According to industry research firm TechEmergence, Artificial Intelligence (AI) technology will have the single most radical, transformational impact on business and society. AI is driving the fourth industrial revolution or 4IR—the newest industrial era, which is characterized by emerging technological disruption and increasingly blurred lines between the physical and digital worlds. Organizations are rapidly exploring the business gains that can be made by investing in machine learning (ML), a form of AI, including improvements in automation, predictive analytics, and customer service via intelligent chatbots.
In this environment, organizations across all sectors are asking the question: Should we invest now in AI, or take a wait-and-see approach? With companies already investing tens of billions of dollars globally in AI and ML technologies—and leading-edge companies seeing massive improvements in operational efficiency, customer experience, and innovation—it’s imperative to make AI a part of your organization’s strategy to stay competitive. At a recent AI conference Appen attended, one presenter claimed, “If you haven’t yet invested in machine learning … you’re already 12 months behind.”
This year’s Constellation Research AI Study found that 60% of C-level executives plan to increase their AI investment in 2018 by more than 50% compared to last year. And the research group expects overall AI budgets to continue to rise by more than 50% annually over the next four years as companies gain significant returns on their investments in machine learning and AI.
While some of the larger global tech firms have taken the lead investing in visible consumer-facing AI applications (such as smartphone voice assistants or photo library management with image recognition), leading companies in other industries such as automotive, healthcare, and manufacturing are also getting in on the act. AI examples in these sectors, respectively, include the development of self-driving vehicles, more intelligent patient diagnosis, and the predictive maintenance of heavy machinery.
Even if your company hasn’t yet adopted machine learning and AI, it’s certainly not too late. Investing in machine learning is economically advantageous, and doing it sooner rather than later will help your organization secure a stronger competitive position. Let’s look deeper at some of the research and thinking on this topic.
Why should our company invest in AI?
The short answer as to why firms should invest in AI is: It’s profitable to do so. A few weeks back, we blogged about learnings from McKinsey’s April report, “Notes from the AI Frontier, Insights from Hundreds of Use Cases,” where its consultants analyzed over 400 use cases to assess how machine learning and a subset of ML called deep learning were helping to solve a range of business problems. The paper examined the broader value of machine learning, reporting that a company could expect to gain returns between 1 and 9 percent of its overall revenue from applying AI. That translates to trillions of dollars of potential impact across the business sector.
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