Entrepreneur
It’s a case study of the dangers of overthinking. Many businesses are getting stuck trying to solve complex problems with AI instead of focusing on obvious opportunities where it could provide value very quickly. It comes back to the fundamental way the leaders of those companies perceive artificial intelligence — is it a tool or a threat? Part of the problem is that people are aware that AI can do a lot. Still, fear of misguided initiatives leaves many businesses frozen like a deer in the headlights.
Businesses will only start to overcome any uncertainty around AI’s potential by getting practical and finding the best use cases. Look no further than Amazon for inspiration. Its AI-driven recommendation system for personalized marketing has become one of the most ubiquitous features in e-commerce.
Using data from a customer’s purchase history, this feature uses AI to analyze customer behavior patterns and suggest products tailored to their preference. It has been so successful that 35% of what consumers purchase on Amazon comes from these recommendations, and the feature has since become an industry benchmark.
As big as Amazon is, its success shows that when AI is implemented well, there is nothing to fear and everything to gain. Yet, I have seen businesses without a clear path to the optimal implementation of AI spinning their wheels and failing to make progress or see results. To help combat analysis paralysis, I have put together a basic roadmap on how to capitalize on AI’s potential.
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Break free of these misconceptions
The first stop on our roadmap is debunking a few common myths. To kickstart your AI journey, get real about the following:
- AI does not require perfect data. Granted, data fuels AI. But there is no such thing as perfect data. Actually the best thing about AI is it thrives on unstructured data. Hard to use before, unstructured data now represents untapped potential. What business data do you have demonstrating what “good” looks like? Reports, advice, plans? Feed these great resources into AI along with the problem being solved. Once the model understands the problem being solved and what good looks like, it can begin to produce these outputs on its own.
- You don’t have to build it yourself. When implementing AI initiatives, off-the-shelf solutions may be a great way to start because they satisfy the needs of most organizations. A multitude of AI products are hitting the market. Take some time to browse their features and watch the review commentary. Just seeing what’s out there can inspire innovation.
- Internal champions are needed to drive AI initiatives. As with any new initiative, the team must be invested and passionate. Don’t give an AI innovation project to a team that isn’t excited to partake in it. We all know where that will end. Find your champion, someone who sees the potential and wants to learn and grow. If you find the right leader, your plans will flourish.
The main message for business leaders is to start now. Don’t wait for conditions to be perfect. Leverage whatever data you have available now and focus on quick wins to provide immediate value for your company.
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Identify quick wins
As tempting as it might be to think big picture, to find those quick wins, narrow your focus. Usually, that means honing in on processes that are manual, repetitive, time-consuming and often prone to human error. Then, apply AI strategies to identify patterns and trends in the data, such as customer preferences, habits and seasonal trends. Determine which of these are most relevant to turn around a quick win with the help of the people who work on them daily.
Another tip is to target areas with high data availability, such as customer service or human resources, and find smaller, scalable opportunities where AI tools can add the most value. For example, AI can easily extract the most common topics of customer complaints that can then be used to enhance services. Other easily identifiable quick wins include:
- Retail chatbots: A Gartner survey found that about a quarter of organizations will rely on chatbots as their main customer service channel by 2027. When automated shopping assistants are integrated into retail operations — i.e., mobile apps, websites, messaging platforms, etc — they can analyze user data and patterns and make product suggestions tailored to the customer’s specific interests. Plus, customers will have access to efficient assistance outside business work hours, increasing efficiency and reducing customer wait times.
- Supply chain management: AI is helping businesses optimize their supply chains and manage their inventories more efficiently by analyzing vast amounts of data and making accurate predictions. Whether the data is structured or not, it can illuminate customer profiles, populate planning documents, highlight inbound supply and even draft planning documents.
According to a McKinsey report, implementing AI-enabled supply chain management could save early adopters up to 15% in logistics costs, significantly optimizing inventory levels. Examples like this show that an organization’s AI strategy should go beyond mere technological upgrades to align with its business objectives so that each iterative initiative should work toward commercial benefit.
Clear value, low risk
Companies that will thrive in our evolving digital marketplace are quick to harness the full potential of AI-powered tools. This includes generative AI, a powerful asset for any decision-maker. Pulling insights from amounts of data, offers fresh parties and can help many executives avoid biases in decision-making.
Remember to focus first on high-impact opportunities where AI can provide clear value quickly and at minimal risk. This will help leaders break out of analysis paralysis and start realizing AI’s tangible benefits. From there, the future is unwritten, but it is likely to belong to those willing to embrace change and adapt to new realities.
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