Apr 1 2020
Businesses are often tempted to employ a range of technologies, including artificial intelligence (AI), to enhance performance, reduce labor costs, and improve the bottom line—a fact that is logical.
Image Credit: Rensselaer Polytechnic Institute.
However, before opting for automation that can potentially risk the jobs of humans, business owners should carefully assess their operations.
According to Chris Meyer, a professor of practice and the director of undergraduate education at the Lally School of Management at Rensselaer Polytechnic Institute, the same method should not be used when applying AI to each business.
Meyer had studied this topic and has now detailed this in a recent conceptual paper published in an exclusive issue of the Journal of Service Management on “AI and Machine Learning in Service Management.”
AI has the potential to upend our ideas about what tasks are uniquely suited to humans, but poorly implemented or strategically inappropriate service automation can alienate customers, and that will hurt businesses in the long term.
Chris Meyer, Professor of Practice and Director of Undergraduate Education, The Lally School of Management, Rensselaer Polytechnic Institute
Based on Meyer’s findings, the option to utilize AI or automation has to be a strategic decision. For example, if a company’s business competes by providing an array of service offerings that shift from one client to another, or by offering a considerable amount of human interaction, then its business will experience a lower success rate if human experts are replaced with AI technologies.
Meyer further observed that the reverse is also true: Businesses that restrict customer interaction and choice will witness better success if they decide to automate.
Business leaders planning to migrate to automation should cautiously assess their strategies for handling knowledge resources. Before investing in AI, companies should first understand whether it is a strategically viable option to use algorithms and digital technologies in the place of human interaction and judgment.
The ideas are of use to managers, as they suggest where and how to use automation or human service workers based on ideas that are both sound and practical. Managers need guidance. Like any form of knowledge, AI and all forms of service automation have their place, but managers need good models to know where that place is.
Chris Meyer, Professor of Practice and Director of Undergraduate Education, The Lally School of Management, Rensselaer Polytechnic Institute
Meyer also established that in businesses where reputation and trust are vital factors in fostering and sustaining a client base, individuals will probably be effective than that of automated technologies.
On the other hand, in businesses where human biases are specifically dangerous to the service provision, AI will serve as a comparatively better tool for companies.
Meyer further stressed that several businesses will eventually be utilizing a combination of automation and people’s skills to compete effectively. Even AI, which can manage highly complicated jobs, works optimally alongside humans—and the other way round.
Automation and human workers can and should be used together. But the extent of automation must fit with the business’s strategic approach to customers.
Chris Meyer, Professor of Practice and Director of Undergraduate Education, The Lally School of Management, Rensselaer Polytechnic Institute