What is Artificial Intelligence (AI) in Business?
What is Artificial Intelligence (AI) in Business?
SAGAR KOLEJULY 16, 2020
The impact of artificial intelligence in business, according to Accenture, has the potential to increase
productivity by 40 percent or more. With the World Economic Forum statistics on the impact of AI by
2022, over 75 million human jobs will have been replaced by AI, at the same time, creating 133
million jobs, refuting the misconception that the adoption of AI will leave more people jobless.
WHAT IS ARTIFICIAL INTELLIGENCE (AI) IN BUSINESS?
With the increasingly vast amount of data available today and the constantly evolving preferences
and complexity of customers, businesses can no longer rely on traditional business methods to drive
growth. These radical changes have opened up new realm of possibilities, with AI, to drive business
growth through actionable insights generated from customer data.
Artificial intelligence in business simply involves the use of intelligent computer software with
human-like capabilities to boost revenue, improve customer experience, increase productivity and
efficiency, and drive business growth and transformation.
WHY SHOULD COMPANIES USE AI?
Business processes in the 21st century is characterized by a high level of complexity involving tasks
that are stressful and inefficient to be carried out by humans. Business in today’s world is dominated
by the era of data. Companies can obtain valuable insights on strategies that can radically drive
growth from data.
Hence, the need for businesses to uniquely understand the needs and preferences of customers is
invaluable in today’s business world; to thrive and maintain relevance within the fierce competition.
Using artificial intelligence in business, companies can now uniquely understand and engage
customers, automate business processes and improve productivity and revenue while reducing
operational expenses.
EXAMPLES OF ARTIFICIAL INTELLIGENCE IN BUSINESS
The current era of data has stimulated the rise of many applications of artificial intelligence in
business including data analytics, personalized business offerings and automation.
Here are a few examples of artificial intelligence in business:
AI IN CUSTOMER SERVICE
The replacement of humans with AI in customer service is another controversial example of artificial
intelligence in business. With the advent of chat-bots, customers can now interact with companies in
real-time to resolve complaints, place orders, get information and do almost anything they would
require from having a conversation with a human customer-care representative.
According to Gartner, 85% of customer interactions will be managed without a human by 2020. This
disruptive innovation of artificial intelligence in business will alleviate the need for humans in
customer interaction, reducing business costs and exponentially improving customer care
accessibility and conversational experience.
BUSINESS INTELLIGENCE
With the increasing amount of available business data, finding insights from the data can be quite
challenging. This has driven the routine adoption of artificial intelligence in business intelligence to
obtain valuable insights from data.
These insights help companies improve the effectiveness of marketing, understand customers
better, perform segmentation to create personalized experiences, and develop business strategies to
aid corporate decision making and leverage artificial intelligence in business management.
There are quite a number of tools today that involve the use of artificial intelligence in business
intelligence. Popular tools include Microsoft Power BI that helps companies get key analytics to
know which strategies and decisions have great influence on business metrics. Additionally, the
integration of Machine learning capabilities within Power BI can help businesses create machine
learning models to make valuable forecasts and predictions from data and automate business
processes.
PERSONALIZED AND TARGETED MARKETING
The key to growing company revenue requires knowing the wants of a consumer and knowing what
to market to each consumer. In our world of increasing digital engagement, customers have
extremely limited time with too many companies trying to market their products to them. This
accounts for the rising need to market only what attracts each customer and knowing who to market
each of a company’s product too.
With data obtained from the online activities of customers, companies can now use AI to predict and
target who to market a particular product to in order to increase the chances of sales and
effectiveness of marketing activities at the same time, reducing the overall marketing cost.
PRODUCT RECOMMENDATION AND PREDICTIVE ANALYTICS
To increase the effectiveness of marketing efforts and the engagement of customers with a
company’s product, companies need to be able to recommend products that will retain the interest
of their customers and satisfy the desires of a customer. Companies like Netflix, Spotify, Amazon,
etc., now use AI to understand the habits/behaviours of customers to predict which product to
recommend.
Spotify, for example, monitors and understands the listening behaviour and song preferences of
users and uses AI to provide song recommendations that each user may likely enjoy. Other
companies like Netflix make use of AI recommendation systems to keep users entertained and
addicted to their product by providing movie recommendations that appeals uniquely to each user,
based on their distinct experiences.
