• Blu Artificial Intelligence

Identifying High Value Digital and AI Projects


Digital and AI transformation is not just about cutting costs or appearing innovative. Companies invest in Digital and AI projects to automate decision making at scale. Savvy business leaders aim to build digital tools and systems that find patterns in business data, forecast customer needs, and make repeated business decisions.


Ultimately, investing in digital and AI technologies is about gaining sustainable competitive advantage – running your business faster and better than your competitors.


True digital and AI maturity requires a project portfolio that continually delivers business benefits and ROI over different time horizons. But how should executives pick the projects themselves? How might companies identify high value applications of digital and AI and translate these use cases into projects?


We recommend that business leaders start by articulating the company’s business needs, strategic objectives, and challenges. Leaders can then work with internal and external subject matter experts to identify digital and AI tools to address these needs. This becomes the basis for building a project portfolio that complements the firm’s strategic goals.


Phase I: Articulate Business Priorities

Senior executives should start by formulating and articulating their broad strategic goals. What business objectives has the firm set for itself over the next 1, 3, or 5 years? Does the firm plan to double sales in an emerging market? Or increase operating margins in a mature market? Which growth opportunities is the firm pursuing? Are there competitive, regulatory, or supply chain challenges that keep senior executives up at night?


Executives should also understand the type of digital and AI projects that the firm has or is currently working on. Which business functions, departments, and geographies do these projects cover? Do projects tackle simple or complex use cases? Across one or many departments? Are departments coordinating on project delivery, or is each following their own path?


Finally, does the firm have a ‘transformation vision’ in place that articulates how digital and AI investment will increase the firm’s market share and margins. A transformation vision is a company’s ‘This is how we win’ statement.


Phase II: Identify Critical Processes


Which specific business processes are most important for achieving strategic goals? For instance, if a retail bank’s strategic focus is regulatory compliance, business processes related to fraud detection and anti-money laundering (AML) are especially important.


Executives should make a prioritized list of all the business processes that are important for achieving the firm’s strategic goals over the next 1-5 years. Executives, or members of their management teams, must understand these critical processes end-to-end, including dependencies with other teams and functions.


Phase III: Determine Digital & AI Use Cases

An in-depth understanding of business processes enables senior leaders to have meaningful conversations with technical specialists or consultants to identify digital and AI solutions for each process.


Use case identification is a comprehensive activity where internal technical specialists and/or external consultants work with the firm’s managers and subject matter experts to determine:

  • Which digital or AI tool/method is best suited for a given business process

  • How the digital or AI use case can be implemented

  • What impact the implementation will have on the business process (e.g., efficiency, accuracy, scalability, etc.) and how it will be measured

Each process & use case pair is a potential project. For example, a bank’s fraud team can use machine learning models to significantly improve fraud detection capability and drastically reduce the number of transactions incorrectly flagged as fraudulent. Building, training, and operationalizing this machine learning model becomes a project.


Phase IV: Construct a Project Portfolio

The potential projects identified in the previous phase should be ranked by:

  • ROI: both strategic and financial

  • Time to deliver

  • Ability to deliver

  • Management enthusiasm

The last factor is important in the real world. Projects that the management team believes in and that enjoy buy-in from other stakeholders have a higher chance of success.


The result should be a project portfolio that delivers short-term and long-term benefits to support the firm’s strategic goals. An ideal portfolio contains some projects that deliver quick wins and others that tackle higher-value use cases, thereby needing more time to generate ROI.


Most portfolios consist of four project types: pilot, short-term, medium-term, and long-term projects. Specific numbers of each project depend on the complexity of use cases being tackled and how many business functions, departments, and regions the projects cover.


Pilot projects take a few weeks to deliver a concept or basic prototype. Pilots are for learning and validating concepts. Their value comes from showing the firm where it is now and what is needed in terms of data, talent, and tools to deploy a full digital/AI solution.


Short term projects take less than a year and focus on generating ‘quick wins’ from single use cases. Major benefits include tangible financial ROI, which further increases management support and builds momentum. For instance, a bank or insurance company might automate customer onboarding by building a web/mobile app that is supported by digital back-end systems to process and store customer information.


Medium term projects may take between 12-24 months. These projects focus on higher value use cases that need more time to generate returns. Major benefits include recurring ROI (e.g., revenue or cost savings). For instance, a company might build a customer segmentation model powered by machine learning that enables sales & marketing teams to quickly identify new cross-selling and up-selling opportunities. Unifying customer data sources, training and testing the machine learning model, and integrating it with sales & marketing workflows, takes some time.


Long term projects may take two years or more to implement. However, these projects provide real and sustainable value to the firm and its customers. These can be standalone projects or an initiative that combines smaller project implementations into a coherent solution. For instance, financial services firm might build interconnected digital platforms and mobile apps that handle customer onboarding, provide self-service tools, recommend products & services, and automate basic customer service.


Takeaways for Business Leaders

Building an effective digital or AI project portfolio starts by articulating the firm’s strategic goals and understanding the related business processes. Next comes use case identification where each business process is paired with a digital or AI solution. Finally, leaders filter these use cases into a project portfolio that helps achieve overall strategic objectives.


The goal of digital and AI projects should always be to achieve sustainable competitive advantage. Individual digital and AI projects are tools to achieve a business objective. Taken together, these tools enable a company to achieve high-quality business results faster than their competitors.


If you are working towards integrating digital and AI capabilities into your business, please contact our management team below for a confidential discussion.


 

Contact us at info@blu.ltd to discuss how your company can identify & implement high-value RPA and AI solutions. Feel free to contact our management team directly.

Fabrice Fischer

CEO

fabrice@blu.ltd




Kevin Pereira

Managing Director

kevin@blu.ltd




 

About the Author

Rajendra Shroff

Director, Head of Applied AI Research

rajendra.shroff@blu.ltd


Raj Shroff is an AI Consultant with a background in Insurance. Prior to joining Blu, he was with AXA in Hong Kong.


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