The Impact of AI Use Cases on the German Economy

APPANION
APPANIONAPPANION
THE IMPACT OF AI USE CASES
ON THE GERMAN ECONOMY
meetup.ai Hamburg @ WunderMobility - 06.02.2019
2
WHY DO WE INVESTIGATE
THE AI IMPACT?
3
PRODUCTIVE AI ADOPTION REQUIRES PRIORIZATION
AND FINANCIAL BACKING OF USE CASES
EARLY MAJORITYINNOVATORS EARLY ADOPTERS LATE MAJORITY LAGGARDS
TIME
0 - 3% 4-17% 18 - 50% 51 - 84% 85 - 100%
Prioritization
Financial resources
Does it
work?
Does it provide
value?
Does it scale?
Is it better than
any other solution?
Can‘t I exist
without it?
ADOPTIONRATE
4
HOW TO MEASURE THE AI IMPACT?
Cost reduction Revenue increase Output efficiency Risk avoidance
Customer acquisition Customer loyalty Strengthening the USP Speed of action
5
AI INFLUENCES ALL ENTERPRISE FUNCTIONS
Marketing and sales Supply chain and production Finance Operations
Customer acquisition & lead generation Yield optimization Smart expenditure and accounting Task automation
Social media channel management Predictive maintenance Expense and income reporting Robotic Process Automation (RPA)
Market research & behavior analytics Yield simulation and optimization Analytics-driven accounting Autonomous cybersecurity systems
Automated social & PR analytics Energy and throughput efficiency Smart investing Task augmentation
Content creation Intelligent quality control Robo advisory Monitoring and assisted decision-making
Pricing and marketing budget allocation Procurement and spend analytics
Dynamic pricing optimization Logistics network optimization Risk management IT & administration
Marketing spent optimization Supply chain optimization Risk modeling Workforce productivity and efficiency
Sales forecasting Autonomous transportation Regulatory compliance & SLAs Collaborative robots
Customer value optimization Smart vehicle routing and fleet management Risk scoring and valuation Knowledge management
Retargeting & personalization Warehouse optimization Fraud and debt analytics Translation, transcription, protocolling
Product recommendation engine Demand forecasting Fraud detection Contextual search and data generation
Context aware marketing Inventory optimization Billing and debt collection Data Management
Churn reduction Data cleaning & validation
Anticipatory CRM and upselling HR Product development Data labeling
Customer service management Analytics-driven hiring and retention Product Engineering
Chatbots and intelligent routing Analytics-driven hiring Product development cycle optimization
Biometrical authentication HR retention management Product feature optimization
HR Performance and safety management
Performance and safety management
Building management and security
Marketing & sales
Supply chain & production
HR Product development
Finance
Risk management
Operations
IT & administration
6
WE ANALYZED 46 USE CASES IN 40 INDUSTRIES
Marketing and sales Supply chain and production Finance Operations
Customer acquisition & lead generation Yield optimization Smart expenditure and accounting Task automation
Social media channel management Predictive maintenance Expense and income reporting Robotic Process Automation (RPA)
Market research & behavior analytics Yield simulation and optimization Analytics-driven accounting Autonomous cybersecurity systems
Automated social & PR analytics Energy and throughput efficiency Smart investing Task augmentation
Content creation Intelligent quality control Robo advisory Monitoring and assisted decision-making
Pricing and marketing budget allocation Procurement and spend analytics
Dynamic pricing optimization Logistics network optimization Risk management IT & administration
