Only 10% of organisations achieve significant financial benefits with AI despite increased investment and activity, said Boston Consulting Group recently when releasing a major study by MIT Sloan Management Review (MIT SMR), BCG GAMMA, and BCG Henderson Institute.
The study highlights the often underestimated role of mutual learning between humans and machines in generating value from AI, BCG pointed out, adding that those companies that draw on multiple types of interaction and feedback between humans and AI are 6X times more likely to amplify their success with AI.
Based on a survey of more than 3,000 managers in 29 industries in 112 countries and several in-depth interviews with experts, the study includes a four-year longitudinal examination of cross-industry AI adoption and a variety of use cases, according to BCG.
Multiple foundational steps and process improvements enable companies to generate value with AI, but ultimately, companies achieve the most value when mutual learning occurs between humans and machines, according to the study report.
Investments that help maximise value
The study also highlights the following investments organisations make to maximise value.
- Building foundational capabilities — AI infrastructure, talent, and strategy — increases the likelihood of achieving significant benefits by 19%.
- Scaling AI across different use cases and going beyond automation increases likelihood by another 18%.
- Achieving organisational learning with AI (drawing on multiple interaction modes between humans and machines) and building feedback loops between human and AI increases that likelihood by another 34%.
Three essential characteristics among organisations learning with AI
In addition, organisations that learn with AI share three essential characteristics, the report says.
- They facilitate systematic and continuous learning between humans and machines.
- They develop multiple ways for humans and machines to interact.
- They change to learn, and learn to change.
Organizations that systematically invest in these activities are 73% more likely to achieve significant impact with AI, BCG pointed out.
“Isolated AI applications can be powerful,” said report coauthor Sam Ransbotham. “But we find that organizations leading with AI haven't changed processes to use AI. Instead, they've learned with AI how to change processes. The key isn't teaching the machines. Or even learning from the machines. The key is learning with the machines — systematically and continuously.”
- 70% of global executive respondents understand how AI can generate business value, an increase from 57% in 2017.
- 59% of global executive respondents have an AI strategy, an increase from 39% in 2017.
- 57% of global executive respondents affirm that their companies are piloting or deploying AI, an increase from 46% in 2017.
- A growing number of companies recognize a business imperative to improve their AI competencies and data infrastructures.
- Despite these trends, just one in ten companies generates significant financial benefits with AI.
The single most critical driver of value from AI is not algorithms, nor technology — it is the human in the equation, said report coauthor Shervin Khodabandeh.
“We continue to see that despite more companies investing in AI technologies and launching AI initiatives, only a small fraction get meaningful value, he noted. “What this select group do well is that they create integrated AI-Human systems, where AI learns from human and human learns from AI. And the more different ways of learning between the two, the more value there is to get.”