Artificial intelligence sounds like it belongs to the domain of science fiction, but companies have been using AI in very real and practical ways.
A new report from the McKinsey Global Institute titled “Notes from the AI Frontier” looks at how companies are currently using AI techniques to solve business problems along with how they can use them in the future.
“One of the things we’ve done is we’ve looked at something like over 500 use cases,” said James Manyika, director of the McKinsey Global Institute. “These are actual problems in the real world that typically businesses are trying to figure out. Predictive maintenance, for example. Trying to understand information and supply chains, for example.”
How much value can AI generate in economic terms? Between $3.5 trillion and $5.8 trillion across 19 industries.
We dived into McKinsey’s paper to look at the ways it can be used in different industries. Here were some of the findings:
- Artificial intelligence has the ability to optimize the routing of delivery traffic, which can improve fuel efficiency and reduce delivery times. In one case study, the report found that a European trucking company reduced fuel costs by 15 percent. Drivers used sensors that monitored both vehicle performance and driver behavior, and received real-time coaching on when to speed up or slow down.
- It can predict congestion and weather-related problems, which can help airlines avoid costly cancellations.
- Taking advantage of AI can help with a business’ supply chain. For instance, with pharmaceutical and medical products, AI could use real-time data to predict regional demand and health trends can help companies determine how much they should have in their inventory.
- AI could help with “next product to buy” recommendations, similar to what Amazon and Netflix have successfully implemented. In auto insurance, for example, premiums could be based on data about driving patterns and distances driven. In one case, a travel company offered additional services such as hotels and airlines using an algorithm trained on product and customer data.
- Pharmaceutical companies are using AI to reduce risk in clinical trials, and mining companies have used technology to anticipate any disruptions to their production.