What to watch for when implementing AI

Dentons recently carried out a survey of 450 international businesses to identify key trends in AI implementation. The results demonstrate a consensus that AI adoption is critical for continued success. 74 per cent of respondents agreed that AI is important to protect a business's bottom line, with 65 per cent believing businesses that fail to adopt AI will become increasingly unviable.

Globally, businesses are set to spend $250 billion on AI infrastructures in 2025, with AI expected to contribute $15.7 trillion to the global economy by 2030. The Scottish business sector is incredibly diverse, with market-leading businesses in manufacturing, technology, food and beverage, financial services and retail.

It is important for Scottish businesses to consider the benefits of implementing AI into their organisation. AI enables businesses to analyse large datasets, providing insights that inform strategic decisions and enhance competitive advantage. By automating routine tasks, AI helps reduce costs and improve efficiency, allowing businesses to focus on strategic growth.

AI is playing an ever-growing role in daily life, says Steph Innes

AI facilitates the development of new products by predicting trends and consumer demands. AI-backed chatbots are becoming an increasingly popular method of providing first-line support to consumers online, freeing staff for complex queries while ensuring consumer engagement. AI also analyses consumer behaviour to create personalised marketing campaigns.

In logistics, AI can help businesses manage inventories through real-time stock data and automatic reordering to reduce waste and increase availability. Similarly, AI optimises transport routes to reduce emissions and increase efficiency.

While the scope for AI to enhance business operations is significant, it is crucial to address the legal considerations associated with its adoption early in any AI-related project. This applies whether a project involves procurement, development or implementation. As a starting point, the legal landscape for AI is rapidly changing. Businesses must keep abreast of regulatory updates and establish robust governance structures. Dentons' findings indicate that 63 per cent of companies lack a formal AI strategy, with the firm now receiving instructions from several clients to support in both the creation and implementation of such strategies.

From an information security perspective, AI systems process large volumes of data, including data relating to individuals. It is therefore essential for businesses to ensure they comply with applicable data protection legislation, both in the implementation and ongoing use of AI. Breaches of data protection legislation can lead to fines, and are often widely reported in the media, and so failing to effectively manage the data processed by an AI system may result in significant reputational damage.

In addition to ensuring that AI systems are set up and run effectively, businesses must be mindful of the need to monitor their output, especially where this can be seen directly by consumers without any human review. AI also has the potential to inadvertently encroach on the intellectual property rights of third parties in its output.

Finally, where AI is used to make any decision about individuals, businesses must ensure that the AI system does not inadvertently discriminate in reaching its decision. Establishing comprehensive governance frameworks and conducting regular audits to avoid this bias can help to minimise these risks.

With AI playing an ever-growing role in daily life, there is a unique opportunity for businesses to enhance both their operations and consumer engagement. In order to do so, they should be mindful of the need to work within the regulatory framework, ensuring appropriate engagement from stakeholders and keeping consumer confidence at the forefront of their AI strategy.

Steph Innes is a commercial and intellectual property partner, Dentons​