21 November 2019
Econ 4.0: Keep an eye on AI?
This article first appeared in Enterprise, The Edge Malaysia Weekly, on November 11, 2019 – November 17, 2019.
Here is a tech fable with a testy twist. In the foreseeable future, the interconnected computational power of the internet self-creates an artificial intelligence (AI) app and invites the world’s best brains to contribute their collective knowledge directly to it. In return, the app offers to solve the most complex problems plaguing mankind.
Over the next six months, the world’s intelligentsia upload their collective knowledge to the app. A meeting is then called by the UN, where world leaders get the app to solve complex problems such as poverty, climate change, biodiversity and living in outer space.
After an hour of debate, the UN Secretary-General asks the app a deep question: “Is there a God?” The app takes a full 15 seconds to respond, “Yes. Now, there is.”
If that sounds like an ominous prediction, it is — or it is not — depending on which side of the AI fence you are on.
On the anti-AI side are people like Tesla CEO Elon Musk. Late last year at the US National Governors Association, he said AI posed a fundamental risk to the existence of human civilisation. On the pro-AI side, Facebook CEO Mark Zuckerberg posted a video calling such negative talk “pretty irresponsible”.
Philosophy aside, most businesses are pretty bullish about AI and are set to plonk US$98 billion on AI-related solutions and services by 2023 — up a whopping 250% over the US$37.5 billion they will spend this year, according to the latest estimates by International Data Corp (IDC). That is a compound annual growth rate (CAGR) of 28.4% between 2018 and 2023.
“The use of AI and ML (machine learning) is occurring in a wide range of solutions and applications, from ERP (enterprise resource planning) and manufacturing software to content management, collaboration and user productivity. AI and ML are top of mind for most organisations today. We expect AI will be the disrupting influence that will change entire industries over the next decade,” says IDC research director for cognitive and AI systems David Schubmehl.
Which sectors are leading the charge? Retail and banking. Each is set to invest more than US$5 billion this year. Nearly 50% of the retail spending will go to automated customer service agents, expert shopping advisers and product recommendation systems. Meanwhile, the banking industry is focusing on automated threat intelligence and prevention systems as well as fraud analysis and investigation.
“Other industries that will make significant investments in AI systems include manufacturing, healthcare and professional services. The fastest growth in spending will come from the media and government agencies, with five-year CAGRs of just over 33% for each,” says Schubmehl.
What is ironic is that humans train AI and ML systems, but AI programmes are ideal to train humans in both hard and soft skills, such as sales. Using AI for sales training and coaching can provide a more individualised learning experience that can scale across the company. That is because creating a high-performing sales force is difficult with traditional training and coaching technology, says Gartner Inc.
“Training and coaching content needs to be delivered based on individual learning styles. Learning styles such as visual, auditory and kinaesthetic affect how sales reps receive training and coaching. They can create an imbalance in performance if not accounted for at scale,” says Melissa Hilbert, a senior research director at Gartner.
How does AI help? It can guide sales reps and managers with recommendations for training and coaching based on their learning styles. AI algorithms use “branching” — a way to guide an individual’s learning through a module based on responses — as well as adaptive learning, where the system directs the learner to appropriate training or coaching based on their interaction with it. Gartner predicts that by 2020, 30% of all business-to-business companies will employ some kind of AI to augment at least one of their primary sales processes.
Eye on AI in MY
Malaysia’s AI promise is a proposed US$1 billion AI Park that Prime Minister Tun Dr Mahathir Mohamad finalised on a recent visit to China. The park is a partnership between Malaysia-based G3 Global Bhd and Chinese firms SenseTime Group and China Harbour Engineering Company. The initiative will focus on AI apps in computer vision, speech recognition and natural language processing. Details on the park’s location are being worked out.
It is pertinent to note that SenseTime is currently the world’s most valuable AI start-up. It was founded in Hong Kong in October 2014 and received a US$7 billion valuation from Softbank. On July 1, Malaysia’s sovereign wealth fund appointed three new members to its board of directors, including SenseTime founder Xiao’ou Tang and Tencent Holdings Ltd senior executive vice-president Lau Seng Yee.
One hot opportunity: Grooming AI talent. Malaysia can potentially lead in this space in Southeast Asia. The government is planning to unveil a data-and-AI policy in due course.
“This policy is a priority of my ministry. We are now in the process of listening to inputs from all stakeholders. After that, we will sit down and formulate a policy. Once the policy is ready, I will take it to the Cabinet,” Communications and Multimedia Minister Gobind Singh Deo said in September.
