Disruption Through Artificial Intelligence

Anita Nickerson APRJ 699 Applied Project Paper “Disruption through Artificial Intelligence - an HR focus” Submission Date: December 30, 2017 Word Count: 14,999 Student Number: 3016273 Academic Coach: Angela Workman-Stark Academic Supervisor: Andy Igonor

Abstract

This paper examines how Artificial Intelligence (AI) has already impacted companies and will create further changes within the workplace. There are many theories that are both in favour of and discourage the use of this technology. This paper is a literature review and from the readings the writers suggest that AI is still in its infancy stage even though we are already using AI: in our homes, cars and at work. There are fears that as AI evolves, it may take over most jobs and create huge unemployment affecting our economies and society. The doomsday prophecy is even more bleak in that it will take over our systems, create wars, thereby eradicating the human race. Those who have a positive outlook view; AI will allow more time for individuals for leisure as well as to obtain retraining while offering better opportunities to pursue well paid AI related jobs.

The reader will learn about AI through the literature reviewed here and the potential benefits, disadvantages and risks, in order to understand before deciding to implement AI. The literature includes global studies conducted by large consulting firms on companies that currently or soon plan to use AI in the workplace. Some of the studies argue that AI will replace manual work with additional well-paying jobs. Other occupations will remain without major technological changes due to the complexities of the tasks that only humans can produce. There are scholarly theories and studies on how AI impacts workplace planning and how leaders will need to incorporate this in their current processes.

The trend for AI is not simply a fad; rather, it is here to stay. The question is when will companies embrace this technology and what roles and processes will be adopted to create organizational effectiveness. There is an AI race with global technology leaders (Apple, Microsoft, Amazon) to be the first to create real AI that will learn on its own and be truly autonomous—able to think like a human. The paper will provide recommendations on how to adopt AI using human resources and project management methodologies. The paper concludes that some jobs and industries will be disrupted, and new ones will be created in the future. The reader will understand what type of occupations will be available to them or become extinct in the future for their own career planning purposes. The paper demonstrates businesses can benefit in leveraging HR analytics, to provide objective information; in predicting for talent management purposes. Upon learning how AI can benefit business and the positive applications, readers will learn how AI can help them both personally and professionally. In order for organizations to remain competitive it is essential to plan for AI now, or else risk losing out to others who leverage this opportunity to become early adopters of this fascinating technology.

Table of Contents

Abstract ...... 2 Table of Contents ...... 3 Introduction ...... 4 Research Purpose and Questions ...... 4 Research Design ...... 5 Literature Review ...... 6 What is Artificial Intelligence (AI)? ...... 7 Goals of AI ...... 8 Benefits of AI ...... 9 Risks of AI ...... 11 AI and Workplace Disruption ...... 12 Jobs That Will Be Eliminated ...... 14 Industries That Will Be Impacted ...... 18 Jobs That Will Be Created ...... 21 Ethics and AI ...... 25 Case Studies of Select Organizations and Industries ...... 26 Findings and Discussion ...... 29 Recommendations and Future of AI in the Workplace...... 31 Conclusion ...... 35 References...... 36 Appendix A ...... 46 Appendix B ...... 47 Appendix C ...... 48 Appendix D ...... 49 Appendix E ...... 50 Appendix F ...... 51

Introduction

HR ONE Consulting Inc. (HRONE) is a boutique management consulting firm based in Toronto, Ontario. HRONE is comprised of two partners that provide human resources and project management consulting services. The strategic vision for HRONE is to provide high quality and impactful solutions for our clients that contribute to their success with positive economic results.

Technology has evolved in business and helped eliminate some drudgery from day-today manual tasks thereby creating efficiencies, improved productivity and reduced business costs. Additionally, the automation of routine tasks affords workers to focus on more strategic deliverables. According to Josh Bersin in his article “Catch the Wave” he found in his research that the payoff for companies is 23 per cent greater financial returns in automation. Technology is disruptive to HR and how companies operate. Automation will impact operations and it will grow exponentially in the future. Business work has evolved ranging from: using pen and paper, typewriters, to computers, robots and automation (Siri) which has resulted in job loss (Kaplan, 2016). Technology has been part of business for decades, used to improve and automate processes for organizational effectiveness and one of the latest to enter the workplace is artificial intelligence (AI).

The importance of this paper is for HRONE to remain relevant and plan on how AI can impact our business and our industry. The purpose of this study is to understand how AI is currently being leveraged in business along with future trends in order to find innovative, strategic solutions for our clients. The managerial domain of this paper is innovation within information technology and how AI will affect HR in business and its multiple stakeholders. This paper will be a literature review focusing on AI and its disruptive impact on the workplace today and into the future. Any business owner, leader or job seeker can gain advantage from reading this paper regardless of the size of the organization or location. In order for companies to remain competitive they will need to embrace this technology or risk becoming extinct.

Research Purpose and Questions

The purpose of this paper is to address the impact of AI while providing examples of industries that have been impacted by this technology. This paper examines benefits and disadvantages of this technology and any ethical implications and perceived risks in adopting this technology.

The research goal of this paper is to demonstrate to what extent AI can be disruptive to the workforce in a global context within large organizations that create or leverage this technology. Currently, AI and the use of very expensive robotics is cost prohibitive for

smaller companies that have less than $1Million in net profits. The rationale for using larger organizations is their access to available resources (money and workforce) to make this technological shift. Additionally, there is research and information readily available where AI has been created and/or adopted within larger organizations. Some of the research range from scholarly academic papers to large consulting firm (Deloitte, PwC, McKinsey) reports, documentaries, newspapers and other research information gathered from studies and surveys. Typically, a team of experts is required to implement this technology and these subject matter experts (SME) are hard to find, and command a high salary that smaller companies cannot afford. Small companies can still benefit from reading this paper to plan for the future when prices become more affordable for AI, robots, 3D printers, data (HR) analytics, etc. When technology first enters the marketplace the price point is prohibitive at the beginning and then costs decrease after new suppliers enter the competitive marketplace. We have seen price reductions with televisions, stereos, cell phones to 3D printers. [One may procure a 3D printer for as little as $1000.00 USD for hobby use.] The aim of this paper is to further add to the current AI literature in that AI is disruptive to HR and business.

It is assumed that AI is disruptive to HR and the research will provide insight on how disruptive, to which industries, in what countries and how it affects the workplace. The extent of the disruption will be explored through research and documented in a literature review. It is also assumed that the reader will have some knowledge of AI and possess a general understanding of this technology’s impact and how it affects numerous stakeholders including: business owners, leaders, employees, customers and the public.

Research Design

The purpose of the study is to research AI and how it affects business and work as we know it today and in the future. In this study, the paper will use a conceptual framework approach focusing on AI and explaining what are the future jobs that will be disrupted and which labour market to focus. The outcome of the literature review, suggests that applying AI to HR and project management methodologies is effective for future success in business. Based on the literature review we need to understand what is AI, how will it benefit business and what are the potential risks. This paper will address the following questions:

• Defining what is AI? What are the goals of AI? • How AI has impacted the workplace and caused disruption in the labour market? • What industries have been impacted by AI and what industries will be impacted in the future? • What are the benefits and potential risks of AI? • What is the future of AI?

Initially the study will set the stage for AI, and then take a closer look at how it will affect work and future jobs and how business needs to lead and develop this technological frontier in order to deliver successful future results.

The inputs to this study will include: articles, books, documentaries, lectures, newspapers along with research from various associations. The content utilized in this paper will be based on the last ten years.

Literature Review

Reviewing AI material, articles, essays, books, documentaries, current affairs and other related readings, there seem to be many thoughts as to what AI is and how it disrupts business and jobs as we know it. Yet, finding a universal and clear definition of what AI is, is challenging, as a learning thinking machine, is difficult to dispel on how the brain thinks. What is common in the vast technology literature is that they are saying the same thing but using different definitions and examples. Throughout this literature, the common understanding is that AI will disrupt business by eliminating mundane and boring work which will be replaced by more efficient and creative work. Both individuals and businesses need to prepare for this innovative technology through HR planning and change management practices. Current business processes will need to be reviewed, revised to incorporate new AI technology entering the workplace. This preparation needs to include training and development of employees in this bold new technology as well as succession planning by pipelining for skilled and knowledgeable employees in AI. It will also involve leaders in making decisions around planning on how AI will fit into their strategic business model.

There tends to be two viewpoints of how AI will disrupt the workplace; either positively or negatively. Elon Musk, inventor of Tesla, the world famous electric car, is fearful of this technology in that if not managed properly the end of the human race will transpire, similar to the Terminator movies. In Musk’s words “Artificial Intelligence will provide many societal benefits, including self-driving cars and improved medical diagnostics. However, with AI we may be summoning the demon and could create an existential risk to humanity.” (Forbes, September 28, 2017). The positive future outlook is that of Ray Kurzweil who is a computer scientist, sci-fi author, entrepreneur and futurist who believes that positive aspects will transpire in that the human consciousness will survive indefinitely and will surpass our mortal bodies. Another positive opinion by Facebook inventor and owner Mark Zuckerberg, stated that AI “will be better than humans at most basic tasks in 5 to 10 years”. (Loukides and Lorica, 2016). To add to the debate, some futurists believe that manual and mundane work will be replaced by better skilled and higher paid jobs, whereas others feel all jobs may be affected in that there won’t be enough new AI related roles. This imbalance may create societal unrest that could lead to increased crime () including theft, riots and revolt. Some solutions to this problem have been an income supplement plan provided by the government that allows society to not worry about money, to free their time for retraining and entering AI type careers. From the literature there is concern about government involvement in the process,

including regulating the technology. Those who are in favour of government regulation want to ensure AI doesn’t have authorization to release missiles or weapons without human involvement and approvals. For those who do not want to see government involvement it is also a concern that bureaucracy stifles innovation and creativity.

