South African businesses embrace AI to boost revenue

IFew technological advancements have captured people's imaginations in recent years as much as artificial intelligence (AI). As the technology becomes more commonplace, it creates an opportunity for South African businesses to rethink how they operate to strengthen existing revenue streams or even generate new ones.

The TCS AI for Business Global Study, a comprehensive report on AI adoption and its impact, found that 69% of enterprises are focused on leveraging AI to drive innovation and increase revenue rather than productivity gains and cost optimization.

Globally, 86% of the world's top business leaders are already leveraging AI to boost revenue. Domestically, the emerging technology is proving its value, positively impacting corporate profit margins by 1.4%.

Research shows that South Africa is on track to become an AI leader on the continent, with businesses across sectors realizing the technology's potential to:

• Increased productivity and efficiency Optimizing your supply chain leads to better inventory management and reduced costs.
• Improved customer experience AI can be used to analyze customer data and provide targeted recommendations, leading to improved customer satisfaction.
• Driving decision-making through dataThey can predict equipment failures, perform preventative maintenance, and optimize marketing campaigns.
• Offer personalized solutions to customer and industry issues.

While interest in AI is growing, there are challenges to its widespread adoption, including limited access to skilled talent, high upfront costs of implementing AI solutions, and concerns about data privacy and security.

For example, AI has the potential to significantly improve the delivery of government services, from fraud detection to resource management, while businesses are expected to leverage AI to improve efficiency, innovation and competitiveness.

“South Africa is on the brink of an AI revolution, with both businesses and government recognising its potential,” said Langa Dube, TCS country manager for South Africa. “If leveraged responsibly, AI has the power to unlock unprecedented value for both businesses and customers. Combining the computational power of AI with human ingenuity will enable South African businesses to achieve new levels of innovation and efficiency.”

Cautious optimism and closing the skills gap

There is a cautious optimism among business leaders, with 57% believing in the potential of AI, but it is clear that the path to AI-driven transformation will be fraught with challenges.

The future of work is not man versus machine, but rather human to human and Machines work together. By embracing this partnership, businesses can realize new levels of productivity and innovation driven by the irreplaceable power of humans.

However, to achieve this, 45% of business leaders predict that almost half of their employees will need to be familiar with generative AI within the next three years, highlighting the urgent need to upskill South Africa's workforce with the expertise necessary to succeed in an AI-powered future.

Measuring impact

The survey revealed that businesses are struggling with how to measure the success of their AI adoption — in fact, 72% of companies admit they don't have the right metrics, indicating a need for new benchmarks to track the impact of AI on business outcomes.

At the same time, the South African government is developing a National AI Plan to guide responsible AI adoption across the country. The plan aims to promote AI research and development, develop a regulatory framework for ethical AI use, and invest in AI skills development programs.

TCS AI for Business Global Survey Details

The TCS AI for Business global study is one of the largest of its kind, surveying nearly 1,300 CEOs and P&L chiefs across 12 industries and 24 countries. Other key findings from the report include:

• Executives believe that AI's impact will be greater than that of the internet (54%) and smartphones (59%).
• Corporate functions with the most completed AI projects: Finance/Comptroller (29% completion rate), Human Resources (28% completion rate), and Marketing (28% completion rate).
• 40% of executives say they will need to make many changes to their business to get the most out of AI.
• More than half (55%) said they are currently actively making changes to their business or operating models, or products and services, in light of the potential benefits and risks of AI.
• 93% of executives surveyed in the UK and Ireland said they have AI projects underway to increase revenue. Executives in other regions were similarly enthusiastic: 89% in North America, 88% in Asia Pacific, 83% in Continental Europe and 80% in Latin America.
• Nearly two-thirds of BFSI (64%) and manufacturing (63%) industry executives surveyed said they are hopeful or optimistic about the impact AI will have on their business.

The AI ​​revolution is upon us, and South African businesses have a unique opportunity to harness this transformative technology to grow, innovate and compete on the global stage.