AI for Managers – S.

Prof. Soumen Manna

Becoming an Innovation-Focused Organization

• The advantage of being the company to present a key piece of

innovation in the marketplace is game changing.

• This first-mover advantage can be achieved only via the relentless

pursuit of innovation and rigorous experimentation with new ideas.

• Innovations using AI can also lead to cost-saving practices, offering

the competitive edge needed to fiscally outmaneuver the
competition.
Culture of innovation

• A culture of innovation is hard to implement correctly, but it yields

splendid results when done well.

• Your organization should have policies that encourage innovation and

not limit it.
Culture of innovation
• IBM pioneered the concept of Think Fridays, where employees are encouraged to
spend Friday afternoons working on self-development and personal research
projects. This in part has led IBM to being called one of the most innovative
companies given that 2018 marks their 26th consecutive year of being the entity
with the highest number of U.S. patents issued for the year.

• Google similarly has a 20 percent rule that allows employees to work on personal
projects that are aligned with the company's strategy. This means that Google
employees, for the equivalent of one day a week, are allowed to work on a
project of their own choosing. This morale-boosting perk enables employees to
work on what inspires while Google maintains the intellectual property their
employees generate. Famously, Gmail and Google Maps came out of 20 percent
projects and are now industry-leading Google products in their respective fields.
Culture of innovation
• Not every organization needs to be as open as Google, but even a 5
percent corporate-supported allowance can have a big impact.

• Every employee is a subject matter expert about their own job.

Transferring this personal knowledge into shared knowledge for the
organization can lead to a valuable well of ideas.

• Organizations have to take a proactive approach instead of reactive

approach in this era of AI.
Idea Bank

• To aid the growth of an innovative organization, an “idea bank”

should be maintained.

• The idea bank stores all ideas that have been received but not yet
implemented.

• An innovation focus group should be given the authority to add and

delete ideas from the bank.
A sample idea bank
Business Process Mapping
• Business process mapping helps to identify tasks that can be
automated or improved on.

• Flowcharts and decision trees can be used to map processes and their
flow within the organization.

• Flowchart helps to understand everyone's jobs and their purposes in

your organization.

• Who? What? How? Why? Asking these four questions for every stage
to draw a proper flowchart.
Map for a department store chain
As an example, let's map the details for a department store chain starting at the
store level:
• Who controls the stores?
Store manager
• Who controls the store manager?
VP of Finance
• What does the store manager control inside the store?
Processes related entry inward/outward and the requisition of goods
• How does the store manager control the stores?
Uses custom software written 10 years ago
• Why does the store manager control the store?
To ensure that company property is not stolen or otherwise misused
An Enhanced Organizational Chart
Information Flows
• A vital tool in your toolbox of idea discovery is the tracking of
information and dataflows throughout your organization.

• It helps to get fresh insights on work duplication, among many other

efficiency issues.

• Drawing up flowcharts for these dataflows will allow you to visualize

the organization as a whole.

• It helps to think of the entire business as a data processing unit, with

external information being the inputs and internal information and
reports sent outside being the final output.
An Information Flow Before an AI System
Observation

• The production schedule can be made automatically using AI with the

marketing forecasts and the constraints of the production team.

• This efficiency improvement can free up the production manager's

time for higher-value activities.
An Information Flow After an AI System
Coming Up with Ideas
• Once the process flowcharts, timesheets, information flows, and responsibilities
are established, it is time to analyze this wealth of data and generate ideas from
the existing setup about how to revamp it.

• Industry best practices should be adopted once the gaps have been identified.

• Every process should be analyzed for information like its value-added to internal
and external stakeholders, time spent, data required, source of data, and so forth.

• The idea is to find processes that can be revamped to provide substantial

improvements that will justify any revamp investment.
Value Analysis
• Mapping out all your business processes and performing a value
analysis for the various stakeholders in your company will help you
isolate processes that need to be modified using an AI system.
• “Value” is a largely subjective concept at this point and need only be
shared with the stakeholders who are directly affected.
• We must, however, consider both internal and external stakeholders
when making this decision.
• For example, your company's tax filing adds no direct value to your
customers. However, it is important to stay in business and avoid late
fees. Therefore, tax filing has important ramifications and is thus
deemed “valuable” to a government stakeholder.
Value Analysis
The major stakeholders in a business can be grouped into five
categories:
1. Customers
2. Vendors
3. Employees
4. Investors
5. Governments

• Each of these stakeholders expects to receive a different kind of value from the
business. It is in the business's best interest to provide maximum value at the
cheapest cost to each stakeholder in order for the business to remain solvent.
Questions?