Data Analytics & AI

Quantifying the potential of AI

This is an extract from our new report on Artificial Intelligence (AI), AI: The time is nowdownload the report for the full insight

Improvements in customer experience that result from AI can be measured by changes in an operator’s Net Promoter Score (NPS) and in churn reduction. However, trying to pin a monetary value to the many and varied use cases for AI across a communications service provider’s (CSP’s) organization is extremely difficult.

Operators, of course, are considering the significant potential for savings resulting from reducing staff, but few are prepared to put a number on this publicly. As an executive from a CSP in Asia notes:

“We don’t really want to highlight manpower issues with AI because it doesn’t resonate well. We need to get people to appreciate the power of using AI and how AI can simplify their role. Then we get them to upskill so that they can use the AI – they can do higher value work rather than focus on mundane skills that can be done by machine. But, of course, if you’re talking about call center assist in the outsourcing model, we can cut those seats.”

Reducing staff by 30% is possible

Another respondent whose company has set up an automation program within operations was willing to be more specific about the potential savings that will come from transformation and the introduction of agile software development and DevOps, which will include the use of AI. He says:

“In the next four to five years, we expect to be able to reduce staff by more than 30 percent. The more systems you have which eliminate the human factor the more instabilities you remove.”

Increasing productivity

Another way of expressing the benefits of AI and automation is in overall ‘value’. Consulting firms such as PWC use this as a metric for assessing the merits of transformation. In its analysis of the impact of AI, the company forecasts gains in gross domestic product (GDP) globally, the majority of which will come from increased productivity.

Incentivizing teams to deploy AI

The message from our survey and interviews with CSPs is that there is considerable enthusiasm for investing in AI. As the IT transformation director at a European CSP comments:

“When we first started talking about AI, there was resistance in the business because of the time and money that it requires. This has now disappeared and people see the benefits. There was a concern that AI needed lots of computing capacity but now we realize that it is not expensive because we can use it in a cloud environment.”

Measuring AI’s impact

Another respondent told us that his own personal key performance indicators (KPIs) this quarter are mainly based on the progress in analytics and AI (for example, building capabilities, developing use cases, creating algorithms and rolling out solutions). For many people in his team, this represents more than 20 percent of total KPIs.

Others are starting to measure AI deployment specifically. As one respondent explains: “We already have a target of the percentage of trouble tickets that get handled by bots.”

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    About The Author

    Chief Analyst

    Mark Newman is an analyst with 25 years of experience delivering insights on the future of the telecoms sector to senior level executives and audiences. Mark’s recent research has focussed on telecoms operator business models, digital transformation, service provider diversification, and the intersection between Internet and telecoms. He delivers analysis, presentations, strategy sessions and workshops to global audiences, helping them to plan for the changes that technology and disruptive new business models that will fundamentally transform their businesses. Mark was Chief Research Officer at Informa Telecoms & Media and Ovum before leaving to set up his own research firm, ConnectivityX, in 2016. He joined the TM Forum as Chief Analyst in February 2017.

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