How to get budget and buy-in for AI adoption

Building the case for AI adoption

Like most of your colleagues, executives will have lots of questions and concerns that need to be addressed before they’re all in. The good news is that once you’ve got them onboard, getting the rest of the business bought-in becomes easier. But business executives are very busy with business.

Their time is valuable so, before you approach them asking for budget or buy-in, it’s important to prepare a compelling business case for AI adoption. Here are three tips to help you build the case for AI adoption:

1. Understand your business’ goals

Before approaching executives and budget decision-makers, you should have a solid understanding of your business’ goals and priorities. People generally think AI is quite cool. Sometimes, this perception can be positive when it comes to buy-in. But it does come with a drawback when dealing with executives.

They’re sometimes suspicious of our motivations when we want budget or buy-in for AI, worrying we’re looking for a cool new toy. Coming to the table with a demonstrable understanding of your business’ strategy and a clear vision of how your AI project will help your business deliver its goals can make a big difference in how executives perceive your request.

2. Identify pain points

Identify specific pain points or challenges within the organization that AI can address. These could range from operational inefficiencies to customer service improvements. By framing AI as a solution to these problems, it becomes easier to make a compelling case for its adoption.

It’s really important to identify pain points that are particular to the executive you’re pitching to. As an executive, they may have a vested interest in seeing the business succeed. But you’ll find getting buy-in much easier when they can see how AI could address their personal pain points.

3. Provide ROI projections

Executives are often inundated with requests for support. So when it comes to getting support, you’re not going to be the only person asking for budget and buy-in. You have to find a way to make sure your request can stand out among competing pitches.

This is why return on investment (ROI) projections are so important. ROI projections give executives an objective idea of how valuable your project can be. But often with AI adoption, the promise of ROI lies so far in the future that executives are hesitant to give their support. This is why it can be beneficial to partner with an AI company with proven solutions that can deliver results in weeks, not years.

Communicating the vision and benefits of AI

AI is still surrounded by myth and mystery. AI is a specialist area, so it’s not surprising that many people know very little about it. And what people do know about AI is often informed by newspaper headlines and fiction. While this generates a lot of interest in AI, it means there’s a lot of education to be done on what AI is, how it actually works and the kind of benefits it can deliver to most businesses.

Communicating the vision and benefits of AI is more than myth-busting, though. To get your business onboard with AI adoption, you have to tell a compelling story to the right stakeholders. Here are five tips to help you:

1. Educate stakeholders

As I mentioned earlier, most people know very little about AI. That’s why it’s so important to help key stakeholders and decision-makers in your business understand AI. Sharing accessible content with stakeholders is a great way to help educate them on AI. When sharing information, it’s important to focus on content that’s accessible and relevant to your stakeholders.

So rather than sharing content from technical resources, send your colleagues content from people like them. For instance, if you’re sharing AI content with a supply chain leader, try and find articles, podcasts or videos by supply chain leaders, who can talk about the benefit they’ve got from AI, in a way your people like them can understand. If you’re looking for helpful videos about AI that you can share, check out these videos from Peak’s AI summit AltitudeX. 

As interest in AI increases, you might want to provide more interactive forms of content. For instance hosting  lunch and learn sessions, where you can explain AI but also take questions from your audience. This way you can find out what their knowledge gaps, but also identify and address any concerns they might have.

2. Tell a great story

Having a compelling business case is important, but how you present that business case is just as important. A dizzying deck of slides, containing facts and figures is unlikely to do the trick. Humans are story-driven. It’s how we relate to the world. In fact, neuroscience research has shown that when we listen to stories our brain fires in the same pattern as the person telling the story (a process called ‘neural coupling’).

But relevance matters too. The story you tell should demonstrate your understanding of the business and its strategic priorities. Your story begins with where your business is at the moment and ends with your vision for where AI could take your business. Another way you can use storytelling is showcasing how other companies, preferably in the same industry, have successfully leveraged AI to achieve their objectives.

3. Set realistic expectations

When you’re trying to convince someone to support AI adoption, it can be tempting to set sky high expectations about the benefits they’ll get from AI and how quickly those benefits will be realized. But this can be counterproductive.

Research from Gartner shows that technology innovations often follow what they call a ‘hype cycle’, where enthusiasm about technology tends to follow a distinct curve. Initially, there’s a lot of excitement about a new technology as it and its benefits are hyped up. Interest and belief in the technology starts to fall though as implementations of a technology fail to deliver on inflated expectations.

While this analysis is meant to give a high-level view about technology hype cycles on a global scale, the same thing happens at a more local level, in our own businesses. If we set unrealistic expectations about what and when AI will deliver for our business, we set the standards too high, meaning that anything less will be seen as failure. The result can be a loss of faith in AI, which can harm your business in the long-term.

