Four ways AI is already changing business

Artificial intelligence has been a mainstay of the big hitters – Amazon, Google, Netflix – for years, but how can other businesses benefit from the technology?

Utter the words “artificial intelligence”, or AI, and responses might range from a shrug, a nod or even a nonchalant, “yeah, we use that”. The world has moved on from anxious predictions of a sci-fi dystopia under robot rule. Instead, we have learned that AI isn’t as scary as we first thought.

“A lot of organisations use AI to improve efficiencies. It’s basically designed to augment the existing processes that are already being used by companies,” explains Tom Dixon, Head of Technology at Hiscox. “AI is increasingly being used to streamline business administration and help to cut costs.”

AI has been used in aircrafts’ autopilot for years and is now driving Amazon, Uber and Netflix. A Forbes Insights survey of more than 300 business executives reveals that 95% believe AI will play an important role in their responsibilities in the near-future. It cites the biggest benefits to business as increased productivity (40%), reduced operating costs (28%), improved speed to market (21%) and transformed business and operating models (20%). So how does that translate into the way we  conduct business every day?

  1. Taking out the tedium
    Will you ever be replaced by a robot? Probably not but we are moving towards a scenario where the more repetitive tasks will be superseded by AI technology. The preparation, maintenance and management of AI, however, will require the creation of new, higher-level jobs. With 120 million workers needing to be retrained as a result of advances in AI, according to Forbes, we could simply be looking at a redistribution – rather than reduction – of the workforce.
  2. Fraud detection
    Computer security software provider McAfee reports that more than 5.5 million fraudulent offences take place online each year. Even in the earliest stages of deployment in the banking sector, AI is seeing tangible benefits, able to identify criminal patterns; spot hidden rules (data patterns that indicate fraud but are simply too complex for humans to spot); and significantly reduce the number of false positives (when data incorrectly identifies the presence of fraud) that are costly to business operation and reputation. Crucially, AI can adapt almost instantly to behaviours and metrics it hasn’t seen before
  3. Helping the headcount
    According to Linkedin (external link), some 76% of recruiters believe AI’s impact on their sector will be significant. For some roles, businesses can receive hundreds of applications so rather than having HR sift through these, AI technology has the ability to instantly select the most suitable candidates. Many recruiters and organizations are also excited about the role AI will play in improving companies’ diversity hiring, from AI-driven chatbots that eliminate any unconscious bias as they screen candidates, to the writing of inclusive job adverts.
  4. The marketeer’s dream
    Go deeper into AI technology and we find ‘deep learning’… a marketeer’s dream. It requires a large data set, neural networks (which are a set of algorithms modelled on the human brain and designed to recognise patterns) and lots of computational powers. Deep learning will allow businesses to understand the who, when and how of marketing, based on extensive computer analysis of existing customer behaviour. In other words, current customers will create new ones.

Insurance implications

With the huge benefits that AI can bring comes the need to fully understand where the technology creates business risk. “The thing that we’re keeping an eye on is called ‘sideways exposure’,” explains Tom. “This is where someone uses AI to solve a problem for multiple customers, but it doesn’t go as well as expected and it creates problems, and therefore potential claims, across multiple companies.”

The sheer volume of data AI technology is able to process means that one error has the potential to affect hundreds of clients. “The consequence of something going wrong is always going to be our concern,” says Tom. “The added complication here is that a lot of these companies using AI are rightly very focused on the positive outcomes and benefits, so understanding the downsides for underwriters might be more complicated than usual.”

Tom, however, is keen to make the point that, on balance, AI will transform the way companies work. “It will bring benefits to the bottom line, it will improve margins, it will create greater efficiencies and it will allow employees to be more productive.