Implementing a successful artificial intelligence strategy in retailBy Mylo Portas on November 6, 2019
As we head towards 2020 at what feels like lightning pace, more and more retail businesses are starting to finalize their plans for undoubtedly another big year ahead.
One thing that you can guarantee will be – or at least should be! – on their agenda is developing a robust artificial intelligence (AI) strategy to optimize processes, drive sales, and ensure their survival in an often turbulent and unpredictable market.
AI and business strategy go hand in hand in the modern retail era, with 72% of retailers well aware of the practical application of AI in their business, and a huge 79% of retail executives planning to invest up to $1.3m in the technology. This begs the question, therefore, that if the benefits of an AI implementation strategy are well-known by all, why isn’t everyone in retail doing it?
Generally, the answer is that they haven’t quite figured out how to execute their AI strategy yet, or are still undecided on the steps they need to take to first introduce AI successfully. However, the clock is ticking, and businesses need to move now before they miss out on the advantages of being an early AI adopter.
What is an artificial intelligence strategy?
If you’re not 100% sure what an AI strategy looks like, you’re not alone. But don’t worry – here are some key steps to set you on your way to becoming AI-driven and boosting your revenues and profits…
Start small, think big
It’s important to outline what you want to achieve with AI from the outset, but take small steps to start your AI journey – don’t dive in head first at the beginning! The pace of the technology’s advancement means that what might be a “oh, that’s a cool idea” today will be a commercial reality by tomorrow; you need to focus on what you can achieve now, but also understand how this will roll into a game-changing, market-leading piece of kit in the near future. Put the right structures in place to accommodate this scale from the beginning – such as team training, upskilling, and change management processes.
Avoid point solutions
Your business is made up of multiple connected parts, and it’s important to understand and acknowledge how AI can be used across the entire enterprise; not only in terms of top-line growth, but also in terms of establishing new, positive links between teams and different business areas. This will drive a real, positive change across your business. In Peak’s experience, we’re seeing the biggest value from AI when businesses are making smaller gains across multiple business areas and functions, coming together to create a significant total AI opportunity.
Collect data – and lots of it!
Think about the masses of data your company has at its disposal – whether it’s customer, transactional, or supply chain data. No matter the business system or where it’s stored, your business is gathering data all the time. A key first step in your AI journey is collecting as much data as you can – and don’t worry if it’s not perfect or a little messy; AI can handle it!
AI strategy implementation
So, now you know more about what an AI strategy entails and some of the points your business should consider during the AI research and development phase. But how do you go about actually implementing your AI strategy framework?
Define success and measurements
One piece of advice that we give here at Peak is to brainstorm and rank your ideas in terms of the value they could ultimately offer and how difficult they will be to deploy successfully into your organization. You need to define what success looks like and how it will be measured, focusing on tangible outcomes and a demonstrable ROI – this helps when it comes to internal stakeholder buy-in, too.
You need to remember that introducing AI isn’t like getting a new CRM or ERP system, or even a shiny new data warehouse. It needs to be deployed with the intention of delivering real business change – which means you can attribute the benefits it has brought to your business in a really effective and transparent way.
Understand your data landscape
As we’ve said already, your data is key to the success of any AI project you embark upon. You should engage and empower all of your teams to get everyone on board with your plans for becoming AI-driven – even some of the teams you might not think of as being potential AI beneficiaries at first. All teams produce and store a lot of really valuable data, and the more you give your AI solutions to work with, the better the results will be. Simply put, always think of your data as the building blocks and foundation of your AI business strategy.
In conclusion, here’s a reminder of some of the key steps when it comes to planning and executing an artificial intelligence strategy in retail:
- Think big, take small steps, but make sure you act now
- Focus on outcomes and a clear ROI
- Consider the value of AI across your entire business – think of all that lovely data you have just sat there waiting to be leveraged!