Are you looking to adopt Artificial Intelligence in your organization? Did you know that only one in ten companies generates significant financial benefits with AI?
A 2020 Global Executive Study and Research Project by BCG and MIT Sloan surveyed over 3000 businesses representing 29 industries and 112 countries. In this survey, 71% of the respondents said they had understood how AI will change the ways their organization will generate value. 59% said they had a strategy, and 57% were piloting or had already deployed AI solutions.
The study found that while many companies are investing in artificial intelligence, only a small percentage can scale their AI initiatives and generate significant business value. Specifically, only 10% of companies get significant financial benefits from artificial intelligence technologies.
The study revealed that successful AI initiatives are typically accompanied by a rethinking of business processes and workflows, with the goal of optimizing them for AI-enabled automation, decision-making, and other capabilities. In fact, those engaging in extensive business process changes are five times more likely to realize significant financial benefit.
Process centered AI Transformation seems to be a critical component for benefits realization. Another study focused on AI and productivity by the University of Pennsylvania found that firms that use AI tools and are more oriented toward process improvement experience greater productivity gains. Where the lack of focus on process is likely to drive productivity losses.
The scale of the transformation is another key ingredient to high returns. A business just implementing AI in targeted applications is only 2% likely to achieve significant financial benefits. This percentage jumps up 19% once they invest in infrastructure, talent and strategy. Another 18% jump, once they are not only building solutions, but the business adopts them successfully. Solutions that incorporate AI in Digital Transformation use cases beyond just automation. But the real gains start when they scale AI broadly in embedded solutions, establish knowledge sharing between humans and AI, structure roles, and then continuously learn and adapt by growing the collective knowledge of the organization.
However, the AI Transformation blueprint differs significantly from previous approaches to Digital Transformation. On a page, the words may look the same, but AI-led Business Transformation is nothing like previous waves of Digital Transformation, even concepts such as agility or innovation take a different shape in this new wave of change.
It's critical to understand both AI fundamentals and current market dynamics to design the right strategy, delivery, and operating model.
In this series, we’ll explore the ins and outs of how AI can drive value to your business, address current misconceptions, and provide you with insights on how to best ways to approach AI Transformation.
So if you enjoyed this article, subscribe so that we can keep you updated with the best of AI Strategy and Transformation. What you should focus on now, next, and later.
Stay human,
