Application of AI in Business

Businesses are increasingly using AI applications to optimize their daily operations and drive their high-level strategy. AI capabilities such as machine learning, natural language processing, computer vision and large-dataset analysis allow these applications to mimic human intelligence and decision-making—or, in some cases, exceed them—at least in limited use cases.¹

This article will cover the application of artificial intelligence in business, including how it can lower costs and increase productivity while driving strategic decision-making.

According to the global consulting firm McKinsey & Co., artificial intelligence business applications extend to almost every industry.² Some of the most widespread use cases include the following:

With high turnover rates and stress levels, customer service and support jobs can benefit from AI applications that can reduce volume and increase efficiency. Natural language processing allows AI customer service chatbots to interact with people using everyday language. AI applications can automate many routine support tasks, such as tracking orders or answering FAQs. These applications should supplement rather than replace human workers. They’ll help businesses do more with fewer workers and free up human talent to focus on more complex or high-value tasks.³

McKinsey estimates that AI applications in marketing and sales could reach a value of $2.6 trillion.² AI-driven data analysis can uncover trends in customer data to make marketing campaigns that provide a hyper-personalized experience. These applications can provide seamless engagement that allows customers to switch between multiple channels without losing their progress.⁴

Businesses can also use AI to generate effective data-driven marketing strategies based on consumer behaviors and market trends. Additionally, by automating repetitive tasks, AI applications can increase marketing and sales teams’ productivity.⁴

The supply chain is another sector that McKinsey highlighted as a major area of impact, with the value of AI applications expected to reach $2 trillion.²

According to EY, an international professional services firm, 40% of supply chain organizations are investing in generative AI. Because they can interact using natural language, these applications make it simple for business leaders to ask questions that can inform their demand forecasting, product planning and risk management.⁵

The financial industry is one of the most highly regulated due to its critical and sensitive nature. AI business applications in finance are used to detect anomalies that could indicate fraud, money laundering, or cyber threats. AI advisors can provide personalized investment advice based on a customer’s goals and risk tolerance. AI tools can also automate many aspects of compliance to increase productivity and reduce human errors.⁶

The research and advisory company Gartner is already seeing widespread AI adoption in HR and expects it to continue to grow as HR leaders use AI to perform time- and labor-intensive tasks while generating actionable insights. HR teams can use AI tools throughout the employee lifecycle. These tools can perform data analysis to determine the most effective recruiting channels. Once employees are hired, they can handle mundane onboarding tasks and provide personalized training plans. Through natural language processing, generative AI tools can also help create HR content.⁷

Bad actors are already using AI technology to launch cyberattacks on a massive scale, but IT teams are using it to counter these threats and shore up their cyber defenses. AI tools can monitor network traffic to detect early signs of unauthorized access. They can also pre-emptively flag potential scam emails. AI-powered security tools can perform automated penetration testing to find weaknesses in an organization’s system, and they can scan codebases to find security flaws before applications are deployed.⁸

New product development can significantly impact a company’s growth and long-term success, and AI can contribute by providing in-depth data analysis to achieve an optimal product-market fit.⁹

Once a business establishes that there’s strong demand for a product, AI applications can speed up iteration and reduce time to market. Instead of spending weeks on a prototype or mock-up, AI tools can create them in hours. They can also scan and then analyze data on customer sentiment from multiple sources for faster and more accurate feedback loops.⁹

The possibilities are almost endless when it comes to the applications of artificial intelligence in business, so one of the most difficult aspects of implementation is deciding where to start. First, you should write out a list of the problems you need to solve to achieve your goals. Although AI applications can solve a variety of business problems, human intelligence is the main driver.¹⁰

When you’ve identified your most significant problems, evaluate the AI solutions that are available and choose one to implement as a test case. Finally, develop an adoption strategy that includes training your team and measuring your results.¹⁰

While AI has many crucial benefits in business, let's take a closer look at five of these benefits.

One of the hallmark benefits of AI is its ability to automate repetitive tasks, thereby freeing up human resources for more strategic endeavors. AI-powered tools can handle everything from data entry and customer service chatbots to complex data analysis and predictive maintenance.

• Automation: AI systems can perform tasks at a much faster rate than humans, reducing the time required to complete them
• Scalability: With AI, businesses can manage and analyze vast amounts of data in real-time, helping streamline operations and facilitate smarter resource allocation

AI goes beyond just handling tasks; it provides remarkable insights that drive better business decisions. Through sophisticated algorithms, AI can analyze patterns and trends, providing actionable intelligence.

• Data-Driven Insights: AI tools can process enormous datasets to identify trends that might not be immediately obvious to human analysts
• Predictive Analytics: By forecasting future market trends, customer behavior and potential risks, AI equips decision-makers with critical foresight that guides strategic planning

While the initial investment in AI technology can be substantial, the long-term cost savings are undeniable. AI can significantly reduce operational costs in various ways.

• Operational Efficiency: By automating routine processes, businesses can reduce the time and labor costs associated with them
• Error Reduction: AI systems minimize the likelihood of human error, which can result in costly mistakes and inefficiencies

In the age of customer-centric businesses, AI plays a pivotal role in enhancing the customer experience. Personalized interactions and efficient service are becoming the norm, thanks to AI.

• Personalization: AI algorithms analyze customer data to offer personalized recommendations that cater to individual preferences
• 24/7 Support: Through AI-powered chatbots and virtual assistants, businesses can provide around-the-clock customer service, ensuring swift and effective resolution of inquiries

AI isn't just about improving existing processes; it's also a catalyst for innovation. Companies leveraging AI are often at the forefront of their industries, finding new ways to innovate and stay competitive.

• Product and Service Innovation: AI helps in developing new products and enhancing existing ones by providing insights into customer needs and preferences
• Market Leadership: Companies that effectively integrate AI into their business strategies are seen as industry leaders, known for their innovation and forward-thinking approaches

AI is advancing at an unprecedented pace. Because of the rapid increases in its capabilities, businesses face significant challenges related to adoption. Ethical considerations are a primary challenge since many AI models are opaque, and we aren’t sure how they make decisions.¹¹

Another significant concern is data protection and privacy. While AI-specific regulations aren't widespread, AI tools must comply with existing data protection and privacy regulations.¹¹

Many businesses, including small businesses, also face technical and operational challenges in implementing AI solutions. They may not have access to extensive training datasets, or their staff may not be qualified to implement AI.¹¹

We’re in an era of transformational business growth across sectors. W&M’s Online MBA program can equip you with the skills and knowledge you need to lead a future-focused business in a shifting landscape.

Our program is consistently ranked in the top 10% nationally.¹² Our curriculum focuses on solving complex, real-world business problems, and it is taught by leading experts who have demonstrated success in the field.

Reach out to one of our admissions outreach advisors today to get started.