The insurance industry is outpacing at least a dozen other business sectors when it comes to artificial intelligence investment, according to new research from Tata Consultancy Services (TCS), a global IT, consulting and business solutions organization.
The TCS Global Trend Study on Artificial Intelligence compiled survey responses from 835 executives across 13 industries worldwide. Researchers behind “Getting Smarter by the Sector: How 13 Industries Use Artificial Intelligence” found that AI is becoming essential to remain competitive, with all of the industries polled revealing plans to advance AI initiatives within the next three years.
The insurance industry has invested an average of $124 million on AI systems, compared to an average of $70 million in the other verticals surveyed. Consumer packaged goods reported the second most significant investment at $95 million.
“It’s striking that the sectors making the boldest current or future AI investments and citing the most significant results seem to group around industries like insurance, travel, hospitality and telecom, where disruption is having a major impact,” K. Ananth Krishnan, the chief technology officer at TCS, said in a press release.
In the future, according to TCS, the industries likely to invest the most in AI initiatives are those that haven’t already hopped on the bandwagon. Consider that:
— The travel, transport and hospitality industry plans to increase its AI investment by 750%, from $4 million in 2015 to $34 million to 2020;
— Media, entertainment and information services will increase their AI investment by 292%;
— Industrial manufacturing will increase its AI investment by 74%;
— Health care will increase its AI investment by 44%; and
— Banking and finance will increase their AI investment by 29%.
“The second phase of our Global Trend Study highlights that all industries see AI technology as a major game-changer on their business competiveness by 2020,” Krishnan said.
Incentives and challenges
Among the global industries that have already turned to AI initiatives, the average revenue increase across all 13 industries was 17%, while the average cost reduction was 12%.
However, increased reliability on machine learning also opens up fresh cybersecurity risks. Adoption challenges also exist in more manual and face-to-face jobs, where executives acknowledged the need to address employee concerns that AI initiatives will render them jobless.
In fact, previous research by TCS determined that “revenue and cost improvements from AI (will spur) the need for at least three times as many new jobs in each function by 2020 because of cognitive computing innovations.”
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