We are living in uncertain times. The COVID-19 pandemic, the war in Ukraine and the energy crisis are all contributing to a volatile marketplace.
The term VUCA, coined by the US military after the cold war, perfectly encapsulates the current landscape. VUCA stands for volatile, unpredictable, complex, and ambiguous. In a VUCA world it can be extremely hard to predict the future based on current information. However, whilst we may not be able to change these external factors, we can adapt and harness the potential of these situations to overcome challenges.
“The time is now for companies to make bold investments in technology and capabilities that will equip their businesses to outperform others,” said global management consulting firm McKinsey & Company in a 2021 paper entitled “The new digital edge: Rethinking strategy for the post pandemic era.” Certainly, investment in technology is essential to stay ahead of the competition, but with a huge number of products and solutions on the market where is this investment best placed?
Hyper-automation, a term first used by technological research and consulting company, Gartner, addresses the application of advanced technologies, including artificial intelligence (AI) and Machine Learning (ML) to increasingly automate processes and complement people and business.
Hyper-automation is the next stage in the evolution of automation, working with both routine tasks and complicated business operations by utilising technologies such as AI and machine learning. Hyper-automation simulates human activity, forming a digital twin for any operation, improving scalability and performance.
“Hyper-automation has shifted from an option to a condition of survival… Organizations will require more IT and business process automation as they are forced to accelerate digital transformation plans in a post-COVID-19, digital-first world,” said Fabrizio Biscotti, research vice president at Gartner.
Hyper-automation in fuel retail
To succeed in this current climate, companies must extract maximum value from their core business by using traditional and digitally enabled levers. For fuel retailers, selling fuel is part of the core business. Pricing that fuel using a data-driven approach to extract maximum value is a perfect example of hyper-automation.
PriceCast Fuel is A2i’s dynamic fuel pricing solution. It has been designed from the ground up as a decision-making system. Instead of defining a set of simple well-defined tasks such as rules reacting on competitor observations, PriceCast Fuel uses AI in the pricing process – effectively creating a digital twin to the pricing analyst.
Not only does this free up human resources, making you less dependent on highly trained employees (which can be hard to find), it also elevates your focus from fine-tuning tactics to achieving strategic objectives.
Pricing in a volatile market
Each country and each market have been affected differently by the pandemic, the war in Ukraine and the energy crisis. AI-driven fuel pricing has helped retailers to maintain a pro-active pricing strategy, even in an unpredictable market.
In times of volatility, traditional models, which are often tied to normal distribution patterns on linear scales, start to fail. This results in a flood of chaotic data, making the chances of navigating a crisis situation limited.
No-one can predict the unpredictable, but AI models can handle large chaotic sets of data and spot non-linear, complex patterns. This allows the AI to make predictions on a higher level and ensures it continuously adapts in the ever changing new-normal.
We don’t always know what is around the corner, but one thing is certain – fuel retail sites are evolving.
Alternative fuels such as EV and hydrogen are a looming threat to the core business of selling fuel. From 2035 the sale of new fossil fuel cars will be banned across Europe and in some states in the US – and forecourts are already having to adapt. We are witnessing traditional fuel sites evolving into fuel hubs which offer increased convenience.
Today A2i is providing PriceCast Fuel for the pricing of traditional fuels, but that won’t be enough for the customer of tomorrow. In the future customers will visit a fuel hub for any number of reasons and the next phase of technology will need to not only understand their intention for visiting but provide incentives to keep them coming back to the site. That is called hyper-personalisation, and that is for another day…