Why business leaders should embrace Artificial Intelligence
Artificial Intelligence is in media mania right now. However, beyond the hype and neon lights, it is clear that AI is becoming the new essential technology for business. If you have only just started thinking of being digital or being mobile-first then you’re probably already behind the curve — business leaders will need to start thinking about how to become ‘AI-first’.
Artificial Intelligence at a tipping point — get ready for lift off
AI had a stunning breakthrough last year when Google DeepMind’s AlphaGo computer programme defeated the world GO champion. This achievement proved that AI is now able to complete complex tasks that would take people years to master. And indeed, Artificial Intelligence has already mastered a remarkable list of human tasks, ranging from translations to more creative undertakings like writing music and film scripts.
It is not hard to imagine the potential and relevance of AI for the world of business. Many businesses deploy consultants these days to help resolve the most critical and complex business decisions, often at significant cost over several months. AI can now do the work of hundreds of the brainiest people in a matter of seconds. At the current pace, AI will quickly establish itself as a critical technology running through every business process.
CEOs can’t afford to take a ‘wait-and-see’ approach; AI’s capabilities are at the tipping point of exponential adoption and impact. A combination of the plummeting cost of computer processing power, increasing availability of data, and democratization of open source machine learning tools, allow any company to become AI-enabled. These technologies are evolving so rapidly that you will struggle to catch up if you’re not on the ball already. As the Singularity Hub team would say: ‘Ignoring AI today is the equivalent of ignoring the rise of the Internet 15 years ago’.
Using AI to build your company’s defensive moat
Companies need a deep, defensive moat to fend off competition and develop a sustainable and profitable business. In recent times, scale and network effects were some of the principal sources of competitive advantage. Intelligence is the next battleground.
With the application of AI in the business world still nascent, deploying AI now can be a company’s secret weapon for growth. AI can help outsmart the competition — even competitors with previously considered unbeatable scale and network effects. Of course, the flipside is failing to place AI in your DNA today, and becoming obsolete tomorrow.
So where to start?
Get familiar with AI: The technologies underlying AI can be highly complex and technical, so start small by applying AI to specific processes and decisions in your business context.
Prioritise opportunities to deepen your moat: Top AI talent is in very short supply, so it’s important to focus scarce AI resources where large pools of proprietary data can be deployed to improve the most critical business decisions and processes. Build a competitive edge through data advantage.
Invest in your data infrastructure: Data is the new oil. Many companies are sitting on enormous un-tapped data reserves, but they are often scattered and in incompatible data formats. Companies should invest to make sure they can extract as much value from their data as possible.
Don’t reinvent the wheel. A good data scientist can already do a lot using the open source AI tools made available by Amazon and Google. Leverage these to the max.
Set up your team and pilot projects: Talent is probably your biggest constraint, so set up your team and identify gaps. Invest in pilot schemes and be prepared to fail.
Prepare to fail
For all its potential, AI does have a ‘dark side’ to be aware of and get comfortable with. While AI algorithms perform the programmed tasks they master exponentially better than their human counterparts, they are still prone to gaffes. AI is not flawless and does make mistakes, albeit at a lower frequency than a human. For non-critical business tasks, such as advertising, and product recommendations, such mistakes might be considered tolerable. This can become more problematic, though, as AI becomes more critical to the heart of a business, for example, independently determining product pricing, or who is eligible for a loan. CEOs should allow for some (costly) failures.
Having to deal with wrong decisions is one thing (and arguably part of everyday life). Not being able to explain why a bad decision has been made is another. AI algorithms can be so complex that even engineers struggle to explain the underlying drivers of any given AI decision. AI is a black box and requires leaps of faith. This can be highly unsettling, but CEOs must accommodate failure as the price of succeeding in the long run. Ultimately, AI is no longer a peripheral technology, but potentially the key to unlocking an organisation’s competitive advantage.
