Artificial Intelligence in Business Decision Making

Name: Ammar Presswala

Registration Number: 35-1190
University: Balaji Institute of Modern Management (BIMM)
River: Brahmaputra

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 Table of contents
Abstract 4

Introduction 5

Research Problem 6

Objectives 6

Hypothesis 6

Literature Review 6
Growth of Artificial Intelligence in Business Decision Making 6
AI adoption is increasing 7
Data remains a roadblock 7
Trust is a Challenge 7
Security is paramount 8
External partners play an important role 8
Role of AI in Business Decision Making 9
AI unique capabilities in business decision making 9
The scope of AI’s autonomy in decision making 9
Benefits of AI in Business Decision Making 10
Quicker decision 11
Handling multiple inputs 11
Reduced fatigue 11
Non-intuitive predictions through more original thinking 12

Methods of AI in Business Decision Making 12

Marketing Decision-Making 12
Customer Relationship Management (CRM) 13
Problem Solving 14
Opinion & Sentiment Mining 14
Augmented Analytics 15

Methodology 15
Research Design 15
Data Collection Method 15

Results and Discussion 16

Conclusion 21

Recommendations

References 23

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1. Abstract

In today's complex environment, business decision making is a dynamic and uncertain

process. As a result, varied groups of responsible employees must deal with a great amount
and variety of information that must be gathered and analysed correctly in order to derive
appropriate choices. Although research in this area is still in its early stages, the technological
potential of artificial intelligence (AI) is projected to provide additional support. However,
because the technology is intended to have capabilities beyond those of traditional machines,
the effects on the division of work and the description of roles established in the current
human–machine relationship are being explored with growing awareness. This article
presents an overview of the possibilities identified by current research for incorporating AI
into business decision making under uncertainty, based on a comprehensive literature review
and content analysis. The findings are summarised in a conceptual model that first describes
how humans may use AI for business decision making under uncertainty and then outlines
the problems, preconditions, and repercussions that must be taken into account. While there
has been significant study on organisational structures, AI application selection, and
knowledge management options, a clear prescription for ethical frameworks, despite being
identified as a critical basis, is lacking. Furthermore, AI, unlike traditional machines, has the
potential to amplify rather than solve issues inherent in decision-making processes. As a
result, human responsibility grows, but the skills required to utilise technology differ from
those required to operate other devices, necessitating education.

Keywords: Artificial Intelligence (AI), Machine Learning (ML), Customer Relationship

Management (CRM), Information Technology (IT), Compound Annual Growth Rate
(CAGR)

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2. Introduction

Artificial Intelligence has significantly shaped the business world and revolutionised
business decision making. AI has the potential to surpass human intelligence and enable
improved decision making. It assists in the detection of incorrect decisions and speeds up the
overall decision-making process. Its techniques are increasingly extending and enhancing
business decision making by coordinating data delivery, analysing data trends, forecasting,
developing data consistency, quantifying uncertainty, anticipating the user's data needs,
providing information to the user in the most appropriate forms, and suggesting courses of
action (Rose, 2020). In business, artificial intelligence simply refers to the use of intelligent
computer software with human-like skills to generate revenue, enhance customer experience,
increase productivity and efficiency, and drive business development and change. Businesses
may use AI to generate new ideas, get greater insights, and make better business decisions.
Real-time interactive dashboards, automated marketing campaigns, and expert systems allow
businesses to make risk-free and profitable decisions (Kopanakis, 2019).
This presented research paper will cover  each and every single factor that would be
essential for having a better understanding or knowledge in relation to Artificial Intelligence
in business decision making which includes it's growth, impacts, roles and methods in the
business sector.

3. Research Problem

To determine the concept of Artificial Intelligence in Business Decision Making

4. Objectives

● Understanding the Role of Artificial Intelligence in Business Decision Making

● To explore the Artificial Intelligence Methods (Marketing Decision, CRM,
Recommender System, Problem Solving, Opinion and Sentiment Mining and
Analysis) that will enhance Business Decision Making.

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5. Hypothesis

● Artificial Intelligence Methods (Marketing Decision, CRM, Recommender System,

Problem Solving, Opinion and Sentiment Mining and Analysis) have a positive
impact on Business Decision Making.

