Keeping up with consumer preferences is challenging. The latest advances in artificial intelligence (AI) have created new potential for pervasive commerce to cater to these preferences.
The TCS AI for Business Study shows that most business leaders in consumer packaged goods (CPG) companies are optimistic about the potential of AI. This report provides fresh insights into how consumer goods and distribution companies are building effective AI strategies for their enterprise.
This report uncovers:
Most CPG executives we surveyed have a positive sentiment toward AI.
Yet there’s no consensus on AI adoption strategies and not enough metrics to measure success. 66% of executives say they need better KPIs to measure the success of their AI implementations.
However, companies still a have a long way to go before they realize their AI goals.
We asked CPG executives what their primary concerns are about AI, especially with the advent of generative AI (GenAI). Five strategic challenges are apparent.
As the integration of AI into business processes accelerates, measuring the financial return on such an investment becomes increasingly significant. But only 25% of CPG executives said they have "good enough" metrics and KPIs for their AI deployments.
Without adequate KPIs for AI-enabled operations, proving ROI and getting future buy-in will be challenging.
Even in this era of AI, there’s no substitute for human creativity, empathy, and strategic thinking.
As many as 83% of Pacesetters, or top-performing CPG companies, think human strategic decision-making and creativity will remain essential to their competitive advantage.
Most executives believe AI will augment and enhance human capabilities, enabling people to focus on higher-value activities. 54% of CPG companies expect most of their employees will be using GenAI daily in three years.
Innovation will be a focus for future AI implementations. In fact, 89% of CPG companies are focused on using AI to spur innovation.
Contextualize AI adoption to the domain-specific needs and focus areas across the CPG value chain.
Create a framework for business case formulation and success measurement and enable an AI-first business architecture by leveraging top-of-the-line industry expertise.
Focus your AI strategy on enhancing human-machine interactions—be it employees, customers, or consumers.
Reimagine work systems through the lens of how AI interacts with different user personas—augmenting what they are already doing (improving efficiency and effectiveness) or building new experiences altogether (greenfield innovation).
Integrate emerging technologies with existing ones for complementary and cost-effective value generation.
Emerging technologies, such as GenAI and large language models (LLMs), are just part of the AI puzzle. Look to complement and build upon existing solutions and enterprise systems (for instance, CRM and marketing automation tools) to enhance service teams’ productivity and drive sustainable growth.
Create transparent and responsible AI usage frameworks for a more democratized adoption.
Establish guidelines, policies, and processes to ensure AI systems are ethical, fair, and compliant with regulations. Make AI models more transparent and their decisions more explainable to users, allowing stakeholders to understand AI-driven outcomes and reducing resistance to adoption.
Adopt a multi-dimensional approach to measuring the success of AI implementations.
Create the right business case for AI initiatives. Understand the end-to-end cost implications before starting. Have a well-articulated value proposition along with use-case-specific metrics that can be tracked to assess differentiated business impact across the CPG value chain.
Prioritize enterprise readiness for scaling up successful pilot programs.
Success in the controlled environment of a pilot/POC exercise is no guarantee of success in scaled productionization. Invest in initiatives to prepare your data, tooling, architectures, and people for enterprise-wide AI adoption.
TCS’ Thought Leadership Institute conducted a double-blind study of approximately 1,272 senior executives with P&L responsibilities in 12 industry sectors across Asia, Europe, Nordics, LATAM, North America, and the United Kingdom and Ireland, with respondents having annual revenue of $5 billion to $100 billion. The CPG industry findings are based on feedback from 106 survey respondents.
This global study examines how CEOs, LOBs, directors, and business line managers prepare their businesses to be AI-ready, focusing on aspects such as their strategy around operations, talent, and future implementation plans. The study provides best practice recommendations based on these insights.
