August 1, 2017
AI is already improving industry processes, creating new ways to work, and making a new generation of machines “smart.”
Artificial intelligence (AI) is an umbrella term for “smart” technologies that are aware of and can learn from their environments, enabling them to subsequently take autonomous action. Robotic process automation, machine learning, natural language processing, and neural networks all incorporate AI into their operations. The most distinguishing aspect that separates AI from other general-purpose software is that it can enable machines to respond on their own to signals from the external world–signals that programmers do not directly control and therefore cannot anticipate.
AI enables a variety of other emerging technologies as well. For example, it provides the “brain power” that allows robots to take on human-like characteristics, and it lends the analytical muscle that derives meaning from—and can act on—the flood of data generated by billions of interconnected devices in the internet of things (IoT).
The AI market is growing quickly, attracting more than $3 billion in venture funding in 2016, according to a PwC/CB Insights MoneyTree™ Report. There’s a great deal of hype surrounding AI, and it is often portrayed as either a servant, enabling technologies to be more responsive to the humans that operate them, or an overlord, eliminating jobs and violating privacy. But for business executives, it is primarily an enabler of enhanced innovation and increased productivity. Yes, it may eliminate some existing jobs, but it will also fundamentally change work processes by pairing people and machines in newly efficient ways and creating more productive workplaces.
In our broad definition, AI is a collective term for computer systems that can sense their environment, think, learn, and take action in response to what they’re sensing and their objectives. Forms of AI in use today include, among others, digital assistants, chatbots and machine learning. AI works in four ways:
- Automated intelligence: Automation of manual/cognitive and routine/non-routine tasks.
- Assisted intelligence: Helping people to perform tasks faster and better.
- Augmented intelligence: Helping people to make better decisions.
- Autonomous intelligence: Automating decision making processes without human intervention.
As humans and machines collaborate more closely, and AI innovations come out of the research lab and into the mainstream, the transformational possibilities are staggering.
According to PwC’s 2017 Global Digital IQ Survey, the number of companies that are investing or have plans to invest in AI is second only to the number of companies that are investing in the IoT. Today, 54 percent of the companies surveyed are investing in AI, while 63 percent say they plan to do so in three years. North American and Western European companies lead the way in pioneering and adopting AI technologies, as do insurers, entertainment and media companies, and healthcare payers. In three years, information and communications firms, asset managers, capital markets, hospitality and leisure, and professional services firms expect to throw their hats into the AI ring.