+44-7897-074717Review Article - Journal of Research in International Business and Management ( 2023) Volume 10, Issue 4
Received: 23-May-2023, Manuscript No. JRIBM-23-99742; Editor assigned: 25-May-2023, Pre QC No. JRIBM-23-99742 (PQ); Reviewed: 08-Jun-2023, QC No. JRIBM-23-99742; Revised: 25-Sep-2023, Manuscript No. JRIBM-23-99742 (R); Published: 04-Oct-2023, DOI: 10.14303//jribm.2023.047
This study focuses on the benefits and drawbacks of introducing Artificial Intelligence (AI) into key business operations such as product development, marketing, sales, customer service, operations, and finance. AI employs machines and algorithms that replicate and augment human intelligence. While AI has the potential to enhance human skills and decision making, it is important to note that human supervision and assistance are essential when incorporating AI into business operations. Entrepreneurs may increase production, lower expenses, and gain a competitive advantage by employing AI tools and practices. In general, this study demonstrates the potential benefits and challenges associated with artificial intelligence in business operations.
Artificial intelligence, Entrepreneurs, Business operations, Augment human intelligence, Algorithms
Artificial Intelligence (AI) is transforming all sector including entrepreneurship. AI can be applied to several entrepreneurial processes to increase productivity, efficiency, and decision making, including product development, marketing, sales, customer service, operations, and finance. Entrepreneurs can obtain a competitive advantage and accomplish their goals by utilizing AI tools and approaches.
AI uses machines and algorithms to replicate and improve human intellect. In order to assist organizations, make wise decisions, this technology can analyse vast amounts of data, spot trends, and make predictions. Real-time customer support and interaction can also be offered via AI-powered chatbots, and automated processes can provide entrepreneurs more time to concentrate on other essential tasks. Although AI offers many potential advantages, it also has drawbacks. For AI to be effective, a large investment in expertise and data is necessary.
Additionally, AI needs human supervision and assistance because it cannot replace human oversight and support.
Overall, it's critical to properly balance the benefits and drawbacks of integrating AI in business. We'll look at how entrepreneurship is being impacted by AI in this paper while offering suggestions on how entrepreneurs can successfully incorporate AI into their long-term objectives (Rana et al., 2022).
The review of existing literature reveals that the role and impact of Artificial Intelligence (AI) and Machine Learning (ML)applications in supply chain digital transformationhave been investigated through bibliometric analysis.
The examination of the emphasis placed on investment decisions in crowd funding has also been explored, and AI tools have been introduced into the training methods of entrepreneurship activities (Baldegger et al., 2020).
Additionally, future challenges for entrepreneurs in the changing business environment have been studied, along with the correlation between entrepreneurial orientation and the implementation of AI in human resource management (Ahmad et al., 2019). Moreover, the age of AI has presented unique challenges for entrepreneurial action, creativity, and judgment. Creativity in the context of AI has been discussed, with attention given to the potential for unexpected outcomes. In marketing, the use of AI techniques for modelling environmental systems has been studied, and the impact of AI on the future of marketing has been analyzed (Wang et al., 2020).
The articles I reviewed shed light on different aspects of AI in the context of businesses. One article looked at what drives and inhibits operational excellence when implementing AI. Several articles explored the potential benefits that AI can bring to businesses. The role of digital transformation was studied concerning] entrepreneurship and innovation. Lastly, the ethical and privacy concerns associated with AI were explored through bibliometric analysis in one of the articles. Overall, the literature indicates that AI has tremendous potential for entrepreneurship, innovation, and operational excellence. It does, however, emphasize the importance of addressing significant ethical considerations linked with AI (Tkachenko et al., 2019).
Artificial intelligence in product development
AI is making a huge difference in product development. It boosts efficiency, improves customer experiences, and gives valuable insights. According to a PwC research, AI might boost the global economy up to $15.7 trillion by 2030. This demonstrates the enormous potential for AI for bettering people's lives. The integration of predictive analytics, quality control, product design, customer feedback, and supply chain optimization drive numerous product development aspects.
However, the importance of human creativity and expertise for analysing qualitative feedback, evaluating consumer preferences, and making strategic business decisions cannot be overstated. Combining AI with human ingenuity provides a competitive edge and sparks innovation. The combination of AI and humans can together achieve more than they ever could independently, making it an exciting time for the field of product development (Table 1) (Townsend et al., 2019).
•Predictive analytics: AI can analyse data oncustomer preferences and behavior to spot trendsand forecast demand. This can assist businessowners in making wise choices regarding thecreation of new products, setting their prices, andconducting their marketing campaigns.
