Should retailers ramp up investments in AI for employees?

Discussion
Photo: NRF
Feb 01, 2018
Tom Ryan

Deciding when to take steps into tech investments is always a matter of timing, but a study from Accenture finds companies across industries are significantly shortchanging their workforces when it comes to empowerment through artificial intelligence (AI).

As part of the report, “Reworking the Revolution: Are you ready to compete as intelligent technology meets human ingenuity to create the future workforce?,” a survey of 1,200 executives found only three percent indicating their organization plans to significantly increase its investment in AI skills in the next three years.

The modest investment came despite exec optimism about workforce benefits for AI:

  • Seventy-one percent agreed that intelligent technology will be critical to their organization’s market differentiation;
  • Sixty-one percent think the share of roles requiring collaboration with AI will rise in the next three years.
  • Forty-two percent believe intelligent technologies will be behind every new innovation they implement in the next three years.

In retail, Accenture estimates that if stores invest in AI and human-machine collaboration at the same rate as top performing companies, revenues would climb 41 percent by 2022 and employment levels by 10 percent.

A barrier is perhaps evident in the finding that only 26 percent of execs feel their workforce is ready for AI adoption. Yet a survey of 14,000 workers as part of the report found 69 percent agreeing that it is important to develop skills to work with intelligent machines and 62 percent believe AI will have a positive impact on their work.

Companies may encounter bigger hurdles as AI transforms functional jobs into specialized, insight-driven, multiskilled roles. Among the suggestions offered by Accenture to rethink the workplace:

  • Reimagine work: Companies should “assess tasks, not jobs; then allocate tasks to machines and people, balancing the need to automate work and to elevate people’s capabilities.”
  • Pivot the workforce: Think beyond creating efficiencies and productivity gains though AI to how growth can be supported by “creating entirely new markets, products, services and customer experiences.”
  • Scale up “new skilling”: Measure the workforce’s level of skills and willingness to learn to work with AI to personalize training and employ digital learning that maximizes training investments at speed and scale.

DISCUSSION QUESTIONS: Should retailers be aggressive or patient at this point in investing in enabling retail workers with AI? What’s causing the apparent slow pace of investment? What’s your overall advice to retailers around applying AI to their workforce and work processes?

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Braintrust
"If we've learned anything from Amazon, it's that waiting will leave you behind."
"They have two choices; wait to see what others do and then decide how to proceed or jump in now and be the innovator."
"At the moment, apart from maybe the tech and marketing teams, I can’t see a reason why retailers should spend any money or lose sleep over AI."

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19 Comments on "Should retailers ramp up investments in AI for employees?"


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Zel Bianco
BrainTrust

They have two choices; wait to see what others do and then decide how to proceed or jump in now and be the innovator. First-mover advantage can make a big difference and waiting while others jump in may make it more challenging to catch up down the road. I believe that if a retailer has the resources — both in people and money — they should invest now as the lessons they will learn will allow them to leapfrog their competition. Look at who the leaders are now and you will see the same ones are at the top of the list in AI as well as other experiments that sometimes work and sometimes do not. Fail fast, as they say.

Art Suriano
BrainTrust

Most retailers will agree that AI is the way of the future, but most will have a “wait and see” mindset. There are many reasons for being cautious: 1.) Investing in any technology is expensive 2.) AI has a lot of kinks that need ironing out and 3.) A company has to determine how they will use AI and, once they do, make sure it will work for them.

There are many questions and many reasons why most retailers are moving slowly.There are also the needs that every retailer has for investing in other areas of their business, like building up their e-commerce, store remodels, new stores and new store concepts, increasing staff and training, advertising and more. So if retailers are keeping a “wait and see” attitude, it’s because there are only so many dollars available and until they are sure how AI is going to benefit them, they’re going to move with great caution.

Mark Ryski
BrainTrust

Retailers need to be patient on this front as technology continues to evolve. These are still early days, and while the sentiment of the executives surveyed suggest it’s clearly an important topic, they are not investing — yet. While the technology is advancing rapidly, it’s still expensive and clumsy. Furthermore, any moves that bring the machine vs. human argument into play also have the potential to create tension. I would advise executives to take serious steps in terms of identifying and researching potential opportunities for applying AI in their workforce, but to do so carefully and thoughtfully.

Lee Kent
BrainTrust

When retailers have to touch the stores, the cost of any project/change multiplies significantly. This is one of many reasons retailers like to be very sure they are making the right move. While I believe that now is the time to be aggressive, for the reasons mentioned, I am not surprised at the low number of executives who plan to invest in AI over the next three years. If we’ve learned anything from Amazon, it’s that waiting will leave you behind. And that’s my 2 cents.

