How to Get Started With AI to Demonstrate Business Value In Months
Part 1: Common Best Practices in Using Artificial Intelligence for Successful Digitalization
We hear plenty about digitalization, but often companies are unclear and use different approaches and technologies to achieve digitalization. Some have had great success and demonstrate business value in the first six months, and others stuggle to deliver value after millions of dollars in investments. To successfully leverage AI, companies should have the ability to quickly build AI-enabled applications that either automate tasks or augment human decision making.
Fortune 500 companies that have made the decision at the board and CEO level to make AI-driven digitization a key strategic imperative are those that are making the fastest progress in digitalization and are rapidly gaining a strategic advantage in their industries. These AI-driven initiatives fall into three buckets.
- Automation: The automotive industry, for example, is pursuing AI for both factory automation as well as with autonomous vehicles.
- Edge Computing: One example is BP using drones to remotely monitor high-value, high-risk assets, such as offshore platforms.
- Augmented Human Decision Making: Maersk and Shell leverage AI to provide recommendations into the operations that have the biggest impact on the gross margins of the company by enabling subject-matter experts to make better and faster decisions.
Maana is working with the most innovative industrial companies in the world that have made digitalization a strategic imperative using AI and analytics. We count organizations, such as Airbus, Maersk, Shell, and Chevron among our customer base. The focus of these companies’ AI initiatives is to help their most valuable employees, such as drilling engineers or logistics experts, make better decisions around high-impact operations like logistics and contingency management, or exploration and drilling. Our customers have identified anywhere from 100 to 400 operations and decisions that, when improved with AI, will increase gross margins anywhere from $1 billion to $5 billion annually.
We see plenty in common between these large industrial companies working toward digitalization. For one, they are assigning a chief digital officer (CDO) who they are charging with delivering business value with AI and analytics. Especially among industrial companies, the number of CDOs appointed continues to rise. These executives are tasked with building an ecosystem around AI and analytics, which often consists of:
- An internal team primarily led by subject-matter experts responsible for the optimization initiatives who collaborate with data science and analytics experts.
- A stack of best-of-breed digital technologies, typically hosted in the cloud by Azure, AWS or Google Cloud; and,
- An internal analytics team or a systems integrator (SI) partner to augment their team.
- A digital knowledge layer on top of operational data scattered across the enterprise, that shows the relationships and interdependencies between various operational entities. Those entities are key drivers of operations, such as ships, cargo types, ports, customer contractual agreements and more.
The CDOs that are successfully delivering value from AI typically form a close partnership with line-of-business executive sponsors, such as a head of logistics in transportation or VP of drilling at an oil company. Often, the business executive sponsor identifies 2-3 operations that they want to improve using AI, with the goal of delivering the biggest business value. The CDO and sponsor then partner with a best-of-breed AI software company that provides software that is easy to use by employees of the company. Ultimately, this internal partnership, coupled with the right software will enable the company to demonstrate business value in less than 6 months. The first few use cases, easily demonstrate the opportunity for additional operations that can be optimized as each operations often impacts multiple other operations in the value chain.
In the next part of this blog post, we’ll take a more detailed look at how successful industrial companies leverage AI to lead their digitalization efforts.