Stock trading: In 2015, six of the top eight hedge funds in the U.S. earned around $8 billion based largely — or exclusively — on AI algorithms. “The machine” has already won in stock picking.
Healthcare: AI is quickly surpassing the capabilities of human radiologists. At Houston Methodist Hospital, AI software interprets results of breast X-rays 30 times faster than doctors do, and with 99% accuracy.
Law: AI-enhanced computer systems are conducting discovery and due diligence far better, faster, and cheaper than the most talented paralegals. Soon, relying only on humans for discovery might become grounds for malpractice.
For many people, the encroachment of AI into the human sphere — and the rise of the new machine fueled by AI, algorithms, bots and big data — raises a discomfiting question: If machines can do everything, then how are humans going to make a living?
This question has been going through my mind, and those of my colleagues at Cognizant’s Center for the Future of Work, for a while, too. Which is why we’ve worked to define how technology will shape the opportunities and threats we face, and to foresee how man and machine will relate and coexist.
Man and Machine
The bottom line: It’s going to be all right. Will the new machines displace many current workers? Yes. However, on a larger scale, new machines will also create work that is better, more productive, more satisfying than ever before, raising living standards and ushering in a period of widely distributed economic growth.
But there’s a catch. Businesses must embrace two truths:
In short, the changes you make now are critical for preparing for the next era.
Based on our work with Global 2000 companies, we’ve developed a structured approach for moving forward, which we call the AHEAD model. The model is essentially a playbook that outlines five specific approaches for winning with AI, each with its own set of approaches and tactics.
Automate: It’s a once-in-a-generation opportunity: Organizations that deploy intelligent process automation can completely change their cost structures and significantly increase the velocity and quality of their operations. It’s the only way to compete at the “Amazon cost” and the “Google speed” required in the digital age.
To force yourself and your team to reimagine how work can be done, apply the 25%-25% rule: Set expected cost reductions at 25%, and an associated productivity increase of 25%. It will quickly become clear that traditional approaches are not good enough and that only AI-driven digital automation will deliver expected results.
Halo: Every industrial revolution was catalyzed by a raw material: coal, steel, oil, electricity. Today, it’s data. Businesses need to understand how to take this commodity — available to each and every one of us — and turn it into a competitive advantage.
The race is on to instrument products and people and leverage the data they generate (what we call Code Halos) and then use the resulting insights to create new customer experiences and business models. By doing so, you can become a “Know-It-All” business — one that uses sensors and instrumentation to know everything about everything.
General Electric and Nike are great examples of companies changing the rules of the game in their industries by instrumenting their products, surrounding them with halos of data, and creating new value propositions and customer intimacy.
Enhance: We believe the best way to understand our future is to see smart machines not as competitors taking our jobs but as companions, increasing our job productivity and satisfaction. Think of how a GPS currently enhances your driving. In the coming years, entire vocations, from sales to nursing to teaching, will be enhanced by the new machines, and the vast majority of us will choose to work with the enhanced human — the one equipped with a sophisticated system of intelligence at their side.
When the computer does what it does well, it allows us to focus more on what we do well. In an enhanced world of more pervasive technology, uniquely human activities will become even more important: being empathetic, building relationships, making sense of complex situations, etc.
Abundance: The economic idea of abundance is actually quite old: The loom led to abundance in clothing, the steam engine to abundance in transoceanic travel, and the assembly line to an abundance of appliances and automobiles for consumers around the world. These products went from rare luxuries, to democratized and ubiquitous.
With the new machines, we will soon experience a new wave of abundance, in areas such as financial services, insurance, healthcare, entertainment and education. As the new machine drives price points down, markets of abundance will be established, driving sales up to unimagined levels. Will your organization seize advantage with the new abundance or fall victim to it?
Discovery: While machines will do more of our current work, the process of innovation will allow us to discover entirely new things to do that will ultimately become the core of what we do in the future. When the lawn mower was invented in 1827, for example, who knew it would lead to the global sports industry, now worth $620 billion annually? Systems of intelligence are now creating the foundation on which new industries and new jobs will be built.
We’re already seeing digital leaders place discovery bets on their “lawn mowers” (think Mark Zuckerberg and the Oculus VR purchase, or bank trials of blockchain). Your job is to imagine the new forms of value you can create with the new machine.
Whether you’re managing a large enterprise or just starting your first job, deciding what to do about the new machine — this new cocktail of AI, algorithms, bots and big data — will be the single biggest determinant of your future success. Similar to the world’s previous “industrial revolutions,” this one will steamroll those who wait and watch, and will unleash enormous prospects and prosperity for those who learn to harness the new machine.
This content originally appeared as a blog on Weforum.org and was written by Ben Pring, co-director of Cognizant’s Center for the Future of Work. He — along with Malcolm Frank and Paul Roehrig — is a co-author of What To Do When Machines Do Everything: How to Get Ahead in a World of AI, Algorithms, Bots, and Big Data and Code Halos: How the Digital Lives of People, Things, and Organizations are Changing the Rules of Business. He can be reached at Ben.Pring@cognizant.com.