Marketing spent optimization Supply chain optimization Risk modeling Workforce productivity and efficiency
Sales forecasting Autonomous transportation Regulatory compliance & SLAs Collaborative robots
Customer value optimization Smart vehicle routing and fleet management Risk scoring and valuation Knowledge management
Retargeting & personalization Warehouse optimization Fraud and debt analytics Translation, transcription, protocolling
Product recommendation engine Demand forecasting Fraud detection Contextual search and data generation
Context aware marketing Inventory optimization Billing and debt collection Data Management
Churn reduction Data cleaning & validation
Anticipatory CRM and upselling HR Product development Data labeling
Customer service management Analytics-driven hiring and retention Product Engineering
Chatbots and intelligent routing Analytics-driven hiring Product development cycle optimization
Biometrical authentication HR retention management Product feature optimization
HR Performance and safety management
Performance and safety management
Building management and security
7
USE CASE CATEGORIES CAN INCLUDE
VARIOUS SUB-APPLICATIONS
Marketing and sales Supply chain and production Finance Operations
Customer acquisition & lead generation Yield optimization Smart expenditure and accounting Task automation
Social media channel management Predictive maintenance Expense and income reporting Robotic Process Automation (RPA)
Market research & behavior analytics Yield simulation and optimization Analytics-driven accounting Autonomous cybersecurity systems
Automated social & PR analytics Energy and throughput efficiency Smart investing Task augmentation
Content creation Intelligent quality control Robo advisory Monitoring and assisted decision-making
Pricing and marketing budget allocation Procurement and spend analytics
Dynamic pricing optimization Logistics network optimization Risk management IT & administration
Marketing spent optimization Supply chain optimization Risk modeling Workforce productivity and efficiency
Sales forecasting Autonomous transportation Regulatory compliance & SLAs Collaborative robots
Customer value optimization Smart vehicle routing and fleet management Risk scoring and valuation Knowledge management
Retargeting & personalization Warehouse optimization Fraud and debt analytics Translation, transcription, protocolling
Product recommendation engine Demand forecasting Fraud detection Contextual search and data generation
Context aware marketing Inventory optimization Billing and debt collection Data Management
Churn reduction Data cleaning & validation
Anticipatory CRM and upselling HR Product development Data labeling
Customer service management Analytics-driven hiring and retention Product Engineering
Chatbots and intelligent routing Analytics-driven hiring Product development cycle optimization
Biometrical authentication HR retention management Product feature optimization
HR Performance and safety management
Performance and safety management
Building management and security
Task augmentation
Monitoring and assisted decision-making
Healthcare Agriculture Legal
8
HOW DO WE APPROACH
THE AI IMPACT?
9
THE GROSS IMPACT OF AI
DIRECTLY AFFECTED VALUE CREATION THROUGH ADVANCED ANALYTICS OR MACHINE LEARNING
Additional AI-enabled
revenue from innovative
products and services
AI-impact on existing
revenues through
process automation
Direct costs from
infrastructure,
HR and R&D
AI-impact on existing
revenues through
decision-support
Substitution of revenues
within the industry
Gross Impact of AI
Cost
reduction
Revenue
increase
Quality
improvement
Investment Losses
KPI for the
extend of
industry change
10
WHAT ARE
THE KEY FINDINGS?
