How AI Is Fulfilling Its Promise of ROI

ServiceNow is on track to achieve $100 million in workforce savings this year, thanks to the internal implementation of AI.

Why it matters: CFO Gina Mastantuono stated that the company expects to realize productivity gains from its use of AI, resulting in reduced staffing costs.

  • This potential for productivity gains at ServiceNow follows Salesforce's announcement that AI now handles between 30% and 50% of work at the CRM vendor.
  • Additionally, AI was cited as the main reason for Workday's decision to eliminate 1,750 positions in February, which represented 8.5% of its workforce.

Between the lines: SoftBank CEO Masayoshi Son has announced that the era of human coding is approaching its end.

  • "Within our group, we aim to have AI agents completely take over coding and programming," he declared at a customer event.

By the numbers: Masayoshi Son explains that SoftBank estimates it needs to create around 1,000 AI agents to replace a human worker.

  • "The agents will be active 24 hours a day, 365 days a year, and will interact with one another," he stated.
  • He estimated that each agent would cost just $0.27 per month.
  • Therefore, having a thousand agents replace a programmer would amount to only $270 per month.

Zoom in: Coding automation is not a new concept.

  • Since the emergence of the first compilers in the 1950s, very few developers have had to write code in assembly language.
  • Instead, they have focused on improving the way compiler instructions are written.
  • This led to the development of high-level programming languages, such as Python, and applications like Excel, as well as a shifting focus towards software as tools for people.
  • Artificial intelligence represents the next step in this ongoing automation process.

Behind the scenes: Every company across various industries and regions is working to figure out how to implement AI.

  • IBM's latest financial results indicate that the company is benefiting from GenAI.
  • According to IBM's CFO, Jim Kavanaugh, "We exited 2024 with an annual run rate savings of $3.5 billion achieved.
  • We now believe we can reach approximately $4.5 billion in annual run rate savings by the end of 2025."

Human aspect: In addition to the software and systems needed to implement AI, the key factor in achieving a significant return on investment (ROI) is staff training.

  • By training the C-Suite first, and then other departments on AI literacy, the entire company can comprehend how AI benefits both the organization and individual roles.
  • This approach has been proven to ensure rapid adoption, which leads to a quick ROI.

Go deeper: If you want to know more about training and achieving rapid ROI for AI initiatives, contact Todd Moses & Co. for a complimentary book.