Tag: Generative AI

Meeting the ROI Bar: Client’s Expectations for Generative AI in IT Outsourcing Deals | Blog

Generative artificial intelligence (AI) has disrupted the global market since its scaled capabilities were unveiled to the world by OpenAI at the end of 2022.

Today, most enterprises either want to adopt this game-changing technology or are looking to build their own gen AI capabilities, but at what cost? Reach out to us to discuss this topic further with our expert analysts.

Billions of dollars have now been invested into building and leveraging gen AI, with the hope that it will improve business operations with unprecedented productivity improvements.

Similarly, on the information technology (IT) services side, many service providers have begun investing in proprietary gen AI solutions to pass on the associated efficiencies to their clients, all while identifying new use cases during delivery. While the offering of gen AI-driven productivity was considered a differentiator for providers in 2023, this has become a table stake in the past two to three quarters. Despite all of this, a big question remains: “Is the providers’ proposition aligning with client expectations regarding ROI?”

In this blog, we delve deeper into the current expectations in IT outsourcing deals.

Demanding more from gen AI: enterprises raise the bar

With a varying degree of success from the proof of concepts (POCs), enterprises now expect service providers to clearly demonstrate a visible return on investment before approving fresh investments. Enterprises are now expecting clear call outs on both capabilities, as well as true efficiencies from their gen AI solutions.

In this regard, some of the leading providers have started to highlight specific details as a part of their gen AI solution value proposition, such as:

  1. Quantifying productivity: What are the incremental productivity gains over the deal term?
  2. Cost benefits: How would the improvement in productivity translate into noticeable cost benefits? This should take into consideration the reduction in the overall Total Contract Value (TCV) of IT outsourcing deals, both with and without the gen AI proposition
  3. Intangible benefits: How will the gen AI solution lead to an enhanced user experience? For example, highlighting potential reduction in the meantime to resolve (MTTR) or improvement in customer satisfaction (CSAT) scores

Please note that with the advent of new technologies like Agentic AI, the cost implications and the productivity benefits are also expected to increase in the future.

The gen AI return on investment (ROI) dilemma: Is it worth the hype?

Despite the allure of gen AI, executives are under increasing pressure to justify its seemingly hefty price tag. Demanding an ROI of at least 2-2.5x, they’re wary of projects that fizzle out after initial proofs of concept due to the soaring costs and its unclear benefits.

To address these concerns, enterprises are demanding greater transparency and more accountability from providers, scrutinizing costs associated with resources, infrastructure, data, and large language models (LLMs).

There are also concerns around the associated capital expenditure. In response to these demands, providers are strategically positioning gen AI as a long-term value proposition by amortizing the upfront costs over the contract period. In most cases, especially in competitive IT services opportunities, we are also observing a few leading providers proposing gen AI solutions as an investment from their side.

To safeguard the interests of both parties, contracts are now evolving to include detailed discussions on risk, regulatory compliance, commercial impact, and implementation costs. Periodic benchmarking clauses are also being negotiated to ensure ongoing accountability and prevent unforeseen expenses.

Everest Group partners with both enterprises and leading IT service providers on mandates related to pricing strategies, productivity gains, and pricing impact related to gen AI.

If you found this blog interesting, check out our virtual event, Gen AI Unhyped: How It Is Evolving and How to Plan for Success.

To discuss this topic in more detail or for a detailed analysis, contact us at [email protected], or please contact Prateek Gupta and Anubhav Jain.

Elevating CX: Trends and Insights for a Unified CX Tech Strategy | Webinar

ON-DEMAND WEBINAR

Elevating CX: Trends and Insights for a Unified CX Tech Strategy

In the dynamic customer experience (CX) landscape, competition to achieve an effective tech stack is driving innovation. By integrating service, sales, and marketing capabilities through a platform approach, businesses can streamline operations, centralize customer data for better insights, improve collaboration across departments, and enhance the overall customer experience.

Watch this webinar to discover how leveraging unified platforms and innovative technologies can help businesses scale, increase agility, and create seamless, personalized customer journeys.

Our analysts also covered key buyer pain points, the CX tech vendor landscape, enterprise approaches to unifying CX, pricing strategies for sourcing CX tech, the impact of generative AI in improving CX, and future CX technology trends to watch for.

What questions did the webinar answer?