The specific management models or frameworks to prepare for AI technology require an understanding of the benefits and disadvantages, through lessons learned from other organizations, and planning for technology innovation disrupting your workplace, which involves reviewing current and future state processes. There are many opinions on how AI will affect the future; at the end of the day no one has a crystal ball to predict all of its implications either positive or negative. It is imperative to use different management skills to assess how AI will disrupt business including: strategy, resource planning, HR and legal, etc. Also, addressing as many stakeholders as possible in the decision- making process will be necessary prior to implementing this technology in the workplace. Communication and change management practices will also benefit the implementation including: Executive teams, HR, IT, Operations, Sales, Public Relations, Project Management and many other various departments. When planning for innovation one needs to assess current work processes and plan future steps for AI technology using strategy tools and techniques (SWOT analysis), HR concepts and project management methodologies.

What is Artificial Intelligence (AI)?

A new form of intelligence has begun to transform our world as we know it — it is called Artificial Intelligence. The impact of AI has often been compared to the advent of the Internet. Others say AI will be as transformative as the discovery of electricity. AI is intelligence exhibited by machines, rather than humans or other animals (also known as natural intelligence, NI). In computer science, the field of AI research defines itself as the study of “intelligent agents”: any device that perceives its environment and takes actions that maximize its chance of success at some goal. The term "artificial intelligence" is applied when a machine mimics cognitive functions that humans associate with other human minds, such as learning and problem solving. As described by Stuart Russell and Peter Nerving in their scholarly book “Artificial Intelligence: A Modern Approach” they describe AI by comparing human intelligence and that of a thinking and evolving machine.

“We call ourselves Homo sapiens—man the wise—because our intelligence is so important to us. For thousands of years, we have tried to understand how we think; that is, how a mere handful of matter can perceive, understand, predict, and manipulate a world far larger and more complicated than itself. The field of artificial intelligence, or AI, goes further still: it attempts not just to understand but also to build intelligent entities”. (Russell & Norvig, 2010).

Another definition by the founding father of AI, John McCarthy, describes it as “that of making a machine behave in ways that would be called intelligent if humans were so

behaving.” (Kaplan, 2016). A number of writers on AI refer to Alan Turing in their definition where a computer can pass the recognized and often coined term “the Turing Test”. This test involves a person not being able to know if they are working, talking or dealing with a computer or a human. “If a computer could show enough intelligence to pass as a human in conversation, the computer could be said to be ‘thinking’”. (Popular Science, February, 2017) The confusion continues on a clear definition of AI by delineating between “strong AI” and “weak AI”. The strong AI is similar intelligence that a human would demonstrate within the confinements of a computer. Whereas, weak AI can handle specific tasks or focus on a particular problem such as mastering games as shown by IBM’s Watson AI computer winning Jeopardy. This is a very narrow form of intelligence as machines can only focus on one thing or task.

A thinking machine needs data to learn from, make mistakes and grow. “Machine learning will help us make sense of an increasingly complex world. Already we are exposed to more data than what our sensors can cope with or our brains can process”. (Kaplan, 2016). The data to feed the machines can come from a company’s own internal systems and/or external information from: websites, databases and social media. The machine learning is built by programmers using software languages thereby creating algorithms. “In simplest terms, an algorithm is a set of step-by-step mathematical rules. They tell a computer how, exactly, to accomplish a certain task. What makes algorithms important for artificial intelligence is that they can also be written so that they learn on their own”. (Popular Science, February, 2017).

AI also comes in many shapes and forms ranging from: software algorithms (the programming language/code in computers that makes decisions) sometimes referred to as the brains of AI to the hardware—robots. Tasks and capabilities under AI may include: understanding human speech, competing in games (such as chess and Go), autonomous cars, intelligent routing in delivery networks, military use of drones, and interpreting complex data such as HR analytics.

Goals of AI

It is essential to determine what are the company’s objectives to leverage AI: be it for competitive advantage, creating organizational effectiveness or simply to follow suit with the competition or follow the AI trend. Like all technology or major change within a business one should consider their vision to ensure that AI implementation is strategically linked to the company’s objectives. Otherwise, the company risks wasting time, money and valuable resources on a fruitless project. One may ask if AI, like all technology, is being used for the greater good or are there more sinister reasons. Is AI going to be used to create more harm than benefit to the business stakeholders including customers? Technology if used correctly could help remove mundane, tedious tasks to free one’s time for more strategic work. According to consultants from the latest McKinsey Global Institute report it is imperative for early adoption of leveraging technologies such as AI as it can have “performance benefits such as quality and

speed, as well as greater efficiency and productive use of all factors of production.” (Manyika, et al, December, 2017).

As companies feel the pressure from external competitors, one of the strategies incorporates overall cost savings. A major cost to companies is employee wages (dependent upon how labour intensive the work is); which could be reduced by automation. According to Richard J. Long, Professor of Human Resources and Organizational Behaviour at the Edwards School of Business at the University of Saskatchewan states that “Canadian firms typically spend 40 to 70 percent of their operating budgets to compensate their employees. For most firms, compensation is the single largest operating expenditure”. (Long, 2016). This amounts to vast amounts of money according to Statistics Canada “employers in Canada spent nearly a trillion dollars on wages, salaries, and benefits (imagine a stack of $100 bills 1,112 kilometres high)”. (Long, 2016).

We have seen a technological shift at work from the early days of the Industrial Revolution to assembly line plants at car manufacturers to automating farming and agricultural tasks. These changes have increased productivity at a cost to employment. Thereby, as wages and standards of living increase, there is an incentive for companies to automate as many tasks as possible resulting in cost reduction and increased profit margins.

Leadership is critical in making the decision to use AI and in which facets of the business. The other option is to remain as status quo and take a wait and see approach. Another consideration is the timing of the implementation to ensure it doesn’t impede operational deliverables. If there are pre-existing commitments that use most of your valuable resources (people and money) then considering implementing later may be more beneficial. Change management partnered with constant communication to employees on the AI goals tied to business objectives may help alleviate unnecessary fears such as losing jobs or other changes that are beyond an employee’s control. Creating AI committees comprised of employees from different departments and levels may help minimize fears and help create AI ambassadors.

Benefits of AI

From the literature there are many advancements made due to AI technology and its ongoing evolution to streamline our processes and remove mundane work. The main benefit of AI is removing boring work to free up time to be more productive in other areas that may be more valuable to the business and workers. This focuses on AI working in areas including: programmer, strategist, project manager, and technology leader. The algorithms (programming code into a computer) used for AI has proven by Turing and other computer experts that it is more accurate and helps save us time in manual computations, as once done by humans. As illustrated in the true story movie ‘Hidden Figures’ that human computers (African American women) were used to calculate the trajectory of a NASA rocket ship. These mathematicians had to prepare

for change by learning computer code at the end of their career or else face being replaced by machines. Some of the everyday AI milestones include our smartphone device (accessible computer) that may have a virtual assistant to help you search items on your phone, the web, as well as set up reminders of upcoming appointments and tasks. We have seen front line reception and assistants be replaced by these AI virtual assistants such as: Apple’s SIRI, Amazon’s Alexa, Google Assistant and Microsoft’s Cortana. This is a benefit to business in terms of streamlining and helping us organize our day, however, we are constantly on our devices which impacts work life balance. The biggest risk to society and the employee are lost jobs.

AI can compile large amounts of data that a human never could in one’s lifetime. It is also the rapid speed with which AI can compile, analyze and report on the data that helps business be more flexible. Velocity in business is imperative in today’s rapid paced environment to release new products and services ahead of the competition. The benefits are easy to describe but how humans need to view AI is difficult as it is changing people’s perceptions and behaviours as described by a leading analytics expert from Price Waterhouse Cooper.

