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From Artificial Intelligence to competitive advantage

How can we create competitive advantages out of artificial intelligence?

Artificial intelligence will enable us to use automatic structured (indexed in databases) and unstructured (text, images, conversations) data treatment systems.

The golden rule for the years to come will not only be to place the customer at the centre of our decisions but to place customer data as well.

Artificial intelligence systems such as those used by Google or Facebook might detect when a women is pregnant even before she fully realizes it herself: her behavior on the social networks changes. Hormonal changes induce changes in social network user patterns. For example, which events generate more sensitivity (what she gives “likes” to) or what she is twittering about. The emerging pattern is confirmed if she makes searches, for example, about “feeling dizzy”, especially if the demographic and sociological data coincide with those of a young woman of childbearing age and, also, if there have been recent posts of wedding photos on her networks. Artificial intelligence engines can trace our digital footprints on the web on a 24/7 basis in order to induce potential purchasing patterns. Artificial intelligence systems are able to predict states of mind, personal circumstances or changes in dynamics in people’s lives, which turns users into potential targets for targeted sales, given their greater predisposition towards them.

Soon artificial intelligence will position itself at the centre of the business models of the majority of companies, in all sectors. Brands such as Coca-Cola, Unilever and Heineken are already aggressively forging ahead in this field, positioning themselves as “Smart Brands”. Companies such as Netflix or Amazon support their new product recommendation systems on a detailed analysis of their customers’ behavior patterns, based on previous decisions. The German company, Otto, specialized in supply chains, is able to predict a customer order one week before it is placed. Google and Microsoft describe themselves as “AI-centered” companies”. IBM’s Watson was a pioneer in this field. Artificial intelligence can help us to take strategic decisions (there are decision support systems which analyse micro and macroeconomic variables so as to anticipate strategic scenarios), to improve market intelligence to limits that are within the realm of science fiction, to redesign our supply chain, cut costs or predict possible incidents in our production plants.

In the coming years artificial intelligence will become a great source of competitive advantages in the new digital era.

We are approaching a total immersion into a magma of data. Fifty billion new devices will connect to the internet by 2020. All manufactured items will be connected and will become a data source. Devices, which until now were inert, will become transmitters of information. Products will become services (a sensorized refrigerator connected to the web will provide its owner with information services). Cars will become a subsegment of the immense internet of things, providing data in real time on road traffic, images of the surroundings, the state of the vehicle and driving patterns. Data that is relevant to the entire ecosystem: from the car brands themselves right up to public administrations and insurance companies. The virtual world will become a spitting image, in real time, of the physical world. No analyst is capable of processing the information tsunami that is on its way: it will be processed automatically by artificial intelligence systems.

Having said this, paradoxically, as in the case of the internet, artificial intelligence, the next big source of competitive advantage, will in a short period of time also become a commodity. Google, Amazon, Microsoft or IBM will send us an artificial intelligence “hose” (a connection, and a set of apps) which in a few years time every company will be able to access in order to treat their data. We will all have access to automatic data treatment services.

What will differentiate us under these circumstances?

Two things: our capacity to imagine superior experiences for our customers, and the amount and quality of the data we can gather. It won’t be a question of hiring more analysts but of implementing the right data strategy, linking up to an artificial intelligence provider who will treat our data, and induce new and superior user experiences from it.

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