  • What does a typical CX tech stack need to look like?
  • Who are the emerging players/buying trends in the space?
  • What advantage does a platform-based approach have?
  • How can I unify end-to-end CX?
  • What are the pricing models prevalent in CX tech?
  • What will be the impact of Gen AI in CX?
  • Which are the major future trends in this space?

Who should attend

  • Enterprises 
  • Service Providers
  • CIO, CTO, CX leaders
  • Procurement heads
Das Anubhav
Practice Director
Sharma Sharang Refresh gray square
Vice President

Are Human-centric Experiences Possible with Gen AI? We Think So! | Blog

In this blog, we explore how generative AI (Gen AI) is not only enhancing our personal and professional interactions but also ensuring that the essence of human connection remains central in our increasingly digital world. Reach out to us to explore further.

In a world where digital transformation is the norm, maintaining genuine human connections becomes our greatest challenge and opportunity. Gen AI isn’t just a futuristic concept – it’s a present-day reality reshaping how we interact on both personal and professional levels. Amidst the whirlwind of technological innovation, the essence of human connection remains a priority. Let’s delve into how gen AI is revolutionizing customer and employee experiences, ensuring that humanity stays at the forefront of our digital journey.

Gen AI: the game changer

Gen AI is a technology that doesn’t just respond to your commands but anticipates your needs, understands your emotions, and adapts to your preferences. It’s a revolutionary leap beyond traditional AI, enhancing our interactions and deepening our connections. This isn’t about robots taking over; it’s about AI becoming a true partner, understanding us on a more profound level than ever before.

With its ability to sift through vast datasets and interpret the subtleties of human emotions, gen AI is transforming customer experiences into something remarkably intuitive and personalized. Picture your favorite brands offering customized solutions for your needs, with customer service that feels less like a transaction and more like a genuine interaction. Gen AI can improve operational efficiency in contact centers by 15-25% and create experiences that resonate on a deeply personal level, making every interaction feel uniquely tailored to you.

Enhancing employee experience with AI

The impact of gen AI goes beyond revolutionizing customer interactions; it’s also redefining the workplace. Gen AI is transforming how we work, learn, and grow. Imagine walking into your office and having an AI-powered system that understands your work habits, suggests ways to enhance your productivity, and even recommends personalized professional development opportunities. This isn’t merely about efficiency – it’s about creating a fulfilling and engaging work environment.

By leveraging gen AI, companies can significantly reduce agent training time by 20-30%, enabling employees to reach proficiency more quickly. AI tools can help managers give personalized and timely feedback, making employees feel more connected and appreciated. AI-driven training platforms tailor learning experiences to each person, ensuring everyone gets the most relevant and useful training. This makes learning exciting, and employees more engaged with their roles. Additionally, AI can analyze how engaged employees are and suggest ways to boost morale and productivity. By understanding how we work and what we need, AI creates a supportive environment where everyone feels valued and empowered.

Cracking the code: keeping it human

While diving into the digital deep end, we never lose sight of keeping it human. Gen AI might be smart, but it’s no substitute for real connection. So, how do we strike the balance? Simple: by putting empathy first and foremost in every interaction.

Designing for empathy

Think of AI as your trusty sidekick, not the hero of the story. By designing AI systems with empathy in mind, we ensure that technology enhances, not replaces, human interaction. For instance, customer service bots are programmed to recognize when a customer is frustrated or upset and respond with appropriate empathy and understanding and when to pass on the conversation to an agent. This isn’t about mimicking human emotions; it’s about creating a supportive and responsive environment.

Similarly, in the workplace, AI tools are designed to support employee well-being. For example, if an AI system notices a drop in an employee’s engagement scores or an increase in negative feedback, it can proactively suggest wellness resources or flag the issue to HR for a more personalized follow-up. These small, empathetic touches can make a big difference in creating a supportive and nurturing work environment.

Humans + AI: the dream team

Forget the man vs. machine showdown. It’s time to embrace collaboration. Gen AI isn’t here to steal our jobs; it’s here to supercharge them. By teaming up with gen AI, we can unlock new levels of creativity, productivity, and innovation. According to research by Everest Group, 65% of enterprises believe that gen AI will improve or transform their workflow, underscoring its potential to revolutionize the workplace.

AI can handle the repetitive, mundane tasks that often bog us down, freeing us up to focus on what we do best: creative problem-solving, strategic thinking, and building meaningful relationships. This collaboration between humans and AI can lead to more innovative solutions and a more dynamic and engaging work environment.

