5 functions where AI benefits the bottom line

Companies have quickly come to rely on AI for tasks like data collection, robotic process automation, content and story generation, and product recommendations based on consumers' preferences. Around the world, 42% of organizations are exploring AI's capabilities, while another 35% are already using AI in some way, according to the IBM Global AI Adoption Index 2022. And generative AI is pushing excitement—and adoption—even higher within specific business departments. A new survey finds nearly 95% of IT leaders see the benefit of generative AI to help complete work.

To date, revenue increases are moderate, according to 2022's McKinsey Global Survey on AI—but in some cases, companies attribute revenue increases of more than 10% to AI adoption. 

Freshworks looked at the survey and ranked functions by percentage of revenue increase generated by AI. Keep reading to see where AI represents the biggest value-add for companies around the world.

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Supply chain management

Of organizations that adopted AI in supply chain management, 59% saw revenue growth as a result. That includes:

• 28% saw revenues increase by 5% or less

• 17% saw revenues increase by 6-10%

• 14% saw revenues increase by more than 10%

Among these organizations, 52% also said AI lowered costs in this function.

The COVID-19 pandemic laid bare existing vulnerabilities in the supply chain. Shutdowns exacerbated these fail points—including insufficient tracking and management of demand and inventory, shipping backlogs, and staff shortages.

AI is already optimizing supply-chain management by forecasting demand, predicting and tracking changes in material costs, monitoring compliance, and estimating the shipping speed from factory to customer. UPS is using AI to prevent package theft, utilizing customer location and other data to recommend delivery times or more secure options, including store drop-offs. 

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Manufacturing

Of organizations that adopted AI in manufacturing, 61% saw revenue growth as a result. That includes:

• 33% saw revenues increase by 5% or less

• 18% saw revenues increase by 6-10%

• 10% saw revenues increase by more than 10%

Among these organizations, 42% also said AI lowered costs in this function.

According to MIT Sloan School of Management, generative AI can help manufacturers detect defects, digitize maintenance tasks such as writing instruction manuals, and reduce and eliminate tedious or repetitive tasks to increase productivity. These tech solutions may help manufacturers be more nimble and cost-effective by reducing waste or raising yields.

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Strategy and corporate finance

Of organizations that adopted AI in strategy and corporate finance, 65% saw revenue growth as a result. That includes:

• 41% saw revenues increase by 5% or less

• 16% saw revenues increase by 6-10%

• 8% saw revenues increase by more than 10%

Among these organizations, 43% also said AI lowered costs in this function.

AI stands to revolutionize corporate finance by interpreting a high volume of complex data quickly, making decisions based on that data, identifying trends, and making predictions. Companies can take a hybrid approach, relying on more traditional human analysis for some things while leveraging automation and AI to supplement that work.

However, companies have been slow to adopt AI for these means: McKinsey's survey found that just 7% of respondents use AI in strategy or financial planning, compared to 25-30% in marketing, supply chain, and service operations.

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Marketing and sales

Of organizations that adopted AI in marketing and sales, 70% experienced revenue growth as a result. That includes:

• 41% saw revenues increase by 5% or less

• 20% saw revenues increase by 6-10%

• 9% saw revenues increase by more than 10%

Among these organizations, 28% also said AI lowered costs in this function.

AI can make phone calls, send messages, and offer online customer support in the form of chatbots. And generative AI can boost marketing and sales by devising personalized messages tailored to customers' interests and behaviors or by producing first drafts for ads, headlines, slogans, social media posts, and product descriptions. Safeguards are necessary, however, to ensure the AI does not plagiarize, violate copyrights, or produce copy with inaccuracies.

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Product and/or service development

Of organizations that adopted AI in product and/or service development, 70% experienced revenue growth as a result. That includes:

• 33% saw revenues increase by 5% or less

• 24% saw revenues increase by 6-10%

• 13% saw revenues increase by more than 10%

Among these organizations, 30% also said AI lowered costs in this function.

As with other sectors, AI functions most seamlessly in tandem with its human counterparts. In product development, it can jog industry experts out of tired thinking and help inform companies' key performance indicators.

Machines can also now take an initial design, analyze the data it is based on, and offer modifications, suggest the best materials based on cost and performance specifications, and estimate production costs more accurately based on various materials and other criteria.

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