“Artificial intelligence can help people make faster, better, and cheaper decisions. But you have to be willing to collaborate with the machine, and not just treat it as either a servant or an overlord.” (Anand Rao PwC Innovation Lead, Analytics)

Once AI is functional and work processes are developed it may pay for itself in replacing highly paid employees. AI and robots won’t have the same downtime as humans with not calling in sick, taking breaks, going on vacation or getting hurt in the workplace. AI can also work overtime, and won’t ask for promotions or raises. The other human resources aspects such as unmotivated employees or employment legislation won’t impact businesses when using AI. Other advantages include:

• IMPROVED PROFITS FROM COST REDUCTIONS – By replacing highly paid workers with machines • NET NEW JOBS – New STEM and AI jobs including supporting roles: project management, and new occupations that we are unaware today of what they may look like in the future • BETTER EFFICIENCIES – Improved quality and speed through AI accuracy • COMPETITIVE ADVANTAGES – If implemented correctly AI efficiencies can help save customers money. Some companies may want to use AI versus a human as the perception may be that machines are more objective and trustworthy and don’t have ulterior motives. • TIME SAVINGS – By replacing boring, mundane work with that which is more engaging, motivating and rewarding. The free time can be used on leisure and recreation (similar to the dishwasher, washer & dryer) and to obtain more skills training • MORE EDUCATED WORKFORCE - With retraining, employees may obtain higher wages

• LESS DANGEROUS WORK FOR HUMANS – robots will replace humans for dangerous work such as in the military where they are currently being used for detecting and removing land mines

Risks of AI

The potential risk and perceived threat of AI if it replaces our tasks, is that we may all be replaced by AI and robots. We fear what happens when things go awry with AI, using examples from science fiction movies: HAL9000 in Space Odyssey 2001, the Terminator, the Replicants from Blade Runner, the Agents in Matrix, and Ava the humanoid autonomous robot from Ex-Machina. Another example is if AI is not planned or programmed correctly, one outcome could be that it will have the capability to shut itself down and also to take control. An example of when AI would have been helpful was the 2011 Fukushima Daiichi nuclear disaster — where were the AI computers in Japan? What happens if AI malfunctions – i.e. using a 3D printer and creating a condominium or miniature scale of a house instead of using the schematic drawings? This technology (3D printers have made: textiles, prosthetic limbs, and chocolate) could lead to waste and potential environmental concerns. There are other potential risks that go beyond taking over our tasks that are ethical in nature. What happens when a programmer inputs data that reflects his/her own bias? The AI continues to learn around this data set and thinks it is normal or ethical. This was seen in the case where Microsoft had to remove their AI [chat]bot Tay after it started posting racist comments on Twitter.

A number of disadvantages of AI include privacy concerns of storing data and potential security breaches from hackers. The data for AI will need to be kept secure and decisions of having the data stored in-house or on the Cloud has its own set of challenges. How will the energy be sustained and backed-up to prevent a security breach? The minerals required for batteries needed by companies like Tesla for their cars and Space X require mining that has its own set of hazards and environmental costs.

The biggest factors prohibiting companies from adopting AI are the upfront costs and the lack of technical skills to implement, maintain and upgrade the system. Jobs lost that don’t have net new job creation will affect the labour market with an unbalanced increase in supply which will result in lower wages and less full-time jobs. This includes the following other disadvantages:

• JOB SECURITY – In today’s GIG economy there is more precarious and part- time work that creates instability in the labour market, and insecurity with employees • SABOTAGE – Employees may feel threatened by AI taking over their jobs and may try to sabotage the technological systems

• FEAR OF AI – Some employees may act in a dishonest way by withholding valuable information for fear of losing their jobs • SUPERVISOR SKILLS – Lack of skilled managers to lead employees working alongside AI • LACK OF AUTONOMY – Truckers that were interviewed, in one study, claimed issues of giving up their autonomy to AI (taking orders from machines) and lack of control • FAD – implementing new technology due to fear of being left behind rather than strategically linking to the company’s goals • LACK OF PLANNING – If AI is implemented too early and without planning it could cost the company money due to poor implementation. If AI is done too late, a company could lose an opportunity to the competition • DOOMSDAY – What happens if AI is established in military strategies and protocols (missiles and drones) and fire off missiles on their own without [human] authority. An interview by 60 Minutes television show demonstrated how military who operated the drones suffered post-traumatic stress disorder by launching drone missiles remotely • TECHNOLOGY FAILS – what happens to the data if there is a power outage without proper contingency plans • PRIVACY & SECURITY – Are there safeguards in place that protect peoples identify and data? Are there protocols and plans if hackers invade AI systems? Recent data hacks at Uber and Equifax where private public information was breached have occurred • LACK OF EXPERTISE – There is already a shortage of technical talent (data scientists, engineers, developers) and with the uprising of AI it will create an even larger gap that could push wage scales to a limit that is unaffordable. • ENVIRONMENT & SUSTAINABILITY – are there any environmental implications in terms of battery and electricity usage from using AI and robotics? • WHO IS TO BLAME IF SOMETHING GOES WRONG – if an employee gets hurt or killed on the job, does the AI manufacturer bear the liability or does the blame lay with the company that bought or implemented it?

AI and Workplace Disruption

AI has caused a disruption that has not been seen before in the workplace. The term "disruptive technology" was referred to by Harvard Business School professor Clayton M. Christensen where he describes technology as lacking "refinement, often has performance problems because it is new, appeals to a limited audience and may not yet have a proven practical application”. An earlier example was the case with Alexander Graham Bell's "electrical speech machine," also known as the telephone. Other examples of disruptive technology include but are not limited to: computers, email, cell phones, social media, cloud computing, etc. This disruption will continue at a faster pace that will force organizations to keep up or they may be forced to shut their doors. McKinsey Global Institute (MGI) reported in “Jobs Lost, Jobs Gained: Workforce Transitions in a Time of Automation” it is predicted globally by 2030, work will displace

by automation, up to one third of all work tasks and activities. The research was conducted on 46 countries and concluded that only 5% of an entire job can be fully automated. What is shocking from this report is 6 out of 10 occupations will “have more than 30% of activities [job tasks] that are technically automatable”. (Manyika, et al., December 2017). The researchers foresee that jobs that require predicable and physical job aspects will be the first to be replaced by automation which could result in 15% of full time equivalent workers (equates to 400 million worldwide) being displaced by automation. The study mentions that the greatest impact will occur within Japan, Germany, and China followed by US and other European countries. These statistics are for technology in general and do not specify AI (it is compiled in the data); some of the current IT technology can support AI. The below information provides more concrete studies in AI.

In the article “Artificial Intelligence and Machine Learning in Industry” by David Beyer from O’Reilly Media, he specializes in writing on AI technology and holds annual conferences. Beyer asks Michael Osborne, an expert in Machine Learning and Professor at the University of Oxford, his opinions on AI and how it will affect the labour market, jobs, and industries in the future. Osborne claims that future jobs that will not be as affected by automation require a balance of skills including: creativity, manual dexterity and social intelligence. Automation in such form or another has affected how we do work and has replaced some jobs in the past. We have seen the Pony Express be derailed by the train and followed by the automobile. We as humans may be replaced by AI, similar to trains replacing horses, however, we have some advantages over machines such as our high-level emotional interactions. Osborne believes this won’t protect full employment as machines have certain advantages such as accuracy, speed and cost savings over the long term. He claims that it is the least skilled jobs that will be replaced by automation and that “21st-century work, by and large, may not match the skill mix and volume for a healthy replacement rate. In the absence of decisive education reform, a growing list of occupations (e.g., truck drivers, auditors, clerks in various retail situations—to name just a few) will fail to keep up”. (Beyer, 2017).

This differs from the McKinsey report that believes the jobs in the retail sector in China will increase due to increased standards of living from improved economies. Osborne provides valuable insight for companies who want to exploit the state-of-the-art machines in that it’s not necessarily about AI; rather, it is about “redesigning jobs to suit the technology already at hand”. (Beyer, 2017). I interpret this as not to buy the latest IT gadget but to review current processes and use what you may already have in place to serve your current business needs. It is important to conduct due diligence before implementing technology. This involves requirements gathering to determine what are the business needs and tying it into business strategy. It is beneficial to adopt best practices, so long as one accounts for which stakeholders does the technology benefit. If the technology creates a competitive advantage by bringing in and retaining customers and makes their lives more efficient and/or cost effective that could be a consideration to adopt AI. However, if the costs (time, money and personnel) outweigh the benefits you may want to wait until the technology comes down in price or it actually performs what you hope it will deliver. This is where planning and requirements

gathering tools and techniques can help before you formulate a business case before you decide to purchase or make AI technologies changes.

Jobs That Will Be Eliminated

According to Osborne’s research back in 2013 using 702 occupations and using the data from O*NET [Department of Labour] he “found that 47% of US labour market faces the risk of automation”. (Beyer, 2017). Osborne describes that travel agents have dropped by 50% in the last 10 years within UK. Another industry that will be heavily impacted by automation is the transportation and warehousing where he predicts that 75% of employment is threatened, such as forklift operators.

In the McKinsey Quarterly “Where machines could replace humans—and where they can’t (yet)” (Chui et al., 2016) the article describes the benefits and costs of technology replacing humans and the supply-and-demand dynamics of labour were used to determine jobs that can be displaced by machines (robot) in the short and medium term as seen in the below image.

(Source: http://www.mckinsey.com/business-functions/digital-mckinsey/our-insights/where-machines- could-replace-humans-and-where-they-cant-yet )

To add to the list, employees at fast food chains like McDonalds may be replaced by robots such as ones built by Momentum Machines that grill and flip 400 burgers in an hour. We are already seeing automation changes at McDonalds with humans (order takers) being replaced by order taking self-serve kiosks.

It appears that Uber is positioning themselves to replace humans with autonomous vehicles, as one of the largest expenditures for the company is the drivers. There are also

benefits to having autonomous trucks on the road that can provide fuel efficiencies by travelling close together in what is known as ‘truck platooning’. This can help save

companies costs, improve times for deliveries, and help the planet with less fuel consumption through aerodynamics. Truck drivers won’t be replaced immediately by autonomous cars as society may not be receptive initially to driverless cars due to the hazards from collisions and the type of cargo they are carrying (dangerous and explosive materials). Government regulations in the transportation area will also need to be revised to permit driverless vehicles.

Other jobs that will be impacted are within multiple industries and may include the following:

• If AI technology is implemented within hospitals, MRI and XRay technicians may be replaced in the future by AI • AI is a significant threat to Lexis Nexis, Westlaw and other research firms and to jobs within editing, researching and paralegals • Robots are currently being used to plant seeds in China that will replace farmer’s tasks o There are robots that are being tested to pick fruit (oranges and tomatoes) which will replace low paying, mundane jobs for migrant workers • A further labour disruption would occur in back-office transaction work such as: accounting, mortgage, and financial • Robot’s T-shirts are being created by robots which eliminate artisans and textile labourers by creating the designs on software and producing the articles through 3-D printers • HR is being replaced by HRIS/HRMS but also through AI recruiter software; traditional head-hunters will no longer be needed as they will be easily replaced robots and AI companies such as Zip Recruiters • Other jobs that will be lost due to automation will be pharmacists as there are automated pharmacy dispensing systems • Chefs and baristas will be replaced by robotic hamburger flippers and automatic robotic arm coffee dispensers

According to a 2013 study by Oxford University there are a number of blue-collar jobs that will be affected and are most susceptible to AI automation includes the following:

• “Sewer diggers • Watch repairers • Machine operators • Tellers • Shipping, receiving and traffic clerks • Drivers • Inspectors, testers, sorters and samplers • Projectionists • Cashiers • Grinders and polishers • Farm laborers

• Lobby attendants, ticket takers • Cooks • Gaming dealers • Locomotive engineers • Counter attendants (at cafeterias, coffee shops) • Postal clerks • Landscapers and groundskeepers • Electrical and electronic equipment assemblers • Print binding and finishing workers”

Source: What Everyone Needs to Know, (Kaplan, 2016)

The same study also reviewed white-collar professions where the introduction of AI will result in job losses due to ease of automation including the following:

• “Tax preparers • Title examiners • Insurance underwriters and claims processors • Data entry and brokerage clerks • Loan Officers • Credit Analysts • Bookkeeping, accounting, and auditing clerks • Payroll clerks • File clerks • Switchboard operators • Benefits managers • Library assistants • Nuclear power reactor operators • Budget analysts • Technical writers • Medical transcriptionists • Cartographers • Proofreaders • Word processors and typists”

Source: What Everyone Needs to Know, (Kaplan, 2016)

The above jobs will soon be obsolete, and businesses will need to allocate funds to pay out severance which could result in wrongful dismissal suits if not done correctly. This is where HR comes in to help mitigate losses with legal compliance and care for the termination process for both the employee and business. Some of the HR current practices, such as recruiting, will be replaced by automated but overall the HR role involving people management will still prevail.

Industries That Will Be Impacted

From Osborne’s analysis he predicts within the next 20 years that the highest risk industries are within the accommodation and food services industries in that 87% of these jobs will be threatened by automation. Some examples can be seen at Chili’s introducing tablets [iPads] and shifts in the travel industry using AirBnB for lodging. AirBnB allows consumers to shop online for accommodation worldwide by using client preferences and AI algorithms. In Japan, a cutting-edge hotel ‘Henn na’ is fully automated with robots from the time you register in, enter the guest room, to the time you depart without human intervention. In the article “Harnessing Automation for a Future That Works” the authors claim that automation will impact physical jobs “in highly structured and predictable environments, as well as data collection and processing…within the manufacturing, accommodation, food service and retail trade” amounting to almost $2.75 trillion in wages. (Manyika, et al., 2017). AI will disrupt the food industry from the land (farming), to the table as seen within the fast food industries as shown by an automated coffee robot, pizza that makes your pie as per customer’s specifications within the vehicle and delivers it to one’s home, and a fully autonomous sushi bar. The need to automate the food and beverage industry is due to the high food and labour costs. Starbucks has capitalised the coffee market for being a niche coffee house but soon will enter barista robots. Café X in San Francisco offers coffee from its Mitsubishi six-axis robotic arm. The robot is affectionately known as Gordon and as one customer claims “it’s like a java ATM, minus overdraft fees”. (Marx, 2017). Another robot named Sally prepares your salad over 1000 different ways. Predictive analytics is also entering the pizza business at Zume Pizza where their robots make the dough into shells, lays the sauce and topping and places it in an oven. The pizzas are then placed by humans into trucks that keep the pies warm with smart ovens, to your home. Chefs and sous chefs may need to look for other jobs as Spyce Kitchen isn’t hiring humans any time soon with their robots offering meals in less than 5 minutes. In Shanghai there are twin robots named Koya and Kona that can create your made-to-order ramen meals in less than two minutes. Not only does it save companies in labour costs but also removes human injuries, burns, slips, falls, and other hazards.

Automation changes are taking place in warehouse distribution such as Amazon by using robots thanks to their acquisition of Kiva systems. The robots scan barcodes to determine where the products need to be shelved within the warehouse. This technology frees up employee’s time and potentially removes ergonomic strain or hazards. People can then focus on more complex tasks; verifying mistakes and rearranging items on shelves. This demonstrates that human labour is still required and works alongside robots. However, there have been job cuts as seen recently by Canadian grocery chains Metro and Sobeys, to make way for more technological advancements in their distribution warehouses.

There is an urgent need to automate some aspects of the healthcare system due to the high costs, budget reductions and ever growing elderly population that require more care. Healthcare is very complex due to the nature of the patient’s illness or injury which makes automating processes much more complicated. However, through observation of

small tasks some aspects of these complex jobs can be automated if broken down into its smaller components. Osborne describes the process in that “assessing the restructurability of a job requires a narrow aperture and nuanced understanding of the given occupation.… even if a task can be automated, following through requires navigating a web of stakeholders and norms. In the case of healthcare … GP and patient associations chafe at certain kinds of automation. The barriers, in other words, are many”. (Beyer, 2017). Patients also may be fearful of robots working autonomously until it becomes more standard practice in the operating rooms. Some areas of healthcare can be improved by technology such as X-Ray imagery where AI has been proven to detect certain types of cancers more accurately and quicker than medical imaging specialists.

The legal industry will see a significant change due to AI as most of the work involves research. Since AI is very good at collecting, compiling and analyzing vast sums of data, this will help lawyers in finding the right precedent for their legal case. There is already in existence a fully automated UK legal research database that exceeds the timing of an articling student trying to find the correct legislation for a case. The student took 20 minutes longer than the AI robot of less than one minute. In some research cases, it could take lawyers 20-30% of their time and up to 70% for a junior lawyer according to Jake Heller, founder and CEO of Casetext, an AI research software company. In addition to saving lawyers time in research this software saves money by providing a cost effective solution versus having to pay legal database companies for a single search that ranges from $20-100 per document. The company is a comprised of: 20 engineers, natural language processing, data science with crowdsourcing that replaces 20,000 editors at these premium legal research companies. Additionally, Casetext has created new machine learning CARA (Case Analysis Research Assistant) that permits lawyers in mere seconds to ‘drag-and-drop’ legal documents similar to LexisNexis machines at a more effective price point. Recently at UofT, researchers have applied IBM Watson to create an AI legal research system which will have significant impacts on the Canadian legal system, jobs, processes and research businesses.

We have seen technology force farmers in the past to move to cities to garner work. Significant technological shifts occurred during the Industrial Revolution from the horse and plow for farming, to machine operated watering systems and plows. According to Erik Andrejko who leads the data science and research at Climate Corporation by using machine learning to solve climate change problems and agronomic modeling is studying precipitation to maximize crop yields. There is enormous data collected in this area around the world on the types of crops, how the season temperatures and precipitation from rain affected the size and profits. Agriculture is big business by growing and feeding the world as seen with companies such as Mosanto spending millions on research on seed, pesticides and genetically modified organisms. According to the studies, the industries that will be affected the most, and very quickly, will be manufacturing and farming; predominantly in developed countries due to the incentive to remove the high costs of employee wages. There is research and development taking place in Australia where robots are being created to plant seeds and pick crops

which will revolutionize traditional farming practices. In Canada, farmers use migrant workers to plant and pick tobacco, soy, corn and tomatoes which may be replaced by these robots.

We are seeing in finance the latest AI tools that permit individuals to invest online, through a company called Wealth Simple. Clients are required to answer a few questions on their risk tolerances, age, assets for AI to determine what is the best investment portfolio based on the responses. This AI tool has allowed investors to contribute to the economy with lesser amounts of $50K versus $500K. Technology takes the guess work out for consumers as well as reduces very expensive financial planner fees and helps the company save on employee costs through automating processes. Most people do not know that they are working with a robo-advisor (similar to chatbots) on a website. A study conducted by Price Waterhouse Cooper on what consumers will use in the future for making their next financial decisions was surprising as 54% chose algorithms for insurance decision-making, whereas human judgement is preferred for banking and asset management.

The latest on the financial industry embracing AI is a start-up company Cytora, which evolved from insurance technology research conducted at Cambridge University, just receiving funding in the amount of £4.4m from Hank Greenberg (former AIG chairman). This type of large investment demonstrates the belief that AI is the future for business.

