Artificial Intelligence in Value Creation

350 Pages·2019·3.66 MB·English

by  Andrzej Wodecki

ANDRZEJ WODECKI
ARTIFICIAL INTELLIGENCE
IN VALUE CREATION
Improving Competitive Advantage
Artificial Intelligence in Value Creation
Andrzej Wodecki
Artificial Intelligence
in Value Creation
Improving Competitive Advantage
Andrzej Wodecki
Warsaw University of Technology
Warsaw, Poland
ISBN 978-3-319-91595-1 ISBN 978-3-319-91596-8 (eBook)
https://doi.org/10.1007/978-3-319-91596-8
Library of Congress Control Number: 2018944444
© The Editor(s) (if applicable) and The Author(s), under exclusive licence to Springer International
Publishing AG, part of Springer Nature 2019
This work is subject to copyright. All rights are solely and exclusively licensed by the Publisher, whether
the whole or part of the material is concerned, specifically the rights of translation, reprinting, reuse of
illustrations, recitation, broadcasting, reproduction on microfilms or in any other physical way, and trans-
mission or information storage and retrieval, electronic adaptation, computer software, or by similar or
dissimilar methodology now known or hereafter developed.
The use of general descriptive names, registered names, trademarks, service marks, etc. in this publication
does not imply, even in the absence of a specific statement, that such names are exempt from the relevant
protective laws and regulations and therefore free for general use.
The publisher, the authors and the editors are safe to assume that the advice and information in this book
are believed to be true and accurate at the date of publication. Neither the publisher nor the authors or
the editors give a warranty, express or implied, with respect to the material contained herein or for any
errors or omissions that may have been made. The publisher remains neutral with regard to jurisdictional
claims in published maps and institutional affiliations.
Printed on acid-free paper
This Palgrave Macmillan imprint is published by the registered company Springer Nature Switzerland AG
The registered company address is: Gewerbestrasse 11, 6330 Cham, Switzerland
Contents
1 Value Creation and Competitive Advantage Models 1
1.1 I ntroduction 1
1.2 Th e Value Creation and Competitive Advantage Models 5
1.2.1 Introduction 6
1.2.2 The Influence of Technology on the Logics
of Value Creation 7
1.2.3 Value Chains 10
1.2.4 Motivation for Extending the Concept of Value
Chains 15
1.2.5 Value Constellations 17
1.2.6 Value Shops 18
1.2.7 Value Networks 23
1.2.8 Value Grids 33
1.2.9 Value Structures in Service-Dominated Logics 38
1.2.10 Conclusion 41
1.3 Th e Role of Data, Information and Knowledge in
Value Generation 43
1.3.1 Knowledge as a Key Resource of an Organization 43
1.3.2 Data, Information, Knowledge and Wisdom
in Knowledge Management 44
1.3.3 The Concept of the Knowledge Value Chain 46
v
vi Contents
1.3.4 Transformation Processes in the Knowledge
Chain 47
1.4 The Influence of Information Technologies on Value
Configurations and Competition 50
1.4.1 Liquified Information in the Value Chain 50
1.4.2 Impact of Information Technologies
on the Value Chain 51
1.4.3 The Impact of Information Systems
on Competitiveness and Value Structures 52
1.5 Value Networks in the Telecommunications and IT
Industries 55
1.5.1 Motivation for the Development of New
Methods for Assessing Business Potential
in the IT and Telecommunications Industries 55
1.5.2 The Model of Control Points as the Basis
of the Business Potential Analysis Method 56
1.5.3 The Value Network Models
in the Telecommunications and Digital Media
Industries 59
1.6 Competencies Necessary to Achieve a Competitive
Advantage 63
1.7 Summary 65
References 66
2 Artificial Intelligence Methods and Techniques 71
2.1 Data, Information and Knowledge in Contemporary
Information Systems 72
2.1.1 Smart, Connected Products 72
2.1.2 Data Sources 74
2.1.3 Data Complexity 77
2.1.4 Data Processing Methods 79
2.1.5 Conclusion 84
2.2 C oncept and Basic Methods of Artificial Intelligence 86
2.2.1 Definitions of Artificial Intelligence 86
2.2.2 Classification of Environments 92
Conten ts vii
