Potentials and Limitations of Generative AI in Smart Service Development

Abstract

The development of smart services faces challenges from constantly evolving customer requirements and an increasing complexity and interdisciplinarity. Recent progress in machine learning and natural language processing offers innovation opportunities but also poses ethical and implementation challenges, necessitating strategic planning efforts from organizations. Organizations must understand the capabilities and limitations of Generative AI to enhance customer experiences and operational efficiencies effectively. To address that issue, this study provides an in-depth analysis of the potentials and limitations introduced by Generative AI in the development of smart services by conducting 17 expert interviews, contributing to the existing literature on smart service development. On the other hand, it discusses the potential transformative impact of Generative AI on established smart service development methodologies, thereby enabling new strategies and opportunities.