Approximately 75 percent of what users watch on Netflix come through these recommendations and
the company’s AI recommendation reduces expenses by about $1 billion each year. Banks and
Fintech companies also use AI for predictive analytics, in fraud detection and in determining
customers that are likely to repay loans before approving loan requests.
NATURAL LANGUAGE PROCESSING
If you’re one of those asking, “when will machines be able to read, write and understand languages
like humans?” Well, the answer is NOW! With advancements in natural language processing,
companies now offer smart digital assistant products to assist users in routine tasks.
Companies now use AI to generate automated business reports without human supervision and also
carry out sentiment analysis to understand people’s perception of their brand from various online
comments, tweets, etc., about the company.
Through sentiment analysis, companies can constantly understand the perception of people on their
products and services. This helps to improve the quality of services and personalized product
offerings.
BENEFITS OF ARTIFICIAL INTELLIGENCE IN BUSINESS
The benefits businesses stand to gain from the use of AI is endless and includes:
Automation of processes
More positive results from marketing activities and increased revenue
Better understanding of customers and improved experience of services offered
Fraud detection
Improved and more reliable customer service
CHALLENGES
The application of artificial intelligence in business is constantly increasing. However, this growth is
threatened by some critical factors that limit the use of AI technologies in business.
DATA SCARCITY
Even with the abundance of data available to companies today, the adoption of artificial intelligence
in some respects remains challenging. For Machine learning, which powers most of the applications
of artificial intelligence in business, to work, large amounts of data are required to train the model.
This limits the use of AI in fresh areas in business where there isn’t data available. The huge amount
of data we have are most times largely unstructured and unlabeled and with most AI applications
including supervised training on labelled data, this poses a measure of challenge to the use of
artificial intelligence in business.
ALGORITHM BIAS
Recently, Microsoft and Amazon suspended the sale of their AI face recognition software to law
enforcement agencies because of the ethnic, racial and gender biases of the software. This illustrates
a major challenge of AI, depicting how bad the algorithm can function when trained on biased data.
In the future, such biases will be properly addressed by AI systems but for now, it poses a major
threat to the adoption of AI in some areas of application.
Other challenges include:
Limitations in current computing capability
Issues of threats to data security and privacy (since the use of AI involves the collection of sensitive
information of people).
(Also Read: Latest Developments in the Field of Artificial Intelligence)
BUSINESSES THAT HAVE TRANSFORMED OPERATIONS WITH AI
Most of the top companies in the world have radically adopted the use of AI. Here are some of the
top companies leveraging on the power of AI.
Alibaba: with its integration of AI in its business operations, Alibaba uses AI to predict products
customers may want to purchase and to also automatically create product descriptions
Uber: yet another major company transforming the world of business with AI is the ride-hailing
giant, Uber. Uber leverages AI to predict demand, thereby reducing estimated time of arrival and
efficiently matching riders and drivers, reducing church rate. With Uber’s AI one-click chat feature,
drivers can communicate with riders with a single click via automatic response recommendations to
the rider’s messages.
Other great companies that have transformed business operations with AI include:
Amazon, with their AI recommendation, automated factories and the Amazon Alexa digital assistant
Tesla with their autonomous vehicles
Microsoft with power BI and the Azure machine learning platform
FUTURE AI TRENDS
Looking into the exciting future trends of AI, in the close future, we should be expecting:
AI generated songs and movies by entertainment companies
Fully automated factories requiring no human supervision
The use of AI to generate quality training data for itself, to address the issue of bias and data
scarcity, and many more.
The future potentials of AI, for the first time, will leave humans with the actual power of designing
the future exactly the way we want.
FINAL THOUGHTS
“Artificial intelligence would be the ultimate version of Google. The ultimate search engine that
would understand everything on the web,” Larry Page asserts. “It would understand exactly what
you wanted, and it would give you the right thing. We’re nowhere near doing that now. However,
we can get incrementally closer to that, and that is basically what we work on.”
We’re just scratching the surface of AI and its possibilities can only exponentially increase.
Companies that do not want to miss out on the revolutionary future of business, must, inevitably,
embrace the use of AI as a guiding light.
