On April 16, 2018, a select committee of the United Kingdom’s House of Lords issued a report on the ethical use of Artificial Intelligence (AI) titled AI in the UK: Ready, Willing and Able?. Among the recommendations, the Lords and Baronesses of Parliament’s upper house suggested that utilizing AI to improve commercial and industrial processes is a legitimate and important use of the technology.
Tying AI to ERP system software is a natural fit.
In fact, AI will add tremendous value to an ERP system. Deployed properly, machine learning will eliminate human errors, lower operating costs and simplify nearly all routine tasks that consume far more time than they are worth. At the same time, AI’s data mining capability means the massive amount of information that ERP generates provides the ability to transform the data to actionable business intelligence.
Moreover, the cognitive automation of AI linked to ERP means the entire system can look for the best answer to solve a commercial or industrial process. Living, breathing employees can regain the time they had been spending on ordinary, routine decisions. As a result, the “robot” will create countless efficiencies and improve overall productivity that goes way beyond what ERP software can do on its own – and leagues past the capability of us mere humans.
Indeed, an article in the Harvard Business Review notes that, for companies utilizing ERP, there are three areas where coupling AI to the system will benefit a company:
- AI can have an immediate impact on costs and revenue.
- AI enables a company to produce more products with the same number of people it employs currently.
- AI will produce more benefits on the factory floor than in the front office.
The article goes on to say, “… we believe companies would be wise to use AI first where their computers already interact. There is plenty of low-hanging fruit there to keep them busy for years.”
Although it will dramatically improve ERP processes, AI will complicate the negotiating and contracting process. As an ERP software licensing attorney, I can already see that adding an AI element to the relationship between vendor, integrator and user will make the vendor’s template contract even more useless than it is now. The need to define the specific obligations, responsibilities and liabilities of each party to the agreement will expand exponentially.
By Marcus Harris