2.2.3 Solving Problems by Searching 95
2.2.4 Knowledge and Planning in Certain Situations 100
2.2.5 Knowledge and Planning in a State
of Uncertainty 104
2.2.6 Learning 106
2.2.7 Perception, Communication and Action 109
2.2.8 Creative and Prognostic Capabilities 110
2.2.9 Summary 113
2.3 The Most Important AI Technologies 114
2.3.1 Classification of AI Technologies 114
2.4 Cognitive Computing Systems 119
2.4.1 Features of Cognitive Computing Systems 120
2.4.2 Components and Principles of Cognitive
Computing Systems Design 122
2.4.3 CC Systems as a New Quality in Management 126
2.5 Summary 129
References 130
3 Influence of Artificial Intelligence on Activities
and Competitiveness of an Organization 133
3.1 Objectives, Subject, Method and Quantitative Analysis
of Research Results 134
3.1.1 Objectives and the Subject of Research 134
3.1.2 Research Methodology 134
3.1.3 Detailed Analysis of Value Offered 137
3.2 Adoption of Artificial Intelligence Systems
in Contemporary Organizations 143
3.2.1 Investments in AI and Adoption of This Class
of Solutions 143
3.2.2 Key Success Factors 146
3.2.3 Barriers and Risk Factors 153
3.2.4 Summary 156
3.3 Th e Impact of AI Systems on Activities in the Value
Chain 156
3.3.1 Design 156
viii Contents
3.3.2 Production and Logistics 174
3.3.3 Sales and Marketing 186
3.3.4 Personalization, Service and After-Sales Service 202
3.3.5 Human Resources Management 210
3.3.6 Information and Knowledge Management 214
3.4 AI Influence on Competitiveness and Markets 222
3.4.1 Manufacturers 223
3.4.2 Customers 228
3.4.3 Suppliers 230
3.4.4 New Players 231
3.4.5 Markets 232
3.4.6 Sources of Competitive Advantage 232
3.5 The Influence of Artificial Intelligence on the Role
and Competencies of Employees 237
3.5.1 New Competencies 239
3.5.2 New Roles in Organizations 241
3.6 Summary 242
References 243
4 Model for Value Generation in Companies and Cognitive
Networks 247
4.1 Classification of AI Technology in the Context of Value
Generation 248
4.1.1 Knowledge Value Chains and Data
Transformation Processes in Information
Systems 248
4.1.2 Classification of AI Systems According to a Place
in the Knowledge Value Chain 253
4.1.3 Classification of AI Systems According
to Cognitive Functions 260
4.2 V alue Generation Model: Organization Level 263
4.2.1 Value Generation Process 264
4.2.2 Value Generation Model 274
Conten ts ix
4.3 Cognitive Networks 275
4.3.1 Classic Constellations of Values and Value
Systems Based on AI 279
4.3.2 Cognitive Network Concept 293
4.3.3 Key Competencies of Organizations Operating
in Cognitive Networks 298
4.4 Summary 301
References 301
5 Summary and Recommendations for Future Research 305
Appendices 308
Appendix 1: Summary of Desirable Competencies
in Organizations Implementing AI Solutions 308
Appendix 2: Challenges Related to the Implementation
of Artificial Intelligence Systems 312
Appendix 3: The List of Analyzed Projects and Companies
Using AI or Supporting Its Design 316
References 327
Index 337
List of Figures
Fig. 1.1 Porter’s value chain. (Source: Own elaboration based on Porter
2008) 12
Fig. 1.2 Value configuration in value shops chart. (Source: Own elabo-
ration based on Stabell and Fjeldstad 1998) 21
Fig. 1.3 Network value configuration chart. (Source: Own elaboration
based on Stabell and Fjeldstad 1998) 26
Fig. 1.4 Dimensions of competing in value grids. (Source: Own elabo-
ration based on Pil and Holweg 2006) 34
Fig. 1.5 Knowledge Value chain concept according to Ermine. (Source:
Own elaboration based on Ermine 2013) 44
Fig. 1.6 Knowledge value chain and its management. (Source: Own
elaboration based on Ermine 2013) 48
Fig. 1.7 Knowledge chain model according to Wang and Ahmed.
(Source: Own elaboration based on Wang and Ahmed 2013) 48
Fig. 1.8 Knowledge transformation processes in value chains according
to Ermine. (Source: Own elaboration based on Ermine 2013) 49
Fig. 2.1 Characteristics of environment in classical search. (Source:
Own elaboration) 95
Fig. 2.2 Characteristics of environment in extended classical search.
(Source: Own elaboration) 98
Fig. 2.3 Characteristics of competitive environments. (Source: Own
elaboration) 99
xi