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Success in the adoption of Artificial Intelligence depends on five variables

“The Economist” published a very interesting article, which shows how Artificial Intelligence (AI) is becoming strategic for countries and companies. The article focuses on the US-China dispute, “China may match or beat America in AI,” and in it we can feel how strategic AI is becoming. For example, a PwC study showed that in 2030, the IA will accelerate global GDP by about 16 trillion dollars. The study points out that initially the US will gain productivity gains faster than China, boosted by its readiness for AI and the high percentage of jobs likely to be replaced by more productive technologies. But China may overtake the US in ten years. Europe and developed Asia, such as South Korea, will also achieve significant economic gains from AI. On the other hand, developing countries will achieve much more modest increases because of the lower rates of adoption of AI technologies. Which is highly disturbing.

No industry or company will be immune to the impact of AI. Companies that fail to properly apply AI will inevitably lose market share and competitiveness. The McKinsey consulting firm studied the issue and published an article _ “How artificial intelligence can deliver real value to companies” – which shows the growing competitive gap between companies that adopt IA with the fastest speed and the slowest or that have not yet awakened to the Importance of AI, which are lagging behind.

It is curious to see that intelligent algorithms are already inserted in our daily activities without our noticing. When we see a movie on Netflix or order a book on Amazon, behind that choice there is the influence of recommendation algorithms. The path suggestion proposed by Waze or the pricing of a Uber race are also based on algorithms. Probe or deny credit are algorithm-based. Dynamic prices for air tickets are stipulated by algorithms. The ubiquitous search we do in Google’s search engine is an AI system. More than half of the stock traded in the US is already commanded by algorithms. Search competitions for better algorithms often happen on sites like Kaggle.

Companies that want to stay competitive in the 21st century can not ignore the already-arriving AI tsunami. Here in Brazil, most companies still barely started putting AI and algorithms in their services and products. In fact, IA still seems to be a distant dream for executives of Brazilian companies. But they must obligatorily deliver better experiences to their customers and make better decisions. For this, algorithms are the essential basis. Without algorithms you can not anticipate the needs of your customers or make recommendations that improve your experience.

Machine Learning algorithms can analyze billions of signals and identify a customer’s probabilities, purchase a specific product or target which call center attendant will be best suited to meet a specific demand. Even physical stores, which account for more than 90% of purchases in Brazil, can use AI through chatbots to interact with their customers as they walk the corridors. By analyzing your customer history, preferences, and other information, you can recommend products on gondolas. In summary, the experience I realize on Amazon has no similarity to what I perceive on most Brazilian retail sites. The apps we use in most Brazilian companies, from any industry, from banks, insurance companies or retailers, do not provide a personalized experience. Most are desktop interfaces adapted to the screens of smartphones, with cosmetic changes.

The big challenge for business is how to prepare and deliver talent, technology, and data access to make the most of the AI ​​opportunity. The Economist article clearly shows how important it is to prepare talent. China, for example, has an education with a strong emphasis on mathematics and all of its major universities already have or will be launching AI education programs very soon. It is estimated that China already has 2/5 of the world’s AI scientists today.

Five variables for success

AI has high potential for innovation. The article “Why artificial intelligence is different from previous technology waves” clearly shows this. However, in order to exploit this potential, we need to bring together five essential variables: talents, density, culture, capital, and the regulatory environment.

Talent means we need to emphasize education in mathematics and computer science with a strong dedication to AI technologies such as natural language recognition, Machine Learnng and Deep Learning.

Density exemplifies that scattered talent loses the opportunity to exchange ideas and experiences, as well as leverage joint efforts. It is important to be together in a high density environment. The creation of coworking space accelerators dedicated to business solutions in AI is a strong driver.

Culture means society’s adoption of the risk-taking mentality typical of entrepreneurship. In Brazil we have a shortage of talents in AI and the vast majority of our universities still have not awakened to the importance of the subject, still maintaining a very sparse and superficial programming. We also find difficulties in our culture that still strongly emphasize risk aversion. However, we already see some positive signs from a more entrepreneurial generation that is emerging.

Fundamental is also access to capital. Between 2012 and 2016, Chinese AI companies made more than $ 2.6 billion, far less than the $ 17.9 received from the US. But the gap is narrowing rapidly. Here we are very far from it!

And, the regulatory environment implies a scenario of facilitation for research and creation of companies, with little bureaucracy. Again, we are very poor in the photo! I recommend reading the study “Fostering the Startup Innovation Ecosystem” for a greater detail of these variables.

Advances in Artificial Intelligence and Robotics are driving a new era of intelligent automation that will be an important driver of business performance in the coming years. It will affect companies, jobs, society and the economy. It will require a review of current educational training, and will require strong action by governments and companies.

It is essential that corporations from all business sectors understand their potential impact so they do not fall behind. This is the world we have begun to tread, no turning back. The signs of change are already here and there, and many companies are not paying attention.

We are, without a doubt, in an increasingly hyperconnected and digital society. The digital world, computing, and AI algorithms will be so embedded in our day-to-day life that it may not even make sense to speak in the IT industry in the future because all companies will be technology-wise. What is a Uber, Airbnb, Facebook, Alibaba, Amazon? Technology companies that know how to do transportation, lodging and retail very well!

AI is not a nerd or a scientist thing, but it should be in the meetings of the CEO and the board of organizations. Survival question in the 21st century.

(*) Cezar Taurion is head of Digital Transformation at Kick Ventures and author of nine books on Digital Transformation, Innovation, Open Source, Cloud Computing and Big Data. This article was originally published in

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