Commentary
AI Projected To Boost Business Profits, By A Lot
- by Chuck Martin , Staff Writer, June 26, 2017
It’s obvious there could be serious money in artificial intelligence.
A new study now suggests that AI has the potential to actually boost business rates of profitability and push those rates into the trillions of dollars.
Businesses could increase profitability by an average of 38%, leading to an added $14 trillion in additional gross value added across 16 industries in 12 economies, according to a new report by Accenture Research and Frontier Economics.
The duo measured the potential economic impact of AI in gross value added, which they say is a close approximation of gross domestic product that accounts for the value of goods and services produced.
The industries most impacted will be information and communication, manufacturing and financial services. Those three sectors alone will account for an additional $6 trillion in 2035, according to the study.
The study actually breaks down the results by industry, suggesting that in labor-intensive sectors, such as retail and wholesale, AI will augment the human workforce, enabling people to become more productive, leading to a profit increase of almost 60%.
Here, by industry, is the share of profit increases projected by 2035:
- 84% -- Education
- 74% -- Accommodation and food service
- 71% -- Construction
- 59% -- Wholesale and retail
- 55% -- Healthcare
- 53% -- Agriculture, fishing
- 46% -- Social services
- 44% -- Transportation and storage
- 39% -- Manufacturing
- 31% -- Financial services
- 27% -- Public service
- 26% -- Arts, entertainment
- 24% -- Professional services
- 17% -- Information and communication
- 9% -- Utilities
By country, the largest economic impact due to AI is projected to be the United States and the least is Italy.
Of course, these projections are for the year 2035, which is hardly around the corner.
The report makes several suggestions to get there. These include creating an AI roadmap, using AI beyond automation, such as harnessing the intelligence of self-learning machines, and creating an open AI culture in an organization.
Chuck Martin is Editor of the AI & IoT Daily at MediaPost and writes the daily Connected Thinking column. He is a NY Times Business bestselling author and his latest book is “Digital Transformation 3.0” (The New Business-to-Consumer Connections of The Internet of Things.) He is CEO of Net Future Institute and a frequent keynote speaker internationally. Follow him on Twitter @chuckmartin and contact him at Chuck@MediaPost.com.
I am getting some deja vu here...remembering all the tech miracles that were supposed to bring huge profits in implementation. Perhaps what the study means is that consultants and service providers are ready to see huge profit jumps - fleecing clients with algorithms that are merely AI wannabe's... Given the past couple of decades of tech miracles this seems far more realitistic. So much tech makes profits for providers - not for those using it.
Right, Doug, the long-term promises often have a hard time being met.