Practical tips: Assessing AI and ML for family businesses
FAMILY businesses in Southeast Asia face new challenges given the rapid speed of change in technology and macroeconomic trends.
They are realizing that they can no longer rely solely on family connections and loyal customers, and must change their ways of doing business in order to meet emerging customer demands and be on equal footing as their industry’s challengers and disruptors.
What’s unique to family business is the potential difference in mind-sets between the younger and older generations as they handle succession and leadership change from one generation to the next.
The younger generation is more ready to recognize that disruption is imminent and keen to explore new technologies to win in a digital economy.
Tech Wire Asia spoke to Anthony McMahon, Senior Vice President, Small & Medium Enterprises (SME), Asia Pacific and Japan, SAP to better understand the challenges of AI adoption in family businesses.
“In our partnerships across the region, the best run family business is a result of a good balance between promoting the unique business culture of a family-owned business and openness to implement new technologies,” said McMahon.
In fact, based on the Economist Intelligence Unit’s Planning for Prosperity report commissioned by SAP, a family business in South and South-east Asia is very confident in the digital proficiency of their employees (70 percent).
They also feel that they are prepared to utilize data analytics (94percent), machine learning (88percent), and cloud applications (89percent) in their operations, and display an openness to adopting new business models to scale up and sustain their business.
This bodes well for the future of family business because machine learning (ML) and artificial intelligence (AI) have the potential to help business systems reach new levels of intelligence and efficiency.
However, technology only plays a supporting role in a business.
Having a digital blueprint, starting with a digital core can transform the family-owned businesses to transform into an intelligent enterprise.
The following principles are guidelines that family business can keep in mind when assessing and evaluating innovative solutions, be it ML and AI.
Think integration, not silos:
ML and AI can only deliver the most optimal output if it has access to data across all business functions and can make sense of this complexity.
Essentially, the AI or ML solution should be able to integrate seamlessly with business functions and make sense of the data by categorizing and acting on insights automatically.
Trial on a small-scale basis first:
There is no need to roll out solutions across the whole business at once, but rather, implement it in the business function that needs the most help in efficiency.
Look at what benefits the business in a holistic way rather than force AI into a purpose that might not be the best fit.
If the finance team is struggling to streamline certain operations, then it might make sense to make the AI investment with the finance department first and go from there.
AI and ML approaches that are automatic finance and procurement processes include AI for Automated Invoice Management, which removes the need for tedious invoice mapping, contributing to efficiency and productivity.
Look at AI as a source of revenue and profitability:
Don’t regard AI as merely an automation tool to lower operational costs.AI has the potential to bring about fundamental, rather than incremental, change.
Believe in machine learning’s potential in business model innovation.
Snow peak, a Japanese innovator of outdoor apparel is such a believer. The company invested in predictive analytics that could consolidate data in real time across markets.
Equipped with some of the most powerful data analytics tools and ERP solutions, the company was able to make targeted suggestions for future purchases, boosting their growth as they expanded in the U.S, and ultimately driving revenue.
Businesses should consider a digital platform first at the core, then build on that with solutions based on your business requirement, to drive an integrated and consistent user experience.
AI applications serve very practical, functional purposes in the workplace and if wielded right has the potential to uncover market opportunities, cut operational costs through automation, and ultimately enhance the customer experience.
Start by mapping the challenges your business needs to address, then find a partner what can help you understand the solutions available to plug those gaps, and drive business outcome.
The outlook for family business remains positive – they are bullish on their prospects, looking to offer new products (94.3 percent) and enter new markets (93.7 percent).
“With their continual embrace of new technologies such as AI and ML, I am confident that they will continue to thrive in the current digital age and beyond,” concluded McMahon.
- Kickstarting a high-performance, low-code culture of innovation
- How to mitigate the rising cyber incidents in Asia?
- Chip makers are bracing themselves for the worse downturn in a decade
- Smart systems that help protect intelligently: Vectra AI
- Everyone is anti-ransomware, especially financial services