“With ever-increasing levels of available data, we can really see the benefits that artificial intelligence and other similar technological advances bring to the industry. We believe that Cytora can use this information in a powerful way to provide a competitive edge to Starr and its other clients.” (Hank Greenberg)

The fashion industry is also seeing a breakthrough in the manufacturing of clothes and on the runway by using AI and 3D printing technology. It is forecast that a consumer will be able to download the architectural design images and have printed at their home on their own personal 3D printers. One such company in Canada, Sid Neigum, has

received grants to pursue 3-D printed garments. The jewellery industry is already seeing new 3-D printed designs by Iris Van Herpen and Daniel Christian Tang. “Designer and co-founder Mario Christian Lavorato predicts that digital manufacturing is poised to take over. Right now, 3-D printing is still kind of this new industry that’s finding its way in medical and other industries but not really in retail and mass production. Given the speed of this industry… its eventually going to become the only way to produce products”. Amazon has received a “patent on its on-demand computerized system of made-to-order clothing that includes textile printers, cutters and an assembly line…it’s only a matter of time before we’re all clicking to buy our very own digitally printed wardrobes”. (Agnew, 2017).

Within HR technological disruptions from HRIS implementations have replaced certain tasks such as dashboard reports which can be pulled instantaneously with live data. Technology has displaced these workers who have not upgraded their skills. There is enormous candidate data available both internally or externally (Linked-in, Facebook, Twitter, and other social media platforms) that HR can’t keep up; hence the reliance on applicant tracking systems to source top talent. The next revolution in HR is analytics by collecting data and creating predictive analytics on who to hire, when and where. For example, the AI technology can help create analytic reports on candidates and existing employees to help predict where to recruit for the next new hire. These analytics can also be used to determine if employees are motivated, engaged and productive through absenteeism reports and performance management metrics. This type of AI has helped HR save time, money and add credibility to their reporting as large sums of information can be compiled quickly instead of sorting through spreadsheets and accessing different systems to source their next hire. Some of the technology can even red flag who is the top candidate based on the criteria search parameters; using job posting and description and comparing against individual knowledge, skills and other attributes. Such companies such as ZipRecruiter are revolutionizing the recruitment process, as using automation proves to be more accurate and efficient and has a higher retention rate than traditional hiring methods.

We are seeing more companies getting into the autonomous car business in hopes to be the first to have their unmanned cars or trucks hit the ground running by transporting goods or people. Some of the companies that have spent millions on research and development include: Amazon, BMW, Ford, Google, Tesla, Mercedes, Uber. Amazon has also been working on creating drones that deliver their packages to your home. There are too many decisions to make when driving such as avoiding traffic obstacles, and the concerns of AI taking someone’s life, to ensure the cargo is being safely driven autonomously. There are also the environmental conditions that impact driving that AI has not perfected as seen with a recent autonomous Tesla car that went off the road as the cameras and sensors could not decipher the road versus the glare from the sun, rain and snow.

Jobs That Will Be Created

As technology evolves there will be opportunities to learn new skills and new jobs created as demonstrated in the latest McKinsey Report (Appendix C). Some jobs are less at risk due to the nature of the complexity, costs, or the current technology has limitations. There will be requirements for upgrading skills and a demand in the areas of: applying expertise, interacting with stakeholders, managing people and creative roles. There will be a need to increase educational requirements within occupations that may require 375 Million people worldwide to upgrade their skills to switch to a new occupation. The need for employers to send employees for training and displaced workers to upgrade their skills will create a need for education to prepare for this upturn in learning. The largest complaint is that there needs to be educational reform that provides more current curriculum, flexibility and focuses on STEM (science, technology, engineering, and mathematics) research to help students prepare for the future, businesses to be competitive and the economy to grow. Some jobs will be replaced by AI but there are new career opportunities that are appearing such as: AI data scientists, robotic specialists, AI programmers, AI designers, AI architects, AI strategists to AI ethicists. It is even predicted that there will be AI psychologists; but, this may relate to programmers that are inputting unethical data into AI programs.

From the McKinsey reports, they predict that the areas of work that will be safe, are ones that are human to human interaction, requiring specialization, technology based [AI], supervisory and are strategic in nature. In 2030, a workforce of 2.66 billion could result in 8-9% in new occupations that have not yet been created or the possibilities imagined today. Approximately 250-280 million new jobs will be created predominantly in higher healthcare and education. Healthcare costs keep rising as people get older; by 2030 there will be 300 million more people aged 65 years and older. (Manyika, et al., 2015). Occupations that will remain unscathed are low paying health care jobs such as personal care aids and personal services to support the elderly from the population growth from baby boomers. Countries that have a dense aged population such as Japan can benefit from AI using therapeutic robots “Paro the Seal” as companion aids for those who have Alzeimers and Dementia.

New jobs will emerge from technological advancements including: professionals (IT, engineers and scientists), health care providers, builders, managers and executives, educators, technical, and creatives. The latter category includes artists and entertainers as this cannot be easily replaced or duplicated by machines due to the creative nature of the work. We can see new creative businesses starting that are worth billions of dollars in revenue. One example is Netflix, online movie streaming company, using AI to help provide suggestions to viewers on which shows or movies, based on past preferences and feedback. A recent example of creatives is Cirque de Soleil, created by two Montreal street performers, Guy Laliberté and Gilles Ste-Croix, who recently sold the organization to a private holding company for over 1.5 Billion dollars. However, some creatives such as jockeys may be replaced in the future by AI as seen in Saudi Arabia where they are using robots in camel racing.

According the researchers from this report 50 Million new technology jobs will emerge including: computer scientists, engineers and IT administrators. It is estimated that

overall spending in technology by 2030 will amount to 50% of companies’ operating budgets which will require both internal IT and external IT consultants. It is predicted that up to 130 Million new health care jobs will spring up from the rising incomes and aging of society by 2030. Amazon, the world-renowned e-commerce purchasing website, is working on many AI technologies including automating its distribution centre with robots and creating its own made-to-order wardrobes. This will create new jobs for highly trained CAD operators to help build the AI software, 3-D printers and textile machinery operators. The need for low paid seamstresses will be replaced by highly skilled computer and machine technicians.

There will be a rise in part-time workers, which the study surmises people will want to take vacation, which will create a new growth spurt in the much-needed leisure and recreation industries. The growth is projected in golf, video games and home improvement. (McKinsey Global Institute, December, 2017)

Automation will create a shift in predictable jobs, however, working with or supervising people is not predictable in nature—hence, these jobs will not be as affected as tedious, mundane and routine jobs. Jobs that will be relatively unscathed require: creativity, expertise, social interaction and managing people. Another road block in implementing AI is the high cost of humans who surpass in certain areas such as dexterity, multi- tasking, high risk decision making. Another factor to not implementing AI or other technology to replace a job altogether is that the employee has low wages. These areas typically are in gardening, child or elder care providers.

Other industries that will result in 20 Million new jobs are in the energy sector as a result of investment from governments, business, investors in this area. Funding will help job creation in buildings and infrastructure such as wind farms that require many different occupations ranging from: drivers, construction workers, engineers, land surveyors. The Paris Climate Accord has created awareness and government involvement in investing in new sources of energy from solar to wind to help with climate change issues.

We have seen more women being educated and entering the workforce since the advent of the birth control pill and the numbers will continue to grow as women postpone having children and obtaining higher education. This will require outsourcing domestic work (cooking, cleaning and childcare) which was traditionally done by women. This unpaid work is estimated to be worth approximately 13% of global GDP in the amount exceeding $10 trillion. (McKinsey Global Institute, September, 2015). This could create new jobs for AI (a robot that folds shirts better than humans but is too slow and expensive to mass produce) and for under-skilled people who are entering the workforce for the first time such as students or those are pursuing such occupations (care giving).

Another study conducted by the US Bureau of Labor Statistics shows that 19,263 jobs were created from technology with 3,508 job losses resulting in net new jobs 15,755 in 2015.

Some of the new jobs that will evolve in the automotive industry include: autonomous driving experts, electrical engineers to help create batteries for electric cars, Customer Care experts that will trouble shoot technological customer related issues, 3D printing engineers, sustainability experts for carbon footprint and analytics experts to help improve driving navigation.

The above information may seem promising, however finding the right talent in technology is already a challenge for companies. This labour demand within technology will create further difficulties for business to try to recruit, retrain and retain talent. Some strategies may include succession planning with current talent and creating professional developmental opportunities through mentorship, training and promoting that is tied to performance measures and Key Performance Indicators (KPIs). Creating positive workplace environments, compensating with positive extrinsic and intrinsic rewards will help with retention strategies. Allowing employees to work from home is considered a reward to some employees and helps save companies on capital expenditures (bricks and mortar office space). The use of external consultants and recruitment agencies will help fill any gaps. The GIG economy is also growing vastly where companies can leverage subject matter experts (particularly technical) to apply and compete for projects online. This flexible and part-time workforce helps save companies time and money by using expensive consultants on a “needs only” basis. Overall, it saves companies costs by not having the expensive burden of payroll benefits (vacation, extended health, and other regulated benefits) and these consultants do not require training as they already possess the level of expertise required for the project.

Ethics and AI

AI could result in huge jobs losses which negatively affects the economy through high unemployment. This may create social unrest that could generate violence, increased criminal activity from idle time. In Canada, we have the highest rate of post-secondary educated individuals yet there is a lack of well-paying jobs. Today’s youth are already overeducated and under-employed, but they are in part-time or temporary jobs with huge debt from funding their education.

