The AI hype is real… so what is it?

Personally, I love to make buzzwords work in practice. However, to be able to apply them, you need to know what they mean first. Take Artificial Intelligence (AI). What is it? What does it really? Let’s find out.

When it comes to building digital capabilities in your organisation, AI comes to mind quite often. Davenport & Ronanki describe clearly what AI is in their Harvard Business Review article (January/ February 2018). They distinguish three types of AI:

• Process Automation;
• Cognitive Insight;
• Cognitive Engagement.

Process Automation

Process automation is the most common type of AI. It is the automation of digital and physical tasks using robotic process automation (RPA). RPA is the least expensive cognitive technology and the easiest to implement. It typically brings a quick and high return on investment. RPA is more advanced than earlier business-process automation tools, because the ‘ robots’ (code on a server) act like a human inputting and consuming information from multiple IT systems. However, it is not programmed to learn and improve (yet). In practice RPA is used, for instance, to transfer data from e-mail and call center systems into systems of record. Or, amongst others, to read legal and contractual documents to extract provisions using natural language processing.

Cognitive Insight

Applications that typically use algorithms to detect patterns in vast volumes of data and interpret their meaning. These are machine-learning applications and, for instance, used to predict what a particular customer is likely to buy. They are also used to automate personalized targeting of digital ads.

Cognitive insight applications are often used to improve performance on jobs only machines can do. Jobs that involve such high-speed data crunching and automation that they’ve long been beyond human ability. For that reason they’re not a threat to human jobs in general.

Cognitive Engagement

Projects that engage employees and customers using natural language processing chatbots, intelligent agents, and machine learning. An example is an internal website for answering employee questions on topics like IT and HR. Davenport and Ronanki found in their research that cognitive engagement was the least used in organizations and -if used- particularly internal. Companies tend to take a conservative approach to customer facing cognitive engagement, mostly because of their immaturity.

Now we have an idea what the concept of AI contains. The next question that appears is: how can you apply AI? How can cognitive technologies be used in practice to solve business problems? How does it add value to business needs or a digital transformation in general? We’ll have a look at that in another blog.

Read the full article of Davenport & Ronanki in Harvard Business Review.