Charles Dimov
Guest

Retailers that are planning to invest in AI, DEFINITELY need to consider training their staff for it. It is probably going to permeate the biggest of retailers first, and trickle down. Fail to train you staff and think through how roles will need to change to adjust — and the implementation will fail (people find ways to subvert threats to their livelihood). The important part is to make sure staff understand how this will take away the mundane from their work, letting them focus on the more in-person, creative or interesting challenges.

Bob Phibbs
BrainTrust

It’s a bit hard to see how “revenues would climb 41 percent.” The reality is that AI is not the panacea to higher sales when there are simply too many places to buy too much of the same thing from too many stores. Yes, technology can help but you can’t posit it in a vacuum. Most retailers have trouble right now because their POS systems are a Frankenstein network of fixes over decades unable to deal with the high demands of always-on technology. I think that would have to be fixed first.

Neil Saunders
BrainTrust

I wonder whether the prediction of a 40 percent increase in revenue is grounded in reality, or whether it was designed to drive headlines at Davos. I strongly suspect the latter!

Yes, it is true that AI is important. Yes, corporations should be looking at it and investing in it. However, many retailers have an enormous amount of work to do in getting the basics of their propositions and operations right. That is the focus in terms of time and capital expenditure.

This means more nebulous technologies like AI take a back seat. That may lose some the early mover advantage, but until such technology is proven to deliver upswings in revenue, it is probably understandable!

Shep Hyken
BrainTrust

If the retailer is very clear on what they want to achieve with AI, then it makes sense to find a solution. That said, many cannot yet define what they want out of an AI solution and are waiting. I don’t blame them. We may have clarity today, but the evolution of the technology is happening at such speed that a new application and solution that hasn’t been thought of yet is just around the corner. That’s why adoption is low at this point.

One point that the article makes that is worth emphasizing: The AI solution should focus on tasks and not jobs. Today’s best use of AI is to increase an employee’s productivity.

Dr. Stephen Needel
BrainTrust

Another buzzword that management has adopted without having a clue as to what it means. Is it automation? Machine learning? A completely new way of doing business? Before jumping in, they need to have a clue as to what AI is and isn’t and why it is useful for their business. Whether employees need training depends on what AI is doing for them — maybe yes, maybe no.

Cynthia Holcomb
BrainTrust

AI cannot be “buzzed” into to being relevant just because it is AI. AI is an investment in the unknown for retailers. It challenges retailers to dive deep into systems, people and process to determine exactly why an AI-enabled solution provides a better, more brilliant outcome than current systems.

How does a retailer measure the value of an AI system? Does an investment in developing and deploying a new AI system into a workforce maximize the value of each employee, the retailer’s brand, business model and products they sell?

AI-enabled systems will require retraining, rethinking and repurposing how employees interact with customers, process and systems. It’s a big deal!

Phil Chang
BrainTrust
Phil Chang
Retail Influencer, Speaker and Consultant
1 year 11 months ago

The new world of retail requires speed to market. For most retailers, this means executing initiatives in three to six months. I’d be using AI to find ways to cut that process down by half. Trends and micro-trends are going to be key to reinforcing your “why” to the right set of customers, and AI can help you do this.

Retail has always been a fast paced business — it just got faster.

Stuart Jackson
Guest

The terms AI or machine learning cover a huge span of technologies, some of which are happening now such as the algorithms that drive chatbots and AI that analyzes social network interactions looking for patterns and reacting accordingly. Others will expand rapidly once proven, such as AI in the supply and logistics chains that can “learn” to predict stock levels across the whole of a company’s estate in real time, helping to avoid items being out of stock, or ensuring that overstocked items are put on promotion. But other stuff I just can’t see happening for a very long time, like in-store robot assistants. I just don’t think customers will like it; they come to a store for human interaction. At the moment, apart from maybe the tech and marketing teams, I can’t see a reason why retailers should spend any money or lose sleep over AI.

Adrian Weidmann
BrainTrust

The existing paradigm that defines retail as we know it is out-of-date and a walking dinosaur. Retailers and brands need pragmatic, defined and measurable solutions — today! Stop chasing and waiting for the next shiny object. Erase the whiteboard and start fresh. There are existing technologies and capabilities that effect change NOW. Find someone to help you identify the correct ones, amplified with AI, that can be forged into an amazing solution. It’s the status quo and the comfort of being safe that will be the demise of those that boldly move forward. Being digital means scraping the status quo into the furnace and reforging workflows and business models to deliver delight to digitally-empowered shoppers.

