The Pros and Cons of Artificial Intelligence in Business
You've heard plenty of talk about artificial intelligence (AI).
But not everyone agrees on the pros and cons of artificial intelligence.
Google's CEO Sundar Pichai says AI is "one of the most important things humanity is working on," and is more profound than our development of electricity or fire.
But Elon Musk warns "If you're not concerned about AI safety, you should be. Vastly more risk than North Korea."
And Mark Cuban insists business leaders must understand and embrace AI:
“If any of you are entrepreneurs or in the business world and if you don’t know AI, then you’re the equivalent of somebody in 1999 saying, 'Yeah, I’m sure this internet thing will be okay, but I don’t give a [expletive].' It’s the same thing."
It's no coincidence even very smart people disagree or have different perspectives on AI.
There are many pros and cons of artificial intelligence.
This post covers the top ones in the business world. It should give you a good idea of how AI can benefit your company and career—and what to watch out for. It covers the following:
- What Is AI?
- What Are the Pros and Cons of AI?
- Answers to Common Questions About AI
- Why You Should Explore AI in Your Career
What Is AI?
AI is when we give machines (software and hardware) human-like abilities. We teach machines to see, hear, speak, move, and make decisions. The difference between AI and traditional technology, however, is that AI has the capacity to make predictions and learn on its own.
Humans design AI to achieve a goal. Then, we train it on data so it learns how best to achieve that goal. Once it learns well enough, we turn AI loose on new data, which it can then use to achieve goals on its own—without direct instruction from a human.
AI does all this by making predictions. It analyzes data, then uses that data to make (hopefully) accurate predictions. It then learns from every prediction it makes, and optimizes its approach the next time around. As a result, AI gets smarter over time.
The actual term "artificial intelligence" is an umbrella term. It broadly describes many different technologies that have the capacity to learn and improve on their own. These technologies may include machine learning, computer vision, image recognition, natural language generation (NLG), natural language processing (NLP), and deep learning, among others.
Pros of Artificial Intelligence
Artificial intelligence is forecast to have trillions of dollars in economic impact. And major brands like Amazon, Facebook, Google, Microsoft, Apple, and Netflix are powered by AI technologies.
There's a reason for that:
AI has serious pros when it comes to business growth.
Better Pattern Recognition and Predictions
AI and machine learning technologies have the ability to recognize patterns in big data at scale, then use those patterns to make predictions about your business. These abilities, in turn, give businesses superpowers.
Using AI, you can do everything from:
- Accelerate revenue growth.
- Create personalized consumer experiences at scale.
- Drive costs down.
- Generate greater ROI on campaigns.
- Get more actionable insights from marketing data.
- Predict consumer needs and behaviors with greater accuracy.
- Reduce time spent on repetitive, data-driven tasks.
- Shorten the sales cycle.
- Unlock greater value from marketing technologies.
AI unlocks benefits that traditional software doesn't provide. That's because it can do things traditional software can't—and improve on its own, producing compounding benefits over time.
This is projected to have a tremendous effect on the world economy.
PwC estimates AI will cause a 14% lift in global GDP possible by 2030, a total contribution of $15.7 trillion to the world economy, thanks to both increased productivity and increased consumption.
In 2021 alone, Gartner projects AI augmentation will create $2.9 trillion of business value, and 6.2 billion hours of worker productivity globally.
Revenue acceleration is a major benefit provided by AI. AI accelerates revenue in two big ways.
First, it unlocks value from big data you already have or will have in the future. This includes marketing, sales, and site data that AI can use to find insights that can dramatically impact your business.
One example: AI was able to find new sources of revenue for a travel business by assessing its advertising data.
Second, AI makes better predictions than humans, when it has enough of the right data. When you can make better predictions, you can much more easily sell more. In one scenario, eBay used AI for email marketing to better predict which subject lines users would open—raising average opens on revenue-driving campaigns by more than 15%.
AI can also significantly reduce costs through intelligent automation. The technology excels at automating or augmenting repetitive, data-driven tasks. These tasks are ones that humans spend a lot of time and energy doing—time and energy that can be better used elsewhere.
Cons of Artificial Intelligence
There's no question AI comes with downsides. To reap the advantage of the technology, you have to understand the disadvantages.
AI is only as good as the data it has. Not every business can reap the benefits of AI tools right out of the gate. They often need a minimum amount of data to even get started. And that data has to be high-quality and clean. For some, significant work and investment is required to get internal data AI-ready.
The exceptions are AI tools that use third-party datasets. Many of these already exist, and use either a proprietary dataset the vendor owns or collect data from online sources, then apply proprietary algorithms to it.
Understanding what data you need for an AI solution is a critical step. And it's not always easy or fast to figure this out.