Another ethical conundrum is whether we will have an unhealthy emotional attachment to robots and lose our social interaction with other humans? For example, the humanoid robot Sophia was the first (synthetic) woman to receive citizenship in Saudi Arabia. US military have felt loss over their robots being destroyed when defusing bombs or experienced sabotage by opposing forces. AI has and will create change in the workplace and may displace employees and cause disruption in the labour market. For displaced employees that will create a labour market surplus which will stagnate or lower the wages. How will we feel and behave if we don’t feel productive and contributing members of society?

• MILITARY USES – Are drones and robots being used to take over the world? Using AI removes the emotional attachment [empathy] of killing others thereby impeding on humanity • POLITICAL SCANDALS – Potential scandals on political voter tampering by other nations either invited or through hacking • SEX ROBOTS – losing our intimacy and social connections which could result in unhealthy relationships with others and may even reduce population birth rates • CAREGIVERS & ELDERLY – AI and robots replace family and humans in elder care • STEREOTYPING & BIGOTRY – From data input by programmers into the AI algorithms • LOSING OUR INTELLIGENCE & IDENTITY – Too much dependence on technology and have we given up our rights and freedoms too quickly? Are we losing our intelligence by surrendering our lives to technology such as: reading maps (GPS has replaced this skill), driving (self-parking cars), not paying attention to our surroundings by focusing on technology (driving and texting)? • ADDICTIONS – Current smart phone usage along with social media has created some unhealthy addictions that rob us of real life intimate connections • DO WE REALLY NEED THESE PRODUCTS? Are we doing this to only make profits or are we really considering stakeholders best interests • DO THE LEAST AMOUNT OF HARM FOR THE MOST BENEFIT OF OTHERS – will AI benefit the many while doing the least amount of harms to others • DECIDING WHO SHOULD LIVE AND WHO SHOULD DIE – when programming autonomous cars who should decide who should live or die in a potential crash avoidance situation? Should the child live over the elderly, a taxpayer over a criminal, man over woman, and other potential unethical scenarios and decisions?

Case Studies of Select Organizations and Industries

AI has made significant breakthroughs that affect many companies today and in the future as well in industries including: manufacturing, retail, technology, health care, education and the list continues to grow. According to Satya Nadella, Microsoft CEO, the three big AI advances include “Big Data, computing power, and sophisticated algorithms—are accelerating AI from sci-fi to reality”. (Nadella, 2017). Due to the exponential growth in data from company’s internal processes, systems, and the internet it helps to feed the insatiable appetite for AI to grow, learn, and become more intelligent. The cloud technology has helped increase the speed of technology systems including complex algorithms that would need more servers and space than what most companies can afford.

The AI race is on with large corporations to fill the gap of human brain processing and thinking and that from a computer. These companies in the AI race include the tech giants: Microsoft, IBM, Facebook, Apple, Amazon, Alphabet/Google. According to the article “The Great AI War of 2018” by Harry McCracken in Fast Company he compares and contrasts these top 6 technological companies’ race and he predicts by using studies conducted by PwC, McKinsey Global Institute and CB Insights that within the five top industries that will be impacted by AI is transportation with over 300 hours saved time for an average American driving annually through autonomous vehicles. The entertainment industry will save over $1Billion per year in search enhancements according to Netflix. The ever rising costs of health care due to aging and the rising price tag for health care professionals, medicines, technology is using IBM Watson’s to read CT scans for any abnormalities such as cancer with more precision than hard to find radiologists. The retail industry has evolved with the advantage of on-line shopping with Amazon and eBay that music industry predicts that $100 Million projected value can be gained by using AI. Large technology firms are acquiring other tech firms not only for the valued subject matter experts but also for their data as Microsoft acquired Linked-In in 2016 for $26.2Billion. In September 2016, CEO Satya Nadella told the Microsoft audience that partnerships help with AI “reason over large amounts of data and covert that into intelligence”. (McCraken, 2017).

Further breakthroughs in AI on speech and image recognition where AI will transform every aspect of business and worldwide economy. According to Microsoft’s speech recognition’s software has beat a human transcriber in 2017—a first time accomplishment. Microsoft’s error rate has improved from 2011 at 18.5% down to 5.1% in 2017. The accuracy for image recognition has exceeded human abilities in 2017 to 97.3% up from 71.8% in 2011 from the Computer Vision Pattern Recognition competition. This equates to new opportunities for business, according to the PwC report “Sizing the Price” AI will amount to $15.7 Trillion to global GDP by 2030. This is fueled by $6.6 Trillion in company gains in productivity and $9.1 Trillion from increased consumer demands. These large sums of revenues are attractive to existing and new companies that want to be the first to implement real AI. This race can be seen in the

car manufacturing industries such as Ford who announced in March 2017 that they will invest over $500 million in R&D by adding 300 engineers that use to work at Blackberry.

Manufacturing companies such as GM are investing in AI research and development (R&D) in Canada due to the top technology talent pool and renowned engineering schools in Toronto and Kitchener/Waterloo area. According to Brian Tossan, head of R&D at GM, “we chose Markham… because it’s the tech capital of Canada”. Tossan continues his rationale for investing in more R&D in the automotive industry as “we see an auto sector that is electric, connected, autonomous and part of a vehicle-sharing economy. These four trends are now mashing together and quickly redefining the future of mobility.” (Lerner, 2017). Universities are also spending time, money and expertise (partly funded by private corporations) on self-driving technology as Uber tested its self- driving cars earlier this year at the University of Toronto (UofT) downtown campus. (A consortium between UofT and Uber on research for fully autonomous cars.) The government seems to be embracing these tests in Canada as the Ministry of Transportation piloted permits for companies to test autonomous vehicles in Ontario in 2016 providing that there is a human driver to monitor the car’s operations. There are other companies that are joining the race to self-driving cars to compete against Uber such as the GM’s Super Cruise option (self-driving) to the Cadillac SRX that is speed and turning limitations; however, like an autopilot of a plane it can drive over 100 meters using GPS at a pre-determined set speed. This is a semi-autonomous car similar to Google but has different ranges such as short term destinations of 30 meters and in the works, is a longer term range of over two hours. The competition in the tech and automobile industries to garner more clients and generate revenues is fierce with new start-up companies getting into the market. One such company Nutonomy that came from MIT is working on an autonomous taxi service in Singapore. The other important objective to organizations is to reduce expenditures and one of the largest costs is employees, to a company budget. Therefore, healthcare is looking into AI to replace expensive and replaceable staff such as radiologists.

There is fear that all jobs may one day be replaced, however, a number of companies believe that humans and machines will work in unison. This is Nadella’s philosophy in which “machines will work with humans, not against them”. Lily Peng, Product Manager at Google Brain believes that AI will work alongside machines by collaborating. “By Sharing the workload, machines can help make that possible.” (Metz, 2017). Google Brain is using neural networks to teach (itself) ailments by receiving retinal scans feeds. The ideal state for healthcare and technology is to get better results “the hope is that the system will eventually help overworked physicians in poorer parts of the world examine far more patients, far more quickly”. Clinical trials in India are using AI analysis to scan patient’s eyes.

There are more robots entering the operating room such as real-time X-Rays (Mazor Robotics Renaissance), Reconstructive surgery on joints by RIO the robotic arm on wheels created by Mako Surgical, the CyberKnife by Accuray which uses high-energy rays to precisely send beams to specific organs, and the most commonly used surgical robot daVinci by Intuitive Surgical that uses 3D cameras interfaced to its three arms that

perform tiny incisions where delegate organ work needs to be performed. There are more advances that are waiting for government approval such as the Flex which is a snake like robot created by Howie Choset at Carnegie Mellon University. Once FDA approved, it will perform surgeries by using a game-like joystick to get into small areas such as the nose and mouth. Wearable technology is currently available such as the Fitbit to help us with our health by measuring our walking steps, but the latest is wearable autonomous healthcare such as seen in the bionic pancreas. Human tests are being conducted by this ground-breaking health technology where it injects insulin from an inserted pump and the external monitor sends glucose levels via Wi-Fi to AI where the algorithm determines what is the proper insulin dosage.

The reason for AI in healthcare is to have more accurate diagnosis for improved patient’s well-being but also to prevent lawsuits from malpractice claims. AI in healthcare has an important role to play including “making diagnoses more accurately and quickly and finding better treatments that save people time and money and prevent exposure to harmful side effects.” (Park, 2017). One of these side effects is drug interaction with existing medicine and also seeing how these drugs react with each patient’s illness or injury. Doctors should not fear this technology but rather embrace it as there is too much data for one person or organization to collect and analyze in a quick or efficient manner compared to machines. According to Francesca Dominici, a biostatistics professor at Harvard T.H. Chan School of Public Health, he claims “Doctors are realizing that if they want to make sense of massive amounts of data, machine learning is a way of allowing them to learn from that data”. There are new health innovations such as SenseTime that determines if you are healthy by taking a picture and sending the information to an AI algorithm created in Hong Kong.