He also said he was not going to set a firm deadline for the policy’s announcement. “As you know, technology develops day by day and it becomes more complex. The whole conversation about data and AI … perhaps by the middle of next year … I am not sure.”
One early adopter is the International Medical University (IMU), which is among the first to use AI to train medical students. In September, it tied up with Malaysia-based Fusionex plc to integrate big data analytics and AI into its medical and health sciences programmes.
“This is the direction that healthcare is heading towards and it is of utmost importance to enable our students to be AI-trained. I am excited to see how this can be extended to other programmes to benefit our students,” says Professor Abdul Aziz Baba, vice-chancellor and CEO of IMU
The collaboration is probably the first of its kind in Malaysia in which Fusionex’s platform, called Giant, will be utilised in conjunction with the medical expertise of IMU to work on crucial areas such as cancer informatics, advanced drugs, vaccine design and healthcare analytics.
Another hot area is smart city schemes. Last year, Chinese giant Alibaba Group Holding Ltd deployed its smart city AI platform in Malaysia, the first such deployment outside China for the group. Its first deployment of the AI platform was in Hangzhou, China.
Called “Malaysia City Brain”, the initiative is a partnership between Alibaba, Malaysia Digital Economy Corp and Kuala Lumpur City Hall. The programme uses AI software to analyse large volumes of data in an urban environment, captured via video, images and speech.
Malaysia City Brain can construct a virtual digital city model and optimise it using ML tools to help make decisions pertaining to traffic management, road layout and planning, bus frequencies and routes and the duration of time signals.
Power and potential
AI may have the power and potential to boost business performance in diverse industries. For instance, in predictive maintenance, AI can analyse large amounts of data from audio and images to detect anomalies in assembly lines or aircraft engines. In logistics, AI can optimise smart routing of delivery traffic and cut delivery times. In customer service, AI can become a valuable tool in call centres. In sales, past transactions, customer demographics and social media can help generate “next product to buy” recommendations.
McKinsey & Co analysed 400 use cases across 19 industries and nine business functions and found that AI improved traditional analytics techniques in 69% of the potential use cases. “Our research estimates that deep learning techniques based on AI could generate as much as 40% of the total potential value that all analytics techniques could provide, by 2030. Further, we think that several of the deep learning techniques could enable up to US$6 trillion in value annually,” says the global consulting firm.
Although many companies have begun to adopt AI, the pace and extent of adoption have been uneven. Nearly 50% of the respondents in a 2018 McKinsey survey on AI adoption said their companies had embedded at least one AI capability in their business processes while another 30% are piloting AI. “Still, only 21% said their organisations have embedded AI in several parts of the business and barely 3% of large firms have integrated AI across their full enterprise workflows,” says the report.
Will AI take over human jobs? Not to worry, says Gartner. By 2020, AI will create more jobs than it eliminates. In real terms, the technology will create 2.3 million new jobs by end-2020 while eliminating 1.8 million redundant ones. The number of jobs affected by AI will vary by industry. Healthcare, education and the public sector will continue to see growing job demand while manufacturing will be hit the hardest.
In the last 12 months, AI deployment grew from 4% to 14%, according to a Gartner survey. “Conversational AI remains at the top of corporate agendas, spurred by the worldwide success of Amazon Alexa, Google Assistant and others. Meanwhile, new technologies continue to emerge such as augmented intelligence, edge AI, data labelling and explainable AI. To assess AI’s value and risks, CIOs (chief information officers) need to set realistic expectations for AI,” says Svetlana Sicular, a Gartner vice-president.
A key area of concern? Governance. Companies that deploy AI need to be aware of the potential regulatory and reputational risks. “AI governance is the process of creating policies to fight AI-related biases, discrimination and other negative implications of AI,” says Sicular.
To develop AI governance, CIOs should focus on three areas: trust, transparency and diversity. “They need to focus on trust in data sources and AI outcomes to ensure successful AI adoption. They also need to identify transparency requirements for data sources and algorithms to reduce risks and grow confidence in AI. They should ensure data, algorithms and viewpoint diversity to pursue AI ethics and accuracy,” she adds.
Should you keep an eye on AI? Yes. Unlike all other previous technologies, AI is like a tsunami. That is because it has the potential to go into an area of thought that has so far been exclusive to human beings — intuition. It is akin to nuclear technology. It offers huge advantages, as well as poses big risks. So, it is crucial that companies and government agencies that deploy AI are cognisant of both sides of the coin.
Raju Chellam is vice-president of new technologies at Fusionex International, Asia’s leading big data analytics company
To learn more about Fusionex AI Solution: https://www.fusionexgroup.com/products/artificial-intelligence/