Why is Artificial Intelligence in Business Analytics so critical for business growth?
Be it in the form of deep learning technologies, autonomous vehicles, or smart robots, artificial intelligence (or AI) is making its presence felt everywhere in the connected world. With AI-enabled technologies having a prominent place in the Gartner Hype Cycle for Emerging Technologies, this technology is enhancing the capabilities of business analytics and business intelligence.
The increasing volume and complexity of business data is driving the commercial adoption of artificial intelligence in business analytics tools in various industries. The mainstream use of artificial intelligence and machine learning in business intelligence (or BI) is helping business enterprises to pull out actionable insights from large and complex datasets and deliver business recommendations that can be understood by any business user.
So, how does AI actually work in the business world? Through this article, let’s try to understand what artificial intelligence is and why it is so important for today’s business corporations.
What is Artificial Intelligence and why is it important to business?
By definition, artificial intelligence or AI is a term used for training computer systems with human intelligence traits like learning, problem solving, and decision making. The AI application in business has been mainly enabled by the AI-powered machine learning (ML) technology that can be used to perform specific tasks such as:
- Read and comprehend written text such as user feedbacks or suggestions.
- Recognize and classify visual images and photos.
- Recognize facial features and objects thus enabling facial recognition and product recommendations.
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Based on these capabilities, we have seen multiple applications of artificial intelligence in business in the form of:
- Chatbots, virtual assistants, and business intelligence bots
- Targeted online advertising
- Predictive analytics
- Voice recognition
- Pattern recognition
What is the importance of AI for business corporations? Here are a few ways in which businesses can avail of benefits of AI:
- Automate business communication with customers through online chats, email marketing, and social media messaging that previously needed human agents.
- Provide online shoppers with a personalized experience based on AI-driven data insights derived from customer behaviour and online purchasing patterns.
- Achieve operational efficiency through various means including the adoption of AI-powered automation in inventory management and the use of artificial intelligence in robotics for automated hotel check-ins and in factory premises.
- Make business predictions or sales forecasts based on customer data and buying patterns that can accurately estimate sales volumes, inventory management, and product demands.
- Provide real-time help to customers where companies can use AI-powered mobile apps to communicate with large numbers of customers on a real-time basis or to provide personalized services to individual customers.
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In the following sections, we shall discuss some of the important business applications of AI and the use of artificial intelligence in business analytics and business intelligence.
3 Major Applications of Artificial Intelligence in Business
While Artificial Intelligence or AI works in different aspects of modern business enterprises, here are the 3 major applications of artificial intelligence in business:
- Work Automation
AI-driven work automation is estimated to cut over 9 million manufacturing jobs in the U.S. alone. Manufacturing companies are utilizing AI technologies towards a smarter use of their resources. For example, General Electric is reducing its machine downtime through data collected from AI-powered smart sensors installed on its manufacturing equipment.
By combining AI with the Internet of Things (IoT) technology, companies are reducing costs, improving productivity, and creating more specialized jobs.
- Sales and Marketing
The significant role of artificial intelligence in marketing and sales is also transforming this function across industries. AI technologies are enabling marketing personnel to automate most of their routine tasks through acquired data while they can focus on key sales functions like increasing sales and customer satisfaction.
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For example, Facebook is using ML algorithms to track customer behavior and target them with the right digital ad. Online marketplace company, Airbnb is using AI to optimize, and market the right accommodation prices based on its location and customer demand.
- Customer Service
According to industry estimates, 30% of all online retail transactions are made on the mobile phone. With the increasing use of mobile apps among smartphone users, messaging and social media usage is among the top 5 categories of apps accessed by online users. Business enterprises are now majorly investing in AI-powered chatbots to provide customer communication and service. For example, Royal Dutch Airlines is enabling traveler check-ins and flight notifications through its Facebook app. Currently, Facebook Messenger has over 300,000 active bots on its platform exchanging around 20 billion messages between business enterprises and customers each month.
In the next section, let’s explore more deeply the adoption of artificial intelligence in business analytics including that of AI and machine learning in business intelligence.
Artificial Intelligence in Business Analytics and Business Intelligence
The global business world is witnessing increasing volumes of connected devices and business data. According to Statista, IoT-enabled connected devices are projected to increase to 75 billion by the year 2025 (up from 26 billion devices in 2019). Along with the number of IoT devices, the data generated by these connected devices is exploding with over 5 quintillion data bytes being generated each day.
With the massive increase in business data, corporations can no longer depend on traditional business analytics or business intelligence tools to analyze data and derive valuable business insights for better decision making and business strategies. Operating over 11,000 retail stores, Walmart is using the ML-enabled HANA platform to process its high number of daily transactions in a matter of seconds. Machine learning tools in business intelligence like the HANA tool is expected to reduce the customer’s infrastructure costs and improve operational efficiency.
Another industry example is that of the business management software firm, Domo. By combining its capabilities in AI, machine learning, and predictive analytics, Domo customers can extract and analyze data from a variety of sources including Salesforce, Facebook, and Shopify that provides them with insights on customers, sales volumes, and inventory levels.
What does this industry trend mean for the future of business analytics? Like the manufacturing sector, will the role of business analysts also be automated?
As AI-driven business analytics becomes more common, it will transform the role played by the business analyst. As AI technology powers the real-time analysis of data, business analysts will be required to focus more on the fundamental skills of data analysis without any programming skills. For example, the machine learning-enabled DataRobot tool is automating predictive modeling and is accessible to users with no skills or experience in machine learning.
The growth of machine learning will enable business analysts to delegate most of their repetitive tasks to the computers, while they focus more on providing business enterprises with advanced analytical skills that are more valuable.
How is AI transforming the field of business intelligence? According to the latest 2019 business intelligence statistics, over 60% of business executives believe that a well-planned AI strategy can create more data-driven business opportunities. 72% of business leaders consider AI as a major business advantage.
Apart from the use of chatbots in customer service, business intelligence bots are enabling decision making by reading and analyzing business data. What’s more, is that BI bots can analyze data-related queries made in a natural language without the use of complex querying codes. Gartner estimates that BI bots enabled with conversational analytics and natural language processing will boost the adoption of business intelligence tools in the workplace.
AI-powered BI tools have the potential to transform business enterprises by:
- Managing the growing volumes of big data from a variety of sources and break them into more manageable data chunks.
- Get real-time insights from the rapidly evolving market data that can aid business managers in key day-to-day decisions.
- Overcome the industry shortage of qualified data analysts thus reducing hiring costs for data-dependent businesses.
Conclusion
This article highlights the growing adoption and importance of artificial intelligence technologies in business functionalities including business analytics and business intelligence.
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