•Quality control: AI can be used to monitor andevaluate industrial operations, find flaws andguarantee product quality. Entrepreneurs may beable to cut expenses and increase productivity as aresult.
•Product design: AI can help with product design bycreating 3D models and simulations. Entrepreneurscan use this to test several designs beforemanufacturing and visualize the end product.
•Customer feedback: AI-powered chatbots andsurveys can gather and evaluate customer feedbackto pinpoint areas that need improvement and guideproduct development.
•Personalization: Based on consumer preferencesand behaviour, AI can be used to customizeproducts. This can assist entrepreneurs indifferentiating their products and providing highercustomer experiences. The Table 1 illustrates the useof AI in product development (Acemoglu et al.,2018).
| Company | AI Application | Description |
|---|---|---|
| L'Oreal | Customized skincare | L'Oreal's skincare line, SkinCeuticals, uses an AI-powered diagnostic tool that analyses a customer's skin and recommends a personalized skincare routine. |
| Microsoft | HoloLens | Microsoft's mixed reality headset uses AI to assist designers in creating 3D models and analysing product performance data to improve the design and development process. |
| Amazon | Alexa | Amazon's voice assistant, Alexa, uses AI to analyse customer feedback and reviews to identify areas for improvement and inform new feature development. |
| Nest thermostat | Google's smart thermostat, Nest, uses AI to learn user behaviour and preferences, adjusting the temperature automatically to optimize energy usage and reduce waste. |
Table 1. Example of AI application in product development.
Artificial intelligence in marketing
Marketing is an integral aspect of all flourishing business strategies, specifically given the dynamic landscape of contemporary business operations. With a fast growing market value of USD 40.09 billion by 2025 and a CAGR of 29.79% during the forecast period by Markets and Market, the field of Artificial Intelligence (AI) is transforming the marketing landscape. And AI in marketing had a value of USD 5 billion in 2017, with the forecast period covering from 2018 to 2025. AI can be implemented at various levels in marketing to optimize operations, including personalization, chatbots, predictive analytics, image and voice recognition, video content creation, and ad optimization (Audretsch, 2012).
By utilizing AI-based marketing tactics, companies can simultaneously enhance customer engagement, retention, and revenue growth. While these technological advances demonstrate exceptional potential, businesses must continually assess and improve their strategies to deliver the best human centric experiences to customers (Grace et al., 2018).
•Personalization: AI algorithms can access customerdata to develop personalized experiences fordelivering products, services, or informationcustomized to specific preferences and behaviours.
•Predictive analytics: Artificial Intelligence is used toanalyse large datasets for patterns and futureforecasts. It can be valuable in marketing to decidewhether a customer is likely to convert or quit andalso indicates which marketing campaigns will bemost thriving.
•Image and voice recognition: The potential for AI-powered image and voice recognition technology intargeted marketing campaigns is enormous. Forexample, image recognition can study social mediaposts and recognize brands and products, whilevoice recognition is used in voice activated marketing campaigns (Amabile et al., 2019).
•Content creation: AI has an ability to generatevarious types of content, including blog posts,product descriptions, and social media posts. NLPalgorithms can evaluate existing data and generatenew audience specific content that is engaging.
•Ad optimization: AI is employed to optimizemarketing campaigns, by analysing audiencebehaviour, ad performance, and campaign analytics.AI can increase the efficacy of marketing initiativesby enhancing ad targeting, modifying biddingstrategies, and determining the best ad strategy(Belk, 2019).
Overall, the use of highly individualized, data driven, and automated marketing methods made possible by AI has the potential to revolutionize the industry. Businesses may increase the impact of their efforts, cut expenses, and provide better consumer experiences by utilizing AI in marketing. The Table 2 illustrates the use of AI in marketing (Figure 1).
| Company | AI Application | Description |
|---|---|---|
| Netflix | Recommendation system | Netflix uses AI algorithms to analyse customer viewing habits and provide personalized recommendations for movies and TV shows. |
| Coca-Cola | Personalized Ads | Uses artificial intelligence to analyse the social media posts of its customers, generating valuable information about the consumption patterns of its products such as the location, timing and manner in which they are being used |
| Spotify | Personalized playlists | Spotify uses AI to analyse customer listening habits and create personalized playlists, which has resulted in increased customer engagement and loyalty. |
| Adidas | Customized shoes | Adidas uses AI to analyse customer data and provide customized shoe recommendations, which has resulted in improved customer satisfaction and increased sales. |
Table 2. Example of AI application in marketing.
