From Expense To Asset: How Today's AI Investments Can Save You Money
Whatever sector you're in, you've no doubt been thinking about the mounting pressures facing your business. Now more than ever, it's critical to strategically prioritize any and all investments.
If you're looking for a sign to invest in generative AI (GenAI) solutions, here it is: According to a 2024 IDC–Microsoft survey of 4,000 business leaders tasked with bringing AI into their operations, for every dollar invested, you can expect to get about 3.7 times back. And that ROI is projected to climb as both GenAI and its adoption continue to grow.
However, realizing this ROI takes time. According to KPMG, as reported in The CFO, "nearly 70% of leaders plan to spend between $50 million and $250 million on related [GenAI]
Yet as we look to the future of GenAI, it's clear that the efficiency gains, cost savings and competitive advantages are too significant to ignore. With more successful use cases emerging and GenAI tools maturing rapidly, the question is no longer if businesses should invest in this technology, but how to do it right.
Spending Money To Save Money
It may feel counterintuitive to invest in new technologies when markets are facing uncertainty, but GenAI is already making tangible differences. Microsoft recently published a list of 261 success stories about how its GenAI solutions were used to save money, amplify efficiencies, drive productivity and extend the capabilities of organizations globally.
Regardless of economic conditions, customers' expectations of digital experiences will never decline. If anything, those expectations will continuously rise as competitors and new market entrants set higher bars for service. Those bars are greatly influenced by companies' embrace of new and emerging technologies.
Nvidia's "State of AI in Financial Services" survey notes that one of the top GenAI ROI use cases is customer experience (CX) and engagement. Notably, the report states that the use of GenAI for CX "has more than doubled, rising from 25% to 60%. This surge is driven by the increasing availability, cost efficiency and scalability of generative AI technologies for powering more sophisticated and accurate digital assistants that can enhance customer interactions."
The report also says roughly two-thirds of respondents saw AI drive a 5% increase in revenue and a 5% reduction in annual costs. It also tracked an uptick in the number of companies using GenAI, and in the variety of ways the technology is used.
GenAI can be deployed both as agent-facing tools to empower employees and as customer-facing solutions, including autonomous AI agents, to handle interactions independently. But these applications aren't the only ways AI drives value.
Meaningfully supporting your company's ability to serve and engage customers takes a more profound and big-picture implementation across the employee experience, business operations, hiring processes and supply chain management. Only when your company is working in harmony across all departments can you fully realize the ROI potential of your AI investments.
Bringing GenAI Assistants Into The Fold
GenAI has changed the way companies handle communications, information, performance data and innovation. Employees are increasingly turning to GenAI tools to enhance their productivity, streamline workflows and tackle complex problems more efficiently.
This is happening whether or not your company has adopted and implemented GenAI. Recently, my firm, TELUS Digital, revealed that a majority of employees depend on GenAI assistants in their day-to-day work and will use publicly available large language models (LLMs) like ChatGPT if none are available internally.
What's more, 57% of respondents admitted to entering sensitive information, including customer names and contact details, into publicly available GenAI assistants, making the need for a secure, enterprise-safe GenAI platform even more evident.
Unsurprisingly, employees reported that GenAI assistants helped them work faster, improved their performance and reduced strain caused by repetitive tasks, but the availability of GenAI assistants also has impacts on talent acquisition and recruitment. In fact, our survey found that 44% of employees would be more likely to quit if their company didn't allow AI assistants, and 59% said they'd prioritize applying for jobs at companies that allow AI assistant usage.
GenAI is becoming an increasingly crucial part of employees' day-to-day lives, and businesses can no longer simply ban the use of AI at work. Given the workforce demand for GenAI assistants, it's incumbent upon companies to embrace GenAI and work to fill skill gaps now.
The Cost Of Inaction
Regardless of data to the contrary, many business leaders believe GenAI may still be too risky to invest in. Choosing to delay adoption is not the safe bet some may think it is. Late adopters may experience escalating implementation costs, widening skill gaps and dissatisfaction among customers who are benefiting from AI-enabled services elsewhere.
The reality is, the capabilities of safe and responsible GenAI are expanding by leaps and bounds every day. McKinsey recently noted that transparency and explainability of some of the leading LLMs doubled or tripled between 2023 and 2024, based on Stanford University's Transparency Index. GenAI is continually becoming better at accuracy, reasoning and even independent decision-making.
For those considering GenAI investments, best practices dictate a few clear steppingstones:
• Conduct an AI readiness assessment.
• Start small with pilot projects with a fast time to value.
• Develop a phased implementation strategy.
• Establish clear benchmarks and KPIs for tracking ROI and other metrics.
• Develop comprehensive training programs and risk and governance frameworks that include human oversight.
• Work with an experienced partner to benefit from their expertise, technology and economies of scale.
Taking The Leap
To drive efficiencies and reduce costs on a sustainable basis means investing strategically in AI today. As our executive vice chair of the board, Jeff Puritt, previously shared, "Whether your organization is poised to thrive, highly constrained, or in a fight to survive, investments in your people, technology, and communities are measurably beneficial to the bottom line. ... Doing the right thing is the right way to inoculate your business against exogenous events, while positioning your brand for sustainable growth in even the most trying of times."
Forbes Technology Council is an invitation-only community for world-class CIOs, CTOs and technology executives. Do I qualify?
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