For example, in customer service, while gen AI can handle routine queries, human agents can step in for more complex issues, providing the empathy and nuanced understanding that only humans can offer. This not only improves efficiency but also enhances the overall customer experience, creating a win-win situation for both businesses and their customers.

Looking ahead

As we gaze into the future, one thing’s for sure: gen AI is here to stay. But let’s not forget our roots. Let’s keep the human touch alive and kicking, even as we ride the digital wave into tomorrow.

The future of gen AI is bright, with endless possibilities for enhancing both customer and employee experiences. However, it’s crucial that we approach this future with a balanced perspective. While embracing the technological advancements that gen AI brings, we must also prioritize the human element, ensuring that empathy, connection, and understanding remain at the forefront.

In conclusion, maintaining human connections in the digital age isn’t just a matter of convenience – it’s a fundamental aspect of our humanity. As we continue to embrace the possibilities of gen AI, let us do so with a deep appreciation for the power of human connection. By harnessing the transformative potential of technology while preserving the essence of what makes us human, we can build a future where empathy, understanding, and compassion flourish in the digital realm.

Watch the webinar, Gen AI Unhyped: How It Is Evolving and How to Plan for Success, to gain insight into how to stay ahead using this emerging tech as a lever, and how to harness the full potential of gen AI.

What Recent Generative AI Updates and Announcements Signal for Some Industries | Blog

Generative AI is rapidly transforming industries as it evolves. Read on to learn how generative AI developments are impacting functions, including personalized learning, content creation, and web search, and surfacing the need for responsible AI practices. Reach out to us to discuss this topic.

Generative AI is fast transforming various aspects of the technology landscape. Major updates and launches announced in the OpenAI Spring Update, Google I/O, and Microsoft Build event this year, show how rapidly this technology is evolving. At present, the artificial intelligence (AI) market is marked by technology companies looking to rapidly develop IP and shape eco-systems and standards and by providers and enterprises looking to evolve their business models to absorb generative AI.

Generative AI’s current functionalities and its rapidly evolving capabilities offer much in terms of potential benefits but also come with their fair share of uncertainties. Figure 1 gives an overview of the areas of generative AI impact that we will dive into.

Slide2 2

Hyper personalized learning may be upon us

Generative AI promises to personalize learning and make it interactive. It can empower teachers through AI assistants to offer more engaging and accessible learning. Examples of such context-aware AI innovations include OpenAI’s GPT-4o, Google’s LearnLM, and Microsoft’s Khanmigo. GPT-4o offers personalized and adaptive learning, identifying students’ strengths and weaknesses and providing solutions in their preferred learning styles, with multilingual support.

Recent generative AI updates have highlighted advancements in educational tools and platforms, showcasing new features and functionalities designed to enhance personalized learning experiences. Going forward, educators will likely be able to use generative AI tools to customize learning plans for students and understand their learning challenges through data and insights. Perhaps what is even more remarkable is the self-learning potential that generative AI offers. In a world where educators are largely overwhelmed, generative AI may be the force multiplier the education industry has been crying out for.

Generative AI-enabled learning tracks can help organizations thread the needle between scaling L&D initiatives and contextualizing them to different stakeholder needs. Generative AI may have the potential to not only provide 1-1 tutoring on emerging skillsets across a variety of languages but may also be leveraged to ideate and design the curriculum. At a time when the half-life of talent is becoming shorter, generative AI may be the answer to ensuring organizational L&D stays relevant and nimble.

Content creation may soon become commoditized

While generative AI has a wide-ranging impact across the media and entertainment value chain, content generation is where the impact is most acutely felt (see figure 2).Slide3 1

One of generative AI’s most striking use cases has been the creation of hyper-realistic content that seems indistinguishable from artist or studio creations. Recent generative AI updates and advances like GPT-4o have made content generation easier. These technologies can recognize tone, multiple speakers, background noises and produce outputs with embedded emotion such as laughter and songs. Innovations like OpenAI’s Sora or Google’s Veo empower creators and professionals to generate high-quality videos across different cinematic and visual styles without requiring extensive filmmaking expertise.

Advances in content generation have sparked fears about the ongoing relevance and demand for creative roles. Stories like that of Hollywood filmmaker Tyler Perry putting the brakes on a planned US$800 million expansion of his Atlanta studio upon seeing Open AI Sora’s video generation capabilities do little to allay such concerns. While current concerns about AI taking over creative work are understandable, it is more likely that going forward, we will simply see creatives engaged in higher-order work while AI solves for more time-consuming tasks. Content may become more synthetic, i.e., generated as opposed to filmed, produced faster, and more personalized. We may even start tiptoeing towards real-time content generation.

