As business becomes increasingly competitive, finding unique ways to leverage technologies like artificial intelligence (AI) is vital if you want your organization to succeed long term.
According to a survey by consulting firm Gartner, 79 percent of corporate strategists agree that AI and analytics will be critical to their organization’s success over the next two years. A separate survey by PwC found that 73 percent of U.S. companies have already adopted AI in some aspect of their business—putting others who haven’t started experimenting at a disadvantage.
“I have a strong belief that the future of business is going to be AI-powered,” says Harvard Business School Professor Karim Lakhani, who co-teaches the online course AI Essentials for Business with HBS Professor Marco Iansiti. “There’s not one organization, one role that will not be touched by AI tools.”
If you’re ready to implement AI in your organization, you must first understand its role in your business strategy.
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AI is a key driver of digital transformation across various industries. For example, it’s enabled early disease identification in healthcare, while in finance, it’s automated fraud detection. By integrating AI technologies, you can effectively adapt and innovate within your own organization.
In an episode of HBS Online’s Parlor Room podcast, Jen Stave, launch director of Harvard’s Digital Data Design (D^3) Institute, discusses AI’s impact across industries.
“If you look around at the world today, we believe that we’re on the precipice of a major transformation,” Stave says. “We do go so far as to say it's going to be bigger than the internet, bigger than electricity.”
Listen to the full Parlor Room episode with Stave about AI’s transformative impact:
This anticipated transformation is prompting business leaders to rethink AI's role in business.
Despite debates on AI’s negative workforce impacts, leaders are learning how to use AI to navigate the digital transformation happening in their industries and use it as a tool to reimagine business processes.
If you’re ready to take your organization to the next level in the digital age, here are five benefits you can expect from using AI in business.
5 Benefits You Can Expect from Using AI in Business
1. Increases in Efficiency and Productivity
AI is well-known for its ability to enhance efficiency and productivity in the workplace by:
- Automating repetitive tasks
- Streamlining workflows
- Providing data-driven insights
These improvements can lead to significant gains in operational performance and employee effectiveness. According to management consulting firm McKinsey, AI and other technologies have the potential to automate work activities that absorb 60 to 70 percent of employees’ time, enabling them to focus on more strategic initiatives.
In the same Parlor Room episode, Stave reiterates that business leaders must embrace AI to experience high productivity and efficiency.
“I think you all should jump on the wave that's coming,” Stave says, “but it's the individual productivity that I think is already here today. And this is where you hear all these fun anecdotes like you can go and do someone's job 20 percent faster if you have AI with you as a co-pilot.”
For example, you can use AI-powered virtual assistants to manage your schedule, set reminders, and prioritize daily to-dos, which can help you streamline your daily activities, reduce mundane administrative tasks, and free up time to focus on achieving organizational goals.
2. Enhanced Decision-Making
AI is revolutionizing business decision-making. By analyzing vast amounts of data, AI can help you identify patterns and trends not easily detected by human analysts. This capability can help you make more informed, strategic decisions and reduce the risk of errors.
Many business leaders are starting to recognize the quality assurance AI can offer. In a Deloitte survey, 59 percent of executives agreed that AI enabled them to glean more actionable insights from the analytics they were tracking.
Yet, how you leverage AI technologies in strategic decision-making often depends on your industry.
For example, oil and gas company Shell employs AI-driven predictive analytics to optimize its oil drilling placement. Shell analyzes vast amounts of data from sensors on its drilling equipment to predict potential equipment failures or maintenance needs to allocate resources more effectively.
In healthcare, IBM's Watson uses AI to analyze patient data and medical literature to provide doctors with evidence-based treatment options and help them choose the most effective cancer treatments.
No matter what industry you’re in, AI can aid in highly complex decision-making in today’s fast-moving world.
3. Boosted Cost Savings
AI offers several ways to reduce costs and save money across your organization.
Because AI can help you automate routine, time-consuming tasks, you can empower your employees to engage in more strategic initiatives. This shift can increase employee engagement, which can, in turn, bolster your competitive advantage.
AI can also drive down business expenses by anticipating maintenance needs to optimize supply chains and streamline inventory management through predictive maintenance.
AI can also significantly optimize energy consumption in your facility—an essential step toward mitigating climate change since office buildings consume nearly one-third of the world's energy and contribute roughly a quarter of global greenhouse gas emissions. By leveraging AI to analyze usage patterns and adjust energy consumption, companies can achieve substantial savings on utility bills while reducing their environmental impact.
4. Improved Customer Experience
AI is transforming customer experiences by providing personalized and efficient interactions. Through advanced data analysis, AI can help you determine customer preferences, behaviors, and needs, making it easier to tailor your products and services.
For example, leading beauty retailer Sephora utilizes AI through its Virtual Artist feature, an augmented reality tool that allows customers to try on makeup virtually. It analyzes facial features and skin tones to provide personalized product recommendations, which users can then purchase in the app.
Leveraging AI in customer interactions can also help you offer more tailored, engaging experiences that boost brand loyalty. Sephora’s AI-powered chatbots and assistants can anticipate customer needs, respond to inquiries promptly, and provide recommendations that align with individual preferences. As a result, Sephora’s become a “force to be reckoned with in the retail space.”
5. Encourages Innovation
AI is a catalyst for innovation and enables you to explore new ideas and develop cutting-edge solutions.
By harnessing the power of AI, you can:
- Accelerate product development
- Optimize business operations
- Discover novel ways to meet customer needs
Generative AI, a subset of AI that uses generative models to create new content from data, is particularly revolutionizing how businesses innovate. This technology enables companies to easily generate text, images, music, and other media, providing a wealth of new possibilities for creative and practical applications.
“With this rise of generative AI and ChatGPT, it's been a Cambrian explosion,” says HBS Senior Lecturer Jeff Bussgang in an episode of the Parlor Room. “So much innovation, so much excitement.”
Related: Listen to Bussgang discuss the rise of AI and raising venture capital on The Parlor Room podcast or watch the episode on YouTube.
One notable innovation example is the fashion brand Stitch Fix, which uses AI to analyze customer preferences and fashion trends to provide personalized clothing recommendations.
This AI-driven approach has allowed Stitch Fix to create a unique shopping experience that blends human expertise with machine learning to drive significant business growth.
Embrace the New Business Age
AI doesn’t have to be a business threat. In fact, failing to embrace it could be what leads to a swift demise.
To avoid being left behind, it’s important to stay informed about the latest strategies and tactics to effectively use and implement these tools within your organization.
One of the best ways to do this is by taking an online course, like AI Essentials for Business, to learn how to compete in the age of AI. Throughout the course, you’ll be introduced to industry experts at the forefront of AI who can help you lead your organization through a successful digital transformation.
Are you ready for the age of AI? Explore our online course AI Essentials for Business—one of our digital transformation courses—and download our online learning success guide to prepare for the program experience.