Figure 1. Global AI in marketing market 2021–2028.
Artificial intelligence in sales
The fast paced business world always demands new approaches to boost sales and revenue. The McKinsey report suggests that Artificial Intelligence (AI) offers a promising solution, with an estimated $13 trillion global economic value by 2030. AI will be crucial for companies looking to stay ahead in the game while revolutionizing their sales performance and achieving business goals. AI is allowing sales teams to unlock new opportunities with advancements in sales analytics, dynamic pricing, sales forecasting, and customer segmentation, which can make business operations more efficient and inclusive in achieving objectives. AI-driven insights not only enhance the customer experience but also provide businesses with desired profitability and sustainable growth. This section explains how artificial intelligence can fundamentally transform the sales process (Chen et al., 2008).
•Sales performance analytics: AI can analyse salesperformance data and pinpoint areas forimprovement. It supports sales team to optimizetheir approach and reach more promising results.
•Customer segmentation: AI algorithms helps insegmenting customers based on their behaviours,choices, and purchasing patterns. This help salesteams tailor their approach to each customersegment and deliver a more personalized experience.
•Sales forecasting: AI help to forecast sales trendsbased on historical data and market needs. It helpssales teams plan their marketing strategies andadjust their approach to maximize revenue.
•Dynamic pricing: AI algorithms helps in adjustpricing in real time based on market requirements,customer demand, and other facets. It supportssales teams by optimizing revenue and profitmargins.
•Sales pipeline management: AI can be used toanalyse sales data and provide insights into thestatus of deals in the sales pipeline. This will assistsales teams in prioritizing their efforts and directingtheir attention towards the most promisingopportunities.
To summarize, with the proper usage of AI, sales teams can make better data driven choices, target the right customers, and deliver a more customized and effective sales experience. As AI technology advances, its potential for revolutionizing sales expands and organizations that adopt it early will gain a strategic edge in the market. The Table 3 illustrates the use ofAI in sales (Davenport et al., 2020).
| Company | AI Application | Description |
|---|---|---|
| IBM | Watson sales accelerator | It is a sales enablement platform that employs artificial intelligence and predictive analytics to detect possible sales opportunities and provide customized recommendations to sales teams. |
| Salesforce | Einstein | AI-powered CRM platform that leverages machine learning to assist sales professionals in prioritizing leads, automating administrative tasks, and making data-driven decisions. |
| HubSpot | Sales hub | AI-powered predictive analytics platform that assists sales teams in prioritizing leads and closing deals more efficiently. |
| Gong | Conversation analytics | AI-powered sales conversation analytics tool that aids sales teams in enhancing their pitch and closing deals more efficiently. |
| InsideSales | Predictive analytics | AI-powered predictive analytics platform that assists sales teams in prioritizing leads and closing deals more efficiently. |
Table 3. Example of AI application in sales.
Artificial intelligence in customer service
Poor customer service costs businesses a staggering $1.6 trillion annually, a report by Accenture. This is a significant amount, particularly in the rapidly evolving environment of modern day business. Customer service is becoming an essential segment that companies must prioritize to remain competitive (Tariq et al., 2021). AI is one promising tool that can help businesses reach this goal. By integrating AI into multichannel customer engagement platforms, companies can enhance the customer experience, driving revenue growth in the process. As stated in a Gartner report, customer service organizations that incorporate AI technology into their operations can boost their operational efficiency by up to 25% by 2025. This section explores seven ways businesses can integrate AI into their customer service systems - including chatbots, performance analytics, and other strategies,
•Chatbots: AI-powered chatbots can help businesses offer 24/7 customer service support, answer frequently asked questions, and even resolve simple issues, freeing up human agents for more complex tasks.
•Sentiment analysis: AI-powered sentiment analysisis a valuable tool that businesses can utilize to gaininsights into customer feedback and improve thecustomer experience. By swiftly identifying anynegative sentiment or feedback, businesses can takeproactive steps to address areas of concern,ultimately helping to increase customer satisfactionand retain customer loyalty. Effective sentimentanalysis can lead to an optimized customerexperience and increased business success.
•Voice assistants: AI-powered voice assistants likeGoogle Assistant and Amazon Alexa can assistcustomers place orders, get information aboutproducts, and even troubleshoot issues.
•Self-service options: Utilizing AI-powered self-service options like interactive FAQs and knowledgebases will enable customers to promptly andeffectively access the information they require.
