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After the AI Summit Hong Kong, we caught up with PwC’s global data and analytics leader, Gerard Verweij, to reflect on the event and to address the ways AI is impacting and disrupting the global marketplace today.
PwC is actively engaged in the AI ecosystem through their partnerships with academic and research institutes, alliance partners and multiple start-ups and organisations. We sat down with Gerard to discuss how business leaders should anticipate entering the augmented age and best leverage the benefits of artificial intelligence.
AI is the largest commercial opportunity in today’s economy and is set to entirely alter and transform a range of industries and businesses from top to bottom. In their 2017 annual report, 'Sizing the Prize', PwC estimated that AI will have a $15.7 trillion boost on global GDP in the period to 2030 – the equivalent of the current combined output of China and India. PwC state that from this total amount, $6.6 trillion is likely to come from increased productivity and $9.1 trillion is likely to come from consumption-side effects. In our interview, Gerard discusses how this change will be felt and how business leaders can best prepare for the disruption and opportunities triggered by the AI Revolution.
Gerard began by arguing that organisational transformation will be felt in three main areas: production, consumption, disruption, and change. He then evaluated where we are likely to see the greatest change over the next 3 years;
‘All industry sectors will be impacted but healthcare, automotive and financial services are likely to benefit most in the short term. Production gains will be realized first…
‘…Industries with high degrees of routine manual and cognitive processes in their production processes are most exposed to this first phase of disruption. For organizations, there is a huge amount of expectation surrounding AI. There’s also a significant amount of wariness. Much of that is based on a misunderstanding of how and where AI operates.’
Gerard reflects that disruption & change to business models and value chains have significant threats and opportunities, but ultimately he feels success entirely depends on how organizations recognize and adapt to changing technology today;
‘In many industries, the competitors of 2030 don’t even exist today. Emerging markets have opportunities to leapfrog more developed competitors. In ten years’ time, a start-up or business in its infancy could be the market leader in your sector. Organizations can’t stick their head in the sand or take a narrow view of the opportunities.
'Companies at the most risk of being threatened or disrupted by AI will be those that think it’s in the future, not now.'
Gerard continues… ‘Organizations need to understand the current opportunities and disruption risks. Those that make investments to leverage in front, middle and back office processes, supported and understood by top management will see the gains. It’s an end to end, not project based solution. In the long term, winners will be those who not only exploit the production applications of AI, but also have an eye on how it can address the unseen and unspoken preferences of consumers, and then build products and services to meet these needs.’
Gerard explained the areas where businesses need to be targeting investment in order to harness AI effectively. He argues that Infrastructure and talent are the two essential investment areas and cites data scientists, AI engineers and ‘creative talent’ as fundamental additions to any successful team;
‘Organizations could look at how AI has been applied already – and examine what they can learn from that in terms of the skills needed and how they were developed/recruited. Remember AI may replace some jobs, but it will also open up opportunities for new roles and skills. Understanding how AI can be deployed (whether automated, or augmenting what you do) will help you identify what kind of investment and skills you need.’
‘Our PwC Global AI study is the accumulation of industry and function-specific examples of where AI is actually in use today, and what the potential is for the short, medium and long term. It will help organizations identify the return on investment and build out what their requirements for these applications might be.’
‘If information is power, then AI is its zenith. Yet like all power, it needs to be applied with insight, sensitivity, and responsibility.’
Gerard listed some of his main considerations for business leaders looking to leverage the power of AI today and admitted that access to data is a prerequisite for success; ‘AI capabilities - and models in general - are only as good as the data that underlies them. Big Data is critical to the success of AI and organizations need to increase their access to data (both internal as well as external), and how they organize and quantify data.’
Gerard reveals an example, ‘In order to determine the best treatments for MS patients, we used 15 years’ worth of data of MS patients obtained through doctors’ networks. We then used machine learning to help predict what the impact will be of several potential treatments to individual MS patients. We continuously enrich and enlarge the data set with new available data to refine our approach and results’.
PwC claim that they are leading the discussion regarding the risks and dangers related to AI development. They have published a practical online framework advising organisations to think through the threats and concerns to help business leaders build trust and confidence in AI.
67% of CEOs think that AI and automation will have a negative impact on stakeholder trust over the next five years’
Gerard argues that for boards to give the green light to AI ‘they need to have assurance on strategy, how the technology will be implemented and all the possible outputs and outcomes.’ He feels it is vital for businesses ‘to build, develop and leverage AI in a responsible and transparent way to maintain the confidence of customers and wider stakeholder’.
Gerard reveals the three pillars for achieving this that organisations need to keep at the forefront.
We asked Gerard about what he gained from his experience at the AI Summit Hong Kong. Gerard stated;
‘The AI Summit is a forum to participate in the broader AI eco system and support the ongoing debate and development of AI. We are still in the early stage of development and application -especially in enterprises and there are several complex problems and challenges that need to be solved for which PwC can provide significant contributions. Ultimately, the AI summit allows us to share our deep experiences and knowledge in this area as well as learn from others as to what value they add to the eco system as well as what lessons they have learned in the adoption of AI.’