Accenture: Strategic scaling AI shows 3X the return
Leaders who strategically scale Artificial Intelligence (AI) investment enjoy three times the return compared to companies who pursue a silo approach, report Accenture.
During a time when 84% of C-suite executives believe they must leverage AI to achieve their growth objectives, the message from Accenture is “focus on the ‘I’ in Return on Investment (ROI)” in the new report, AI: Built to Scale.
“An overwhelming majority believe achieving a positive return on AI investments requires scaling across the organisation. Yet 76% acknowledge they struggle when it comes to scaling it across the business,” comment Accenture.
According to statistics, three out of four C-suite executives believe if they don’t scale AI in the next five years, they risk going out of business entirely.
“With the stakes higher than ever, what can we learn from companies that are successfully scaling AI, achieving nearly 3X the return on investments and an average 32% premium on key financial valuation metrics? Asks Accenture.
Insight from global research
Global research by Accenture involved 1,500 C-suite executives from companies with a minimum revenue of US$1 billion in 12 countries across 16 industries, looked at:
- Extent to which AI enables the business strategy
- Top characteristics required to scale AI
- Financial results when done successfully
Three distinct groups of companies of AI emerged from the research:
- CEO focus with advanced analytics and data team solving big rock problems
- Multi-disciplinary teams of 200+ specialists championed by Chief AI, Data or Analytics Officer
- Able to tune out data noise
- Accenture predict 15-20% of companies are here
Proof of concept factory
- Analytics buried deep and not a CEO focus
- Siloed operating model typically IT-led
- Significant under investment, yielding low returns
- Accenture predict 80-85% of companies are here
Industrialised for Growth
- Digital platform mindset and enterprise culture of AI democratising real-time insights to drive business decisions
- Less than 5% of companies have evolved to this point
“Considering the companies in our study collectively spent US$306 billion on AI applications in the past three years, the ROI gap amongst them is significant. How significant? US$110 million between companies in the Proof of Concept stage and Strategic Scalers,” comments Accenture.
The report explores if there is a relationship between successfully scaling AI across the enterprise and key market valuation metrics? And what is the “premium” for being a leader?
“We discovered a positive correlation between successfully scaling AI and three key measures of financial valuation with an average lift of 32% on enterprise value/revenue ratio, price/earnings ratio, and price/sales ratio.”
Accenture report a three-step guide to strategically scaling AI in your business:
- Drive intentional AI
According to statistics, Strategic Scalers are 65% more likely to report a timeline of one to two years to move from pilot to scale.
“To successfully scale, companies need structure and governance in place - Strategic Scalers have both - 71% say they have a clearly defined strategy and operating model, while only half of the companies in Proof of Concept report the same,” says the report.
“Strategic Scalers are also far more likely to have defined processes and owners with clear accountability and established leadership support with dedicated AI champions.”
- Tune out data noise
Strategic Scalers tune out data noise as they recognise business-critical data, identifying financial, marketing, consumer, and master data as priority domains plus they are more adept at managing data.
Accenture research shows they have a more accurate data set (61% versus 38% of respondents in Proof of Concept). And 67% of Strategic Scalers integrate both internal and external data sets as a standard practice compared to 56% of their Proof of Concept counterparts.
“They use the right AI tools - things like cloud-based data lakes, data engineering/data science workbenches, and data and analytics search to manage the data (60% compared with 47%) for their applications.
- Treat AI as a team sport
The effort of scaling calls for embedding multi-disciplinary teams. “It’s a lesson Strategic Scalers have learned well. In fact, 92% of them leverage multidisciplinary teams,” say Accenture.
“It enables faster culture and behaviour changes. In contrast, those still in Proof of Concept are more likely to rely on a lone champion within the technology organisation to drive AI efforts.”
Three additional variables that speed companies along their journey to the ultimate destination are also identified in the report and include:
- Focus on the ‘I’ in Return on Investment (ROI)
- Adopt a digital platform mindset to scale
- Build trust through responsible AI
“Scaling the exponential power of AI across the enterprise is a journey. Those that learn the lessons on each path will reach a place where the business is seamlessly fused with intelligence that boosts productivity and effectiveness,” concludes Accenture.