We have all seen how the use of artificial intelligence has transformed industries and various businesses. The popular and world’s leading video streaming and entertainment company Netflix makes use of artificial intelligence to suggest and recommend relevant content to users based on their viewing habits. The company that was struggling to retain its subscribers in 2017, and almost shut down, now saves more than USD 1 billion per year just by using AI to improve operational efficiency.
Even though your business may not be as big as Netflix or some other companies like Nike, Amazon, Facebook, Uber, Google, Apple, and many others, operational efficiencies can be improved by using AI.
What does operational efficiency mean?
- Operational efficiency refers to improving all the key processes involved in the production of a product or service.
- Operational efficiency focuses on processes and effective resource utilization.
What are the benefits of improving operational efficiency?
- Reduce production and processing costs
- Higher profitability
- Retention of existing customers
- Reduce wastage of raw materials
- Save valuable time
- Improve profit margins
- Faster production
- Better delivery and distribution
- Streamline operational processes
In order to stay competitive in today’s fast-paced and rapidly growing industry competition, there is a need to improve operational efficiency, no matter how small or large your business is. The use of artificial intelligence and other latest technologies can help streamline various operational processes in your business.
AI can help increase business productivity by up to 40 percent. (Accenture)
Different ways in which operational efficiencies can be improved by using AI
Better customer support
- Customer experience and customer support are the main differentiator between you and your competitor.
- 68 percent of customers are willing to pay more for products or services from a brand that offer excellent customer service.
- In today’s world, people expect a business or brand to resolve customer issues in the shortest possible time.
- Quick answers to questions is what customers are expecting from brands.
- Providing 24*7 customer support in-house is not practically possible for all businesses since the cost is too high.
- Outsourcing the work to a third-party call center is cost-effective, but it can damage the reputation of your company if the right answers and resolutions are not provided to customers.
- The use of artificial intelligence can help provide speedy responses to customers anytime, anywhere.
- AI-powered chatbots help deliver exceptional customer service to resolve easy problems and some commonly asked questions.
- Since using AI chatbots, common customer questions can be resolved, the customer service agents have more time to handle complex queries from customers.
- Implementing AI can help reduce the resolution time, customer wait time, and help your business achieve higher customer satisfaction rate.
Lower operational costs
- There are certain fixed costs for a business that cannot be reduced.
- However, using artificial intelligence, the higher cost on certain business operations can be cut-down drastically.
- For example, AI can provide real-time insights about a digital marketing campaign to help you know the performance of the campaign.
- Another place where the use of artificial intelligence can help your business is preventive maintenance. AI can help detect the breakdown of any machinery before it actually happens, thus enabling you to go for scheduled maintenance and help prevent downtime.
Improve production process
- Production is a key aspect of every business, and your business is no exception to this.
- Just like other businesses, you may be trying to reduce the production cost.
- In the production process, there is a lot of unnecessary wastage of raw materials and also inefficiencies.
- The use of artificial intelligence can help streamline the production process, eliminate all possible errors and redundancies, to make the process a seamless one.
- AI can help smart machines make their own decisions by replicating human behavior.
- A great use case of AI is the improvement of the production process through the use of AI sensors and cameras to help the Quality Analysis team identify any defects before the end product reaches the customers.
- Using artificial intelligence, your business can automate certain manual, tedious, and repetitive tasks which the employees have to perform.
- Performing non-productive activities waste the valuable time of employees, which otherwise they would spend doing the core functions of the business, which adds to the bottom-line of your business.
- The use of artificial intelligence can help automate several business activities, enabling your employees to focus on sales, marketing, providing better customer experience, and other such functions.
In the rapidly advancing technological environment, businesses need to use artificial intelligence and other technologies for increasing operational efficiency, which is a lot more than just saving on cost for businesses.