Hyper-realistic generated content also opens the door for deepfakes. False images, videos, and sound clips mimicking public figures or enterprises can lead to public unrest and material damage. With multiple elections being held around the world this year, deepfakes can have a meaningful impact on political discourse. This has understandably led to increased government scrutiny toward generative AI companies. Beyond politics, deepfakes are increasingly being used to commit fraud. Related to this, an employee at a multi-national organization was duped into paying out millions of dollars to those the employee believed to be key stakeholders at the company.

Generated content also poses some interesting intellectual property (IP) questions. Who has rights to the IP of generated content? Is it the person who prompted the output? Is it the technology company whose algorithms are being used to generate the content? Do the individuals or organizations whose data was used to train the algorithm also have some stake in what the model produces? Apart from adherence to IP laws, those using generative AI to create content will also have to be mindful of possible algorithmic biases manifesting in the generated content. Increasing efforts around responsible AI and transparency are needed to ensure biases in training data don’t get reinforced through the usage of generated content to train/tune other models.

Web search is changing

Generative AI is expected to have a massive impact on how web search takes place, and by extension, how online advertising plays out. Consequently, digital advertising, particularly SEO and SEM, are key areas being disrupted by generative AI (see figure 3).

Slide4 2

The move from coursing through books at the library to typing out keywords in a search bar was one of the biggest shifts in how people looked for information. Similarly, the impending transition from typing out keywords to simply asking in natural language promises to be the next big shift.

Generative AI updates have introduced new features in search engines and voice assistants, transforming how users interact with these tools. Advertisers increasingly express concerns about bot traffic eating away at their ad dollars. How would they feel about bots being the norm? Imagine if search fundamentally shifts to an audio-visual interface, with those searching for information rarely scanning the website themselves. How might this affect existing advertising models? Here are some possibilities – advertisers may realize that the customer is no longer on the website and needs to be engaged elsewhere. This can lead to a shift in the advertising mix, with more audio ads being rolled into searched information. SERP1 ads may also become more expensive due to their proximity to the search interface. For publishers, the shift may be from using ads to monetize content to directly monetizing the content itself based on how it is consumed to answer questions. Ad exchanges may evolve to become a network for generative AI bots to find content at a given price point. While these are indeed speculations, what is clear is that we are on the brink of a fundamental shift in information search and, by extension, digital marketing. All stakeholders within advertising may have to reassess their role in the broader ecosystem – be it advertisers, publishers, or ad exchanges.

For now, the impact of generative AI on everyday information search is limited. We are starting to see the integration of generative AI tools into existing search engines. For example, Google has integrated generative AI into its search tool. Through this feature, Google can interpret complex visual questions, provide explanations, suggest next steps, and offer resources using an AI overview. Voice assistants like Siri are also getting an overhaul. Apple’s partnership with Open AI promises to provide Siri with generative AI capabilities. The search space had one undisputed king for a long time – generative AI looks to be one of those seismic events that has the potential to reshape this hierarchy.

AI needs to be responsible

Generative AI promises to have a wide-ranging impact across multiple sectors. Given the massive impact that generative AI can have, tech companies need to balance innovation with safety. Responsible AI (RAI) is fast becoming an area of focus for enterprises looking to invest in and scale generative AI. Figure 4 illustrates some key considerations that will shape emerging RAI policies.

All Gen AI Future Disruptions graphics

Enterprises will increasingly look to collaborate with service providers and technology companies that prioritize data security and have effective governance setups to ensure responsible usage of AI. Implementing ethical guardrails is essential to unlocking the full potential of generative AI and ensuring its responsible usage. As user expectations and government oversight rise alongside AI’s evolution, companies that embrace RAI will be the ones leading the charge in this exciting new era.

If you have questions about this blog or would like to discuss recent developments in the generative AI space, please reach out to Abhishek Sengupta or Oishi Mazumder.

Watch the webinar, Gen AI and the Future of Cybersecurity: Advanced Strategies for Cyber Defense, for insights into new developments, emerging applications, challenges, and opportunities presented by generative AI in cybersecurity.

How can we engage?

Please let us know how we can help you on your journey.

Contact Us

"*" indicates required fields

Please review our Privacy Notice and check the box below to consent to the use of Personal Data that you provide.
This field is for validation purposes and should be left unchanged.