10 Ways AI Is Improving New Product Development

• Startups’ ambitious AI-based new product development is driving AI-related investment with $16.5B raised in 2019, driven by 695 deals according to PwC/CB Insights MoneyTree Report, Q1 2020.
• AI expertise is a skill product development teams are ramping up their recruitment efforts to find, with over 7,800 open positions on Monster, over 3,400 on LinkedIn and over 4,200 on Indeed as of today.
• One in ten enterprises now uses ten or more AI applications, expanding the Total Available Market for new apps and related products, including chatbots, process optimization and fraud analysis, according to MMC Ventures.

From startups to enterprises racing to get new products launched, AI and machine learning (ML) are making solid contributions to accelerating new product development. There are 15,400 job positions for DevOps and product development engineers with AI and machine learning today on Indeed, LinkedIn and Monster combined. Capgemini predicts the size of the connected products market will range between $519B to $685B this year with AI and ML-enabled services revenue models becoming commonplace.

Rapid advances in AI-based apps, products and services will also force the consolidation of the IoT platform market. The IoT platform providers concentrating on business challenges in vertical markets stand the best chance of surviving the coming IoT platform shakeout. As AI and ML get more ingrained in new product development, the IoT platforms and ecosystems supporting smarter, more connected products need to make plans now how they’re going to keep up. Relying on technology alone, like many IoT platforms are today, isn’t going to be enough to keep up with the pace of change coming.   The following are 10 ways AI is improving new product development today:

• 14% of enterprises who are the most advanced using AI and ML for new product development earn more than 30% of their revenues from fully digital products or services and lead their peers is successfully using nine key technologies and tools. PwC found that Digital Champions are significantly ahead in generating revenue from new products and services and more than a fifth of champions (29%) earn more than 30% of revenues from new products within two years of information. Digital Champions have high expectations for gaining greater benefits from personalization as well. The following graphic from Digital Product Development 2025: Agile, Collaborative, AI-Driven and Customer Centric, PwC, 2020 (PDF, 45 pp.) compares Digital Champions’ success with AI and ML-based new product development tools versus their peers:

PWC DIGITAL PRODUCT DEVELOPMENT 2025: AGILE, COLLABORATIVE, AI-DRIVEN AND CUSTOMER CENTRIC, 202

• 61% of enterprises who are the most advanced using AI and ML (Digital Champions) use fully integrated Product Lifecycle Management (PLM) systems compared to just 12% of organizations not using AI/ML today (Digital Novices). Product Development teams the most advanced in their use of AL & ML achieve greater economies of scale, efficiency and speed gains across the three core areas of development shown below. Digital Champions concentrate on gaining time-to-market and speed advantages in the areas of Digital Prototyping, PLM, co-creation of new products with customers, Product Portfolio Management and Data Analytics and AI adoption: