What will artificial intelligence do to us and the way we do business?
It depends on who you ask, and the overall context. Henry Kissinger — yes, that Henry Kissinger, the former US Secretary of State — just penned a piece in The Atlantic suggesting that AI is unleashing dark forces onto our world. “Automation deals with means; it achieves prescribed objectives by rationalizing or mechanizing instruments for reaching them,” he writes. “AI, by contrast, deals with ends; it establishes its own objectives. To the extent that its achievements are in part shaped by itself, AI is inherently unstable.” In essence, AI represents thoughtless, soulless, crunching of available information, versus the application of human introspection and values to given situations.
AI may also crush many businesses in the process, but those that see the opportunity to focus it on superior customer and employee experiences may thrive — and make the world a better place. A slightly less dark view of AI surfaces in a discussion with Andrew McAfee, a principal research scientist at MIT, who points out that yes, AI is to be feared from a business perspective, but those that recognize that “experience” trumps transactions will move forward. “A lot of companies in the incumbent economy don’t seem to be getting me out of the headache business,” McAfee observes in the interview published by McKinsey. “There are a lot of hassles involved in most routine transactions, such as those for travel and financial services. I have to do way too much thinking in most of those kinds of interactions. When I look at the companies where I’m willingly giving more of my time, energy, and money and the apps that I use most often on my phone, it’s amazing how little they make me think and how they’re trying to get the headaches and the transactional nonsense out of my flow and instead start giving me something that I value.”
We, as consumers, are fully prepared for this shift, he states. “There are billions of people walking around with a supercomputer, by the standards of a generation ago, in their pocket. Those devices are connected to each other and to this thing that we call the Internet. And then, just within the past five or six years at most, all the promises made by the artificial-intelligence community have started to be delivered on.”
However, many organizations are still struggling to keep up. Disruption from AI and related technologies is going to drive many companies that don’t keep up out of business. For guidance on how to deal with this, McAfee points to how an industry decimated several years ago by technology, bookstores, and how it responded. It’s a perfect example of the experience economy supplanting the transaction economy. “Independent bookstore owners have realized that going to the bookstore is not just a transactional thing,” McAfee illustrates. “It’s not ‘I want a book. I’m going to find it in a store and then bring it back to my house.’ Going to the bookstore is actually a whole experience.”
Indeed, there has been a revival of independent bookstores: the American Booksellers Association reported 35 percent growth in the number of independent booksellers, from 1,651 stores to 2,227 between 2009 and 2015. Along those lines, a survey of 850 independent retailers overall finds four qualities that they say provides an important advantage: personalized service, connection with community, product expertise and ability to create experiences.
McAfee says “the experience economy is already pretty big, but as a share of the stuff that we want to do and that we want to spend our time and money on, it’s probably going to get a lot bigger. So figure out what people actually want to do in this weird, new world free of all of the hassles we used to experience.”
For his part, Kissinger feels the term artificial intelligence “may be a misnomer,” as it isn’t really intelligence involved, but “memorization and computation.” While “AI is likely to win any game assigned to it, for our purposes as humans, the games are not only about winning; they are about thinking. By treating a mathematical process as if it were a thought process, and either trying to mimic that process ourselves or merely accepting the results, we are in danger of losing the capacity that has been the essence of human cognition.”
AI is probably the most powerful tool we’ve ever had for solving problems and understanding what makes things in our world tick. For businesses, it can be applied to deliver incredible customer experiences — removing obstacles (such as online glitches), making transactions seamless (think about stores with no checkout lines), and wowing them (automatically making alternative arrangements if a flight is delayed). Yes, as Dr. Kissinger recommends, the outputs and decisions of AI systems always need to be questioned and reviewed. At the same time, AI is an amplifier of human activity. part of the evolution of technology that frees us up from the drudgery and enables even more creative thinking and innovation.