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Digital Pulse

in·no·va·tion – A creation resulting from study and/or experimentation. The act of starting something new.

dis·rup·tion – An act of delaying or interrupting continuity. An event that results in displacement or discontinuity. The act of causing disorder.

Digital change is a journey, not a destination.
It requires agility and flexibility to underpin a continually evolving business environment.

Industry Change – The ongoing economic, technological and social development of commercial business and market sectors.

Looking beyond the face of AI

Looking beyond the face of AI

Key takeaways

  • Artificial intelligence (AI) has been closely associated with humanoid robots in popular culture.
  • One of the greatest benefits of the technology, however, is in its power to tackle complex business problems.
  • AI optimisation will transform industries, from manufacturing to retail, by maximising benefits and minimising cost and inefficiencies.

What is the first image that appears in your head when you think of the term artificial intelligence?

Chances are it’s a robot that can speedily perform menial labour, a chatbot to aid your online shopping experience, or even an computer with a knack for anticipating your needs before you do.

For the last century, popular culture has equated AI with sentient humanoid beings that possess human intelligence – albeit quicker, more efficient and often minus the capacity to make misjudgements and mistakes.

Consider, for example, C3PO, the helpful gold droid that starred in George Lucas’ 1977 epic Star Wars or more recently, Samantha, the OS that could crunch reams of data in a millisecond and becomes the companion of lonely protagonist Theodore in the 2014 Spike Jonze film Her.

Often, our understanding of AI – as well as its real-world applications – is rooted in imaginary connections between man and machine. The trouble with the obsession over humanoid robotics is that it focuses very heavily on emotions or sci-fi fantasy, while overlooking AI’s more practical opportunities.

Non-artificial, artificial intelligence

According to Sizing the Prize, a July 2017 report by PwC, AI could contribute up to US$15.7 trillion to the global economy by 2030 – more than the current output of India and China combined. Moreover, US$6.6 trillion of this is likely to stem from improved labour productivity, which will account for over 55% of global GDP growth from AI advances between 2017 and 2030.

These productivity gains are a result of businesses automating processes by incorporating robots and autonomous vehicles, augmenting their existing labour force via AI technologies as well as from the increased consumer demand stemming from personalised and better-quality products and services.

When it comes to driving this future productivity it’s likely that optimisation – the process of optimising inputs and outputs across multiple business objectives – will play a major role.

The value of optimisation

Despite our capacity to innovate relentlessly and invent trailblazing new technologies, complicated optimisation is not really a human strength. When applied to a complex business process, however, it can yield major improvements in terms of productivity, accuracy and efficiency.

Whether you’re trying to maximise profits or customer satisfaction or reduce the unwanted consequences of inefficiency or material wastage – and most importantly several such goals at the same time – optimisation is a powerful tool for solving essential business problems. In the future, it will play a key role in gaining a competitive edge.

Imagine, for instance, an algorithm that optimises the number of right- or left-turns taken by a delivery driver to reach a specific destination – resulting in less time sitting at lights, faster delivery time, less overtime and fewer accidents (parcel delivery service UPS famously did this). Or the airline successfully optimising the amount of drinks it will consume on a flight, a strategy that can support significant fuel savings costs because the plane isn’t carrying unnecessary weight while keeping customers happy because they can get the drink they want.

Optimisation aims to find the best solution out of all the potential options, given the context and constraints of a specific problem. When coupled with artificial intelligence technologies that are wired to find patterns in huge volumes of data, the possibilities are huge.

It’s worth noting that you can optimise without AI or incorporate an AI technology without optimisation. The process of optimisation isn’t necessarily about the type of technology or technique used to do it, no matter how cutting-edge the process might seem. It’s about investing in the technological choices that will solve your biggest business problems and get you closer to your desired result.

Optimisation in action

The ability to automate human processes and carry out tasks more efficiently is among AI’s greatest strengths.

It will transform industries such as manufacturing, logistics and retail, creating optimised solutions for everything from ensuring supply chains are operating effectively to producing built-to-order products based on customer demand. Optimisation algorithms can also set the stage for prescriptive analytics, sparking a series of iterations that lead to better results each time they run.

Although the relationship between optimisation and AI is still in its nascent stages, it’s already starting to revolutionise the way in which complex business operations are carried out around the world.

In June 2017, a Forbes article reported that General Electric had built a smart manufacturing system that increased production capacity to 20% and lowered material consumption rates by 4%¹. In April 2017, logistics giant DHL revealed that it’s currently using AI and predictive analytics to optimise the supply chain, including scheduling, resource planning and customer service².

A May 2017 report in Harvard Business Review predicted that AI is set to optimise business processes spanning everything from fraud detection in the finance sector, to personalised customer service in the retail industry and preemptive maintenance in the transport sector³.

Why it’s not about robots replacing humans

Conversations about AI often revolve around humanoid robots and man-machine interactions. What they neglect however, is how it is something much subtler that will change our world.

Not as deserving of a movie treatment perhaps, optimisation will create new efficiencies that turn industries on their head nonetheless.


PwC’s global AI study, released in July 2017, gives a detailed analysis of the business impact of AI. Download your copy of Sizing the Prize: What’s the real value of AI for your business and how can you capitalise?


1  www.forbes.com/sites/louiscolumbus/2016/06/26/10-ways-machine-learning-is-revolutionizing-manufacturing/#726c937028c2
2  www.ioti.com/industrial-iot/artificial-intelligence-unshackling-dhls-supply-chain-potential
3  https://hbr.org/2017/05/8-ways-machine-learning-is-improving-companies-work-processes

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