Artificial Intelligence has been at the top of many minds:
In the next 10 years, we will shift to a world that is AI-first. - Sundar Pichai, CEO, Google, 2016
AI is the next platform. All future applications, all future capabilities for all companies will be built on AI. - Marc Benioff, CEO, Salesforce, 2017
We need to be super careful with AI. Potentially more dangerous than nukes. - Elon Musk, CEO, Tesla, 2014
While a lot of this is either too optimistic or too pessimistic, it’s becoming clear that 2018 will be the ideal time for forward-thinking businesses to embrace AI.
Applied AI in 2018: Beyond the Buzzwords
I think of AI as “software that gets better with data.”
A confluence of trends is making 2018 the first year where AI will start to see mass adoption across diverse industries and in different sizes of businesses:
Trend #1 - Maturing Technology: It’s becoming easier and cheaper to build and maintain AI. For many applications, the challenge has shifted from technology to design, user adoption, privacy, and other go-to-market tasks. As Bloomberg Beta VC James Cham recently said, “[Product Management] is the biggest challenge in AI.”
Trend #2 - Increasing User Expectations: While most AI is not like Siri, Alexa, or Cortana, these voice-assistants are increasing user comfort and softening the ground for AI adoption. Even more so, for a lot of users, AI capabilities are becoming a must have, with the perfect example being the rapid growth of chatbot usage.
Trend #3 - Higher Cost of Delay: AI advantage compounds over time. So, if you didn’t start two years ago, now is the next best time to start! This also makes the cost of delaying this decision exponentially worse. Your competition doesn’t need a head start.
If you don’t have an AI strategy you are going to die in the world that’s coming. - Devin Wenig, CEO, eBay, 2017
It’s time to start applying AI in a practical and tangible way.
When considering this, what’s the next step?
Start with the most important question: Why?
Why is AI at the top of your mind? What could you achieve with AI?
The key is to focus on your business challenges and opportunities. The answers will help you decide how you prioritize, establish success criteria, and manage your investment.
While just “talking” about AI can give you a significant marketing benefit, responses to this “Why” question from senior executives typically fall within the following categories:
To capitalize on the AI Opportunity.
With AI, as with the industrial revolution, great fortunes will be made through innovation and lost through disruption. Even without the bold proclamations, it’s clear that AI presents a rare opportunity.
Broadly speaking, AI benefits any business in two ways: (1) Product/Service Innovation, and (2) Operational Excellence.
AI can make your existing product or service dramatically better. Recently, one of our customers demonstrated an early AI prototype to select prospects and the response was an emphatic “This is a game changer!”
AI is not one “thing”, but many different approaches. Depending on how you apply AI, it can help in many different situations: AI can help grow your business, increase profitability, improve customer experience, and build a strategic foundation for the next decade.
These possibilities are matched by the growing investment in AI-enabled companies.
“ [Excluding corporate R&D, VC investments in AI rose] from 160 deals in 2012 to 658 in 2016. Dollars invested rose 60% [to $5B+ USD].” - CB Insights, 2016
If you don’t have a clear idea of how AI applies to your business, consider exploring AI via training or prototyping. An “Introduction to Applied AI” session, typically attended by the entire executive team, is one of the most common starting points for our clients.
Competition is the leading reason why our customers approach us.
AI is a great way to create and maintain durable competitive differentiation. Since AI advantage compounds, the earlier one starts, the better. AI can also provide a brand and marketing lift that can drive revenue growth.
Only the paranoid survive. - Andy Grove, ex-CEO, Intel
Also, if you think your competitors and customers are not evaluating AI or investing in it, you may be unpleasantly surprised. Just recently, one of our customers’ competitor announced a big initiative to infuse their products with AI. By the time this competitor’s product launches, our customer will have had months of head start in a fiercely competitive market.
Customers are starting to demand AI-enabled products. There will be rewards for being first.
To attract and retain the best.
Sought-after talent join businesses that invest in the future.
On a recent AI project, over 50% of our client’s employees attended an optional kick-off meeting. Excitement, curiosity, desire to participate, and a desire to learn drove this unexpectedly high employee engagement.
Employees are keen to work on AI. Investment in AI will serve as an effective talent attraction, engagement, and retention tactic.
To build a core competency.
AI implementation will require some cultural and company-wide process changes, from marketing to sales to customer support. The sooner you start, the better you will be able to navigate.
For technology companies, AI development will become a long-term investment and a core competency, similar to databases, but much more powerful. AI is developed differently than typical software: it’s hypothesis-driven, probabilistic, difficult to debug, and experimental. Expect change, especially if you need to make long-term AI-related R&D investments.
It’s better to seek out change and adapt on your own terms before change is forced on you.
Answer to this “Why AI?” may vary for each business but…
… investing in AI is becoming increasingly important.
AI can yield many benefits: from better products to higher profitability to improved employee morale.
Start in 2018. The more you delay, the farther behind you will start.