AI and automation afford businesses greater flexibility and scalability. Any company that doesn't include them in its digital modernization risks being left behind.
AI and Automation: Seven Benefits of Digital Modernization for Businesses
In 2023, artificial intelligence (AI) and automation are increasingly normalized in most business environments. Not too long ago, modernizing meant launching a website for your brick-and-mortar establishment, or even moving your entire business onto the World Wide Web, where you could connect with customers digitally instead of physically.
Now, with the help of AI and automation systems, modernization has gone even further. In fact, according to a report by MarketsandMarkets, the AI industry was worth around $82 billion in 2022. With the ever-increasing range of uses for this technology, this figure is expected to keep growing, increasing by at least 36.2% over the next four years.
If you want to use AI and automation technologies to access the business benefits of digital modernization, this guide is for you. Here, we consider seven compelling reasons why modernizing is the way forward.
Defining AI and automation
Before we examine the advantages of digitally modernizing your business, it’s useful to establish what we mean by AI and automation. Although the two are sometimes used interchangeably, they are different technologies.
What is AI?
AI stands for artificial intelligence. It is a system that processes large amounts of data to predict or achieve a desired outcome. It follows a programmed set of rules to find the best way to achieve its goal.
AI mimics human intelligence. As it processes data, it learns the best and most efficient ways of doing things. For example, if you were to use it for product recommendation predictions, it would offer more accurate recommendations as it accessed more product data.
What is automation?
Automation is more rigid than AI, as it follows a tighter set of rules or instructions to carry out repetitive tasks. As automation lacks intelligent design, it must be programmed to perform specific steps. It cannot deviate from what it’s programmed to do.
Automation requires a watchful eye to ensure it continues to function as intended.
What is AI automation?
There’s also AI automation. This is a hybrid form of technology that blends the two concepts. With AI automation, systems can perform repetitive pre-programmed tasks and also adapt to different circumstances based on incoming data.
Why is data modernization important?
AI and automation are both key players in data modernization.
In a recent study, Zippia found that 25% of companies have integrated AI into their operations; in the same study, 79% of marketing leaders claimed AI increased their company’s revenue.
When businesses adopt AI and automation technologies into their processes, they gain crucial insights into their customers’ pain points, behaviors, and desires.
Data modernization benefits for businesses also include effective scaling through highly targeted campaigns, and the ability to keep up with competitors who are benefitting from the use of these technologies.
The seven main advantages of digitally modernizing your business
It’s clear that AI and automation technologies can benefit businesses, so let’s look at seven specific advantages of digital modernization in more depth.
1. Increased efficiency and productivity
AI automation in business is all about taking the load off of employees by automatically completing tasks with minimal human input. AI technologies can perform the same, or even more complex, tasks as humans, but require fewer resources. This frees up employees to carry out tasks that are better performed by humans.
A good example of AI improving productivity in the workplace is the recruitment process. AI can source potential employees, screen applications, and schedule interviews with the most suitable candidates. Completing all these tasks would need human employees to expend a considerable amount of time as well as use multiple resources.
AI can process far more data than people and also analyze it more accurately. It looks for patterns in data and then categorizes this accordingly. This can improve business procedures within the workforce and simplify task management.
2. Improved accuracy and reliability
AI is created with accuracy and reliability in mind. It sifts through data to give consistent results. While humans are prone to errors, AI is not. Using AI and automation technology can thus help businesses reduce mistakes within their operations.
For instance, AI can accurately track and manage inventories. When a product’s stock is low, it can alert businesses and manufacturers. Furthermore, by connecting AI with your eCommerce store, you can be sure your displayed stock levels are consistently accurate. And, if something’s out of stock, it can make it so customers can no longer buy it.
Remember, AI dynamically adapts to the volume of data it collects. Therefore, there’s no need to tweak it to accommodate a boost in sales, for example.
However, AI accuracy varies depending on its use. In 2019, Birmingham University published research that concluded that AI accurately detected diseases in 87% of patients. In comparison, healthcare professionals accurately detected diseases in 86% of cases.
More recently, a book about using AI in an educational setting claimed that AI could regularly be up to 95% accurate.
3. Enhanced decision-making
Businesses that use AI can base their decisions on accurate, real-time data. They can extract useful information to provide essential insights, predictions, and forecasts. AI can also enhance decision-making by removing all possible human biases from the equation.
For example, AI is used in sales forecasting to understand consumer behaviors and accurately predict trends based on purchase history, consumer preference, and customer communication. This helps marketers target consumers with products they’re more likely to purchase.
4. Improved asset utilization and cost reduction
There are lots of ways AI and automation can improve asset utilization and reduce costs. Companies are also constantly discovering new and innovative ways to make AI work for them.
As well as reducing the need to pay staff to complete mundane tasks, AI can help businesses save money on their energy bills. For example, it can analyze data points and give users valuable suggestions to reduce their energy consumption. It can also automatically control the amount of energy a company uses and explore ways to reduce this, especially at peak times when it costs more.
Furthermore, manufacturers may implement a “lights out factory”. This is made up of AI, next-gen technology, and robots that can manufacture products with limited human interaction. This ‘workforce’ can complete its tasks without the high-energy environment, which can include lighting and air-conditioning, that people need.
Businesses can also use AI to improve the manufacturing process. For instance, it can detect flaws in production lines. This is especially useful for tiny defects that the human eye would struggle to identify.
Furthermore, AI technology can help reduce maintenance costs and save your business money in the long run by predicting breakages and failures before they happen.
5. Better customer experience
Providing a better customer experience is one of the most common uses of AI. It can analyze all customer actions at every touch point, from initial exposure through to the first purchase and on to becoming a loyal customer. By using AI in marketing, businesses can show their customers relevant products, services, and information.
AI can also enhance your customer support. One notable use of AI automation for customer support is chatbots. Chatbots are programmed to automatically respond to frequently asked questions.
Using natural language processing, AI chatbots read questions and process data to give the most appropriate and accurate answer. The data they collect also allows them to learn better responses to questions over time.
AI can provide personalized customer service too. It can track customer queries and direct them to the appropriate human customer service department if necessary. This technology also categorizes support tickets and can take customer feedback on board to keep learning.
6. Greater flexibility and scalability
AI and automation afford businesses greater flexibility and scalability. With so many uses for AI, businesses that reject this technology may find themselves lagging behind the competition.
AI dynamically adapts to the volume of data it collects and enables businesses to scale quickly. You can use it to build specific buyer personas and create highly targeted ads and email campaigns. It can be used to keep on top of consumer trends as well.
7. Stronger risk management and security
AI can identify risks in systems and prioritize threats accordingly. For example, an AI cybersecurity system can collect data on known industry threats.
It can then predict the likelihood of your company being attacked, as well as how and where it could happen. AI can identify weaknesses in your infrastructure, which will enable you to enhance your security.
By incorporating AI into their cybersecurity systems, businesses are also better equipped for regulatory compliance. They can ensure that their customer and employee data is as safe and secure as possible, which will in turn increase trust in the business and improve its reputation.
The impact of digital modernization on businesses
AI and automation are key components of digital modernization in businesses. There are lots of ways to take advantage of these innovative technologies, from embedding chatbots into your website to using AI-powered cybersecurity software.
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