Value Assessment of AI Products and Applications

Valuation of AI products and applications

"The value creation through AI technologies is complex: when it comes to monetary evaluation, a distinction needs to be made between internal and external costs as well as benefits. To ensure transparency and comparability, a uniform calculation logic should be pursued throughout the company."
Daniela Rittmeier (Head of AI Hub, AI CoE BMW Group)

The increasing use of artificial intelligence (AI) presents unique opportunities and challenges for companies, as experienced by AI practitioners. In this whitepaper and accompanying interactive evaluation tool, appliedAI, together with affiliated industry and technology partners, presents ways to quantify the value contribution of AI products and applications.

The calculation of Return on AI (ROAI) is based on five central internal and external drivers of return that should be taken into account when calculating the financial benefits of an AI application. Regarding investment expenses, the most relevant cost categories along the ML lifecycle have been detailed.

The authors recommend a strategic perspective that aims to capture short-term AI value pools while also preparing to fully leverage the long-term value potential of AI by reinvesting released resources and applying collected experience to increase the overall AI maturity of the company.

Given the significant investment required to achieve significant returns from AI, this paper presents a ROAI portfolio approach and a five-stage process for operational AI portfolio management based on best practices from appliedAI partner companies.

Authors of the whitepaper:

  • Jannik Seger, Senior AI Strategist at appliedAI
  • Dr. Philipp Hartmann, Director of AI Strategy at appliedAI
  • Dr. Andreas Liebl, Managing Director at appliedAI

The authors would like to thank Clara Laufenberg, Clara Mehler, and Christian Wender for their invaluable contributions to writing this report and developing the associated tool, as well as Henrike Noack for designing this publication.