Image by Blake Richard Verdoorn

Turning an old product into a digital product

It's not enough to make a product / service "smart" — by connecting it to the Internet {Internet of Things} — but make it "intelligent" — by adding artificial intelligence {AI}

Making a product digital — step one:

By connecting things to the Internet they become what we call "smart". They become Internet of Things (IoT). Right now we add the Internet to our organisation, to our service, to our products. It changes logistics, sourcing, it changes production, distribution, marketing, HR, etc. Our business becomes "smart".

Making a product digital — step two:

When it comes to the Internet of Things one thing we talk about is the "smart home". Here it's not only that the individual household item becomes "smart" by the ability to communicate, but that they communicate with each other. The fridge with the heating of the house, with the audio sound system in the house, with the entertainment system, with the car, with the security system, etc.

The same goes for our business. Production communicates with HR, with sourcing, with logistics, with etc.

Making a product digital — step three:

The Internet of Things for the home are underway and it's not a new thing anymore. It's a market which has grown up. A market though which is interesting and which still is within its infancy is the "smart city". It's where the Internet gets applied in the public space, for society. For example, it's a road with sensors that tells you of a free parking space near you. Or it's the traffic light which adjusts the green light to the amount of traffic or creating green waves.

Also brands can think about ways their product could contribute to the public space. One example is Uber. It not only makes your mobility and that of goods in an urban environment easy, but it also helps solve the challenge a city has with traffic. Another example is Airbnb, Airbnb helps make use of existing accommodation, it helps solve the challenge of a city with housing.

These concepts not only help individuals but help solve problems the public has, people as a group has. That's when it gets really interesting.

The question is, how could your product using the web help solve a problem a group of people has, the public has?

Making a product digital — step four:

This is where I want to get to. What if a product is not only "smart" but "intelligent"? What if you not only add the Internet, and we expect that, but what if you add artificial intelligence (AI) to it?

Already technology first companies are using AI. Google uses AI in Search, in Google Now, in Google chatbot, image recognition (Google enables you to instantly search for specific people, places, and things buried in your personal collection of photos), understanding language, voice recognition, etc. Facebook uses AI in identifying faces in the photos you post in status updates. And in deciding what users would see on their News Feeds. Amazon uses AI in predictive analytics, like sales predictions, fraud predictions, price prediction, forecasting recommendations in search. Microsoft uses AI in Cortana, and Skype Translator, for example. Apple uses AI in Siri.

And if you're watching their latest acquisitions and investments, it's in the field of AI.

So what actually is the difference from "smart" to "intelligent"? What is AI capable of doing?

• AI makes sense of, and suggests things based on, large amounts of data (big data)
• logic reasoning, case-based reasoning, as a multi-agent finding agreement between more than one artificial agent (sorry, that sounds a bit complicated)
• it enables a product or service to be autonomous (it operates without the need of human intervention)
• it can do predictive analytics
• it learns and improves over time
• understands speech, images, and language
• one kind of AI is able to do one task really well, that enables it to replace human workers

Let's look a bit closer into AI and what's happening in AI at the moment. And let's look at the options how to collaborate with some of the players in AI. One big player in the field of AI is IBM with Watson.

In 2011 Watson won on the quiz show Jeopardy. Maybe you've heard about it.

This is how Watson works today:

This is how you can use it. Basically you use IBM Watson's API. They make AI available for others, democratising AI. You can do it via the IBM Bluemix site.

This is how a case could look like:

Concept by Laila von Alvensleben, Camilla Canais, Philip Lofstedt, Kenn Massesson

This is how an actual case with IBM Watson looks like, IBM Watson invested in Pathway Genomics, the result: "users could ask how much exercise they should do that day, how much sleep they should get or how much coffee they should drink. The app will then instantaneously reference medical journals and clinical trial data in order to make personalized recommendations based on the user’s genetic and lifestyle data." (source: zdnet.com)

Another case is UnitedUs, an online service for matching job seekers with employers. It uses Watson's "personality insights" service. The person looking for a job fills out a brief online application, which asks for permission to mine their public Twitter messages, Facebook posts or other social media writing. The Watson personality-assessment service then generates a report for the employer to have a more complete picture of the job seeker (source: nytimes.com).

Third case, the consulting firm Case Strategy uses Watson to read, sort and assess vast amounts of financial, market and competitive data — from public government information, private sources and online social networks — to suggest growth opportunities for corporate clients (source: nytimes.com).

Through a web app called Chef Watson, millions of ingredients and recipe combinations come together to create innovative dishes.

Now enough marketing for IBM Watson.

Google released TensorFlow, open sourcing the software engine that drives its AI services. Microsoft makes its AI available with Project Oxford, with for example, one API called Emotion API, that recognises emotions expressed on a face. The $1 billion nonprofit called OpenAI vows to share all of its AI research and technology with the outside world.

So while you do a digital transformation of your product and service — go all the way. By adding AI. Just think of what your product or service could be if it would truly be "intelligent".