6. Literature Review

6.1. Growth of Artificial Intelligence in Business Decision Making

According to Elliot, J. (2021), effective AI may help a business succeed by

automating critical activities and equipment, analysing huge datasets, facilitating
robotics, increasing productivity, and improving customer experience. AI spending is
expected to rise by over 21% every year. When the time comes, businesses will need
basic information to make informed decisions about the AI life cycle (Elliot, 2021).
Below are the key learnings for AI in business decision making:

6.1.1. AI adoption is increasing

AI is recognised as valuable by decision makers. AI technologies and

ecosystems have already provided considerable value to 67 percent of
respondents (Elliot, 2021). The Business leaders perceive this value in greater
profit and income, whereas government agency decision-makers see it in faster
progress toward mission and goals. AI is expected to play a larger role in
operations and business models in the future, according to decision makers and
industry analysts, with a 32.7 percent CAGR over the next five years (Jyoti,
2021).

6.1.2. Data remains a roadblock

The most frequent method that businesses use and profit from AI is through
analysing large datasets and discovering trends. According to the study,

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 respondents indicated their organisations either presently lack critical data inputs
(50 percent) or lack a defined plan for obtaining and accessing data (43 percent)
(Elliot, 2021).

6.1.3. Trust is a Challenge

The procedures and strategies used in the use of AI to ensure that the
solution's outcomes are understandable by humans. According to the study, 73%
of firms that use AI believe it will make their work simpler, and 64% of
consumers believe it will solve complicated problems in the future. Today,
however, over three-quarters of decision makers (65%) believe their workers do
not trust (or understand) AI-enabled suggestions (Rao, 2017).

6.1.4. Security is paramount

Security risks are becoming more prevalent across all commercial sectors and
levels of government. According to a poll of IT specialists, 91 percent of
employees suffered data breaches last year. Following additional study, AI
attacks and attributed 4,799 confirmed attacks to command and scripting
interpreters. Fitch, J. (2021) suggested organisations foresee even larger security
issues in the future, with 91 percent citing robust security features as a key
priority when considering or acquiring AI technology.

6.1.5. External partners play an important role

Organizations and decision-makers engage in AI in a variety of ways,

including collaborating with external suppliers and AI specialists, making
strategic hiring, and educating current personnel. However, most
decision-makers believe that working with external businesses to create AI skills
is more cost-effective than building an internal team (Elliot, 2021).
More sophisticated businesses, in particular, realise the need of collaborating
with external suppliers to implement successful technology on schedule.

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 Working with an external partner resulted in an average savings of 36% of total
cost, according to the survey (Thompson, Bonnet & Ye, 2020).
External providers with best-of-breed solutions may offer a faster path to
gaining differentiation and competitive advantage as organisations attempt to
quickly implement AI technologies.

6.2. Role of AI in Business Decision Making

6.2.1. AI unique capabilities in business decision making

AI uses algorithms and machines to complete specific jobs, providing AI

significant benefits over humans. Because of its computational capability, it can
store more data and analyse it faster than human brains, resulting in better
analysis. It can also access real-time data, which means that storage is no longer
an issue. All of this contributes to the discovery of patterns, the interpretation of
data, and the treatment of large amounts of data more effectively than people
(Claude & Combe, 2018).
Machine Learning (ML) is empowered by data, thus the more data AI is given,
the more accurately it will analyse. This is especially helpful in the age of Big
Data and digitization (Dejoux & Léon, 2018).
AI is objective, entirely rational, and scalable. Human biases in business
decision making, such as conflicts of interest and anxieties, as well as language
obstacles and cultural idiosyncrasies, are irrelevant to the robots.
It analyses data to find the best solutions to a given issue while complying to its
algorithmic principles (Advani, 2021).
AI is scalable in the sense that once it has solved one problem, it can strictly
apply its reasoning method to a comparable problem while analysing the
uniqueness of the new problem using its objectivity skills. Machines' objectivity
and better analytical capabilities enable them to efficiently anticipate future
occurrences based on present reality (Advani, 2021).

