48% of the companies using machine learning (ML) realized an increased profitability and a positive impact (more than 6%) on their revenue streams, as per a new study by SAP.
The study, “Making the Most of Machine Learning: 5 Lessons from Fast Learners”, was conducted by the Economist Intelligence Unit (EIU) and written in collaboration with SAP. Around 360 senior executives from North America, Latin America, Asia Pacific and Europe regions participated in the survey, half of whom were from the organizations with over $500 million annual revenue.
Several companies use machine learning to get competitive advantage, increase profitability and revenue, cost-effectiveness and for better performance across the breadth of operations.
SAP revealed the key characteristics of ‘Fast Learners’— the organizations already benefiting from ML.
- Senior-most executives consider ML a strategic priority
Senior-most executives in the Fast Learning organizations had the understanding of machine learning’s strategic impact on their organization and were more open for accepting change. They considered it a priority and 75% of them planned to retrain their employees displaced by ML for higher-valued tasks.
- They see ML as a way to stand apart from competition
31% Fast Learners increased business model innovation using ML.
Fast Learners believed machine learning helped them stand apart from the competition.
31% saw potential of ML in business model innovation to be vast and they were planning to bring fundamental changes instead of incremental ones.
“AI and machine learning impact the business model in a much more significant way than . . . any of the disruptions we’ve seen in our lifetimes.”
— Cliff Justice, Principal for Innovation and Enterprise Solutions, KPMG
- They recognize the potential for profitability and new revenue
ML helped the Fast Learners increase their profitability. 48% of them expected ML to grow their revenue by more than 6% in 2018 and 2019.
- They focus more on locally sourced business functions
Fast Learners spent more on sourcing the business functions locally (58%), as compared to sourcing them in low-cost regions (22%).
“These technologies will have a profound impact on the way organizations make sourcing decisions.”
— Stanton Jones, Director and Principal Analyst, ISG
- Implement ML enterprise-wide
36% of the Fast Learners cited enterprise-wide implementation of machine learning, rather than implementing it within individual business units.
They integrated ML into product development and customer-facing functions, like contact centers, marketing, etc.
41% of them said that it increased their customers satisfaction.