Skip to content

Archive for

How Artificial Intelligence Is Revolutionizing Business In 2017

  • 84% of respondents say AI will enable them to obtain or sustain a competitive advantage.
  • 83% believe AI is a strategic priority for their businesses today.
  • 75% state that AI will allow them to move into new businesses and ventures.

These and many other fascinating insights are from the Boston Consulting Group and MIT Sloan Management Review study published this week, Reshaping Business With Artificial Intelligence. An online summary of the report is available here. The survey is based on interviews with more than 3,000 business executives, managers, and analysts in 112 countries and 21 industries. For additional details regarding the methodology, please see page 4.

The research found significant gaps between companies who have already adopted and understand Artificial Intelligence (AI) and those lagging. AI early adopters invest heavily in analytics expertise and ensuring the quality of algorithms and data can scale across their enterprise-wide information and knowledge needs. The leading companies who excel at using AI to plan new businesses and streamline existing processes all have solid senior management support for each AI initiative.

Key takeaways include the following:

  • 72% of respondents in the technology, media, and telecommunications industry expect AI to have a significant impact on product offerings in the next five years. The technology, media and telecommunications industry has the highest expectations for AI to accelerate new product and service offerings of all industries tracked in the study, projecting a 52% point increase in the next five years. AI-based improvements are expected to deliver Business Process Outsourcing (BPO) gains in the Financial Services and Professional Services industries as well. The following graphic compares expectations for AI’s expected contributions to business offerings and process improvements over the next five years by industry.

  • Customer-facing activities including marketing automation, support, and service in addition to IT and supply chain management are predicted to be the most affected areas by AI in the next five years. Demand management, supply chain optimization, more efficient distributed order management systems, and Enterprise Resource Planning (ERP) systems that can scale to support new business models are a few of the many areas AI will make contributions to the in the next five years. The following graphic provides an overview of operations, IT, customer-facing, and corporate center functions where AI is predicted to contribute.

  • 84% of respondents say AI will enable them to obtain or sustain a competitive advantage. 75% state that AI will allow them to move into new businesses and ventures. The research shows that AI will be the catalyst of entirely new business models and change the competitive landscape of entire industries in the next five years. 69% of respondents expect incumbent competitors in their industry to use AI to gain an advantage. 63% believe the pressure to reduce costs will require their organizations to use AI in the next five years.

  • Despite high expectations for AI, only 23% of respondents have incorporated it into processes and product and service offerings today. An additional 23% have one or more pilots in progress, and 54% have no adoption plans in progress, 22% of which have no current plans. The following graphic provides insights into the current adoption of AI with survey respondents.

  • By completing a cluster analysis of survey respondents based on AI understanding and adoption questions, four distinct maturity groups emerged including Pioneers, Investigators, Experimenters, and Passives. 19% of the respondent base is Pioneers or those organizations who understand and are adopting AI. The study says that “these organizations are on the leading edge of incorporating AI into both their organization’s offerings and internal processes.” Investigators (32%) are organizations that understand AI but are not deploying it beyond the pilot stage. Experimenters (13%) are organizations that are piloting or adopting AI without deep understanding. Passives (36%) are organizations with no adoption or much knowledge of AI.

  • Pioneers and Investigators are finding new ways to use AI to create entirely new sources of business value. Pioneers (91%) and Investigators (90%) are much more likely to report that their organization recognizes how AI affects business value than Experimenters (32%) and Passives (23%). One of the most differentiating aspects of the four maturity clusters is understanding the differences and value of investing in high-quality data and advanced AI algorithms. Compared to Passives, Pioneers are 12 times more likely to understand the process for training algorithms and ten times more likely to comprehend the development costs of AI-based products and services.

  • Organizations in the Pioneer cluster excel at analytics expertise versus competitors and have exceptional data governance processes in place, further accelerating their AI-driven growth. Pioneers are excellent at change management, citing their senior management’s vision and leadership as a foundational strength in accomplishing their AI-based initiative Early adopter Pioneers are also adept at product development, capable of changing existing products and services to take advantage of new technologies.

  • 61% of all organizations interviewed see developing an AI strategy as urgent, yet only 50% have one done today. The research found that regarding company size, the largest companies (those with more than 100K employees) are the most likely to have an AI strategy, but only half (56%) have one. The following graphic compares the percentage of respondents by maturity cluster who say developing a plan for Al is urgent for their organization relative to those that have a strategy in place today.

