AI Will Affect the Ways in Which Businesses and Governments Engage with Consumers and Citizens Alike

"Artificial intelligence (AI) will profoundly affect the ways in which businesses and governments engage with consumers and citizens alike," says a report developed by The Economist Intelligence Unit (The EIU) and sponsored by Microsoft. "From advances in genetic diagnostics to industrial automation, these widespread changes will have significant economic, social and civic implications."

AI "is moving from the realm of science fiction to real-world adoption among private- and public-sector organizations globally," notes the report. "Today AI is used by financial services companies to serve customers better and detect fraud; by healthcare providers to more accurately diagnose illness and identify more effective treatments; by manufacturers to keep machines up and running on the plant floor and to streamline supply chains; and by city authorities to track and mitigate urban challenges such as traffic, pollution and crime."

Intelligent Economies: AI's transformation of industries and society "draws on a survey of more than 400 senior executives working in various industries, including financial services, healthcare and life sciences, manufacturing, retail and the public sector. Survey respondents operate in eight markets: France, Germany, Mexico, Poland, South Africa, Thailand, the UK and the US. Additionally, we conducted in-depth interviews with business leaders and experts in AI."

Listed below are the report's key findings:

1. Respondents are optimistic about the economic benefits that AI will bring. Over the next five years, survey respondents expect AI to have a positive impact on growth (90%), productivity (86%), innovation (84%) and job creation (69%) in their country and industry.

2. Both private- and public-sector organizations consider AI essential to business strategy. More than nine out of ten respondents (94%) describe AI as important to solving their organizations' strategic challenges, with 57% saying that it is "somewhat" important and a further 37% characterizing it as "very" important.

3. The race to adopt and implement AI in business processes has already begun. More than one in four respondents (27%) say their organizations have already incorporated the technology into key processes and services, while another 46% have one or more AI pilot projects under way.

4. Despite their optimism, businesses recognize several major obstacles to leveraging AI successfully. When asked what major risks they see when adopting or increasing the use of AI, cost or financial risk tops the list, cited by 42% of respondents. Next is execution risk, with 36% saying their organisation may not have the necessary resources, in terms of people or tools, to effectively implement AI. Following closely behind are the workforce challenges involved in persuading employees to adopt new technology or learn new skills (35%) and security (32%)."

The EIU report also reaches the following conclusion:

As AI emerges from research labs and IT back offices and into the mainstream, and humans and machines begin to collaborate more closely, the transformational possibilities of AI for both businesses and societies are enormous.

Some industries, markets and individual companies are further down that road than others, but few will be left untouched. For now, it's still early days, and there are many opportunities for all. Intelligent economies, after all, will be made up of smarter businesses, and regardless of size or geographic location, every organisation has the opportunity to leapfrog the competition. Those that are successful will probably prioritize the following approaches:

Experimentation: an approach based on identifying small early wins will lay the groundwork in terms of innovation and risk mitigation strategies for more ambitious deployments in future. Organizations will look to AI to help them better understand the needs of customers and citizens and then develop new products, services and business models that are more resilient to future economic uncertainty and competitive disruption.

Skilling up: a workforce that clearly understands the benefits that AI brings to their jobs and is equipped with the skills to use this technology to best effect will be well positioned to identify fresh opportunities, not just for increased productivity but also for personal career development. Smart employers will gear training and development accordingly.

Governance: organizations in both the private and public sector will build in appropriate governance and control mechanisms that evaluate the societal impacts of AI. They will pay particular attention to building trust in their AI solutions and ensure that the logic underpinning their algorithms is sound, unbiased and can be easily explained to customers, employees and regulators.

In these ways, business leaders can make their own contribution to building tomorrow's intelligent economies, not just for their own benefit, but for that of their workforce and society at large.

How do you think AI will affect the ways in which businesses and governments engage with consumers and citizens alike?

Aaron Rose is an advisor to talented entrepreneurs and co-founder of great companies. He also serves as the editor of Solutions for a Sustainable World.