An Introduction to Artificial Intelligence, Machine Learning, and Data Science

Written by Mario Biscocho

Data, as they say, is the new oil — such that whoever has control or makes the optimum use of it comes out ahead in this economy. Artificial intelligence, machine learning, and data science are tools available to make sense of so much available data; and making use of algorithms, being able to provide insights, and even predicting consumer behavior, lead to making sound decisions that translate to profitable business. Simply put, these tools help us make use of available data to come up with insights that determine the proper course of action.

Below are some examples presented during the conference, “Applied Analytics for Competitive Advantage: Data Strategies for Disruptive Impact,” held last September 5-6, 2018:

• ZestCash, a financing company operating in some states of the U.S., providing unsecured loans, found out — through an algorithm on data derived over time — that borrowers who write their full names in uppercase letters (JOE SMITH) are of higher credit risk compared to those who only do so at the beginning of their names (Joe Smith).
• Harrah’s Casino made use of so much data run through algorithms that they can predict the perfect time to intervene when a customer is already on a losing streak. The idea is to offer those customers a break by offering meals or snacks. Such strategy was appreciated by customers and has improved customer experience at Harrah’s. This was an illustration of the tools’ use to foster customer intimacy.
• Meanwhile, Woolworths came up with a predictive study, which suggests that customers who drink lots of milk and eat lots of red meat pose lower auto insurance risk. On the other hand, those who drink spirits, eat lots of pasta and rice, and buy gasoline at night have higher auto insurance risk.

As time passes, we see more of the rapid emergence of a data-driven business world — data is deconstructing legacy business. One of the industries severely disrupted through data is banking. In the olden days, big banks used to dominate the world, gorging small financial companies along the way. Gone are those days for, today, banks are being disintermediated by smaller firms (fintechs) who have better use of data. Therefore, they are attuned to the needs of their clients and, in the process, are able to provide needed services. The challenge for these big banks now is to move nimbly and start making use of data to get closer to customers.

The two key components of business, as present-day pundits would say, are resources (assets) and information (data). Resources have less value over time, while information and automated decisions gather more value over time. This brings us to a discussion of the following:

• In the long term, who wins in mobile — the manufacturers (Motorola, HTC, Samsung) or the data companies (Google, Facebook, Uber, Amazon)?
• In the long term, who wins in autos — the manufacturers (Ford, GM, Toyota, Volkswagen) or the data companies (Google, Facebook, Uber, Amazon)?
• In the long term, who wins in pharma — the manufacturers (Novo Nordisk, Lilly, Johnson & Johnson, Novartis) or the data companies (Google, Facebook, Uber, Amazon)?

Whereas in the industrial revolution of old, the winner almost always was the one who made something the cheapest and was able to leverage scale. In the current and, perhaps, future wars, the winner will be whoever makes best sense of data — and still able to leverage scale. In other words, whoever has the better software and data science team will emerge victorious since they will be able to get a hold of the massive (and incredibly valuable) data badly needed by the business.

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About the author:

Mario is the Senior Vice President and Managing Director of the Executive Search and Selection Division, and HRD Consulting Division of John Clements Consultants, Inc. He has been with the company since 1986, initially handling sales and business development. Mario has also taken leadership positions in other John Clements business units: Professional Staffers and PT John Clements Indonesia.

Mario received his undergraduate degree in business management from the Ateneo de Manila University, and he has earned MBA units from the Ateneo Graduate School of Business. He has attended numerous training and development programs, locally and internationally.