AI, applied: Lessons from 2020

January 15, 2021 5:59 PM

The year of coronavirus will go down in history not just as a time of plague, but also of crisis-driven tech adoption. Mass migration online drove the adoption of cloud-enabled technologies, and AI was one of them. As businesses embrace AI, accountants need to keep up to make sure maximum efficiencies are achieved — but also because they don’t want to get left in the dust.

Businesses are confident in the power of AI, but feel a certain lack of preparedness to meet the new challenges AI brings. 2020 was a difficult year, skewing a lot of data for companies, making AI models less reliable. Below are some lessons learned from AI in 2020.

Advantages of early adoption are quickly fading

As AI adoption accelerates, the competitive advantage of early adoption is fading. Part of what drove uptake last year was the forced rapid adoption of cloud technology as businesses were forced to go remote. The more businesses adapt to newer technology, the more new technology they can leverage. The “early adopter” phase is coming to an end, and businesses will have to work harder to maintain the competitive advantage AI may have previously given them.

Efficiency is table stakes — differentiation is the next step

Because AI is, in many ways, essentially very sophisticated automation, its promise has been time savings and increased efficiency. However, as more businesses adopt the technology and the competitive advantage of time savings fades, organizations need to think about new ways to harness AI to differentiate themselves.

Respondents to the Deloitte survey said the top two benefits they sought from AI were making processes more efficient and enhancing existing products and services. Deloitte analysts suggested that businesses look beyond improving existing offerings, and think about new problems and areas AI could enable them to explore.

There is a preparedness gap

Adopting any new technology carries risk, but artificial intelligence carries particular risks as it “learns” on the job — risks around bias, transparency, and security. Over half of businesses reported they felt major concern over their preparedness for a variety of AI-related risks at their organization, ranging from making decisions based on bad data to data breaches. Education is a key piece for firms and clients alike in this new, AI-enabled world.

AI investment inspires confidence in employees

Among companies that invest the most and see the most benefits from AI, employees rated their C-suite as “very effective” more often than employees at other companies, according to a recent McKinsey survey. They are also more likely to report that their AI initiatives have an engaged and knowledgeable champion at the executive level. This suggests that the value of AI is evident to employees, and a company that invests in AI becomes more attractive to employees and possibly even future hires.

Deviant data produces deviant results

AI technology works by learning as it is used, and is only as good as the data fed into it. While businesses that have seen AI perform well for them increased investment in AI in response to the COVID-19 pandemic, those same businesses have also seen AI models “misperform” over the last year, according to the McKinsey report. Because the pandemic caused major disruption in many industries and virtually every area of life, aberrant data could have had effects on predictive models, and this effect was most apparent in the marketing and sales, product and service development, and service operations industries.