  • 70% of respondents are personally looking forward to delegating the more mundane, repetitive aspects of their jobs to AI. 84% believe employees will need to change their skill sets to excel at delivering AI-based initiatives and strategies. Taking this approach provides career growth and a chance to become more marketable for many whose jobs that are being increasingly automated. Cautious optimism regarding AI’s effects on employment dominates early adopter organizations, not dire fatalism. The bottom line is that AI is providing opportunities for career growth that will only accelerate in the future. Those that seize the chance to learn and earn more will end up having AI removing the mundane tasks from their jobs, leaving more time for the most challenging and rewarding work.

Gartner’s Hype Cycle for Emerging Technologies, 2017 Adds 5G, Edge Computing For First Time

  • Gartner added eight new technologies to the Hype Cycle this year including 5G, Artificial General Intelligence, Deep Learning, Edge Computing, Serverless PaaS.
  • Virtual Personal Assistants, Personal Analytics, Data Broker PaaS (dbrPaaS) are no longer included in the Hype Cycle for Emerging Technologies.

The Hype Cycle for Emerging Technologies, 2017 provides insights gained from evaluations of more than 2,000 technologies the research and advisory firms tracks. From this large base of technologies, the technologies that show the most potential for delivering a competitive advantage over the next five to 10 years are included in the Hype Cycle.

The eight technologies added to the Hype Cycle this year include 5G, Artificial General Intelligence, Deep Learning, Deep Reinforcement Learning, Digital Twin, Edge Computing, Serverless PaaS and Cognitive Computing. Ten technologies not included in the hype cycle for 2017 include 802.11ax, Affective Computing, Context Brokering, Gesture Control Devices, Data Broker PaaS (dbrPaaS), Micro Data Centers, Natural-Language Question Answering, Personal Analytics, Smart Data Discovery and Virtual Personal Assistants.

The three most dominant trends include Artifical Intelligence (AI) Everywhere, Transparently Immersive Experiences, and Digital Platforms. Gartner believes that key platform-enabling technologies are 5G, Digital Twin, Edge Computing, Blockchain, IoT Platforms, Neuromorphic Hardware, Quantum Computing, Serverless PaaS and Software-Defined Security.

Key takeaways from this year’s Hype Cycle include the following:

  • Heavy R&D spending from Amazon, Apple, Baidu, Google, IBM, Microsoft, and Facebook is fueling a race for Deep Learning and Machine Learning patents today and will accelerate in the future – The race is on for Intellectual Property (IP) in deep learning and machine learning today. The success of Amazon Alexa, Apple Siri, Google’s Google Now, Microsoft’s Cortana and others are making this area the top priority for R&D investment by these companies today. Gartner predicts deep-learning applications and tools will be a standard component in 80% of data scientists’ tool boxes by 2018. Amazon Machine Learning is available on Amazon Web Services today, accessible here.  Apple has also launched a Machine Learning JournalBaidu Research provides a site full of useful information on their ongoing research and development as well. Google Research is one of the most comprehensive of all, with a wealth of publications and research results.  IBM’s AI and Cognitive Computing site can be found here. The Facebook Research site provides a wealth of information on 11 core technologies their R&D team is working on right now. Many of these sites also list open positions on their R&D teams.
  • 5G adoption in the coming decade will bring significant gains for security, scalability, and speed of global cellular networks – Gartner predicts that by 2020, 3% of network-based mobile communications service providers (CSPs) will launch 5G networks commercially. The Hype Cycle report mentions that from 2018 through 2022 organizations will most often utilize 5G to support IoT communications, high definition video and fixed wireless access. AT&T, NTT Docomo, Sprint USA, Telstra, T-Mobile, and Verizon have all announced plans to launch 5G services this year and next.
  • Artificial General Intelligence is going to become pervasive during the next decade, becoming the foundation of AI as a Service – Gartner predicts that AI as a Service will be the enabling core technology that leads to the convergence of AI Everywhere, Transparently Immersive Experiences and Digital Platforms. The research firm is also predicting 4D Printing, Autonomous Vehicles, Brain-Computer Interfaces, Human Augmentation, Quantum Computing, Smart Dust and Volumetric Displays will reach mainstream adoption.

Sources:

Gartner Identifies Three Megatrends That Will Drive Digital Business Into the Next Decade

Gartner Hype Cycle for Emerging Technologies, 2017 (client access required)

%d bloggers like this: