10 Ways AI is Making Companies More Efficient
Transforming Challenges into Opportunities with AI
With a staggering 72% of organisations already integrating AI into at least one business function [1], and with multiple reports highlighting AI's ability to make “workers more productive and lead to higher quality work” [2], it's clear that AI is transforming the way companies operate.
But the question remains: how can your business use AI to achieve similar results?
Here we look at 10 key ways that AI is driving efficiency: from streamlining operations to personalising customer experiences.
1. Process Automation
This covers the automation of a wide variety of tasks, both routine and complex: freeing up employees to work on more complex or strategic activities.
Traditionally this category included the automation of quite basic tasks, like data entry. But as the technology has developed, it’s now possible to achieve human-level accuracy on complex tasks: particularly if historical data is available to train a custom machine learning model.
It’s important to note that complete automation isn’t always necessary: significant efficiency gains can be achieved by partially automating processes, or by supporting employees to make more efficient and more accurate decisions with the assistance of AI.
2. Process and Workflow Optimisation
Process and workflow optimisation can be divided into two main categories: optimising the overall high-level workflow and optimising individual lower-level processes. Both of these are crucial for improving efficiency and productivity within an organisation.
High-Level Workflow Optimisation:
This involves analysing and enhancing the entire workflow: identifying and improving any potential inefficiencies.
Lower-Level Process Optimisation:
This focuses on improving specific processes within the workflow.
An example of this is inventory prioritisation. Consider an employee tasked with investigating a large list of potential client leads: manually sifting through the full list may not be feasible.
Instead, we first use a machine learning model to prioritise these leads (based on their potential value) the employee then only needs to work on the most promising leads: not only saving time but also increasing the likelihood of converting high-value leads.
3. Risk Management and Compliance
Within risk management and compliance, we include fraud detection, cybersecurity, and regulatory compliance - all of which are essential for maintaining the integrity and security of business operations.
Fraud Detection:
AI, particularly machine learning models, excel at identifying anomalies and unusual patterns in data, enabling real-time fraud detection.
Traditional methods that rely on manual reviews and predefined rules are often limited and insufficient for modern needs - given the constantly evolving nature of fraud, sophisticated techniques that can analyse data in real-time and identify emerging fraud trends are crucial.
Accurately identifying instances of fraud while minimising disruption for genuine customers is essential not only for operational efficiency but also to protect the organisation from reputational damage.
Cybersecurity:
Much like in fraud detection, AI excels in cybersecurity by constantly monitoring networks for suspicious activity.
AI is capable of identifying patterns that are indicative of cyberattacks, like unusual login attempts or other suspicious activity. This allows for real-time responses to prevent breaches and safeguard sensitive information.
Regulatory Compliance:
Regulations often result in a huge amount of paperwork, as well as a need for constant monitoring. AI can help to automate the steps involved:
Compliance Tracking: AI keeps a watchful eye on your activities, ensuring they align with regulations.
Automated Reports: No more manual report creation! AI handles it automatically, saving you time.
Real-Time Alerts: AI acts as your early warning system, flagging potential violations before they become issues.
AI systems can even track changes in the regulations, and automatically update protocols: which reduces administrative burdens and ensures ongoing compliance.
4. Document Management and Intelligence
Managing various documents, including contracts, emails, customer feedback, and scanned images, can be a significant burden. AI, and in particular Natural Language Processing (NLP), offers a solution:
Automated Classification and Tagging: AI can analyse documents, automatically classifying them by content and assigning relevant keywords. This simplifies their organisation and retrieval.
Intelligent Search: AI provides more effective document retrieval by matching high-level concepts as well as synonyms. It can even find relevant information in scanned images.
Data-Driven Decision-Making: going beyond document management, AI can also extract key insights from documents and integrate these into decision-making processes.
5. Predictive Maintenance
Predictive maintenance uses AI to continuously monitor data from equipment sensors: through predictive modelling, it’s possible to predict maintenance needs before issues occur.
This proactive approach offers several advantages (which reduce costs as well as increase efficiency):
• Preventing downtime,
• Extending machinery life,
• Reducing maintenance costs.
6. Dynamic Pricing & Sales Forecasting
Accurate prediction is one of the key abilities of AI and so applying this capability to allow businesses to set prices and manage inventory makes perfect sense.
Dynamic Pricing:
Again, one of the key strengths of AI is its ability to analyse multiple sources of information and make a prediction. In the case of dynamic pricing, a machine learning model can consider factors like market demand and competitor pricing to set an optimal price in real-time.
A good example is the airline sector, where ticket prices are adjusted based on real-time booking patterns.
Sales Forecasting:
In the case of sales forecasting, ML models can consider relevant information (market trends, historical data, and other external factors) to predict future sales patterns.
This has a range of benefits, from setting more realistic sales targets and budgets to enabling inventory optimisation.
Integration:
Since dynamic pricing and sales forecasting are related functions, companies can integrate them into a single cohesive system. For example, a retailer can use AI to forecast demand for a product and then adjust the price to optimise sales and inventory.
7. Personalised Marketing
The ability to personalise a wide range of marketing based on customer data is extremely beneficial.
We all know how annoying it is to receive marketing that’s not relevant (essentially spam), but if we receive content that is personalised to the point where it is relevant then it’s a win-win: increasing engagement and conversion rates.
This covers a diverse range of applications, from an e-commerce platform recommending products based on a customer’s past purchases and browsing history, to streaming services suggesting shows and movies customised to individual viewing preferences.
8. Customer Analysis and Support
Providing exceptional customer service starts with understanding your customers, and AI offers the tools to both understand and support them effectively.
Customer Insights:
As we’ve already discussed, one of AI’s strengths is its ability to analyse vast amounts of data. In the case of customer insights, providing information like purchase history and browsing behaviour, allows AI models to reveal customer preferences and potential pain points.
This enables businesses to provide targeted and proactive support.
Enhanced Support:
The latest chatbots and virtual assistants can access customer histories and other information to deliver higher-quality support around the clock.
When these AI tools are insufficient, other AI-based systems can assist human agents by providing real-time insights, helping to achieve faster and more effective resolutions.
The result is happier customers, improved loyalty, and reduced support costs.
9. Data-Driven Decision Making
The goal here is to turn raw data into actionable insights and enable more informed decision-making.
Some of the key ways this can be achieved:
Large-scale data processing: AI can analyse diverse data sources to identify hidden patterns and trends.
Predictive and prescriptive analytics: Forecasting future trends, anticipating market changes, and suggesting optimal actions.
Real-time insights: Enabling rapid responses to market shifts.
Automated reporting and visualisation: Generating clear, easy-to-understand reports from complex data.
Performance tracking: Monitor KPIs in real-time, identifying areas for improvement.
Benefits include improved decision accuracy, faster market responsiveness, and efficient resource allocation.
10. HR Analytics
Streamlining Recruitment and Assessing Candidate Fit:
AI can analyse CVs, and other candidate data to quickly identify the most suitable candidates, reducing initial screening time and effort.
Additionally, AI can be used to evaluate candidates based on their cultural fit to the company.
By analysing data from past hires and current employees, it’s possible to predict which candidates are likely to thrive in specific roles, in doing so, improving the overall quality of hires.
Improving Employee Retention:
HR analytics can monitor employee performance, engagement, and satisfaction: identifying potential turnover risks.
It’s also possible to provide proactive measures, such as targeted training and career development opportunities to help retain staff.
Understanding the factors that contribute to employee satisfaction allows businesses to implement effective retention strategies.
Conclusion
There’s no doubt that AI is transforming business operations by enhancing efficiency in various ways. We’ve covered applications from automating tasks to personalised customer support, all of which lead to smarter and more cost-effective businesses.
It’s worth noting that AI applications vary based on company needs, for example, while HR Analytics can benefit larger firms, that’s unlikely to be the case for smaller companies. Each business must examine the areas where they spend significant time and effort and develop their AI strategy accordingly.
If you’re looking for guidance on using AI to make your business more efficient, get in contact with us or check out our full range of AI consulting services.
References
[1] Artificial Intelligence Index Report, Stanford University - Human-Centered Artificial Intelligence: https://aiindex.stanford.edu/wp-content/uploads/2024/05/HAI_AI-Index-Report-2024.pdf
[2] The State of AI in Early 2024, QuantumBlack AI by McKinsey: https://www.mckinsey.com/capabilities/quantumblack/our-insights/the-state-of-ai