The rise of AI and what it means for business

It has been reported that worldwide spending by governments and business on artificial intelligence (AI) will reach $154 billion in 2023, an increase of nearly 27% over the amount spent in 2022. In this article, we explore this rise in AI investment, what has made AI so accessible to employees and businesses, the benefits of its use and the risks that might arise if businesses fail to properly prepare. 

Chris Knowles, Chief Digital Officer at RSM UK, commented, “Today most people are aware of the power of AI. ChatGPT for example has taken the world by storm, reaching over 100 million users in the first two months of launching. It has moved AI from being on the periphery to something that is very much on the radar of most people. 

“Before it became mainstream, AI was considered theoretical to most businesses, something that was coming in the future. It all felt a little futuristic, like something from a movie. However, if we look at ChatGPT as an example, an employer will find that their employees are already experimenting with it in their own time and getting quite excited by it, so with that in mind, how can they then ignore its potential in business? 

“It’s not just businesses that need to better understand the rapid evolution of AI and what it means, governments need to get a handle on it too. Regulatory frameworks around the world are playing catch up and it’s a long way behind where it needs to be. That said, many governments are starting to realise its potential, how it might stimulate the economy for example, as they have seen the level of investment in AI and how many jobs it is creating.” 

Why should businesses care about AI? 

In a 2019 MIT Sloan Management Review and Boston Consulting Group survey, 7 out of 10 companies reported minimal or no value from their AI investments. Fast-forward to 2022 and a very different picture emerges, highlighting the rapid nature of AI’s rise. 

Another MIT Sloan report, this time published in February 2022, found that around 92% of large companies are achieving returns on their AI investments, and the same percentage are increasing their AI investments. Their analysis found that when companies increase their intensity of AI adoption to at least 25% — which means using a quarter of the AI tools currently available to them — they start to see a return on investment. 

Chris said, “It can be a game changer. For some industries already using machine learning and AI more broadly, they are seeing the benefit of its integration. This has been more common in software businesses such as HR or financial solutions. Many claim to be powered by AI these days and they can make greater efficiencies with more accuracy than was ever possible before. 

“For businesses smart enough to act quickly and consider how AI solutions such as ChatGPT can be integrated into their existing operations or products, they will reap the rewards. It can significantly enhance employee productivity, improve accuracy, and provide a more detailed level of insight using data that already exists within the business.” 

According to Harvard Business Review, companies using AI for sales can increase their leads by more than 50%, reduce call times by 60-70%, and make cost reductions of up to 60%. Whilst IBM reported that more than 85% of advanced adopters are reducing operating costs with AI. 

Chris continued, “Perhaps some board members are asking why they should be interested in AI as part of a company’s long-term strategy because it is true that some investment – financial, resource, time – is required to execute it properly. My answer would be - because it’s going to be transformational. 

“Look at a business operating 25 years ago, I am sure they questioned why they should make a considerable investment in the internet or e-commerce. Today we can confidently answer that question. It’s simple; if you don’t have reliable internet or an online presence then you don’t have a business. We can expect the case to be the same for businesses in 10 years’ time when it comes to AI. 

“I believe from the rapid growth in AI users over the last year, we can expect businesses to come to the realisation over the next six months that this isn’t optional. Most business leaders will appreciate soon, if they haven’t already, that they need to be actively trying to understand the security implications of integrating AI into their business.” 

Skills in a digital economy 

A study by Salesforce published in March 2023, The Digital Skills Survey, included the opinions of more than 11,000 workers across 11 countries including Australia, France, Germany, India, Italy, Netherlands, Singapore, Spain, Sweden, the UK and the US, captured the feelings of today’s workforce when it comes to AI. 

The survey found that people leaders believe that prioritising employees’ digital skills development will have positive impacts on wider business performance. They cited increased productivity (47%), better team performance (43%) and improved problem-solving capabilities (40%) as likely positive attributes. 

When asked, 22% of global workers ranked AI among the top three most important digital skills today. This number rises to 27% when asked about AI’s importance over the next five years. 

Chris commented, “To approach it in the right way and get impactful results whilst mitigating the risks, businesses need to ask the right questions. For example, how is our industry being impacted by AI and where does our service fit in? Have we got the right skills internally to confidently explore the application of AI within our own business or do we need to outsource these skills? 

“The future workforce will need to feature skills such as data analysts, analytics experts, and coders. A business with internal or access to third-party data analytics and data science skills will be well-positioned to drive smart decision-making through data. 

“For some businesses, it might not be possible to recruit data experts in large numbers or build their own AI-powered solutions, the middle market for example may be restricted by budget constraints. For many businesses, it will be a case of buy it or build it. HR and recruitment teams are thinking carefully about the skills they look for in new candidates, others might outsource this to a technology consulting firm, or look to incorporate SaaS solutions where possible. 

“There is no one-size-fits-all, but what is guaranteed to affect every business is the security and ethical concerns that come with an AI roll-out, so it is vital that businesses make sure they seek expert advice before they jump in.” 

