In this cynical age, when yesterday’s big thing is tomorrow’s yawn, it’s legitimate to ask: Has artificial intelligence hit the overhyped stage already?
The answer: No.
Not only has AI not been overhyped, its potential has not nearly been realized. It has years and years ahead of it to develop in ways not yet conceived. In fact, the conversation about AI has progressed from what it is to what it could do—not to mention how it is already being applied.
Financial fits AI
This is particularly true in banking, and financial services in general.
A KPMG study finds that nearly 80% of U.S. banking CEOs are increasing investments in their companies’ digital transformation. Top of their list are robotic process automation and cognitive technologies, both subsets of AI.
Why? “Digital transformation begins with enhancing the customer experience but the real payoff comes when they digitize their entire enterprise—using technologies such as RPA to eliminate repetitive tasks and gain operational efficiencies, and so employees can focus on continuing to improve the customer experience,” says Jitendra Sharma, KPMG’s National Advisory Leader for Financial Services. [RPA stands for “robotic process automation.”]
This simple statement should be heartening for these bank CEOs. Another survey, by MIT Sloan Management Review and the Boston Consulting Group, finds that while 75% of business executives in general expect AI to create competitive advantage or new lines of business for their companies, only one in 20 has extensively incorporated AI into its current offering or processes.
“The gap between ambition and execution is large at most companies,” says Philipp Gerbert, BCG senior partner. (Emphasis added.)
Hype is out there, of course
So it is fair to say that AI is not yet overhyped—but it may, as a Wolters Kluwer blog cites Gartner’s annual “hype cycle,” be at “peak of inflated expectations” before heading into “trough of disillusionment,” only to rebound into the “slope of enlightenment” and ultimately to “plateau of productivity” (all Gartner terms, not mine).
However, as Wolters Kluwer CEO Nancy McKinstry says, AI “has already moved from the incubator into the real world.”
All kinds of intelligence
Meanwhile, Gartner, in a subsequent notice, cites AI, intelligent apps, and intelligent things, as the top three strategic technology trends for 2018—and likely will drive the payoff for digital initiatives through the coming years.
“The first three strategic technology trends explore how artificial intelligence (AI) and machine learning are seeping into virtually everything and represent a major battleground for technology providers over the next five years,” Gartner says.
Back to the Wolters Kluwer very informative blog, three things (out of many) are notable here. First, there are four things to know about AI:
• There is not one, true definition of AI.
• AI is a collection of technologies and not a monolithic thing.
• AI terminologies can be ambiguous.
• All AI is not equal.
Second, if companies are to unlock the value of AI, they will have to figure out which problems they are best placed to solve. Says McKinstry, the best way to start is “to focus on a very small pain point first. Get that right, and then build out from there.”
Third, the “intelligence” part of AI should not be over-stressed.
At best, it is a “one-trick pony” that can augment but not replace the human experts in the operational and service environment.
“While AI offers great opportunities in cost, efficiency, and productivity benefits, it is the company’s human experts who bring deep insight into our customers’ most challenging problems. As well as providing the checks and balances throughout, they bring nuance, context, meaning—and of course, empathic communication,” the Wolters Kluwer blog concludes.
“Powered by AI”—coming to … well, everything
Pretty soon—again per this blog—“Powered by AI” will be on the label of everything through the end of this decade. So where is it being used now? Here are some recent indications.
• An MIT Technology Review report, sponsored by Genesys, surveyed senior executives globally and found that 91% of the companies that were deemed having the highest levels of customer experience satisfaction and brand recognition deploy AI solutions to achieve those results.
These include applications that include chatbots, customer analytic capabilities, and virtual assistants. Significantly, the researchers found that these high-performing companies consistently recognize that AI tools are most effective when they supplement and extend the capabilities of their customer support team, rather than replace them.
• An Oracle blog by Jenna Danko, advocates for the use of AI in anti-money-laundering detection.
“An AI approach to AML … does not require developers to establish rules that identify potentially criminal transactions. Instead, the system would be trained to identify such transactions over time by analyzing a staggering array of factors,” Danko writes.
What is in this “staggering array”?
Says Danko: “These could eventually come to include where a customer opens an account relative to their home address, what time of day an account was opened, duration between transactions, patterns among the merchants where a customer makes transactions, relationships between other customers of those same merchants, whether a customer uses a mobile telephone, what communication channel a customer uses to contact the bank, and even changes in a customer’s social media presence.”
• Amplero, which specializes in AI marketing technology, finds in a survey by Forrester Consulting that 63% of B2C marketers believe they have too much data to process manually to gain actionable insights on campaigns.
“We believe that marketing has reached an inflection point where companies are increasingly looking to artificial intelligence marketing technology to orchestrate omnichannel customer experiences based on their entire customer data ecosystem,” says Olly Downs, CEO, Amplero.
Let’s get real … really!
It bears reemphasizing the persistent theme running through these and other announcements: growing recognition that AI alone really is not the answer.
For example, Elizabeth Bramson-Boudreau, CEO and publisher at MIT Technology Review, says:
“Iconic firms [those with the top customer satisfaction and brand recognition] realizing the limitations of a technology-centric approach to maintaining desired customer management levels, place a high value on human capital investment, and are keen to strike the right balance between human and automated customer channels.”
Says Wolters Kluwer: “Without doubt, the combination of machine and human, will make for a fascinating future.”
This realization alone should show that AI has not, and hopefully never will, be overhyped.
- Almost 100% of Community Bank Leaders Predict Imminent Recession
- Hanover Bank Expands Reach into Long Island
- Climate change presents both risk and opportunity
- Buy Now, Pay Later Services Are Walking a Tightrope—Unless We Get the Technology Right
- Federal Reserve launches proposal on Libor default rules