•Predictive support: AI algorithms can predictpotential customer issues and proactively offersolutions before the issue arises, improvingcustomer satisfaction and loyalty.
•Intelligent routing: AI can help businesses routecustomer inquiries to the most appropriate agent,based on their expertise and workload, resulting inshorter wait times and enhanced customersatisfaction.
•Performance analytics: AI can analyse customerservice data to identify areas for improvement andprovide insights into agent performance, helpingbusinesses optimize their customer serviceoperations.
These tools provide businesses with the ability to deliver a personalized and proactive customer service experience, improving team’s performance and ultimately driving revenue growth. Further, AI has led to increased efficiency, shorter wait times, and boosted customer satisfaction rates. In this way, AI has transformed the way businesses approach customer service (Davenport, 2018). Table 4 illustrates theuse of AI in customer service (Table 4).
| Company | AI Application | Description |
|---|---|---|
| Bank of America | Erica | AI-powered virtual assistant that provides customers with personalized financial guidance and support 24/7 through mobile app or website. |
| KLM royal dutch airlines | BlueBot | AI-powered chatbot that helps customers with flight bookings, itinerary changes, and other travel-related questions through Facebook Messenger and WeChat. |
| Capital one | Eno | AI-powered chatbot that helps customers with their credit card accounts through SMS or online messaging. Eno leverages natural language processing to understand and interpret customer requests and delivering tailored responses to meet their specific needs. |
| H&M | Virtual stylist | AI-powered virtual assistant that helps customers find and purchase clothing items that fit their personal style and preferences. The virtual stylist uses computer vision and machine learning algorithms to provide personalized recommendations. |
| Audi | Audi service request | AI-powered chatbot that helps customers schedule service appointments, ask questions about their vehicles, and receive maintenance reminders. The chatbot uses natural language processing to comprehend the inquiries of customers and furnish pertinent information in response. |
Table 4. Example of AI application in customer service.
Artificial intelligence in operations and finance
AI is making a huge impact on operations and finance, including supply chain management, predictive maintenance, fraud detection, financial analysis, and risk management (Davenport et al., 2018). By leveraging AI capabilities, organizations can analyse demand, optimize logistics, predict maintenance needs, detect fraudulent transactions, automate financial analysis, and evaluate risks. AI can assist businesses in saving money, improving management efficiency, and enhancing security. This results in better decision making and increased productivity. AI is a key component to improve business performance (Davenport et al., 2011).
•Supply chain management: By analysing demand,spotting risks and optimizing logistics, AI canimprove supply chain management. This may lead tolower expenses and greater effectiveness.
•Predictive maintenance: Artificial Intelligence (AI)systems can evaluate sensor data from equipment to foretell when maintenance is required. This can increase machine uptime and help reduce breakdowns.
•Fraud detection: With AI, it is possible to spottransactions that may be fraudulent by examiningvast amounts of data and looking for patterns. Thiscan enhance security and lessen financial losses.
•Financial analysis: By processing enormous amountsof information and offering insights into financialperformance, AI can automate financial analysis.This can assist firms in improving their financialmanagement and making data driven decisions.
•Risk management: AI can evaluate data to findpotential risks and offer mitigation solutions. Thiscan assist organizations in lowering their riskexposure and enhancing their decision makingprocedures.
Overall, AI is assisting organizations in increasing productivity, lowering costs, and improving decision making in both operations and finance. The Table 5 illustrates the use of AI inoperation and finance.
| Company | AI Application | Description |
|---|---|---|
| Amazon | Automated warehouses | AI-powered robots and algorithms are used to automate and optimize warehouse operations, improving efficiency and reducing costs. |
| UPS | Route optimization | AI algorithms are used to optimize delivery routes, reducing travel time and fuel costs. |
| Tesla | Predictive maintenance | To forecast when a vehicle needs repair, AI-powered sensors and algorithms are employed, minimizing downtime and enhancing reliability. |
| IBM | Watson supply chain optimization | The use of AI-driven algorithms optimizes supply chain operations, which lowers costs and increases operational effectiveness. |
| Airbnb | Dynamic pricing | AI-powered algorithms are used to adjust pricing in real-time based on demand, increasing revenue and occupancy rates. |
Table 5. Example of AI application in operation and finance
Impact of artificial intelligence on entrepreneurship
AI integration can transform startups' operations and the way entrepreneurs connect with customers. It frees up entrepreneurs to focus on meaningful tasks and automate routine workloads. Decisions become more informed, and customers benefit from enhanced experiences that build lasting connections. As AI technology continues to evolve, customers can look forward to more personalized interactions that resonate with them on a human level. Although AI-generated content may lack a human touch, it offers ample opportunities for entrepreneurs to provide superior customer experiences that build lasting people connections. As AI technology continues to advance, businesses can improve their use of AI to better serve and connect with their customers in more meaningful ways. Startups can analyse vast data, improve their marketing plans, and get a competitive edge with AI. Customer service is one area for entrepreneurs where AI is really helpful. Chatbots and virtual assistants powered by AI may offer round the clock customer service, respond to questions, and even complete transactions. This lets entrepreneurs to concentrate on other crucial tasks like expanding their line of products or services (Nambisan et al., 2019).
