Who is making the best use of GenAI? - Horizontal Functions vs. Industry Sectors

History provides numerous examples where transforming work methods or discovering new value sources was the decisive factor between an organization thriving or faltering. Today companies across the world have started realizing that Generative AI will significantly change the way their organization creates, delivers, and captures value over the next three years. As per McKinsey, use of generative AI within organizations has doubled compared to last year.

What do CEOs feel about the impact of Generative AI?

The Generative AI landscape is evolving rapidly, improving adoption and capabilities, significantly impacting business function’s priorities. According to PwC's 27th Annual Global CEO Survey,

• 70% of CEOs, regardless of adopting Gen AI in their organizations, feel that it will have a disruptive impact to their current business model in the next few years.
• 86% of CEOs feel that Generative AI will increase competitive intensity in their respective industries.
• In the last 12 months, 70% of CEOs have changed their company’s technology strategy due to the impact of Generative AI.

Measuring Impact of GenAI – Horizontal Functions vs. Industry Sectors

Horizontal Functions - A horizontal function refers to a business function or process that spans across different departments and industries, rather than being confined to a specific vertical or industry sector. These functions are essential for the operation of virtually any organization, regardless of the industry in which it operates. Generative AI (GenAI) is having a profound impact on various horizontal functions across industries, enhancing processes, boosting efficiency, and enabling innovative solutions. Several GenAI solutions are already available addressing specific use cases of the concerned horizontal function.

Industry Sector - Encompass a range of industries and activities that share common characteristics, such as the products they produce or the services they provide. The use cases, technical complexity, and compliance requirements can vary significantly from one industry to another. There is a noticeable contrast in GenAI adoption across these sectors. Some industries are naturally more suited to GenAI and are leading the way in its implementation.

Let’s look at the top 10 Horizontal Functions and their key application of GenAI.

1.????? IT

Predictive Maintenance: AI models analyze system logs and performance metrics to predict potential failures and suggest preemptive actions, reducing downtime and maintenance costs.

Network Management: GenAI optimizes network performance by analyzing traffic patterns and adjusting configurations in real-time to ensure optimal connectivity and security.

Incident Management: AI can automatically categorize, prioritize, and resolve IT incidents, improving response times and reducing the workload on IT support teams.

?2.????? Sales

Tailored Messaging: GenAI can generate personalized emails, messages, and content that resonate with individual prospects, increasing the chances of engagement and conversion.

Automated Lead Scoring: AI models score leads based on various factors such as engagement levels, past interactions, and demographic data, helping sales teams prioritize their outreach

Insight Generation: AI analyzes CRM data to provide insights into customer behavior, preferences, and potential upsell or cross-sell opportunities.

3.????? Security

Anomaly Detection: GenAI models analyze vast amounts of data to detect anomalies and potential security threats in real-time, enhancing the organization's ability to respond to cyberattacks.

Alert Prioritization: GenAI helps in prioritizing security alerts based on the severity and potential impact, reducing alert fatigue and ensuring critical issues are addressed promptly.

Threat Hunting: GenAI assists security teams in proactively searching for hidden threats within the network, leveraging advanced analytics to uncover sophisticated attacks.

4.????? HR

Personalized Onboarding: GenAI provides personalized onboarding experiences by delivering tailored information and resources to new hires based on their roles and backgrounds.

Sentiment Analysis: AI analyzes employee feedback from surveys, social media, and other sources to gauge sentiment and identify factors influencing employee satisfaction and engagement.

Diversity and Inclusion: GenAI analyzes diversity metrics and suggests strategies to promote a diverse and inclusive workplace, supporting HR diversity initiatives.

5.????? Legal

Statutory Research: GenAI assists in analyzing statutes and regulations, providing summaries, interpretations, and comparisons across jurisdictions.

Compliance Monitoring: GenAI monitors changes in laws and regulations, alerting legal teams to compliance requirements and helping ensure adherence.

Legal Strategy Optimization: GenAI provides insights into the effectiveness of different legal strategies based on historical data and trends, guiding decision-making.

6.????? Software Engineering

Code Generation: GenAI models can assist in writing and optimizing code, reducing development time and minimizing errors. Tools like GitHub Copilot use AI to suggest code snippets and complete code segments.

Automated Testing: AI-driven tools can create and run test cases, identify bugs, and even suggest fixes, streamlining the software testing process.

Documentation: GenAI can generate comprehensive and clear documentation for codebases, making it easier for developers to understand and maintain projects.

7.????? Risk and Compliance

Fraud Detection: AI analyzes transaction data in real-time to detect fraudulent activities, such as unusual spending patterns or unauthorized transactions, in financial systems.

Regulatory Intelligence: AI gathers and analyzes regulatory data from multiple sources to provide insights into compliance obligations and regulatory trends.

AI-driven Learning Programs: GenAI develops personalized training programs for Risk and Compliance professionals, covering regulatory updates, best practices, and emerging risks.

8.????? Supply Chain and Inventory Management

Dynamic Inventory Optimization: GenAI adjusts inventory levels in real-time based on demand forecasts, supplier capabilities, and lead times, reducing stockouts and excess inventory.

Fleet Management: GenAI monitors and analyzes fleet performance data to optimize maintenance schedules, reduce downtime, and extend vehicle lifespan

Quality Inspection: GenAI automates product quality inspection processes by analyzing visual data and identifying defects, ensuring compliance with quality standards and reducing waste.

9.????? Customer Service/Operations

Loyalty Programs: GenAI recommends personalized loyalty offers and rewards based on customer preferences and purchasing behavior, fostering customer loyalty.

Order Fulfilment Optimization: GenAI optimizes order processing and fulfilment operations to meet customer expectations for speed, accuracy, and flexibility.

Call Summarization: GenAI summarizes call transcripts and notes to provide agents with quick insights before interactions, improving efficiency and resolution times.

10.????? Finance and Accounting

KYC and Due Diligence: GenAI streamlines Know Your Customer (KYC) processes by verifying customer identities and assessing risk factors, enhancing regulatory compliance.

Claims Management: GenAI automates claims processing, fraud detection, and settlement calculations, enhancing operational efficiency and customer satisfaction.

Financial Forecasting: AI predicts future financial performance, market trends, and economic indicators to support strategic decision-making and business planning.

GenAI is a transformative force across horizontal functions by driving automation, personalization, efficiency gains, and innovation in various business operations. As organizations continue to integrate GenAI technologies, they are poised to unlock new opportunities, improve competitiveness, and deliver enhanced value to customers and stakeholders.

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References

GenAI adoption: A game-changer for your industry | PwC