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Digital Transformation Review Eleventh Edition Digital Transformation Review Eleventh Edition Artificial Intelligence Decoded 2 Artificial Intelligence Decoded Digital Transformation Review Eleventh Edition Artificial Intelligence Decoded Edited by Capgemini Research Institute About the Capgemini Research Institute: The Capgemini Research Institute is Capgemini’s in-house think-tank on all things digital. The Institute publishes research on the impact of digital technologies on large traditional businesses. The team draws on the worldwide network of Capgemini experts and works closely with academic and technology partners. The Institute has dedicated research centers in India, the United Kingdom, and the United States. @capgemini #DTR11 www.capgemini.com/the-digital-transformation-institute Artificial Intelligence Decoded 3 Contents 06 Academia Lanny Cohen’s foreword 32 Professor Luciano Floridi, University of Oxford AI: Adaptable Intelligence 08 Editorial Artificial Intelligence: Preparing Organizations and their People for 38 Drastic Change Michael Schrage, MIT AI: Survival of the Smartest View from Large Organizations The ‘Valley’ 16 Michael Natusch, Prudential Plc 46 AI: Augmented Intelligence Frank Chen, a16z Matches People and Machines Make AI a Daily Habit 22 56 Rajen Sheth, Atif Rafiq, Google Volvo Cars Putting AI to Work: With Customers Democratizing AI for Traditional and Within the Enterprise Businesses 4 Artificial Intelligence Decoded 62 Capgemini Babak Hodjat, Perspective Sentient Technologies AI: Already Delivering Measurable Results across Sectors 92 Turning AI Into Concrete Value Tech Leaders The Successful Implementers’ Toolkit 72 Rob High, 108 IBM Watson Conversational AI – Augmenting, Not Replacing, Commerce Human Intelligence Why Consumers Are Embracing Voice Assistants in Their Lives 78 Lili Cheng, Microsoft The Need for a Long-term AI Strategy 84 Amr Awadallah, Cloudera AI: Automating, Accelerating and Improving Decision-Making Artificial Intelligence Decoded 5 Lanny Cohen’s foreword Lanny Cohen, Group Chief Innovation Officer, Capgemini @LannySCohen 6 Artificial Intelligence Decoded Alexa, please write this foreword for me.” It’s not beyond the realms of possibility that a AI can transform or replace existing business machine could write this foreword. After all, Artificial processes or create new ones, driving down costs and Intelligence is now doing the work that used to be delivering greater speed, agility and quality. There the preserve of radiologists with vast experience and are numerous new use cases and data-driven revenue carefully honed knowledge. streams, creating new sources of competitive advantages for bold organizations. It’s this revolutionary impact that leads me as the Group Chief Innovation Officer at Capgemini to Not all organizations will complete the journey, or believe that AI will be the most debated, invested keep up the pace, however. It will require singular in, and disruptive business technology trend over determination and vision to drive progress in AI, the coming years. It’s both timely and a privilege, natural language processing, cognitive computing, therefore, to introduce this compilation of expert machine learning and machine-to-machine insights – drawing on the views of CXOs, academics, communication. venture capitalists and futurists – and curated by the Capgemini Research Institute. Whether you see yourself as a proactive adopter or a watchful bystander when it comes to AI, I urge you These insights, and our own interactions with clients, to use this Review as a reference. It is intended to show that companies are transitioning to the age inform and prepare our readers for an uncertain, but of the intelligent enterprise. The opportunities to certainly exciting, future. use AI are numerous, from customer experience to operations, cyber security to risk orchestration. Artificial Intelligence Decoded 7 Artificial Intelligence: Preparing organizations and their people for drastic change Introduction by Capgemini Research Institute History is littered with examples of how new reactions, with our analysis showing that negative technologies create anxiety about job losses, and media coverage far exceeds the positive (see Figure Artificial Intelligence is no exception. Anxiety levels 1). A fog of anxiety and ill-informed opinion is around the technology colors perceptions and obscuring the risks and opportunities of AI. Figure 1: AI media coverage: sentiment analysis 300 250 200 150 100 50 0 2016 Q2 2016 Q3 2016 Q4 2017 Q1 2017 Q2 2017 Q3 2017 Q4 Positive Negative Source: News articles during June/July 2017. Note: Sentiment (volume of positive/negative social media messages) as measured through headlines on Artificial Intelligence and related topics from top media publications in the mentioned time period. 