Peter Luff
BrainTrust
Accenture over simplifying the position! It’s not a case of writing a P.O. and it’s delivered. Hard consideration of how AI will be used is required. There are, after all, a plethora of options — some may help and some may not. Think about what the task or task set is that you want to address, then create the business case that this will show a return before leaping in. Once you have decided, think about the training of the neural networks required to develop the inference engine that can then be used by the teams. This up-front training is where the effort goes. AI needs to be trained, it does not just “do” out of the box. Retailers should in most cases get help. It seems unlikely they will have the technologists and data scientists within their ranks to tackle this alone. The good news from my discussions and experience on this subject with industry AI experts is that retail is in no worse or better shape than most other areas, despite what Accenture… Read more »
Ed Dunn
Guest
1 year 11 months ago

My overall advice regarding AI is to first understand it takes real intelligence to create artificial intelligence. Meaning you have to know your retail operation processes, data and decision workflows before you can teach a machine. No consultant firm or third party can come in and tell you this information, you have to know your business first.

Know there is a different between augmented intelligence AI and artificial intelligence AI. Augmented intelligence helps your workforce while artificial intelligence can replace your workforce with in-store chatbots and voice recognition over the consumer mobile device and perform fulfillment. Make sure when someone speaks of AI you know which version of AI they are speaking of.

Nikki Baird
BrainTrust
Nikki Baird
VP of Retail Innovation, Aptos
1 year 11 months ago
So, I think there are a couple nuances here that need to be explored. One, “only three percent indicating their organization plans to significantly increase its investment in AI skills in the next three years” does not mean *enabling* employees with AI. I read that to mean, investing in people who know how to develop and deploy AI. Those people are enormously expensive, on the order of $500,000 salaries that no retailer will ever pay. Two, the whole point of one major benefit of AI is that you shouldn’t HAVE to invest in training for employees to “learn how to use AI.” One of the biggest benefits of AI is using it to explain complex or hard-to-see data or patterns in a language that people understand. Which in my opinion should definitely be an area where retailers should invest to enable employees. Instead of looking at an incomprehensible dashboard, what if a store employee could just get, either on their mobile device or even spoken to them through an ear piece “The store has not… Read more »
James Tenser
BrainTrust

Any technology solution that requires smarter, better paid or more highly-trained employees is not “Artificial Intelligence” — it’s artificial interference. Nikki, you’ve expressed the issue of employee enablement through A.I. perfectly. Machines are good at being relentlessly vigilant and tirelessly calculating. Humans who are relieved of those exertions can be freed to apply their energies to customer-facing activities that add value.

Harley Feldman
BrainTrust

Retailers should have a deliberative plan to embrace AI over time, and it should start now. AI is a compelling and useful technology to help associates better understand their customers and offer more information about or better visualization of products. It should increase customer sales and satisfaction.

The slowdown of investment in AI is due to three reasons: 1) many other technology issues or initiatives on the plates of retailers, 2) training for associates on how to use AI, and 3) the value of the technology being hard to quantify. As with every other technology, some retailers will be the trailblazers in the use of AI and others will be content to follow. Retailers should work with their employees to understand where the technology can have the most benefit, how it should be implemented and how employees should be trained to bring AI into the organization.

Vahe Katros
Guest
Vahe Katros
1 year 11 months ago
The authors of the report in this story, Accenture, can afford to attract AI resources. So here are some thoughts: 1. New Contracts to protect IP – We are all in the figuring it out phase, so while there are horizontal insights that apply to all retailers, there are some that are specific to your sub-vertical and audiences. So if you decide to bring in a consulting company, you have leverage sharing your data relative to fees charged. This is IP related as well as sharing shopper data so, all I can say is it’s an interesting problem that is not helped if you are feeling desperate. 2. New data to feed the system – The real interesting data relates to the how’s and why’s of engagement. I’m imagining that an Alexa-type device at the shelf or maybe at check-out. Offer a discount if the person states why they bought the product, the information can be anonymized and you can tie it into visual recognition of the shopper to get age and sex. 3. Share… Read more »
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Braintrust
"If we've learned anything from Amazon, it's that waiting will leave you behind."
"They have two choices; wait to see what others do and then decide how to proceed or jump in now and be the innovator."
"At the moment, apart from maybe the tech and marketing teams, I can’t see a reason why retailers should spend any money or lose sleep over AI."

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