AI can also be applied to many business processes to increase their accuracy as well as efficiency. For instance, AI-powered systems can analyse financial data to find trends and forecast future outcomes, assisting business owners in making better investment and revenue projection decisions. Additionally, typical chores like bookkeeping and data entry can be automated using AI-powered technologies, saving entrepreneurs time and money. AI may also assist entrepreneurs in learning valuable information about their target market and customers. Entrepreneurs may design more successful marketing strategies and find potential new growth prospects by evaluating data from social media and other online sources (Wiklund et al., 2011).
With AI in enterprise, there are, nevertheless, some additional difficulties. Entrepreneurs may face challenges with regards to using AI due to concerns around potential bias in the algorithms, as well as a lack of technical knowledge and resources needed to develop AI solutions. However, AI also presents considerable opportunities for entrepreneurs to enhance customer experiences and stay ahead in a competitive landscape. As AI technology evolves, more and more entrepreneurs are likely to adopt it as a valuable tool to provide better services to their customers (Figure 2).
Figure 2. Adoption of AI a survey by DigitalMcKinsey.
Challenges in implementing AI in entrepreneurship
The company’s efficiency, accuracy, and productivity in the process have the potential to be greatly enhanced by Artificial Intelligence (AI). Yet, there are substantial issues with the implementation of AI in entrepreneurship, such as:
•Data quality: In order to learn and forecast, AIsystems rely extensively on data. Poor data qualitycan result in inaccurate results, which can have animpact on decision making and project outcomes.
•Lack of expertise: To design, develop, and execute AIsystems, trained people are required. Yet, there ispresently a scarcity of AI expertise, which mayimpede its implementation in entrepreneurship.
•Integration with existing systems: To maximize theirbenefits, AI systems must be integrated withcompany’s systems and processes. Yet, especially inlarge businesses, this integration may be difficult andtime-consuming.
•Cost: AI system implementation can be costly,involving large investments in infrastructure, hardware, software, and manpower. For startups or companies with tight budgets, this could be difficult.
Future evolution of AI in entrepreneurship
The future growth of AI in entrepreneurship looks promising as various analyses have assessed its potential impact. According to a PwC study, the global economy could potentially benefit from a staggering $15.7 trillion with the help of AI by the year 2030. The same study also predicts that AI will contribute to a 26% increase in global GDP by 2030. Gartner predicts that AI augmentation will create $2.9 trillion of business value by 2021. The global market for AI in business is projected to reach $118.6 billion by 2025, indicating a rapid growth rate. AI is also expected to automate nearly half of all existing work activities by 2055, as per a study by the McKinsey Global Institute. Finally, the AI market is expected to grow to $190.61 billion by 2025, at a Compound Annual Growth Rate (CAGR) of 36.62% from 2018 to 2025 (Figure 3).These statistics highlight the growing importance and impact of AI in entrepreneurship, making it a key area for future investment and growth (Zhang et al., 2021).
Figure 3. AI potential to create value across sectors DigitalMcKinsey.
Finally, using cutting edge tools to improve operations, optimize decision making, and maximize satisfaction with customers has fundamentally altered how entrepreneurs run business. Predictive analytics, chatbots, and other AI-powered advancements like voice assistants have a huge impact on how businesses run.AI will most likely continue to progress in the future. The various benefits that artificial intelligence could offer to a company include increased productivity, effectiveness, and profitability.
AI brings many benefits to businesses, but some potential limitations and problems need to be addressed. Concerns about data security and privacy, the potential for bias in AI decision making, and the need for companies to blend their operations and employees with fast growing technology are one of the obstacles. As entrepreneurs integrating artificial intelligence into their operations, they must be aware of these concerns and work on reducing their impact. While AI has inherent risks, the potential benefits make it a viable investment for firms wanting to remain competitive and successful in today's digital environment.
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