1、Executive PerspectivesArtificial Intelligence: Ready to Ride the Wave?December 2021Executive PerspectivesSources: BCG analysis and case experienceBCG Executive PerspectivesIN THIS DOCUMENTCopyright 2021 by Boston Consulting Group. All rights reserved. BCG Executive Perspectives updated 13 December 2

2、021 Version 2.0AI HAS STRONG POTENTIAL TO REDEFINE INDUSTRIESAt BCG, we believe AI is one of the main forces that will transform industries in the next decadesand we have made it one of our largest investment areas. Many companies have invested in AI to unlock its potential. However, only 11% have r

3、eleased significant valueas the majority have failed to scale beyond pilots, reimagine the way they work with data, and redefine human-AI interaction. This document gives insight into the main success factors that corporatesshould consider when deploying AI solutions.ACT HOLISTICALLY TO HARNESS THE

4、POWER OF AIResponsible AI governanceTalent managementEcosystem orchestrationData and tech capability buildingCollaborative redesign with business ownersAmbition, strategy, and desired outcomesEnterprise agilityNeed to get all ingredients right21. MIT-BCG 2020 Artificial Intelligence Global Executive

5、 Study and Research Project; 2. AI adoption skyrocketed over the last 18 months, Harvard Business Review, Harris Poll 3. Out of those teams that saw improvements in both efficiency and decision quality after implementing AI (58% of teams); The Cultural Benefits of AI in the Enterprise, BCG-MIT, Nove

6、mber 2021; 4. Based on a global survey in spring 2020, attracting over 3,000 total respondents representing 29 industries and 112 countries; our assessment of “significant financial benefits” uses a threshold that varies according to organization size. For the largest organizations in our sample, wi

7、th revenues of more than $10 billion, passing this threshold requires more than $100 million in revenue and/or cost improvements annually from the use of AI. For smaller organizations, the thresholds were lower: $20 million in improvements for organizations with revenues between $500 million and $10

8、 billion, $10 million in improvements for organizations with revenues between $100 million and $500 million (or nonprofits), and $5 million for organizations with less than $100 million in revenues; 5. The Citizens Perspective on the Use of AI in Government, BCGHigh investment Accelerated adoption32

9、%Of citizens express concern that significant ethical issues in AI have not yet been addressed5Headwinds to manage87%Of teams saw improvements in collective learning after implementing AI solutions3Positive team impactAI is gaining momentum given potential, yet headwinds must be addressed $58BGlobal

10、 AI investmentin 2021155%Of companies accelerated their AI strategy and adoption because of COVID-19211%Of companies report significant financial benefits through revenue/cost improvements from implementing AI4Initial value release3Copyright 2021 by Boston Consulting Group. All rights reserved. BCG

11、Executive Perspectives updated 13 December 2021 Version 2.0CURRENT STATE AND TRENDSYet, only 11% of firms report significant financial value from AI. Those that do, deliberately reimagine the way they work with data and successfully move from pilots and proof of concept to scalingApart from driving

12、financial outcomes, AI can also reignite team effectiveness, morale, & culture in the long termStrong potential of AI has driven high growth, underpinned by focused investments in optimization, predictive maintenance, personalization, and automationDespite positive outlook and growth, there are seve

13、ral dynamics to manage: labor market shifts and talent shortages, data capability gaps, ethicality and transparency concerns, and expected increase in regulationsA critical element is people, with high value unlocked in effective organizational learning and change management4Copyright 2021 by Boston

14、 Consulting Group. All rights reserved. BCG Executive Perspectives updated 13 December 2021 Version 2.024531Summary (i/ii) | AI: current state and trendsSources: BCG analyses, experience, and publicationsSummary (ii/ii) | AI: implications for leadersSources: BCG analyses, experience, and publication

15、s3Learn from digital natives: Change your ways of working and operating model to enable enterprise agility, continuously reimagine business processes, and effectively orchestrate ecosystems 5Decouple data capability building from core IT systems, embed flexibility via reshoring, and modernize iterat

16、ively Clearly articulate the ambition for value creation from AI, linked to your companys strategy and purposedevelop a clear perspective of where AI will drive business outcomes6Invest early in responsible AI governance, policies and standards, structural assessment, expert staff, and issues respon

17、se plan; provide transparency to stakeholders4Involve HR early on: Anticipate AI impact on jobs and skill sets, embed in strategic workforce planning and internal upskilling programs, rethink employee value proposition to retain talent12Treat AI development as a business transformation: redesign col