0
200
400
600
800
1000
1200
1400
1600
1800
2000
2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030
AI-impact on total revenue
(Germany, in EUR billions)*
Machine Learning (gross impact)
includes the use of artificial neural networks and deep learning to
solve complex data science problems:
▪ Feed-forward Neural Networks
▪ Recurring Neural Networks
▪ Convolutional Neural Networks
▪ Reinforcement Learning
▪ Generative Adversarial
Neural Networks
11
28% OF VALUE ADDED WILL BE IMPACTED BY 2030
Sources: Estimations from Appanion based on the official VAT statistics of the Federal Statistical Office and
market indicators and forecasts from ZEW, McKinsey Global Institute, Statista and the Federal Statistical Office (2018)
Advanced Analytics (gross impact)
comprises a wide range of mathematical methods for analysis and
problem solving, without the use of neural networks:
▪ Classification
▪ Regression
▪ Clustering
▪ Markov process
▪ Monte Carlo
▪ Reduction of dimensionality
▪ Mathematical optimization
▪ Ensemble Learning /
decision trees
12
MANUFACTURING WILL CONTRIBUTE OVER HALF OF
THE TOTAL AI IMPACT BY 2030 IN GERMANY
13
ONE THIRD OF AI IMPACT IS ALLOCATED IN
SUPPLY CHAIN & PRODUCTION PROCESSES
Based on gross impact figures
Logistics network optimizationYield optimization Warehouse optimization
Demand forecasting
Inventory optimization
Supply chain optimization
Autonomous transportation
Smart vehicle routing and fleet management
Yield simulation and optimization
Energy and throughput efficiency
Intelligent quality control
Procurement and spend analytics
Predictive maintenance
16.8% 6.8% 7.4%
14
TODAY, PREDICTIVE MAINTENANCE HAS THE BIGGEST
IMPACT - BUT THERE IS NOT ONE „KILLER-APP“
Demand forecasting
Autonomous transportation
Supply chain optimization
49,5
Yield simulation and optimization
Intelligent quality control
8,3
Predictive maintenance
Procurement and spend analytics
6,2Energy and throughput efficiency
9,1
Inventory optimization
91,0
Smart vehicle routing and fleet management 3,1
9,0
98,3
8,4
2,7
88,7
9,3
87,9
69,9
4,7
62,0
60,0
7,0
41,8
32,6
2019
2030
Gross AI Impact of supply chain and production use cases
(in EUR billion)
All figures available
at appanion.com
15
THREE KEY TAKEAWAYS
FOR YOUR PERSPECTIVE ON AI USE CASES
1
2
3
Major AI impact comes from optimization - This requires a new mindset
for prioritizing and financing use cases!
Start by mapping your organization‘s value creation with the highest-
quality data assets.
The core value of AI comes from the utilization of machine data in
production and supply chain processes.
Tobias Bohnhoff
Founder
Mirko Schedlbauer
Founder
THANK YOU
mirko@appanion.com
lnkd.in/mirko-schedlbauer
@mirkoschedl
tobias@appanion.com
lnkd.in/tobias-bohnhoff
@tobiasbohnhoff
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The Impact of AI Use Cases on the German Economy

  • 1. THE IMPACT OF AI USE CASES ON THE GERMAN ECONOMY meetup.ai Hamburg @ WunderMobility - 06.02.2019
  • 2. 2 WHY DO WE INVESTIGATE THE AI IMPACT?
  • 3. 3 PRODUCTIVE AI ADOPTION REQUIRES PRIORIZATION AND FINANCIAL BACKING OF USE CASES EARLY MAJORITYINNOVATORS EARLY ADOPTERS LATE MAJORITY LAGGARDS TIME 0 - 3% 4-17% 18 - 50% 51 - 84% 85 - 100% Prioritization Financial resources Does it work? Does it provide value? Does it scale? Is it better than any other solution? Can‘t I exist without it? ADOPTIONRATE
  • 4. 4 HOW TO MEASURE THE AI IMPACT? Cost reduction Revenue increase Output efficiency Risk avoidance Customer acquisition Customer loyalty Strengthening the USP Speed of action
  • 5. 5 AI INFLUENCES ALL ENTERPRISE FUNCTIONS Marketing and sales Supply chain and production Finance Operations Customer acquisition & lead generation Yield optimization Smart expenditure and accounting Task automation Social media channel management Predictive maintenance Expense and income reporting Robotic Process Automation (RPA) Market research & behavior analytics Yield simulation and optimization Analytics-driven accounting Autonomous cybersecurity systems Automated social & PR analytics Energy and throughput efficiency Smart investing Task augmentation Content creation Intelligent quality control Robo advisory Monitoring and assisted decision-making Pricing and marketing budget allocation Procurement and spend analytics Dynamic pricing optimization Logistics network optimization Risk management IT & administration Marketing spent optimization Supply chain optimization Risk modeling Workforce productivity and efficiency Sales forecasting Autonomous transportation Regulatory compliance & SLAs Collaborative robots Customer value optimization Smart vehicle routing and fleet management Risk scoring and valuation Knowledge management Retargeting & personalization Warehouse optimization Fraud and debt analytics Translation, transcription, protocolling