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6.2.2. The scope of AI’s autonomy in decision making

The benefits of AI mentioned in the 6.2.1 section imply that it contains

multiple abilities required to make a choice, and that it outperforms humans in
some of these skills. Based on the research by Claudé, M. (2018) , AI appears to
be independent in terms of judgments made on a small scale, particularly among
employees of IT consulting businesses. These choices are typically tedious and
unpleasant duties for people.
They can be entirely automated since they only require characteristics that
machines outperform people at, such as objectivity and dealing with large
amounts of data. In reality, AI is utilised in companies to deal with regular
operational decision processes that are quite well organised. Such automated
choices currently exist in high frequency trading and stock management (Claude
& Combe, 2018).
Despite the fact that AI is autonomous throughout the business
decision-making process, every study reveals that its thinking and decisions
remain within the bounds imposed by humans, i.e. the rules of the algorithms.
This is what rule-based decision making is all about. Machines only make
decisions based on what has been programmed into them. Thus, engineers
already know what decisions computers would make because they coded the
algorithms to always provide the same response to a given collection of
circumstances. Today, AI-assisted corporate decision making is limited to weak
AI.
Claudé, M. and Combe, D. (2010) stated, AI does not have a global picture of
the problems and that humans will always have a part in the business decision
making process by making the final decision and controlling AI behaviours,
such as unplugging the machine if it becomes very harmful. Indeed, without
human oversight, existing AI will make mistakes, causing people to question
their faith in machine intelligence.

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6.3. Benefits of AI in Business Decision Making

Artificial intelligence helps organisations to process large amounts of data in

real time. AI delivers valuable insights that may be used to tackle recurring business
challenges in this way. Artificial intelligence can provide several benefits to these
organisations. Businesses, for example, could detect discrepancies in their operations
and abnormalities in their patterns to re-strategize their procedures. Which may
reduce risks and improve the efficacy of their corporate decision-making processes
by utilising exploratory and predictive data analysis (Uzialko, 2019)
Kopanakis, J. 2019 explained that today AI plays a significant role in
businesses in accelerating the decision-making process. Greater data variation and
data volume, higher computational processing speed and power and cheaper data
storage systems enable AI technologies collectively to analyse large data sets for
meaningful results. Since datasets are typically large and complicated, machine
learning derives meaning from them in ways that people cannot, therefore, Machine
learning now leads to successful business decisions without human participation.
Here are some part of the business decision making to AI brings many benefits:

6.3.1. Quicker decision

In recent times, the business pace has quickened substantially and there are no
signs that this is slowing down. In such a period, it is highly important to
accelerate decision-making. For example, with the use of AI-powered prices, oil
corporations can modify the price of gas to demand. Statistics reveal that their
profit margins may be increased by roughly 5% (Orlowski, 2017). Similarly,
travelling locations, stores and other businesses regularly employ dynamic
pricing to boost their margins.

6.3.2. Handling multiple inputs

Machines are significantly superior than humans when it comes to input from
various sources while processing a wide variety of factors at once. Because they

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 can analyse numerous information simultaneously to make difficult decisions
and to predict or propose the optimal decision (Kopanakis, 2019).

6.3.3. Reduced fatigue

Several psychological research indicate the quality of those decisions is

deteriorating when people are pressured into making many decisions in a
restricted period. This is why candy and snack bars are located near cash
registers in supermarkets; customers are exhausted from making so many
decisions while shopping, making it impossible to resist the sugar need at the
point of sale. Algorithms do not have so many vulnerabilities on the other hand.
At all times they make equally good choices, thereby enabling managers to
avoid making wrong decisions due to fatigue (Kopanakis, 2019).

6.3.4. Non-intuitive predictions through more original thinking

With AI, managers may uncover patterns for human analyses that are not very
evident. For instance, AI helped a leading pharmacy find that customers buying
clothes also tended to buy alcohol together. Such unique knowledge may have
immediate and considerable effects on the business if it is adopted into
decision-making (Power, 2015).

7. Methods of AI in Business Decision Making

According to Saratchandran, V. 2019, AI has completely transformed the business

environment and revolutionised organizational decision-making. It can provide value to
today's organizations by speeding up decision-making. AI technologies now enable you to
analyse massive data sets quickly and correctly, including increasing data volume and
diversity, cheaper database storage alternatives, and increased computational capabilities .
The focus of the next 5 points is to highlight the methods in which AI can make a
difference in a business decision.

