December 2018 Artificial Intelligence A Starter Guide to the Future of Business An ACS report “AI is the new electricity. Just as 100 years ago electricity transformed industry after industry, AI will now do the same.” Andrew Ng, Co-Founder Google Brain. Foreword If popular culture is to be believed, artificial intelligence will be the end of our civilisation – movies like Terminator and 2001: A Space Odyssey offer a vision of just what a manufactured intelligence – an artificial intelligence – will look like when its intellect is enough to rival our own. The truth, for now, is much Which raises the question: its keen uptake of technology – more benign though no less what can it do for you and there are tangible benefits for world-changing. While the your business? Are there anyone leveraging AI to get to underlying computer science opportunities where AI can market first. upon which artificial intelligence add value to the organisation, rests is not new – MIT’s Artificial optimise efficiencies, or create If you’ve been wondering what Intelligence Laboratory was entirely new revenue streams? AI can do for you, we hope this founded in 1959 – a perfect guide will help you fill in the storm of cheap and powerful As the technology continues gaps about the opportunities networked computing power, to evolve at breakneck speed, of artificial intelligence as a advances in machine learning the potential applications will business driver, and provide a algorithms, and the production become almost limitless. We practical base from which to and storage of vast volumes of will eventually see it playing a develop and launch your own AI data have catapulted artificial role in every major industry, projects. while at the same time intelligence from science fiction Yohan Ramasundara to science fact. revolutionising how we live and work. President, ACS For many businesses it has gone from pie-in-the- And, despite the fact that most sky potential to real-world of the pioneering work comes production – you’ve likely been from big tech companies like using it for some time without Amazon, Apple, and Google, the realising it. Services like cost for entry has been rapidly Amazon’s Alexa and Apple’s falling as the tools and services Siri are clear examples of to build AI products become artificial intelligence applied commoditised. As this guide will as virtual assistants, while show, even small to medium Google’s plethora of services enterprises can get involved with Andrew Johnson from image searching to voice the right framework and people Chief Executive Officer, ACS recognition are all possible on board. thanks to AI. In fact, it’s Now is the time to get involved. becoming so commoditised that Even small projects can lead even smartphones are able to to entirely new business identify images within a fraction opportunities as the potential of a second, all on their own of AI is explored, maintaining hardware, thanks to AI. competitiveness in the market, Make no mistake – artificial or allowing the creation of intelligence isn’t coming. It’s an entirely new competitive already here. advantage. For Australia especially – a nation known for ARTIFICIAL INTELLIGENCE - A STARTER GUIDE TO THE FUTURE OF BUSINESS 3 Contents 01 Why AI? 8 Where we are now 10 Progress to date 16 What the experts say 21 Have we been here before? 24 Looking ahead 26 02 Executive Summary 7 AI as a business driver 28 Benefits of AI at present 30 Real world applications of AI 35 What the big ICT companies are doing 44 Driving your business ahead 46 4 04 Ethical considerations 72 What is ethics anyway? 74 Dividing up the problem 77 Battling bias 79 Legal concerns 81 The need for 03 transparency 83 Building AI for your Ethical design 86 business 48 Recommendations for an ethics-driven How to leverage AI in business 92 your organisation 50 How to be clear on the problem to solve 53 05 What does the How to build the future hold? 96 business case 56 Practical advice for The AI hype cycle 97 building your AI AI focused silicon 98 capability 59 Commoditisation of AI 100 Focusing data as a The increase in strategy 59 automation 101 Sourcing skills Towards a general AI 104 and roles 66 Build, buy, or outsource? 68 ARTIFICIAL INTELLIGENCE - A STARTER GUIDE TO THE FUTURE OF BUSINESS 5 6 Executive summary Artificial Intelligence is set to change the world. Where once it was the realm of science-fiction, AI is now a rapidly growing business driver that has seen some of the world’s largest tech companies invest heavily in it as a strategic imperative. Already, it plays a part in our models and products to look for The scope and capabilities of lives, from search engines key opportunities for growth. AI enable it to be used at every and image recognition, to These can include optimising level of business, from decision email spam filtering and even business processes, improving making to physical operations. recommending what products efficiencies and cost savings, or In turn this means that you might like to buy. Its building entirely new revenue increasingly we will see AI have versatility and capability allow streams and can cross fields a very real impact on the well- it to tackle a vast range of such as automation, predictive being of people. This report also business problems in addition analytics, business intelligence, walks you through an ethical to the creation of entirely new preventative maintenance, framework in order to integrate products and services that didn’t customer service and even ethical considerations that are exist – couldn’t have existed – content creation. a vital component in the design, even a few years ago. production, and deployment of Investing in AI for your own AI-based products and services. It is a game changer that will organisation will likely require alter the economic and social some new skillsets and an We hope you find this report landscape right now and for the appetite to explore, so we an informative, easy to follow, foreseeable future. This guide also provide a framework and educational and enjoyable read. presents an introduction to the practical guidance on what will For more information about ACS capabilities of AI as they stand be required to get a business products and services, visit our today, how it has currently been plan signed off and a project website at www.acs.org.au. implemented, what the big on the road. Ultimately a core players are up to, and where component of this is data – the the benefits lie as a background lifeblood of artificial intelligence from which to spur your own – and how your business ideas for your organisation. captures, manages, and stores data in order to derive value The report then delves into from it. It is data that will leveraging AI for your own enable, train, and refine your AI business. It provides a guide to product or service and so now is understanding the capabilities a good time to become data- and potential of AI, and applying focused. this against current business ARTIFICIAL INTELLIGENCE - A STARTER GUIDE TO THE FUTURE OF BUSINESS 7 01 8 Why AI? Artificial intelligence – as the phrase is often used today – is a bit of misnomer. We tend to think of intelligence in human terms: self- awareness, the capacity for independent thought, the capability to reason, and autonomous decision making among other traits. These capabilities are far beyond intelligence – for the moment – Today’s artificial the implementation of artificial is heavily built for recognising intelligence – for the intelligence that we have today, and learning from patterns in moment – is heavily though all indicators point to a ways that humans never could, built for recognising and future where this will one day be to produce results beyond what humans currently can. learning from patterns in possible. ways that humans never Instead, artificial intelligence is For example, take facial could, to produce results at present confined to narrow, recognition. We take recognising beyond what humans highly focused tasks that a face for granted, but for an currently can. leverage computers to do what artificial intelligence algorithm they do best: process data, and it must be taught what a face is lots of it, very fast. from the ground up by feeding it thousands and thousands Ultimately most everything of images of faces until it can be broken down into data. learns the visual patterns that And not just in the sense of represent a human face. Then, databases of customer details, the algorithm can do what Word documents and the emails humans can’t – pull a face out of that might make up a business. crowd faster than you can blink, Data is also voice, images, and do it all day, every day if we movies, music, and more. so wish. Anything, in fact, that we can This is largely where we digitise is data. see AI applied today: image And where there is data, there recognition, speech recognition, are patterns. Today’s artificial natural language processing, ARTIFICIAL INTELLIGENCE - A STARTER GUIDE TO THE FUTURE OF BUSINESS 9 At its heart, machine learning is a method to build analytical models based on algorithms that can learn from data, identify patterns, and make decisions with minimal human intervention. and in fields like predictive other cars, or even the random analytics, process optimisation, elements of human behaviour. Where we and even recommendation A future, in fact, of safer are now engines (think ‘other shoppers roads that humans – prone Most of the work in AI today like you also bought...’ from to mistakes, tiredness, rage, revolves predominantly around Amazon) – and all the ways and age – could never create.