Product recommendation engine Demand forecasting Fraud detection Contextual search and data generation Context aware marketing Inventory optimization Billing and debt collection Data Management Churn reduction Data cleaning & validation Anticipatory CRM and upselling HR Product development Data labeling Customer service management Analytics-driven hiring and retention Product Engineering Chatbots and intelligent routing Analytics-driven hiring Product development cycle optimization Biometrical authentication HR retention management Product feature optimization HR Performance and safety management Performance and safety management Building management and security Marketing & sales Supply chain & production HR Product development Finance Risk management Operations IT & administration
  • 6. 6 WE ANALYZED 46 USE CASES IN 40 INDUSTRIES Marketing and sales Supply chain and production Finance Operations Customer acquisition & lead generation Yield optimization Smart expenditure and accounting Task automation Social media channel management Predictive maintenance Expense and income reporting Robotic Process Automation (RPA) Market research & behavior analytics Yield simulation and optimization Analytics-driven accounting Autonomous cybersecurity systems Automated social & PR analytics Energy and throughput efficiency Smart investing Task augmentation Content creation Intelligent quality control Robo advisory Monitoring and assisted decision-making Pricing and marketing budget allocation Procurement and spend analytics Dynamic pricing optimization Logistics network optimization Risk management IT & administration Marketing spent optimization Supply chain optimization Risk modeling Workforce productivity and efficiency Sales forecasting Autonomous transportation Regulatory compliance & SLAs Collaborative robots Customer value optimization Smart vehicle routing and fleet management Risk scoring and valuation Knowledge management Retargeting & personalization Warehouse optimization Fraud and debt analytics Translation, transcription, protocolling Product recommendation engine Demand forecasting Fraud detection Contextual search and data generation Context aware marketing Inventory optimization Billing and debt collection Data Management Churn reduction Data cleaning & validation Anticipatory CRM and upselling HR Product development Data labeling Customer service management Analytics-driven hiring and retention Product Engineering Chatbots and intelligent routing Analytics-driven hiring Product development cycle optimization Biometrical authentication HR retention management Product feature optimization HR Performance and safety management Performance and safety management Building management and security
  • 7. 7 USE CASE CATEGORIES CAN INCLUDE VARIOUS SUB-APPLICATIONS Marketing and sales Supply chain and production Finance Operations Customer acquisition & lead generation Yield optimization Smart expenditure and accounting Task automation Social media channel management Predictive maintenance Expense and income reporting Robotic Process Automation (RPA) Market research & behavior analytics Yield simulation and optimization Analytics-driven accounting Autonomous cybersecurity systems Automated social & PR analytics Energy and throughput efficiency Smart investing Task augmentation Content creation Intelligent quality control Robo advisory Monitoring and assisted decision-making Pricing and marketing budget allocation Procurement and spend analytics Dynamic pricing optimization Logistics network optimization Risk management IT & administration Marketing spent optimization Supply chain optimization Risk modeling Workforce productivity and efficiency Sales forecasting Autonomous transportation Regulatory compliance & SLAs Collaborative robots Customer value optimization Smart vehicle routing and fleet management Risk scoring and valuation Knowledge management Retargeting & personalization Warehouse optimization Fraud and debt analytics Translation, transcription, protocolling Product recommendation engine Demand forecasting Fraud detection Contextual search and data generation Context aware marketing Inventory optimization Billing and debt collection Data Management Churn reduction Data cleaning & validation Anticipatory CRM and upselling HR Product development Data labeling Customer service management Analytics-driven hiring and retention Product Engineering Chatbots and intelligent routing Analytics-driven hiring Product development cycle optimization Biometrical authentication HR retention management Product feature optimization HR Performance and safety management Performance and safety management Building management and security Task augmentation Monitoring and assisted decision-making Healthcare Agriculture Legal
  • 8. 8 HOW DO WE APPROACH THE AI IMPACT?