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7.1. Marketing Decision-Making

In today's customer-driven industry, the complexities involved in decision

making are growing by the day. Understanding client wants and aspirations, as well
as matching items to those needs and interests, are all part of this process. It is critical
to have a firm grasp on shifting customer behaviour in order to make the best
marketing decisions (Saratchandran, 2019).
To acquire useful insights, AI-enabled algorithms analyse client data related to
their surfing history. Businesses make efficient marketing decisions based on this
information. These may involve executing marketing campaigns to target prospects,
sending product recommendations, and delivering tailored emails to clients in order
to provide them with precisely what they want, exactly when they want it (Rose,
2020).

7.2. Customer Relationship Management (CRM)

CRM is a system that assists organisations in managing all of their

relationships and interactions with clients and potential customers. The ultimate
objective of keeping a CRM is to strengthen business relations (Saratchandran,
2019).
Artificial Intelligence generates targeted suggestions for salespeople based on
relevant data provided into the CRM system. These include personalised sales,
messages, and mail to be sent at certain times. Organizations may use AI buyer
persona modelling to determine a consumer's lifetime value. It can aid businesses in
managing various inputs. During a complicated decision-making process, AI can
efficiently handle and regulate several elements at the same time (Rose, 2020).
AI-powered algorithms process huge amounts of data in seconds to deliver
actionable business insights. While humans experience decision fatigue,
AI-algorithms do not, making the entire decision-making process easier and faster.
This is how AI facilitates business decision making.

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7.3. Recommender System

A recommended system (engine) is a technology that suggests products or

other commodities to consumers based on their interests and likes. Initially, these
recommendation algorithms were only utilised on music websites, but they are
increasingly being applied in a variety of sectors. Based on ‘explicit' or ‘implicit'
input, the system employs Artificial Intelligence algorithms to give extensive
information on the consumer's preferences (Starita, 2021). These insights assist
business marketing teams in developing the best approach for reducing bounce rates
and creating more customer-specific focused content. This is one example of how AI
may aid with corporate decision making.

7.4. Problem Solving

AI is increasingly guiding corporate choices, but it may be misused if

Executives continue to employ traditional decision-making methods. A fundamental
to productive cooperation is recognising which aspects of an issue to delegate to AI
and which to the management intellect. While artificial intelligence is stronger at
data-intensive prediction issues, humans are particularly suited to the creative
thought experiments that underpin the greatest judgments (Saratchandran, 2019).
An expert system is a type of problem-solving software that attempts to
imitate expert knowledge and reasoning processes. This system employs expert
thought methods to generate data, which includes problem evaluation and
suggestions, which makes it easier to make the right decision and respond swiftly
when faced with issues and problems.

7.5. Opinion & Sentiment Mining

Rose, S. 2020 identified that AI assists organisations in understanding

customer feedback and the causes for their likes and dislikes. All these viewpoints
are accurately acquired and processed in order to generate useful insights. This
information will assist organisations in predicting client issues so that they may take

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 proper precautions when making crucial business decisions. This is how artificial
intelligence facilitates corporate decision making.
AI has shown to be a dependable source of information for decision-makers.
For example, in marketing, AI has supplied businesses with crucial knowledge about
their customers, allowing them to improve their communication with them. It also
assists shops in forecasting product demand and responding rapidly to it
(Saratchandran, 2019).

7.6. Augmented Analytics

Businesses may utilise Augmented Analytics to make better decisions by

evaluating data. Extensive data analysis enables firms to get greater insights, which
aids in the development of promising marketing tactics (Rose, 2020).
Business executives and decision-makers have access to credible data and
recommendations so they can make sound business judgments. The application of
modern AI approaches not only improves the performance of individual team
members, but also enables businesses to outperform their competitors in the market.

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8. Methodology

8.1. Research Design

Qualitative Research is primarily exploratory research. It is used to gain an

understanding of underlying reasons, opinions, and motivations. It provides insights
into the problem or helps to develop ideas or hypotheses for potential quantitative
research.
Sample Area: India.
Sample Size: 53
Sampling Method: Non – probability , Convenience sampling.

8.2. Data Collection Method

1. The Primary data was collected by using a well-structured questionnaire from 53

respondents residing around India by using the convenience random sampling
method.
2. Secondary data were collected from research projects, books, journals, magazines
and from websites.

