AI is not a Magic Bullet

Artificial Intelligence (AI) is not a magic bullet. It will not run your business for you; and, as depicted in a lot of movies and TV shows, it will not destroy the human race (although it may modify it some). AI is not the answer to life, the universe and everything – but it is changing the way organizations conduct business and showcasing the power of properly leveraged IT.

So what is AI? In a simplified nutshell, it is computer code that can learn and modify itself based on that learning – like when your phone seems to anticipate the next word in your text message, or tells you about your commute time without your asking, for example.

AI is difficult to create and very few companies will ever hire an AI engineer. (As it stands now, current salaries for AI expertise can top $1M.) Where most small to medium sized business will encounter AI is by buying cloud-based applications.

The algorithms, computing power, storage capability and hardware needed for modern AI can be rented. Google, Amazon, Microsoft, Salesforce, and other companies are making powerful machine learning infrastructure available via the Cloud. Even better, as these companies compete, business customers should see increasing capabilities at steadily decreasing prices.

Why does this matter? Because it makes your data matter.

The Harvard Business Review article “The Business of Artificial Intelligence,” provides an example of how Deep Learning/Machine Learning can be used:

“Udacity cofounder Sebastian Thrun noticed that some of his salespeople were much more effective than others when replying to inbound queries in a chat room. Thrun and his graduate student Zayd Enam realized that their chat room logs were essentially a set of labeled training data — exactly what a supervised learning system needs. Interactions that led to a sale were labeled successes, and all others were labeled failures. Zayd used the data to predict what answers successful salespeople were likely to give in response to certain very common inquiries and then shared those predictions with the other salespeople to nudge them toward better performance. After 1,000 training cycles (experiences), the salespeople had increased their effectiveness by 54% and were able to serve twice as many customers at a time.”

This is a great example of machine learning; however, the person asking the question had a general sense of the outcome they were seeking. True AI might ask a question on its own, and generate data not previously considered. Sales optimization is just one example of how AI will ultimately be leveraged to help an organization. Automation and CRM for 360 degree views of customers are another.

AI for ROI

Tons of science fiction stories have shown artificial intelligence turning against us — but the TV show “Person of Interest” broke new ground in showing that AI must be developed to produce the desired outcome. This is always true in business. Before you invoke any tool, make sure you understand what it is you are trying to accomplish.

What does properly implemented AI mean for your company? According to x.ai, AI with true business ROI:

• Solves a business problem that is wasting money, time, or resources
• Can be adopted at scale to address depth of problem
• Is more cost-effective than pre-existing or internal solutions
• Features AI/Machine Learning that’s vital to the solution
• Shows you relevant information you do not already know (or suspect)

So, my suggestion:

Do not create an AI strategy and do not focus on AI roadmaps! Instead, create customer-centric initiatives that leverage existing AI solutions to solve problems and improve the customer experience. Target business processes for improvements that generate unleveraged information – think about how AI learning capabilities might improve those processes. Most importantly, test it out first – a pilot project alone could save significant time and money.