Inculcating AI in business strategies is crucial to maximise growth

FILE PHOTO: AI (Artificial Intelligence) letters and robot hand miniature in this illustration taken, June 23, 2023. REUTERS/Dado Ruvic/Illustration/File Photo

Artificial intelligence (AI) possesses the transformative power to elevate both efficiency and revenue in organisations, when harnessed effectively.

Achieving this success hinges on cultivating an environment that not only embraces AI but also trusts AI. As you embark on the journey to embed AI in your organisation, you need to reflect deeply on the following questions:

Have you crafted an AI strategy that seeks transformative change, rather than just incremental improvements?

AI offers exciting possibilities, yet it also carries inherent risks. What measures have you set in place to mitigate both internal and external threats?

Human-AI collaboration is crucial for AI to be effective. How is your organisation fostering a culture where teams not only adopt but also trust and synergise with AI?

This article addresses these essential topics and more, aiding board members by outlining some initial steps, posing critical questions, and highlighting considerations for effective AI implementation.

Decoding the ‘Why’ of AI

The Ernst & Young “CEO Outlook Pulse Survey” revealed that 76% of business leaders anticipate AI to principally boost efficiency, with minimal impact on revenue growth. However, a closer examination reveals that AI’s true potential spans far beyond mere operational optimisation. Its success lies in strategic adoption and application.

Synergising AI, business strategies

AI should not be an isolated venture but an integral part of overall business transformation. Start by intertwining your AI and corporate strategies, focusing on desired business outcomes. Successful AI programmes cut across organisational structures and are not confined to departmental initiatives.

A transformational approach to AI encompasses complete value chains, fostering comprehensive rather than isolated improvements.

For instance, revamping an entire financial management process rather than expediting just one part can yield far more significant benefits.

An illustrative case of optimisation is that of a company seeking to reduce the time and effort required for its finance team to compile management reports. This task typically involves scrutinising competitor activities, crafting comparative analyses with industry peers, and analysing the data.

While the incorporation of AI yields some efficiencies in this specific process, the true potential of AI extends far beyond mere time management. For instance, AI could have been employed to provide strategic insights to enhance profit margins or identify and rectify potential revenue losses.

Clear strategy ownership and outcome measurability are vital. Prioritise use cases that promise the most substantial impact, avoiding the trap of numerous proofs of concept.

When aligning technology with strategy, discern whether to buy or build. Assess whether off-the-shelf solutions suffice, or if a bespoke approach would reap greater rewards.

Boards may wish to ask:

> Is our AI strategy aligned to the business strategy?

> Is it transformative across entire value chains with trackable and quantifiable benefits?

> Who is responsible for the AI strategy and execution?

> Is there a clear strategy on technology (buy vs build)?

> Are all foundational elements – data, business processes, governance – in place to support the AI strategy?

Navigating AI risks

Delving into AI also means confronting the spectrum of associated risks – data privacy, ethical quandaries, and stringent regulatory landscapes. Then comes the looming question: If your AI system malfunctions, what then? Implementing robust checks and balances is non-negotiable to mitigate the possibility of misinformation.

Boards may wish to ask:

> What controls are in place to govern AI? Is there a rollback strategy?

> What does your responsible AI framework look like?

> What external risks, laws and regulations must you consider?

> What is the environmental impact of your AI strategy implementation?

> How autonomous is your AI? What human interventions are in place?

The crux of AI transformation lies not only in technology but also in people. Upskilling staff and reshaping interactions with suppliers and customers are foundational. As AI redefines roles, redirecting your workforce’s potential to areas where they continue to add value is essential.

Boards may wish to ask:

> How does AI change the way our people work, and our interactions with suppliers and customers?

> How do we use trusted, responsible AI to drive brand value with customers, suppliers and our people?

> How are we going to upskill, reskill and redeploy our people to drive value?

> How do we change people’s behaviors so that they embrace, use and trust AI?

AI transcends industries and borders, and it is here to stay. How organisations take advantage of it is open to debate. No matter what your business strategy, we believe there is merit in assessing the value of an AI strategy to drive real business outcomes. Learn first, test second, then scale up, once the value is clear.

Adrian Chew is Asean artificial intelligence and data leader at Ernst & Young Consulting Sdn Bhd.

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