18、laboratively with businessowners, iterate, and improve based on human-AI learningPrepare your operating model for AIEmbed AI in your business5Copyright 2021 by Boston Consulting Group. All rights reserved. BCG Executive Perspectives updated 13 December 2021 Version 2.0Deep dives per implicationon pa

19、ges 14-201Context | AI comprises technologies complementing human capabilities to interpret data, make decisions, and take actions Artificial intelligence is enabled by tech-human interaction across three core buildings blocksMachine vision1Speech recognitionNatural language processing2Info processi

20、ngPattern recognitionLearning from dataImage generationHandling & controlNavigation & movement DATAPROCESSINGACTION6AI has the power to support and enhance human capabilities, beyond what is currently possible Process big data in real time, without need for humans to input updated data1Achieve ultra

21、-granularity, even while processing massive amounts of data 2Improve continuously and autonomously through learning loops3Scale massively at a low cost, with computing power exponentially improving4Provide humans with actionable data difficult to comprehend otherwise5Strong growth: AI market expecte

22、d to grow at 28%3CAGR through 202361. Machine vision: methods to provide imaging-based automatic inspection and analysis, 2. Natural language processing: subfield of AI and linguistics, concerned with interactions between computers and human language; 3. IDC, Worldwide Artificial Intelligence Foreca

23、st, 20192023. Sources: BCG analysis, CB insights, IDCCopyright 2021 by Boston Consulting Group. All rights reserved. BCG Executive Perspectives updated 13 December 2021 Version 2.0Four investment areas 1.Machine learning, 2. BCG-MIT Sloan Management Review 2019 AI Survey, n=2,555. Sources: BCG-Wired

24、 database, Fortune, BCG Henderson Institute, BCG cases and experience1.1AI growth underpinned by focused investments in four key areas that are redefining industries and necessitating actionAI has revolutionized industries across variety of use casesExample use cases7Copyright 2021 by Boston Consult

25、ing Group. All rights reserved. BCG Executive Perspectives updated 13 December 2021 Version 2.0Critical to invest to avoid disruption: 84% of firms believe AI helps them gain a competitive advantage2Example impactTravel | Optimized network planning and service quality with minimal operational disrup

26、tions using passenger flows to adjust route structures and schedulingOptimization27% opex reductionConsumer | Personalized marketing using anticipated customer behavior, contextual and churn probability data, leveraging database of 20M+ customersPersonalization3x incremental revenue per customerIndu

27、strial goods | Risk-based system using manufacturing and inventory data to simulate, predict, evaluate, and optimize logistical and supply bottlenecks Predictive operations/maintenance15% operations and maintenance savingsAutomationInsurance | Same-day claims payment enabled by medical imaging, face

28、 and voice prints, ML,1data from many ecosystems (e.g., finance, health care, auto, real estate)60%+ claims self-serviceSpotlight: AI & CO2emissionsMonitoring emissions Collect data from every part of the value chain Approximate missing data Estimate the level of certainty of the resultsPredicting e

29、missions Forecast emissions Simulate reduction efforts, new tech, and demandReducing emissions Use prescriptive AI to improve efficiency1.2Significant value release from AI is rooted in reimagining the way companies work with data and an ability to move from pilots to scaling1. Based on a global MIT

30、-BCG survey in spring 2020, attracting over 3,000 total respondents representing 29 industries and 112 countries. Our assessment of “significant financial benefits” uses a threshold that varies according to organization size. For the largest organizations in our sample, with revenues of more than $1

31、0 billion, passing this threshold requires more than $100 million in revenue and/or cost improvements annually from the use of AI. For smaller organizations, the thresholds were lower: $20 million in improvements for organizations with revenues between $500 million and $10 billion, $10 million in im

32、provements for organizations with revenues between $100 million and $500 million (or nonprofits), and $5 million for organizations with less than$100 million in revenues; 2. Tech and business sides; Sources: MIT-BCG: findings from the 2020 AI global executive study and research project, Expanding AI

33、s Impact with Organizational LearningOnly 11%of companies report significant financial benefits through revenue/cost improvements from implementing AI12%21%39%73%Organizational learning with AIDiscover AIBuild AIScale AI10 x2x2xFour key steps to unlock financial benefitEach step comprises critical a

34、ctivities for value release 8Copyright 2021 by Boston Consulting Group. All rights reserved. BCG Executive Perspectives updated 13 December 2021 Version 2.0Launch pilots: Implement AI in targeted areas, e.g., models that reduce customer churnAdvance to organizational use: Embed in overall strategy;

