When thinking through enterprise AI deployments, businesses don't need to choose between moonshot projects or stick to the applications that quickly yield return on investment.
Executives turn to AI as a way to one-up the competition and enhance operations. It's seen as a transformative technology that's expected to reach scale at three-quarters of enterprises by 2024, according to Gartner estimates.
But businesses seek clarity on ROI before greenlighting resources to deploy projects at scale. Gartner data suggests 39% of companies successful at deploying AI projects had run financial analysis on risk factors, or conducted ROI analysis.
In assessing AI deployments, executives should begin by taking into account the technology's potential for long-term impact, according to Ricardo Forcano, former CIO and CHRO at BBVA.
"When a new technology comes, you cannot be asking the very first day 'what's the ROI,' because if you ask for that you're going to get nothing," said Forcano, speaking Wednesday at MIT Sloan CIO Symposium.
In the pandemic, AI helped manage added pressures on customer support systems. The experience exposed AI's practical applications to bigger swaths of consumers.
Understanding the impact AI applications will have on customers is critical to assessing the ROI of AI applications, according to Gianni Giacomelli, CIO and leader at Genpact, and head of innovation design at MIT Collective Intelligence Design Lab.
"You want the customer to feel that the experience they have of you as a counterpart is awesome," said Giacomelli. "The moment you start putting people into little silos, into workflows, it's obvious that you're going to degrade the experience for the user."
The operational draw for investing in AI, and where the ROI frequently comes in, occurs in augmenting the work of the human workforce with AI-enabled tools.
"In our case, in the bank, I would say I think the ROI up to now has been mainly coming from cost reduction and efficiency more than revenue generation," said Forcano.
Making tough decisions
The generation of leaders that weathered financial and operational disruption in the COVID-19 era hit pause or deferred major tech investments as they waited for the dust to settle. For AI, the upside was its ability to sustain operations as workforces shrunk.
Gauging the overall ROI of AI deployments in the organizations is very difficult to determine, but there are merits to letting go of projects without a clear benefit, said Craig Mackereth, SVP, Global Support, Rimini Street.
Business leaders should "cut out everything that isn't going to be paying itself off in the first year," said Mackereth. The focus on AI should be aimed at the projects that will yield a return, especially amid a pandemic.
"You've got to identify projects you think are going to return investment really quickly — get going and along the way you'll discover a lot more on that journey," said Mackereth.
For Giacomelli, there needs to be a split in energy and resources. "As an innovation person, I tend to invest 70% of my time and energy on things that … have clear deliverables, you know what they're going to patch, where the process is going to improve, the impact on the bottom line, risk reduction and client experience."
Aside from that ROI-focused effort, now is a good time for companies that can afford innovation to direct part of their time and money on "things that push the boundary," said Giacomelli.