AI expected to revolutionize customer
interaction and become a key enabler for smart products
Many industrial companies are not yet investing to harness
digital technologies and could lose market share if they fail to
adopt these technologies, according to new research from Accenture
(NYSE:ACN).
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As part of the Accenture Technology Vision 2017 report,
Accenture surveyed 102 automotive executives and 562
industrial-equipment executives around the world. Even though
two-thirds of those respondents said they are experiencing digital
disruption, half of the automotive companies and 60 percent of the
industrial equipment companies acknowledged that they are not yet
comprehensively investing in this area as part of their overall
business strategy.
This limited investment comes at a vital time for these
organizations. Although the overwhelming majority (94 percent) of
industrial companies surveyed accept that digital technologies and
the Industrial Internet of things (IIoT) will radically change the
way they need to operate if they are to succeed, they admit to a
lack of capabilities in areas that are increasingly reliant on
digital technologies, such as products-as-a-service and product
lifecycle management.
Of the automotive manufacturing and supply companies and
industrial-equipment companies surveyed, the vast majority –
95 percent – believe it is either critical or important to
evolve business models to support a product-as-a-service strategy.
However, only 10 percent of the automotive companies and
18 percent of the industrial equipment (IE) companies believe
they are well prepared for this evolution.
The potential impact on an organization’s bottom line from
failing to invest in digital technologies is highlighted in
Accenture’s Innovation-Driven Growth research. This shows that
leading businesses focus on more than creating a better product or
service. Instead, they innovate to deliver differentiated customer
experiences that can lead to an annualized revenue lift of 3 to
7 percent. This innovation is being driven by the adoption and
application of digital technologies.
Leaders in this research were identified as the top 20 percent
of all companies as defined by their industry-specific financial
performance along with their advanced innovation approaches and
capabilities. Among the automotive companies examined, those
identified as “leaders” had $1 billion more in revenues and
higher operating income growth than non-leader companies did; among
the industrial product companies examined, the “leaders” also had
higher operating income growth and revenue that was
$560 million higher, on average, than that of the
non-leaders.
Speaking at Hannover Messe, Eric Schaeffer, senior managing
director and head of Accenture’s Industrial practice, said,
“Industrial manufacturing companies need a comprehensive view of
value creation: one that uses the power of smart services as the
backbone of the end-to-end digital value chain. The prize for
taking such a comprehensive view is significantly more satisfied
customers – along with significantly higher revenues and operating
margins.”
The industrial companies surveyed for the Technology Vision 2017
see artificial intelligence (AI) as the new era of computing, which
is moving from a mobile-first to an AI-first approach. They expect
AI to revolutionize the way in which they gather information from,
and interact with, their customers. They also see AI as a key
enabler for smart products, with 54 percent of automotive
companies, and 37 percent of IE companies, expecting to see a
significant change as a result of AI.
Automotive companies surveyed expect their top areas for AI
investment over the next three years to be in deep learning and
video analytics, while IE companies expect their top areas for AI
investment to be in robotic process automation and computer
vision.
While the research revealed AI to be a key technology essential
to business success in today’s digital economy, many of the
industrial companies cited a range of challenges that could slow
AI’s adoption. For the auto industry respondents, there is
widespread concern that users prefer interactions with humans and a
fear over the use of AI technologies. For IE companies, the biggest
perceived challenge is the integration or compatibility between AI
and current IT infrastructure. IE executives also are concerned
that users trust human interaction, but the same executives also
see a lack of expertise as a barrier to embedding AI into the
business.
“Artificial intelligence is moving beyond a back-end tool for
the enterprise and taking on more-sophisticated roles within
technology interfaces,” Schaeffer said. “While one of the biggest
beneficiaries of AI is autonomous vehicles that use computer
vision, AI is making every interface both simple and smart and
setting a high bar for how future interactions will work. It will
act as the face of a company’s digital brand and a key
differentiator – and has already become a core competency demanding
C-level investment and strategy.”
Accenture believes industrial companies risk a significant loss
of market share and revenues if they fail to adopt and embrace
technologies like AI to build new products and services – and now
is the time for executives to get themselves and their
organizations started on experimenting with AI and learning from
these experiences.
“If the labor market’s shortage of analytical talent is any
guide, executives can ill afford to ‘wait and see’ if they and
their managers are equipped to work with AI and capable of
acquiring the essential skills and work approaches,” Schaeffer
said.
Accenture is attending Hannover Messe, Germany. The company is
offering daily topical panel sessions with IIoT experts, keynote
presentations from leading academic and business figures, and
real-life applications of digital technologies for industrial
companies for a range of scenarios, from greater operational
efficiency to new revenue streams and analytics-powered insights.
Accenture is located at DIGITAL FACTORY, HALL 6, BOOTH K45. To
schedule a booth tour, please contact
Florian.heinrichs@accenture.com.
For more information on Accenture’s Hannover Messe presence and
program, please visit:
https://www.accenture.com/us-en/event-hannover-messe-2017
Methodology
Accenture’s Technology Vision is developed annually by the
Accenture Labs. For the 2017 report, the research process included
gathering input from the Technology Vision External Advisory Board,
a group comprising more than two dozen experienced individuals from
the public and private sectors, academia, venture capital firms and
entrepreneurial companies. In addition, the Technology Vision team
conducted interviews with technology luminaries and industry
experts, as well as with nearly 100 Accenture business leaders.
In parallel, Accenture Research conducted a global online survey
of more than 5,400 business and IT executives across 31 countries
and 16 industries to capture insights into the adoption of emerging
technologies. The survey helped identify the key issues and
priorities for technology adoption and investment. Respondents were
mostly C-level executives and directors, with some functional and
line-of-business leads, at companies with annual revenues of at
least US$500 million, with the majority of companies having annual
revenues greater than US$6 billion.
For the Innovation Driven Growth research, Accenture analyzed
the innovation practices and value performance of 351 businesses
from the Global2000 across eight industries (automotive, industrial
equipment, consumer goods, medical technology, enterprise
technology, consumer technology, communications technology and
software) and nine geographies – Canada, China, France, Germany,
Italy Japan, South Korea, the United Kingdom and the United States.
Interviews were carried out with Chief Technology Officers,
Division Presidents and Division Vice Presidents of engineering and
innovation, or their equivalent. The results confirm a clear,
empirical correlation between distinct innovation capabilities and
company growth. Leaders benefited from a 3.5-7.0 percent annualized
revenue lift and a corresponding operating income growth compared
to their industry peers.
About Accenture
Accenture is a leading global professional services company,
providing a broad range of services and solutions in strategy,
consulting, digital, technology and operations. Combining unmatched
experience and specialized skills across more than 40 industries
and all business functions – underpinned by the world’s largest
delivery network – Accenture works at the intersection of business
and technology to help clients improve their performance and create
sustainable value for their stakeholders. With approximately
401,000 people serving clients in more than 120 countries,
Accenture drives innovation to improve the way the world works and
lives. Visit us at www.accenture.com.
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AccentureAnthony Hatter, + 44 7810756
138anthony.hatter@accenture.com
Accenture (NYSE:ACN)
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