  • 9. 9 THE GROSS IMPACT OF AI DIRECTLY AFFECTED VALUE CREATION THROUGH ADVANCED ANALYTICS OR MACHINE LEARNING Additional AI-enabled revenue from innovative products and services AI-impact on existing revenues through process automation Direct costs from infrastructure, HR and R&D AI-impact on existing revenues through decision-support Substitution of revenues within the industry Gross Impact of AI Cost reduction Revenue increase Quality improvement Investment Losses KPI for the extend of industry change
  • 10. 10 WHAT ARE THE KEY FINDINGS?
  • 11. 0 200 400 600 800 1000 1200 1400 1600 1800 2000 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 AI-impact on total revenue (Germany, in EUR billions)* Machine Learning (gross impact) includes the use of artificial neural networks and deep learning to solve complex data science problems: ▪ Feed-forward Neural Networks ▪ Recurring Neural Networks ▪ Convolutional Neural Networks ▪ Reinforcement Learning ▪ Generative Adversarial Neural Networks 11 28% OF VALUE ADDED WILL BE IMPACTED BY 2030 Sources: Estimations from Appanion based on the official VAT statistics of the Federal Statistical Office and market indicators and forecasts from ZEW, McKinsey Global Institute, Statista and the Federal Statistical Office (2018) Advanced Analytics (gross impact) comprises a wide range of mathematical methods for analysis and problem solving, without the use of neural networks: ▪ Classification ▪ Regression ▪ Clustering ▪ Markov process ▪ Monte Carlo ▪ Reduction of dimensionality ▪ Mathematical optimization ▪ Ensemble Learning / decision trees
  • 12. 12 MANUFACTURING WILL CONTRIBUTE OVER HALF OF THE TOTAL AI IMPACT BY 2030 IN GERMANY
  • 13. 13 ONE THIRD OF AI IMPACT IS ALLOCATED IN SUPPLY CHAIN & PRODUCTION PROCESSES Based on gross impact figures Logistics network optimizationYield optimization Warehouse optimization Demand forecasting Inventory optimization Supply chain optimization Autonomous transportation Smart vehicle routing and fleet management Yield simulation and optimization Energy and throughput efficiency Intelligent quality control Procurement and spend analytics Predictive maintenance 16.8% 6.8% 7.4%
  • 14. 14 TODAY, PREDICTIVE MAINTENANCE HAS THE BIGGEST IMPACT - BUT THERE IS NOT ONE „KILLER-APP“ Demand forecasting Autonomous transportation Supply chain optimization 49,5 Yield simulation and optimization Intelligent quality control 8,3 Predictive maintenance Procurement and spend analytics 6,2Energy and throughput efficiency 9,1 Inventory optimization 91,0 Smart vehicle routing and fleet management 3,1 9,0 98,3 8,4 2,7 88,7 9,3 87,9 69,9 4,7 62,0 60,0 7,0 41,8 32,6 2019 2030 Gross AI Impact of supply chain and production use cases (in EUR billion) All figures available at appanion.com
  • 15. 15 THREE KEY TAKEAWAYS FOR YOUR PERSPECTIVE ON AI USE CASES 1 2 3 Major AI impact comes from optimization - This requires a new mindset for prioritizing and financing use cases! Start by mapping your organization‘s value creation with the highest- quality data assets. The core value of AI comes from the utilization of machine data in production and supply chain processes.
  • 16. Tobias Bohnhoff Founder Mirko Schedlbauer Founder THANK YOU mirko@appanion.com lnkd.in/mirko-schedlbauer @mirkoschedl tobias@appanion.com lnkd.in/tobias-bohnhoff @tobiasbohnhoff