Healthcare is rich in data but so is human resources with the vast amount of information on the web, social media and internal. When candidates apply for opportunities posted on job boards such as Monster, Linked-In and company websites, the resume, contact information, skills and experiences are provided during the online application process. New companies are starting to emerge that streamline the sometimes-lengthy recruitment process of compiling and sorting through resumes much more quickly than humans. Some AI machines are going through social media posts, analyzing past work experiences posted and providing fact checks to recruiters. One such company HireVue provides interview feedback by analyzing interviews from facial recognition by monitoring the candidate’s expressions. AI is being used to check for skills and bring the best candidates to the top of the list for HR to vet. Another company Interviewed that uses recruiter chatbots to assess soft skills to determine empathy in the candidates are used for clients such as Instacard and IBM. The company mentions that the machines access and provide the candidates for the human (recruiter, HR Manager) to make the final decision to select for hire. There is software to test the recruiter’s performance to help them find the right talent but also not be discriminatory in their recruitment practices. Textio vets job postings and descriptions for male driven language that may attract more men than women to their postings. According to a Bersin research (a Deloitte company) their survey “shows that nearly 40% of companies are using some form of AI in HR”. (Essex, 2017). This could range from data analytics on people to

identify common patterns in top performers for recruitment and background checks but also for career development to help managers gage employee morale and try to prevent turnover. Businesses are so focused on using AI as according to recruitment firm Alexander Mann Solutions, their research shows “that 96% believe that AI has the potential to enhance talent acquisition and retention”. (Nair, 2017). This recruitment firm already uses robotic process automation (RPA) for their hiring process to reduce time and enhance accuracy in their recruitment tasks. Their robot named Doris compiles, sorts and arranges the resumes based on skill matching to the job descriptions and successful candidates that are flagged as matching the right knowledge skills and experiences are scheduled for interviews by this robot. According to Dean Stoecker, chair at Alteryx a data analytics firm he believes that “HR is the next untapped business function to reap the benefits of adopting a data-lead approach”. Snap.hr is working with over 1600 companies to help in recruitment process by combining AI with machine learning to match skilled technology experts with companies. The results are surprising that they are half the amount of time of human recruiters to select and hire the talent. (12 days versus industry standard of 24) Beamery another AI recruitment software uses a Facebook type “like” system that makes candidates feel valued and keeps lines of communication open. One of the many complaints on the recruitment process is that it is costly, not timely, and candidates aren’t provided status of their application being processed. This AI technology cuts down on mundane HR processes while keeping applicants engaged with transparency and constant communication.

In China, the manufacturing growth is declining so they are looking into investing more time, money and people into AI as described in the article “China Is Building a Robot Army of Model Workers” “Applying artificial intelligence may be the next step in this technology-fueled economic miracle. While many in the west fret about AI eliminating jobs and worsening wealth and income inequality, China seems to believe it can bring about precisely the opposite outcomes”. China is already rich in AI with talented scientists, programmers and a mass amount of data with government approval to move ahead. In article China’s AI Awakening by Will Knight “artificial intelligence may have been invented in the West, but you can see its future taking shape on the other side of the world.” The article goes on to claim that the best AI researchers reside in US and Canada, but China is a contender to watch closely. Sinovation trains Chinese engineers by providing tools in machine-learning and also provides companies with AI. This company may seem utopic in providing education and expertise, however, they have a larger focus on commercializing AI.

Findings and Discussion

The findings from the research suggest that businesses need to embrace AI and help in its advancement to benefit customers and societies. This technology is already being used at home (NEST and Alexa), in hospitals using 3D printers to recreate joints, manufacturing and a host of other services (accounting, recruitment software, accommodation, etc.). Companies that don’t embrace these advancements will be left behind and may not succeed in the future. Some of the challenges for business is to

decide if and when to use AI for their company’s objectives and goals. The costs and lack of expertise is prohibitive for some companies to create and/or implement AI. There are some options today and in the future--leasing AI software or robotics. This is where government could step in by providing subsidies and grants for implementing technology in the workplace.

Also discussed is that companies need to ensure that when AI is adopted, the right technology is adopted that is tied to the company’s strategy. If not, the technology could sit like a paperweight or door stopper as it won’t be utilized by employees. This is too costly an endeavour to not implement correctly; this is where project management methodologies could prevent this from happening. Gathering business requirements to determine current present business practices and seeing any gaps on future projections will be used to develop a business case to adopt AI. From there the project manager could use Agile development to implement and test quick wins of the AI features and adopt within business practices quickly. As mentioned, new processes will need to be developed, however, companies may be able to leverage current technologies rather than developing from scratch or adopting AI too quickly. One of the business gathering techniques is to collect all the systems, processes and practices being used and see if any current ‘as is’ technology can be leveraged versus starting from scratch. Valuable resources will be required, and it will need to be determined if the business has the right skills or the need to recruit external talent on a project or full-time basis.

The great debate whether government should be involved in the first place is discussed in a number of articles. Some opinions are that government would stifle innovation and creativity. The bureaucratic system would slow down progress in research and development. Those who are in favour of government involvement feel it is imperative to ensure that AI is not being used for evil purposes such as war, privacy infringements, sabotage of stock markets or influences on political elections. The government would oversee the progress and what are the appropriate applications for this technology. The naysayers feel that the government should not interfere as it is not their area of expertise nor does the public servant understand business needs to move innovation forward. Rather it is suggested from the readings that AI systems should be opened up to the public for transparency purposes; as this technology is too powerful and useful to so many people. Allowing the public to audit and help test AI in pre-release trials and prototypes could help make AI technology more valid and reliable.

The readings recommend it will be necessary to educate the public as well, on the benefits of AI through such areas as medical breakthroughs and energy conservation, as this will help make the technology more widely accepted. Also, involving the public at think tanks and allowing them a voice to have their questions raised and concerns addressed will help dispel some fears. Informing the public of upcoming innovative technologies and being open and transparent, as opposed to developing technologies in a vacuum – in secret. There is a need for educational reform to train students and help businesses in the areas of STEM. The public and government also need to support STEM research which may cost taxpayers money, but in the long run it could help create a competitive advantage for the country. The AI race is on with US, China,

Russia and Canada hiring the best talent to develop the technology for research, healthcare, and business purposes. High schools and post-secondary education need to focus and provide courses in AI and STEM and help encourage more women in this field. (typically, technological firms have over 75% male with 25% female participation rate with less 1% of women hold executive and board positions)

It is acceptable to have some healthy criticism of AI on how it may impose on our privacy and personal information security; this is where safeguards need to be put in place. Companies should develop AI with this mind, as invasion of privacy is a concern to the public and potential legal liability if someone is harmed. There are great AI concerns around bias and stereotyping that could harm society as seen with Microsoft’s chatbot Tay. The chatbot learned racial stereotyping through twitter feeds and then was later removed. To help prevent stereotyping of women, race, ethnicity it will be important to educate staff on what is appropriate versus unacceptable behaviour.

We as a society are already embracing AI as part of our personal lives using robotic vacuum cleaners (Roomba) to wearable devices (Fitbit) to having virtual assistants reminding us of appointments (Alexa, Google Home, etc.) and Siri on our smart devices. AI is already all around us, but it isn’t as advanced as the human brain – at least not yet.

Recommendations and Future of AI in the Workplace

Mark Zuckerberg, founder of Facebook, claims that “AI will be better than humans at most tasks in 5 to 10 years”. But is this truly AI where it has ‘human level machine intelligence’ (HLMI) or can it only perform very narrow task specific duties. It may be closer than we think as results from a recent survey of technology experts have predicted that HLMI will arrive between 2040-2050. (Müller, A.B., & Nick Bostrom, 2016.) The future of The Jetsons television show where automobiles fly in the air may be not be too far away — as driverless cars are here. Recently at University of Toronto, under the direction of Dr. Raquel Urtasun, the Uber autonomous car is controlled by AI and tested at the downtown campus. The field of AI research will generate more jobs with highly skilled and knowledgeable staff. Driverless cars will affect the transportation business including: taxis, bus drivers, transport and Uber drivers. According to the research these jobs will be eventually replaced by AI as it grows smarter through learning from mistakes and on its own and interacting with other cars on the cloud.

AI is vast, as it can have different applications within many industries including: health, energy, manufacturing, finance, technology, media, etc. We have seen the record stores and albums being replaced by Apps, smart phones, iPods, online streaming music streaming technologies and devices. Will we be so easily replaced? For now, jobs that are safe belong in the areas of human-to-human and human-to-machine interactions such as: therapists, teachers (in-house), artists, nurses, and executives. However, we have seen AI, maybe in its infancy stage provide care starting in 1966 with Eliza, the first chatbot algorithm, that replies to your responses that were typed in a computer. In Japan, caregivers (nurses) have been supported by AI with robots

dispensing medications and robotic companions used for Alzheimer patients. Japan is leading the way in robotics, AI, bio-technology and other innovative initiatives including a fully automated sushi restaurant where the only human intervention is employees watching from a remote location for security purposes and one sushi master chef overseeing the robotic operations. Restaurant staff in the future may become obsolete such as travel agents have also seen their jobs replaced by technology. Recruiters aren’t that much far away from being replaced by AI thanks to data analytics firm Alteryx. This is another field that is currently hot in the market; HR data driven analytics for predictive heuristics. In the movie Moneyball, starring Brad Pitt, they used data analytics to select the best players to create an effective baseball team. The old way of scouting talent was being replaced by statistical analysis. Applicant tracking systems (ATS) have automated the process by bringing candidates to the top of the list using algorithms for key word searches in resumes against job descriptions. AI is useful in scouting for talent virtually by using data analytics from the web, social media, internal ATS/HRIS and other in-house systems. HR is being asked to present more data to the executive team on HR functions through data [HR] analytics. HR has seen a disruption through automating processes using HRIS/HRMS which has displaced some workers who have not adopted or stayed current with this technology. The future of AI, robots and self-service in these areas is exciting but also disrupts HR as it will displace employees if they don’t seek training and re-skilling in this technology.