4. Speak to the right people, in the right way

Perhaps the most important part of storytelling and communicating the benefits of AI is understanding your audience. It’s not just about communicating with anybody, you have to identify and communicate with the people most important in your AI adoption journey. A great way to do this is through stakeholder mapping.

Stakeholder mapping is a tool often used by project leaders to identify and analyze individuals, groups, or organizations that have an interest or influence in a project, organization, or issue. It helps you understand stakeholders’ expectations, concerns, and relationships, enabling effective engagement and management of their interests. One particularly useful stakeholder mapping tool is the Mendelow’s Matrix.

The Mendelow’s Matrix  categorizes stakeholders based on their level of interest and influence. It helps prioritize engagement efforts by identifying key stakeholders, understanding their influence, and tailoring strategies to manage relationships effectively, minimizing risks and maximizing support for organizational goals. Miro offers an excellent template to get you started, which you can find here.

5. Run pilots and proof of concepts

Consider starting with pilots or proof of concepts to demonstrate the technology’s value without significant upfront investments. Pilots and proofs of concept give you the chance to showcase AI’s potential without needing huge upfront investments. Successfully executing these pilot initiatives builds credibility and trust with executives, making it easier to ask for support for larger AI projects in the future. 

At Peak, we believe it’s generally better to start small on your AI journey. Rather than trying to transform your whole business in one programme, start with a single use case as a single project. 

Once one use case has been implemented and is delivering value, you’ll find it much easier in the future to ask for support and budget. This is what we call the ‘modular’ approach to AI adoption. You can learn about the modular approach and much more by downloading our ebook, the Ultimate Guide to AI Adoption.

Securing the budget for AI adoption

To deliver an AI adoption project in your business, you’ll need to secure some budget. Asking for money is awkward in pretty much any context. Luckily, overcoming that awkwardness in business can be a little easier. Here are four tips to help you get the budget you need:   

1. Present a cost-benefit analysis

When you’re looking to secure budget for AI adoption, it’s crucial to speak the language of executives, which often revolves around profitability. This is why presenting a detailed cost-benefit analysis is so important. This analysis should cover various aspects, including the initial investment required, ongoing operational costs, and the anticipated returns over time. 

By painting a comprehensive picture of the financial implications, you’re able to demonstrate the tangible value proposition of AI adoption. Additionally, it’s beneficial to align the analysis with strategic objectives, illustrating how AI can contribute to long-term growth, efficiency gains, and competitive advantage. Ultimately, the goal is to instill confidence in decision-makers by showcasing the clear and measurable benefits of AI adoption.

2. Align with each executive’s financial goals

In a business, each executive will typically have financial goals that they’re specifically accountable for delivering. When you’re making the case for AI adoption to executives, it’s important to understand their financial goals. By understanding each executive’s financial goals, you can demonstrate how AI can help them deliver them.

Ensure that AI investments align with the organization’s overall financial strategy. Highlight how AI can contribute to revenue growth or cost reduction, making it an attractive proposition for budget allocation.

3. Funding sources

When considering funding options for AI adoption, it’s best to have a number of potential funding sources. These may include capital budgets, operational budgets, or dedicated technology or innovation budgets. 

Each funding source will have its own nuances, so it’s crucial to tailor your approach accordingly. Assess the organization’s financial structure and available resources to determine the most suitable funding avenue. 

By diversifying funding sources and aligning them with the specific needs and objectives of AI projects, you increase the likelihood of securing the budget you need to support successful AI adoption.

4. Leverage denomination bias

When it comes to spending money, people are less likely to support one request for a large sum of money over multiple request for smaller amounts — even if the total is the same. This is what psychologists call ‘denomination bias’.

Executives are more likely to sign off smaller amounts of money because it feels less risky than a large sum. If you approach an executive where you’ve used a small amount of money to deliver great value, they’ll likely be more receptive to your request.

This is another area where the modular approach to AI adoption we mentioned earlier comes into play, where you start small with a single use case and continue adopting AI solutions until your whole business has adopted AI.

 

Ask the experts

Securing budget and buy-in for AI adoption can be tricky. It’s hard to estimate the costs and even more difficult to predict how much value AI can add to your company. We’re Peak. We provide AI applications for supply chain management, merchandising and pricing that have been proven to provide commercial benefit in weeks, not years.

If you want help with your AI adoption ambitions, reach out to us. If you want to learn more about AI adoption, you can download our ebook, the Ultimate Guide to AI Adoption or read real life case studies who we’ve worked with to deliver game-changing results from AI.