35、reimagine use of data; invest in data capability building, technology, and algorithms and in developing technical AI skills Scale to broader use cases and solutions, e.g., embed AI into processes and solutions on both production and consumption sides2Create opportunities for mutual learning between

36、humans and AI, e.g., learning how to adapt and use human-machine roles and interactions in different processes and situations (deep dive on next page)Likelihood of achieving significant financial benefits with AI (%)1.3A critical element is peoples interaction with AI - high value is unlocked from z

37、ero-based design and effective organizational learningStart with a zero-based mindset (reimagine input data, collaboration between systems and processes continuouslyand not only incremental changes)5xmore likely to realize significant value when processes redefined to embed AI11. Versus those making

38、 no or small changesSources: MIT-BCG: findings from the 2020 AI global executive study and research project, Expanding AIs Impact with Organizational LearningAgility and oversight are critical: Switch between modes as context changes (e.g., COVID)6xmore likely to release significant value if effecti

39、vely rethink how humans and AI work together and deploy all appropriate human-AI interaction modesAI-dominantHuman-dominantAI decides and implementsAI decides, human implementsAI recommends, human decidesAI generates insights, human uses in decisionsHuman generates, AI evaluatesHumans slow down proc

40、ess Personalized offersAI can capturethe context wellPredictive maintenanceAI cannot factor all context fullyTrading Creative workHiring plansHypothetical situationsSimulationsModeUsed when:Example5xmore likely to realize significant value when facilitating continuous human-AI learningUsing all thre

41、e ways: Built-in AI learning from human feedback Humans learning from AI to apply insights Humans designing AI to learn autonomously9Copyright 2021 by Boston Consulting Group. All rights reserved. BCG Executive Perspectives updated 13 December 2021 Version 2.0To capture value, reimagine processes an

42、d rethink human-AI interactions1.4Apart from driving financial impact, AI can also improve team effectiveness and bolster team culture 1. Of the teams that implemented AI and saw improvements in both efficiency and decision quality (58% of teams); 2. Net Promoter Score; Source: The Cultural Benefits

43、 of AI in the Enterprise, BCG-MIT, November 202110Of teams1indicated that they improved their collective learning87%79%Of teams1highlighted an increase in morale 78%Of teams1reported better collaboration65%Of teams1reported improved clarity of rolesCopyright 2021 by Boston Consulting Group. All righ

44、ts reserved. BCG Executive Perspectives updated 13 December 2021 Version 2.0 Emotional AI “listens” to the conversation of pharmacists, picks up emotional signals, and suggests what the pharmacist could do to provide a better experience Those who used AI tool ended up with more satisfied customers (

45、higher NPS2) Pharmacists understood how they can better execute their role (e.g., how to handle customer calls, portray empathy, respond to situations) AI tool scanning prospectuses for useful information that can benefit clients From 1 person scanning 1-2 docs for hour to AI scanning 120,000 docs p

46、er hour Resulted in significant improvement in employee satisfaction and morale by improving the type and caliber of job that team members do Next-best-offer AI recommendation tool for vendors, now also used for training Adoption varied by vendors tenure (more heavily used by newcomers) Veterans mad

47、e tool more useful by “teaching” it (to enable newcomers and minimize manual training), promoting a culture of AI useEUROPEAN AIRLINE EUROPEAN AIRLINE AI predicting passengers likely to miss their flight and sequencing luggage loading, to limit disruption and ensure on-time departure AI-driven proce

48、ss helps align teams, inform relevant members of what bags to be loaded and offloaded when, and enable better coordinationExamplesUS EXCHANGE OPERATORUS EXCHANGE OPERATORUS HEALTH CARE COMPANYUS HEALTH CARE COMPANYFRENCH ENERGY COMPANYFRENCH ENERGY COMPANYCopyright 2021 by Boston Consulting Group. A

49、ll rights reserved. BCG Executive Perspectives updated 13 December 2021 Version 2.01.5Despite positive outlook, companies must manage labor, data, ethical, and regulatory dynamics1. Artificial intelligence in business gets real, MIT Sloan Management Review and BCG, BCG Center for Sensing and Mining

50、the Future; 2. AI expert says automation could replace 40% of jobs in 15 years, Fortune. 3. “OReilly State of Data Quality in 2020” report. 4. Responsible AI constitutes a companys governance framework that documents how a specific organization is addressing the challenges around AI from both an eth