8 Artificial Intelligence Decoded To cut through the fog, this edition of the Digital corporates, tech startups, academics, venture Transformation Review presents a more nuanced capitalists, futurists, and technology vendors. We perspective on AI. To understand and explain how also launched extensive global research surveys to AI could benefit industry and society, we conducted examine AI and a current hot topic in the industry – wide-ranging research. We spoke to leaders voice assistants. and experts from a broad spectrum: traditional Artificial Intelligence Decoded 9 10 Artificial Intelligence Decoded Leader and expert interviews: from Oxford University to Google I am not worried about future generations, but more about us – the generation that is undergoing the shift. This will be traumatic, but more because of the pace rather than the nature of the phenomenon. Society needs to help those who will feel the brunt of the drastic changes.” Professor Luciano Floridi, Oxford Internet Institute, University of Oxford Artificial Intelligence Decoded 11 Large organizations Michael Natusch, Atif Rafiq, Prudential, Volvo Cars, believes that AI can help explains how AI is helping employees work to the best of Volvo, both internally and their capabilities, which is why he with customers. calls AI ‘Augmented Intelligence’. Academia Professor Luciano Floridi, Michael Schrage, Oxford University, MIT, argues that new technologies outlines how AI is already such as AI are not the problem – competing with humans. it’s actually the pace of change. The ‘Valley’ Frank Chen Google’s Sentient of Andreessen Rajen Sheth Technologies’ Horowitz (a16z) explains how things work Babak Hodjat explains why he thinks at an “AI-first” company gives the startup view this chapter in AI is like Google. on AI and outlines different from previous where this technology ones, and how the is already delivering current AI talent gap is concrete results. only temporary. Tech Leaders Rob High, Microsoft’s Cloudera’s IBM Watson, Lili Cheng Amr Awadallah argues that we should outlines why outlines why we should treat AI as a tool for organizations need a not just see AI as augmenting human long-term AI strategy ‘intelligence’, but more intelligence, not and where AI can have as the automation of replacing it. the most impact. decision-making. 12 Artificial Intelligence Decoded At Google, we emphasize that AI is not something that should be done by only one group. AI is something that should be pervasive. Over the last two years, we’ve gone from around a couple hundred projects at Google using AI to almost 7,500 projects.” Rajen Sheth, Senior Director, Product Management, Google Capgemini perspective: global research In ‘Turning AI into concrete value: the successful AI used to be a very specialized area of academic implementers’ toolkit’, we share findings from a research that was only discussed in specialist circles. global study of nearly 1,000 organizations that are But as AI has moved from research lab to mainstream already implementing AI at scale. We found that AI attention, a great deal of anxiety has been unleashed. is creating new roles in 4 out of 5 companies. And, We hope this edition of the Digital Transformation in ‘Conversational Commerce: Why Consumers Review helps our readers arrive at a more considered Are Embracing Voice Assistants in Their Lives‘, we and informed view of this transformative technology. take a deep dive into growing consumer interest in Please reach out to us if you would like to discuss voice assistants, drawing on a survey of over 5,000 any of these topics and the implications for consumers. Even at this early stage, we found that your organization. nearly a quarter of consumers would prefer to interact with a voice assistant than use a company For more information, please contact the website, and that this will grow to 40% within Capgemini Research Institute and send your email three years. to: [email protected] Artificial Intelligence Decoded 13 14 Artificial Intelligence Decoded View from Large Organizations Artificial Intelligence Decoded 15 Michael is the Global Head of AI in AI: the Group Digital team of Prudential plc. He joined Prudential from Silicon Augmented Valley based Pivotal Labs where he led the Data Science team. His Intelligence experience lies in the application of artificial intelligence methods to Matches large-scale, multi-structured data sets, in particular neural network-based People and deep learning techniques. Michael previously founded and sold a ‘Silicon Machines Roundabout’ based startup and prior to that was a partner at a major consulting firm. Michael holds a PhD in Theoretical Physics from the University of Cambridge and is a Fellow of the Royal Statistical Society. The Capgemini
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