The future of health using AI and robots seems boundless in finding ways to help the deaf, blind and those with physical impairments (walking). These AI bio-technology implants can bring new meaning and life to those who are suffering. But there are implications such as negative perceptions that this will only serve those who can afford the technology to biases in trial selections. Back in 2016, at Toronto Sick Children’s Hospital, 3D printers with AI worked with human design to re-create a child’s human heart to be used as a model for surgeons. Other strides in this technology using AI, humans and 3D printers include joint replacement parts for surgeons and veterinarians. New heart replacement valves using AI and cell technology is also being tested.

Manual work is already being done by AI ranging from iRobot vacuum and in the future, it will drive cars and fold your laundry. Using AI will help free up time to focus on retraining to learn this technology. There are limitations for AI such as senses and feelings, but they are working on this as well with sight and voice recognition. Avigilon cameras are using analytics to determine shopping demographics. This could create issues around privacy (use and storage of personal data) and discrimination through profiling and biases. Other problematic future for AI is lack of socialization, human interaction, intimacy by forming relationships with technology as seen in the movie HER. According to Kathleen Richardson the design of robots for sex is a “dehumanizing practice”. Even those who are in the arts including: journalists, musicians, painters are being threatened by AI. The next AI revolution is working on the sense of smell which has out noted tea sommeliers. The hotel industry will see a huge disruption as with a Japanese hotel that is fully automated from the time one checks in (luggage pick-up) to when one leaves. AI will also create a shift in marine biology research as a new robot is in the ocean depths and tracking why whales are going to shore to die. AI is being

tested in post-secondary institutions. Findings by AI expert Noriko shown technology surpassed most humans in writing entrance exams and essays.

There may be a need for government intervention during the AI disruption through public and private cooperation in providing support through education subsidies. Another consideration is an income replacement subsidy that may be part of or separate from the current employment insurance program that provides income to those who are not working with or without taking training courses.

The days of saying a person will have 5-6 jobs in one’s lifetime has changed due to consumer preferences, labour market trends and will continue to do so with the evolution of technology. In the McKinsey study they report up to 375 Million workers may need to switch occupational categories (as shown in Appendix); which will require new skills training for existing and displaced employees. In order to be proactive companies will need to review their talent pool and will need create new processes and access if their employees require training for this new AI world. What is critical for business is to provide training for their employees to improve skills that could create a competitive advantage that will be either in AI or technology. If they decide to provide training (either on the job, in-house or external) it may help create more meaningful productive work; which can help with employee retention, loyalty, improved motivation through organizational citizenship behaviour. Professional development and new skills training for individuals will help them stay employable and potentially increase their wages if the training is related to technology. AI create benefits that may help with sustainability and environmental concerns. AI may also help communities prosper if used correctly such as empowering third world countries by creating new forms of employment.

As AI evolves, businesses need to make sure that they keep up with this innovative technology. Additionally, companies will need to ensure that AI meets their strategic needs while determining how they will utilize it in their offerings or to support internal processes. Companies will need to plan for the future to stay relevant and competitive by using SWOT analysis, incorporating change management, Porter’s Five Forces. A thorough review of present day processes and planning future ones using AI in the workplace will be an important practice. HR as we know it will have to evolve in taking care of both employees, managers while working with or for [AI] machines. Specialists in this area will have to manage change by squashing any unrealistic fears, potential flight risk issues and create new retention strategies to keep its top talent motivated and engaged.

There will be a requirement to have communication plans on AI project implementations. Within IT projects it is customary to leverage project management methodologies using the Project Management Book of Knowledge (PMBOK), an essential book for project managers, adapting the five process groups known as: Initiating, Planning, Executing, Monitoring and Controlling and Closing. When implementing AI, it will be important to plan to use these process groups to ensure a smooth, timely, cost effective implementation.

Government intervention will be needed in providing some type of employment insurance and/or income supplement and training subsidies for those who will be replaced by AI due to low skilled work. Since government and taxpayer dollars help subsidize education there needs to be more pressure on education of AI and STEM research. Additionally, regulation, auditing and inspecting that AI technology is to be developed and used for the greater good versus harm. Military should have safeguards to ensure that AI (missiles, drones, robots) are supervised by humans to prevent mistakes that could hurt innocent lives.

AI Think Tanks and partnerships should be created comprised of subject matter experts from various areas including: government, academia, business and the public should allow all levels of participation to help AI flourish and improve innovation with some regulations, overseeing, quality assurance and ethical boundaries. This is where education steps in to help with the hard (technical) and the softer (ethical) skills training. Helping educate staff will help remove some of the bias that may be entered by programmers in the algorithm.

Businesses and government will need to come together to help keep people working while automation is being adopted for the benefit of society and the economy. It is imperative that both need to embrace technologies and prepare for workforce transitions and challenges that will happen in the near future with more technology and AI entering the workplace. Creating sustainable investment in new transition programs, retraining, income support and a consortium between private and public sectors to plan and budget for these changes.

Businesses will have to prepare and plan for AI within their operations, HR, IT and customer offerings. This is where staying current with latest trends, reading on technological advancements will help businesses be knowledgeable and learn best practices on what types of AI to adopt and which ones to wait for the future. Succession planning and determining what are the current and future skills gaps is required to remain competitive and external recruiters are trying to garner your top talent away to the competition. Planning will also require investing training on current employees and forecasting what top talent skills are needed for the business. Investing in employee’s skills and providing the necessary training regardless if it is in-house (on the job, mentoring) or external (education providers) is critical to stay ahead of the ball curve. Getting employees involved and engaged in retraining will require communication, performance management and people management skills to sell the benefits of learning new skills. Time and money will need to be set aside to allow employees to return to school and try to implement their new skills on the job. Mentoring with subject matter experts that are in the workplace with those who are junior will help engage and retain top talent. Paying employees well for retention of hard to find technical and people managers will also need to be budgeted and forecasted. According to the latest McKinsey Global Institute report they forecast that “Job growth in the US and other advance economies will be in occupations currently at the high end of the wage distribution… The wage trend picture is quite different in emerging economies such as China and India, where our scenarios show that middle-wage jobs such as retail

salespeople and teachers will grow quickly as these economies develop”. (Mariyka, et al, 2017). Another option to consider is using consultants to help on projects including: business analysts, project managers, technical and business management consultants.

Conclusion

AI provides endless possibilities, opportunities and benefits if leveraged correctly. Many people may feel intimidated by this new technological advancement as there are potential risks for society if AI gets into the wrong hands or used for evil over good. Also, the fear of losing a job or the perception of not having control of the technology has helped create a negative argument against adopting AI.

The high financial costs to implement AI is a disadvantage as well as an employee’s negative perception of losing jobs. If AI becomes a real thinking and learning machine, where it is self-taught, another issue is how managers will lead this technology alongside humans. Managers will have to work with negative employee perceptions (job loss and wage cuts), changing schedules, unstable jobs within GIG economy (working part-time and/or project based). Whereas, highly skilled and hard to find AI experts will see their jobs in demand and compensation rise. (Kaplan, 2016). It is already difficult for companies to recruit and retain technology talent. This challenge will continue for companies with increased need for AI experts (data scientists, programmers, designers and IT architects). The impact of AI in the workplace according to Kaplan affects blue and white collar jobs where any tasks that are process driven (mental and physical) can be programmed into a computer. If physical requirements are needed in the workplace then a robot will need to be created with AI software to run the machine. We have seen robotics replace jobs in the automotive industry and the future in manufacturing does not look promising unless they embrace AI.

The field of AI technology is fascinating and can be a bit frightening on an individual and corporate level, if one is not prepared for it. The traditional methods of working will not remain the same regardless of what industry you are in, as technology is growing at an ever growing fast pace and in order to stay competitive, one will need to review the current work processes and adopt AI technology. To remain competitive requires research into AI and focus on leveraging AI technology in the workplace. Additionally, HR will need to be part of this initiative to embrace AI through data [HR] analytics to find the right talent and create succession plans. HR will need to ensure current employees will be successful in their jobs by accessing current skills and mapping against future skills required for the business. Any gaps in current talent will require training and development in AI technologies and/or find new talent to join the team. HR will also need to help support managers while they lead new and exciting teams that have both human and machine interaction. AI will help create value, strategic competitive advantage and sustainability within organizations and society.

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Appendix A

Appendix B

Appendix C

(Source: McKinsey Global Institute, December, 2017)

Appendix D

(Source: https://www.mckinsey.com/global-themes/digital-disruption/harnessing-automation-for- a-future-that-works)

Appendix E

(Source: https://www.pwc.com/gx/en/issues/analytics/assets/pwc-ai-analysis-sizing-the-prize- report.pdf)

Appendix F

(Source: https://www.pwc.com/gx/en/issues/analytics/assets/pwc-ai-analysis-sizing-the-prize- report.pdf)