging scenarios.
Ø Labour and capital augmentation
Organisations can immensely benefit by allocating tedious, time-consuming tasks to AI while reserving fruitful endeavours for their employees. For example, car insurers in India have to process tens of thousands of claims flowing in customers and their authorised service partners every week. AI can bring immense efficiency to claim processing, a time-consuming activity, and free up valuable human resources for more productive jobs. Similarly, as the AI system improves its understanding over time, it can also detect fraudulent claims or at least mark the suspicious ones for review by a human officer.
Organisations can leverage AI to get maximum returns on capital employed. For instance, in the wind energy business, a sudden breakdown of a turbine would call for availability of specialised maintenance staff, spare parts, and equipment sourcing to ensure speedy restoration for business continuity. The longer the delay in service restoration, deeper the business-losses. NEM, an AI start-up, examines past incidents of turbine failure, monitors every component 24x7 and sets off alerts when any symptoms of impending issues are detected. This way, the energy company can minimise downtime and improve returns on capital invested.
Ø Innovation diffusion
Businesses can also employ AI to expedite new product development and time-to-market, thus improving working capital utilisation. For instance, new drug discovery is the biggest challenge for pharmaceutical companies due to the high capex costs and long pipelines associated with drug discovery and testing. Besides, fewer than 10% of new drugs get final approval from regulators after testing. The biopharma major Berg Health analyses trillions of data points on a cancer’s progress by observing cancerous as well as non-cancerous cells with AI. This way, Berg Health has reduced the cost of discovery of a drug from $2.6 billion to $1.3 billion, saving a mammoth 50 percent in the process, which can be utilised to develop a new drug, thus increasing chances of business success.
Winning the AI battle
In India, industries such as financial services, retail, healthcare and information security are the early adopters of AI. A vibrant ecosystem of AI start-ups can also be seen active in the country, to support large and small businesses deploying AI for business transformation. The Accenture strategies mentioned above can help companies in India to navigate their AI journey in a viable and speedy manner and ride the AI wave to growth and profitability.