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The internet is now brimming with numerous Artificial Intelligence (AI) solutions. Despite this, some companies still rely on open-source AI technologies. While ChatGPT, DALL-E, and other Generative AI technologies are lucrative tools for creating marketing insights, some businesses need a more specialized approach to improve their operations. In this blog, we’ll take a look at the differences between Proprietary AI technologies and Generative AI and how you can identify the best kind of AI solution for your business.

Understanding Proprietary AI and Generative AI

According to IBM, more than 35% of companies worldwide are now using AI for their businesses, and an additional 42% are currently exploring using it. The popularity of the ChatGPT has brought unprecedented growth to the AI industry, which is now expected to reach a total market value of $100 billion.

Undoubtedly, AI technology is now the new path for the B2B and SaaS industries. So, it’s no surprise that numerous tech companies are now investing in creating AI products. While the number of options gives businesses more freedom, finding the right solution for your business has never been more challenging.

From the name itself, Proprietary AI is a set of AI solutions created and owned by a specific company. These tools are usually created through private research and development, with technologies protected by patents, copyrights, and intellectual property rides. The solutions’ data, codes, and algorithms are not publicly available, allowing companies to maintain a competitive edge in the market. On the other hand, Generative AI technologies mostly use open-source databases to create deep learning models. ChatGPT and DALL-E are one of the most popular Generative AI models. These tools can pretty much be used by everyone, making it a quick and easy way to deploy AI technology for your business.

Both Proprietary AI technologies and Generative AI solutions have greatly contributed to the rise of AI in the business industry. While their power is definitely undebatable, their effectiveness still lies in proper use and adjustment by companies.

Benefits of Proprietary AI Technologies

Numerous businesses are now using Proprietary AI technologies to improve their business operations. Here are some of the benefits they currently enjoy:

Tailored to specific business needs

While AI technologies are indeed powerful, it doesn’t change the fact that businesses remain to be complex organizations with numerous operational units. Today, most businesses use AI technologies for customer service. 73% of businesses use or plan to use AI-powered chatbots for instant messaging, while 61% of companies use AI to optimize emails. Despite this, great customer service doesn’t guarantee high revenue generation, nor can it give you efficient streamlining of tasks among your employees. Each operational unit needs specific tools to streamline its operations to ensure efficient workflow within the business.

Greater control and customization options

The rise of AI technology made the business industry much more consumer-focused through personalization. Recent surveys suggest that personalization is not just preferred but expected by 56% of customers, while 69% are open to using AI to boost their purchasing experience. While prompts on Generative AI can give businesses opportunities to create customized results, products, or services, they would still be based on generic data sets. Proprietary AI, on the other hand, allows businesses to customize their data, code, and algorithm to suit their clients’ needs better, leading to better customer satisfaction.

Higher levels of data security and privacy

Data security and privacy have been the biggest issues of open-source AI technologies. In May 2023, OpenAI, creator of ChatGPT, confirmed that a chatbot’s source code bug may have caused a data leak. Cases like this could be extremely dangerous for businesses, especially if the AI algorithm is used for revenue management. Companies using Proprietary AI solutions are less susceptible to data breaches. Business owners can be confident that all of their data would remain only for the disposal of their own team.

Better integration with existing systems and infrastructure

Seamless integration with different POS and CRMs is one of the leading features of Proprietary AI. Since the data sets and algorithms would be tailored fit for the business, they can design it in such a way that it could easily fit into existing systems and infrastructures of the business. This makes Proprietary AIs more cost-efficient, as they wouldn’t need to overhaul their entire operations to make way for the new solution. Remember that one of the key considerations when deploying tech solutions is that it should improve what is already working for the company and its clients.

Advantages of ChatGPT, DALL-E, and Other Emerging AI Technologies

While proprietary AI technologies are powerful, there’s no denying that using Generative AI also has its own advantages. Let’s take a look at each of them:

Ability to handle complex tasks and generate creative outputs

If Proprietary AI is the best option for more specified business tasks, Generative AI is great for making creative outputs. The open-source datasets give the algorithm numerous styles, techniques, and strategies for creating marketing assets catering to a general audience. Despite this, it’s best that creative outputs generated by Generative AI would be further improved with personalization. Furthermore, Generative AI can do complex tasks in the easiest and most efficient way possible. Its machine-learning capabilities have been trained for numerous tasks, making it a perfect tool for automating repetitive tasks and creating initial business plans.

More accessible and affordable than proprietary technologies

Proprietary AIs can be really expensive, as users are expected to shoulder the cost of the research and development of the solution. On the other hand, open-source AIs can be deployed to your team’s workflow even without the need for integration. The accessibility and affordability of Generative AI tools can be really helpful for companies that are still thinking about using AI solutions for their business operations.

Opportunity for constant and rapid upgrades with ongoing research and development

The research and development of Proprietary AI technologies usually take a long time, depending on the use case. The development processes, such as data mining, preparation, algorithm training, and troubleshooting, are already pretty taxing, but the organizational requirements of the governing company could even slow them down. On the other hand, open-source AI technologies are mostly created by a community of researchers and developers, which speed up the process of upgrades and algorithm improvements. While the fact that a single entity doesn’t oversee them could lead to bias and deployment issues, it definitely contributes to the speed of the development.

