Opportunities and challenges for businesses in adopting AI technologies in India

By Kapil Mehta, Senior Director of Technology Solutions, Visionet

With the ongoing rate of technological evolution, we are at a point where we can look back at the years and measure business growth based on the level of tech adoption alone. In the last three years, for example, AI has gone from being a useful emerging technology with limited awareness amongst businesses to now being the centre of most digital transformation initiatives.

Companies across various sectors, from healthcare to retail, have seen the potential of AI, with many taking the plunge and embedding AI solutions into their workflows.

To add to this, the Indian government’s efforts to build a digital economy and ambitious plans like the National AI Strategy have only accelerated AI adoption. Let’s take a closer look to understand the use cases of AI and why there is no way around its adoption.

Where does the hype come from?

Businesses are examining the use of AI in innovative and exciting ways to improve the customer experience, drive efficiency in operations, and support growth strategies.

For instance, in the retail sector, one of the many use cases for AI is inventory management. Retailers can now not just examine their inventory but also make predictions based on demand and trend cycles and make the most of their investments.

AI also helps automate tasks, reducing errors and improving efficiency. A recent report indicates that AI could provide an additional $500 billion to the Indian economy by 2025. This can prove to be extremely valuable when it comes to the customer experience. By utilising AI insights, businesses can serve their customers more effectively, thereby increasing satisfaction and retention. AI chatbots can provide 24/7 customer support and are able to resolve customer queries quickly and efficiently. In fact, it is predicted that by 2025, 80% of customer interactions will be handled by AI.

Is there a catch?

Every coin has two sides, so if there are opportunities, there are challenges as well. AI functions on machine learning, and with it comes the responsibility of collecting and storing data. As businesses continue to leverage data-based insights, the importance of security and data regulation becomes increasingly critical. According to a survey, 56% of businesses in India see data security as one of the major challenges to AI adoption.

Also, while AI adoption has increased rapidly over the years, the talent has yet to keep up. Despite the growing demand, there are a limited number of skilled AI professionals in India. Globally, there will be 97 million new AI and machine learning roles by 2025, which further demonstrates the urgent need for upskilling in the tech sector.

Lastly, the cost of technological integrations can sometimes turn businesses away from making the right choices, so much so that 53% of companies saw high costs as one of the main barriers to AI implementation. This can especially be the case with smaller and medium-sized businesses. But digital technology solutions need not be a maze to navigate, and making the right associations can support businesses of all scales in their growth journey.

What happens next?

AI’s potential is expansive, but overcoming the barriers to success will require strategic action. Technological adoption is now part of almost every business’s core strategies, and the popularity that technologies like generative AI have gained in the last year alone has ushered in this change.

The way forward is as simple as businesses want it to be. If the goal is to make the most of the technological advancements year-on-year, they need to invest in training and development programs that help them build an active and competent artificial intelligence team.

If the goal is to take a cautious approach to AI, then businesses can make collaborations to support that objective as well. Regardless of the approach, businesses have a lot to gain from being early adopters of promising emerging technologies.

Despite India’s competitive business landscape, the aspect that sets organisations apart from one another is how they approach changes, be they internal or external. With AI-based innovations taking up the spotlight, businesses need to ask if they are in the AI game or the innovation game. The answer can often change the way they view their business’ relationship with technology.