Some AI systems are what we call "black box" systems. The user has little to no understanding of how the AI makes decisions. This isn't a dealbreaker when the system works well. If you are getting good business value out of an AI tool, you typically don't care how it works.
But if the AI makes a poor prediction, takes a damaging action, or makes a mistake, it can be hard or impossible to diagnose what went wrong. This, understandably, has companies hesitant to trust AI with critical business decisions where revenue, livelihoods, and jobs are on the line.
It's also why there's been a push from some AI vendors for more explainability in AI tools.
Unrealistic Expectations and Fears
The world of artificial intelligence is filled with hype, buzz, and larger-than-life claims. While there's no doubt AI is going to transform the economy, it still has limits and specific use cases. It can't do everything. And it may not be the right tool for your particular business use case.
AI excels at performing narrow tasks extremely well, on its own, at scale. But the level of advancement in different fields of AI is uneven. Some areas of AI, like language generation and computer vision, have progressed significantly. Other areas are still just scratching the surface of what's possible.
AI is also not going to become self-aware and take over the world. That's science fiction. In reality, AI can do many narrow tasks much better than humans, but it's still math, not magic.
Companies need to temper expectations about the technology's capabilities, and take the time to fully understand what AI can and can't do, so they can actually select, pilot, and scale the technology effectively.
Common Questions About AI
Will AI Take My Job?
It's impossible to predict with a high degree of accuracy how many jobs AI will take. But there are some broad rules to consider when asking yourself if AI can do your job better than you.
- Is your job extremely narrow in scope? Like we said, AI can't do everything. But it can do many narrow tasks very very well. If all you do in your job is, say, A/B test email subject lines, you could be in danger of AI automating your job function.
- Is your job predominately repetitive and repeatable? If you do the same thing over and over, in the same way every time, it's possible AI learn how to do it. If AI learns how to do it, it may also learn how to do it much better, faster, and cheaper than a human.
- Is your job predominately data-driven? If most of your job involves manually extracting insights and signals from data, you also could see this function get automated by AI. In fact, this is an area where AI already excels and already performs better than humans.
Will AI Replace Humans?
We don't think it's likely. While AI may automate jobs with the qualities we listed above, it's increasingly unlikely that humans only do extremely narrow, repetitive, or only data-driven tasks.
Your typical knowledge worker today wears many hats, and performs many creative and strategic tasks that AI just can't do. We don't foresee AI replacing a critical mass of human workers. In fact, we generally predict AI will enhance and augment our work.
You see, a lot of tasks that AI can do better than humans are tasks that humans weren't that good at to begin with. Few of us can even do pattern recognition or make fully data-backed predictions well. And none of us can perform those tasks at scale. When we try to, the result is either wrong or imperfect. And it usually takes a lot of time, energy, and money to produce.
By letting AI do what it's good at, we free ourselves up to do what we're good at. And what we're good at is usually higher value work like creative output and strategic decision-making.
Should I Fear AI?
Based on our answers to the questions above, we don't think you should fear AI out of hand.
You should, to the point made by Elon Musk in this article's introduction, fear the possibility of AI going wrong at scale. As outlined in the cons section, AI can be misused or create negative outcomes.
But we're not seeing a lot of businesses fear AI just because of what it can do.
The COVID-19 pandemic has accelerated AI-powered digital transformation across businesses. Research from McKinsey cites that 25 percent of almost 2,400 business leaders surveyed said they increased AI adoption due to the pandemic.
In our 2021 State of Marketing AI Report (in partnership with Drift), we found that among marketing leaders, fear wasn't a major barrier to AI adoption.
The majority of marketers we surveyed (56%) believe AI will create more jobs than it eliminates over the next decade. Only 16% said fear was a contributing factor to their company's lack of adoption.
How to Explore AI in Your Career
Every business and every professional should carefully evaluate the pros and cons of artificial intelligence.
But we think the verdict is clear:
AI provides tangible business benefits. It's going to transform the world economy. And, with enough education and understanding, the technology's cons can be protected against.
It's why thousands of companies already safely and effectively build AI into their products or use it in their operations across every industry.
You don't have to be a programmer or data scientists to use it, either.
Every professional in every business function is going to need to be AI-ready, given the technology's impeding impact on the economy.
This includes executives, marketers, salespeople, product pros, and customer experience pros.
Today, understanding AI is a significant competitive advantage in your industry and in your career. You can use expanded knowledge of AI to push your business forward and differentiate yourself with employers.
Tomorrow, understanding AI will be essential for any industry and any professional.
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About Mike Kaput
Mike Kaput is Chief Content Officer at Marketing AI Institute and a senior consultant at PR 20/20. He writes and speaks about how marketers can understand, adopt, and pilot artificial intelligence to increase revenue and reduce costs. Full bio.