Revenue impact drivers post AI implementation
The revenue impact sources can be bucketed into three categories. They are monetization/revenue-growth through- Availability, Data, Insights and intelligence, Customer experience.
- Availability: Whenever your systems are down, your business is down. Every time your servers are not working, or customer service executives are offline, your business misses out on big topline numbers. Every second is crucial as it results in your customers becoming more frustrated, your employees are losing out on valuable time, and finally your business has to scramble to get your IT up and running. According to Zetta, there’s a huge cost impact involved whenever your IT systems go offline. An hour of downtime costs on an average: $8,000 to a small business; $74,000 for a mid-size company; $700,000 for large enterprises (3)
- Data, Insights and Intelligence: An increasing number of companies have been using data and analytics internally to get answers to problems around improvement in operational efficiency, service delivery, and customer/user experiences. Now, many business leaders including CDOs, CIOs and analytics heads are trying to use this data externally by developing and delivering insights-based products and services which can be utilized by others — for a price. Results from the McKinsey Global Survey on data and analytics indicate that companies are using data for growth generation, by introducing services to existing offerings, developing new business models, and directly selling data-based products or utilities.(4)
- Customer Experience: R “Ray” Wang, principal analyst, founder, and chairman of Constellation Research says in destinationCRM that every CX journey will eventually follow an AI approach, and the neural networks would be built on top of established consumer graphs. Every brand and customer experience will move from automation to intelligence. Better customer experience translates into better customer retention, more cross-sell/up-sell opportunities realization, incremental purchases and positive word of mouth publicity- customer references that can be most easily and directly monetized, to driving revenue. According to an article in Forbes, Adam Devine, CMO, WorkFusion says, “Adding natural language processes and machine learning changes everything, giving virtual customer assistants (VCAs) the ability to determine not just what rules-based action to take based on a word, but to understand the meaning of words in different combinations, ask questions to create context and intent, and actually do something for the customer.” (5) (6)
The companies which recognize these new and evolving trends and adopt them quickly, will significantly improve their performance, and this in turn can act as their differentiator and competitive edge. While some gains that these companies will get will be through labour substitution, AI and automation will help by enabling the research and discovery of new age solutions, improvement in the prediction accuracy and optimization of existing systems, enhancing overall productivity and raising throughput.
Value generated through AI adoption
Let us have a look at some industries and how AI can impact them in terms of value and gains: (7)