Disadvantages of ChatGPT, DALL-E, and Other Emerging AI Technologies

As mentioned a while ago, open-source AI technologies aren’t always the best options when it comes to business use. Here are some of the disadvantages of using public AI technologies:

Biased models 

Open-source AI solutions require sizable and varied datasets to operate. Most of the sources come from public assets, which are produced without thorough research. Because of this, these AI solutions are prone to running biased and erroneous datasets. This may cause poor business operations workflows that could gravely affect your brand reputation and customer trust, leading to revenue loss.

Ethical problems and external regulations

As early as 2016, the World Economic Forum has already expressed its concerns about the growing ethical problems surrounding the use of AI technologies. Some of the most pressing moral concerns are connected with issues of privacy, security, and accountability when AI is used in delicate fields like healthcare and criminal justice. For this reason, companies that run open-source AI technologies are at risk of facing legal repercussions, financial penalties, and reputational harm. While legal teams can mitigate possible negative effects of these ethical problems, they may not be able to control the public’s reception towards your brand.

Security and Compliance

Emerging AI technologies have the highest susceptibility to data mishandling and mismanagement because of their large database. This may result in serious security and privacy compliance issues such as security lapses, data leaks, and abuse of sensitive information. For this reason, organizations that plan on fully automating their business operations using open-source AI technologies should have strong data security and compliance committees that will oversee the use of AI. 

Finding the Best AI Solution for Your Business

Deploying the wrong AI tool for your business can create numerous problems for your business. Because of this, it’s essential to know the key factors to consider when finding an AI solution for your business:

Assess your business needs and objectives

Finding the exact areas of your company where AI could add the greatest value should be your first step. These areas may include enhancing customer service, streamlining operational procedures, employee management, and more. After identifying the operational unit where you would deploy AI, it’s highly recommended to compare various solutions based on their features, capabilities, and suitability for integration with your current infrastructure and systems. 

When choosing an AI solution, it’s also necessary to consider data protection, security, and ethical considerations. To ensure that your AI tool would not cause any severe issues, it’s imperative to do maintenance reviews, employee training, and risk assessment procedures.

Weigh the pros and cons of proprietary vs. generative AI technologies

Although proprietary technologies can be more expensive and less flexible to changing business needs, they give firms more control, customization possibilities, and data security. These things eventually lead to better conversion rates and higher revenue generation. On the other hand, emerging technologies like ChatGPT and DALL-E frequently offer greater flexibility, thus giving you the opportunity to use them in numerous business areas without breaking the bank. However, there may be hazards associated with data bias, ethical issues, and compliance problems, which can gravely affect the business’s reputation. 

Weighing these aspects against your unique business goals and objectives can help you choose the finest AI solution for your company. Speaking with AI vendors and specialists is highly recommended to learn more about each technology’s potential and possible drawbacks. 

Consider financial factors such as cost, scalability, and ease of implementation

Just like any business expense, it’s imperative to consider your budget when deploying AI solutions for your business. While the upfront price of some AI tools can be enticing, their maintenance fees, training costs, and integration payments can be expensive. Worse, you cannot commit to these payments once you’ve deployed the AI tool, as it may cause more trouble to your business operations. 

Another important consideration is scalability. Nowadays, scalability has become a key driver for growth in high-tech businesses. Because of this, it’s best to make sure that your AI system can grow and develop with your company. You must be able to swiftly and easily incorporate the AI solution into your current processes without interfering with regular company operations is also crucial. You may also want to consider the technical expertise needed to use the solution and the quality of vendor support. 

AI Consulting to help you decide

Ultimately, it’s best to reach out to AI consulting companies to help you decide on the right AI solution for your company. While you can benchmark best practices from leading brands, nothing beats running scientific analysis and research to identify the key AI features your business needs. From verifying datasets, monitoring algorithms, overseeing codes, managing employee training, and running risk assessments, each of these deployment phases would be supervised by AI experts to ensure that your AI solution will align with your business objectives.

Aside from this, AI consulting firms can also help you get the best value offers from tech vendors. They can check follow-up costs such as troubleshooting, integration, and upgrade procedures, allowing you to fully maximize your budget. Most importantly, AI research companies can help you detect biases, erroneous data, and faulty algorithms that may cost you more than deploying your AI. It will help you prevent serious issues that may scathe your business in the long run. 

Conclusion

As AI continues to influence how we do business, it’s critical to fully understand the advantages and disadvantages of both proprietary and developing technology. Emerging AI technologies like ChatGPT, DALL-E, and others provide distinctive advantages like the ability to handle difficult jobs, affordability, and constant evolution. Proprietary AI technologies offer customized alternatives, greater control, and stronger data protection. It’s critical to evaluate your company’s needs and goals, compare the advantages and disadvantages of each solution, and consider aspects like cost, scalability, and simplicity of implementation. 

Ultimately, continually investing in research and development can help your company stay one step ahead of the competition and find the ideal AI solution to suit your particular requirements. Keep in mind that there isn’t a single, perfect solution when it comes to AI, so take the time and talk to AI research and development specialists to find the right fit for your business.