Most firms now consider AI to be essential to remain competitive

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Artificial intelligence technology is expected to have a “dramatic” impact on business by 2020, according to new report by consulting firm Tata Consultancy Services.

The study shows that a large majority (84 percent) of the 835 executives surveyed from North America, Europe, Asia-Pacific and Latin America said their organizations view the use of AI as “essential” to being competitive. Half of those surveyed consider AI technology to be transformative.

The use of AI is expanding across nearly all areas of business, Tata said. IT departments are the leading users of AI today, with about two-thirds (68 percent) of respondents using AI for IT functions. But nearly one third (32 percent) of the organizations surveyed think by 2020 AI’s greatest impact will be in functions outside of IT such as marketing, customer service, finance, and human resources.

The firm surveyed companies from a variety of sectors including automotive, banking and financial services, energy, healthcare, life sciences, industrial manufacturing, and retail.

Companies with the biggest revenue and cost improvements from AI see the need for at least three times as many new jobs in different functions by 2020, because of AI, TCS said.

“As companies begin to gain a better understanding of AI’s application for business, they will realize the significant impact of this transformative force,” said K. Ananth Krishnan, chief technology officer at TCS. “This is reflected in our [study], which shows that forward-thinking companies are beginning to make major AI investments. Given the increasing digital disruption across every industry and the public sector, AI should become a key and integrated component of an organization’s strategy.”

As the technology becomes more mainstream, spending on products will increase, TCS said. The report indicated a strong connection between investments in AI and impact on the business. Those organizations that have seen the biggest AI-related revenue improvements and cost reductions invested five times more on the technology than companies with the lowest AI-related revenue and cost improvements.

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