FIN 108 - Artificial Intelligence and Business Value

Technological, Organizational, Environmental

enablers and inhibitors can be subdivided into three main categories

Data

the core of AI; an essential enabler of AI adoption in organizations

big data

high-volume, high-velocity, and/or high-variety information assets that require new forms of processing to enable enhanced decision making, insight discovery, and process optimization

big data

is often used to refer to these large data sets

Volume, Velocity, Variety

The 3 Vs of Big Data

Velocity or timeliness

refers to the speed at which the data are collected and updated

Data quality

is crucial for providing reliable predictions

Garbage-in, garbage-out

is a fundamental principle for AI, meaning that if training data has low quality, the insights generated by the AI will also be of low quality and not useful in the organizational context.

computing power infrastructure, algorithms, rich data sets

To successfully deploy AI in an organization, three things are needed:

Organizational readiness

refers to the availability of the complementary organizational resources needed for AI adoption

Employee-AI Trust

The ability of employees to rely on and work with AI systems.

Compatibility

refers to the fit between the desired application and technology

business processes, business case

The compatibility concept can be divided into two subcategories:

competitors, government

Organizations operate in dynamic and constantly changing environments, consisting of actors such as _______ and _______, that have an influence on how the organization can and should conduct business.

AI ethics

a set of values, principles, and techniques that employ widely accepted standards of right and wrong to guide moral conduct in the development and use of AI technologies

transparency of AI applications, accountability, safety and security, societal and environmental well-being, design for universal access, human agency and oversight, privacy and data governance

seven key dimensions that organizations should consider when deploying AI applications according to European Commission

Competitive pressure

refers to how an organization is affected by its competitors and the action taken in response to these

AI for automation, AI for augmentation

AI applications depending on their use can be divided very broadly into two categories:

Automation

refers to AI systems that are tasked in replacing human work

Augmentation

enhances human intelligence by providing insight that can aid decision-making

Intelligent Automation

enables the automatization of tasks that were previously considered too difficult to automate, such as knowledge and service work

Chatbots

are conversational software systems that emulate humans’ communication capabilities

Augmentation

refers to integrating AI with human expertise to enhance decisions and optimize actions

Process Efficiency, Insight Generation, Business Process Transformation

To assess the impacts of AI on the process level (first-order impacts), three different effects are discussed:

Operational Performance, Financial (Accounting) Performance, Market-based Performance, Sustainability Performance, Unintended Consequences and Negative Impacts

Second-order effects/impacts can be divided into four categories + one:

Customer satisfaction

is related to how satisfied a customer is with a company’s offerings,and it directly affects the loyalty and retention of customers.

Insight Generation

The concept that AI can reveal hidden patterns in large datasets.

Process Efficiency

Improvement in efficiency, productivity, and accuracy due to AI.

Data, Technology Infrastructure

Technological enablers/inhibitors for AI adoption

Culture, Top Management Support, Organizational Readiness, Employee-AI Trust, AI Strategy, Compatibility

Organizational enablers/inhibitors for AI adoption

Ethical and Moral Aspects, Regulations, Environmental Pressure

Environmental enablers/inhibitors for AI adoption