How to hang on to AI's advantage

As businesses use artificial intelligence to respond to the pandemic, 2020 marks the start of a mainstream AI adoption era in the enterprise.

The technology, in physical and digital form, will couple with human teams to elevate their efficiency, while AI will touch practically every software platform involved in daily work.

This is the reality portrayed in Deloitte's State of AI in the Enterprise report, a global survey of 2,700 IT and line of business executives released Tuesday. Three-quarters of AI-adopters expect the technology will be integrated into all enterprise applications in the next three years.

For 73% of respondents, deployment of AI within their technology ecosystem is currently "very" or "critically" important to their business. As enterprises expand their AI use, the competitive advantage from the technology is harder to maintain.

But other voices contend the full potential of AI, along with the advantage it can provide, is still in its infancy. Even though the pandemic pressed transformation goals forward, AI's ability to help businesses compete will be determined by how the technology is applied and how well leaders are able to align it to business goals.

Leveraging cloud AI strategies and increasing the preparedness of data systems are top areas where leaders find competitiveness. Cloud reigns in AI's leap to mainstream, with 93% of adopters leveraging cloud-based AI as part of their technology stack.

AI is taking a starring role as organizations respond to cost pressures and reassess how best to accelerate their digital transformation, according to Nitin Mittal, principal and AI co-leader at Deloitte.

"It's essentially a move toward modernizing, on a cloud infrastructure, the application of AI and machine learning algorithms," Mittal told CIO Dive.

Keeping AI's edge

To arrive at AI's current position in the enterprise, technology leaders had to overcome the hype and understand where the true value of the technology resides.

In responding to COVID-19, customer service units became overrun by disruption. Leaders saw first-hand how AI could help teams overcome a crisis. In the next three years, AI will become ubiquitous among tech systems companies rely on, from their customer relationship management (CRM) systems to enterprise resource planning (ERP), according to Deloitte's data.

Roberto Torres / CIO Dive, data from Deloitte.

In the firm's previous study, published in 2018, 57% of respondents said the technology would transform their company within the next three years. Now, 75% of adopters say AI is set to transform their company in the same time frame.

Because adoption has expanded, the competitive advantage that AI can provide is "eroding," said Jeff Loucks, executive director of Deloitte's Center for Technology, Media and Telecommunications, in an interview with CIO Dive.

"The confidence in the transformative potential of AI has increased, but at the same time they feel like competitors can gain that advantage nearly as quickly," he said.

To sustain the competitiveness of their AI deployment, CIOs should:

Modernize the data infrastructure that powers AI, a frequent hurdle for adoption
Help their organizations gain access to the best AI technology available
Leverage the efficiency of cloud-based AI

But whether or not AI has reached critical mass isn't the ideal determinant of the technology's potential, said Radu Miclaus, director of product, AI and cloud at Lucidworks. The cultural implications of AI deployment, and whether businesses can effectively break silos internally, is crucial to the outcomes of AI.

"I think we're still looking at the infant stages of what AI can do for organizations," Miclaus said. "There's no 'one and done' with AI. You start small, but build around it. You add more data and more processes. Knowledge always evolves."

What tech can deliver

If ever businesses needed to maximize efficiency, it's in a global crisis. The pandemic pushed digital transformation and AI is one of its core components.

From the CIO's vantage point, decisions in the data space follow the pressures each industry has contended with during the pandemic. Some need to expand in the face of increased demand. In other areas, such as travel or entertainment, CIOs need to bring costs down.

Uses of AI vary by industry, according to Nittal:

In the life sciences field, AI is "at the forefront" of diagnostic test design.
In healthcare, AI-enabled contact tracing, virtual healthcare and an AI-based patient triage help the industry overcome the crisis.
In the banking industry, AI is supporting the move to contactless transactions, with virtual agents enabling customer interactions.

Across industries, AI's move to enterprise mainstream status signals change as "superteams" — or AI-enabled work units — transform operations, Nittal said.

Superteams will "fundamentally redefine the future of work," said Nittal, with algorithms assisting judgement calls previously made by humans.

To respond to uncertain economic forecasts, business leaders will seek to align AI initiatives closer to business value.

Since there's no recent reference to consumer patterns in a pandemic, AI's potential for predicting outcomes becomes attractive, said Anand Rao, PwC's global AI lead, in an interview with CIO Dive. Enterprise-grade, efficient adoption of AI hasn't yet reached a point where the competitive advantage is lost, Rao said.

At the start of the year, AI was part of the tech stack at 45% of companies with 1,000 or more employees, according to an IBM study. Across industries, business leader sentiment indicated that AI adoption was not moving quickly enough.

When gauging how much AI can redefine business, leaders shouldn't view AI as a homogenous technology, according to Geoff Webb, VP of strategy at PROS, in an interview with CIO Dive.

"I understand that there's an incredible adoption of AI occurring," said Webb. "It is accelerating. But the value of AI to businesses has by no means reached some kind of plateau. If anything, we're still climbing that very steep curve of understanding how AI can transform the way businesses run, not just maintain them."

The kind of AI uses, the way in which it's applied and the data it leverages will carry a significant impact in how business extracts value from it.