AI job anxiety 

A report by Goldman Sachs in March 2023 estimates around 300 million jobs could be affected by generative AI, meaning 18% of work globally could be automated. It’s not surprising then that there are so many speculative reports of employees worrying AI is coming for their jobs. 

Chris commented, “I have a favourite quote on AI – you’re unlikely to lose your job to AI, but you are likely to lose it to someone who knows how to use AI effectively. 

“I believe that nearly all of our jobs will be augmented by AI at some point in the future, so why not get a head start and learn how to use it to ensure your skills remain desirable in an increasingly competitive job landscape, and of course, to create job satisfaction. Really the use of AI in our roles is both a question for the employer and the employee, they need to work together to find solutions and policies that actually work for them.” 

Supporting this positive sentiment, the international Salesforce study found that 58% of the workers surveyed were more likely to be excited about the use of AI in their workplace than worried about it replacing them in their job (48%). 

The BCG Henderson Institute and MIT Sloan Management Review survey also found that as many as 64% of employees felt that they personally benefit from using AI in their jobs. And only 8% complained that job satisfaction had fallen after using the technology. 

The sectors where AI is making a big impact 

“Whilst all businesses can use AI to speed up and improve the accuracy of day-to-day tasks such as creating job descriptions, conducting competitor analysis, analysing data within Excel sheets, AI can be incredibly transformational for certain sectors. 

“In academia for example, AI can significantly cut down the time it takes researchers to prepare detailed papers and analyse data-points meaning the findings can be published much earlier, with a greater level of quality, and more can be produced in that time.” said Chris. According to the FT, AI can also be transformational in the healthcare space. It reported, “Applied to large data sets, AI has identified new drug solutions, enabled the selection of candidates for clinical trials and monitored patients with specific conditions. Roche, for example, uses deep-learning algorithms to gain insights into Parkinson’s disease.” 

Chris added, “In the financial services space for example, AI is being applied to tax services where there is a substantial volume of transaction records that tax teams need to sift through in order to categorize them for tax compliance and tax reporting purposes. 

“This is an ideal scenario for artificial intelligence because it learns what the human tax professional does when he or she works with those transaction records, and in doing so, it learns and is able to apply that to the categorisation of tax records. This leads to a greater degree of accuracy when filing the taxes, and it frees up the experts to focus on more complex work or enhancing the customer relationships.” 

Understanding the risks 

A recent study by Forbes Advisor found that some businesses owners are concerned about technology dependence, with 43% of them saying that they are worried about becoming too reliant on AI. 

Chris commented, “Some businesses, consumer-facing ones for example, do need to tread carefully when incorporating AI into their services. Most customers calling a call centre with a problem that needs to be talked through will find it frustrating if they can’t speak to a human for example. If they simply get lost in a labyrinth of options to press and recorded messages, this could alienate them and tarnish customer loyalty with that brand – something a company rarely comes back from. 

“On the contrary, if a call centre is appropriately staffed with skilled operatives who have AI-powered solutions at their fingertips, they are more likely to be able to deliver a superior service to the customer that rings that day. That could lead to an enhanced brand reputation and customer loyalty long-term. 

“Another challenge businesses must contend with is managing the security implications that come with rolling out AI. Yes, ChatGPT provides a solution that is tried and tested, but businesses must also consider the security of their information, how their data will be protected, as well as the privacy and ethical implications. For example, there is the risk that one customer’s data could be disclosed to the wrong customer if the right protocols aren’t in place. 

“There are technology providers introducing AI-enabled transcripts of online meetings as standard these days. That is a minefield of privacy risk. Perhaps a group of colleagues are having an informal discussion with personal details of an employee’s health or employment status are revealed or talking through a highly confidential company update on Zoom or Teams, and the transcript is automatically generated and saved centrally for anyone within the business to access. Due to the nature of AI interpretation, the content of the transcript may not be 100% accurate. The ramifications of this would be huge. 

“Perhaps meeting participants are aware that their every word will be transcribed during the online meeting, this then inhibits them, changing their behaviours in a way that might not be productive. Since working remotely is the norm for many professionals and businesses have embraced this, companies need to be careful how they manage the implications of recording meetings via AI. 

“There are also online meeting solutions emerging that are using AI to analyse the facial expressions of the call participants to determine their moods. This could be open to abuse and plagued with inaccurate assumptions if not managed carefully.” According to the World Economic Forum, an emerging issue in the field of AI is the growing recognition of the importance and interest in solving issues relating to biases and fairness. 

Chris concluded, “If a business fails to develop a roadmap for safe and considered ChatGPT usage of their own, taking the unique structure of their business and customer relationships into account, then they are going to find themselves in increasingly problematic situations when employees start using it anyway – it needs to be controlled. By the end of 2024, it is expected that 75% of organisations will shift from piloting to operationalising AI, leading to a five times increase in streaming data and analytics infrastructures. This statistic highlights the need for businesses to get on top of how they will ensure a smooth implementation for the long-term.”