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9. Results and Discussion

9.1.1. Question 1) Based on your knowledge which Industry uses AI.

From the below table it has been concluded that maximum number of
respondents are aware about the Industries using AI for Business Decisions :
● All of the above: 25 responses at 47.2%
● Fashion and Retail: 17 responses at 32.1%
● Health Care: 10 responses at 18.9%

Industry Frequency Percentage

Fashion Retail 17 32.1%
Health Care 10 18.9%
Agriculture 1 1.9%
All of the above 25 47.2%
Total 53 100.0%

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9.1.2. Question 2) According to you, what are the AI related Technology concerns ?
From the below table it has been concluded that maximum number of
respondents are aware about the Technology Concerns using AI for Business
Decisions :
● Data Security : 21 responses at 39.6%
● Fear of Technology Making Errors : 16 responses at 30.2%
● Fear of Job Loss : 10 responses at 18.9%

Technology Concerns Frequency Percentage

Data Security 21 39.6%
Fear of Job Loss 10 18.9%
Fear of Technology Making Errors 16 30.2%
None of the above 6 11.3%
Total 53 100.0%

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9.1.3. Question 3) What are the companies using AI Technology in the
Business-sector ? Please select from options below ?
From the below table it has been concluded that maximum number of
respondents are aware about the Companies using AI for Business Decisions:
● Google: 46 responses at 86.8%
● Amazon: 41 responses at 77.4%
● IBM: 37 responses at 69.8%

Companies Frequency Percentage

IBM 37 69.8%
Google 46 86.8%
Amazon 41 77.4%
Microsoft 34 64.2%

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9.1.4. Question 4) Do you think AI can assist in Business Decisions ?
From the below table it has been concluded that maximum number of
respondents are aware about the impact of using AI for Business Decisions:
● Yes : 41 responses at 77.4%
● No : 12 responses at 22.6%

AI Assistance Frequency Percentage

Yes 41 77.4%
No 12 22.6%
Total 53 100.0%

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9.1.5. Question 5) According to you, how do you think AI is benefiting a Business
Decision ?
From the below table it has been concluded that maximum number of
respondents are aware about the benefits of using AI for Business Decisions :
● All of the above : 27 responses at 50.09%
● Gain Better Insights : 14 responses at 26.4%
● Automated Process : 8 responses at 15.1%

Benefits Frequency Percentage

Enhance Decision
Making 4 7.5%
Automated Process 8 15.1%
Gain Better Insights 14 26.4%
All of the above 27 50.9%
Total 53 100.0%

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9.1.6. Question 6) How likely are you going to make use of AI in Business Decision
Making
From the below table it has been concluded that maximum number of
respondents would be using AI for Business Decisions :
● Five (5) : 25 responses at 47.2%
● Four (4) : 20 responses at 37.7%
● Three (3) : 8 responses at 15.1%

Rating Frequency Percentage

1 0 0.0%
2 0 0.0%
3 8 15.1%
4 20 37.7%
5 25 47.2%
Total 53 100.0%

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10. Conclusion

Artificial Intelligence techniques are expanding and enhancing business

decision-making, through methods like coordination of data delivery, the analysis of data
trends, forecasting, data consistency development, the quantification of uncertainty,
anticipating the user's data needs, presenting information in the most appropriate ways,
and recommending courses of action.
The future holds both research possibilities and difficulties in the deployment of AI
technologies to enhance business decision making, particularly at the interfaces between
humans and machines. The potential for enhanced business decision making are
substantial, particularly in complicated issues when the environment exceeds human
capacity to grasp and establish relationships between factors. The challenge is to develop
cost-effective, intelligent business decision-making systems that bring tangible benefits
and results acceptable to humans. Adaptive systems are actively pursued which customise
for different users and perceive user intentions in action or in speech. Trust in
autonomous systems is one of the most important challenges when applying intelligent
business decision-making support systems to real problems.

11. Recommendations

The future of artificial intelligence brings research opportunities as well as difficulties

in the application of AI technologies to enhance corporate decision making, particularly
at human-machine interfaces.
● AI can assist in the transformation of the process of discovering and developing
required talent. Using data collected by extensive surveys, AI can assist firms in
determining whether or not external prospects have applied for a position. It can help
identify current employees who are qualified for new positions.
● As technology advances, so will the ability to apply AI to different elements of the
business. While AI may play a vital role in business strategy, human resource choices,
and performance management, it is critical to keep the human factor in mind.

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