What AlphaGo Means to the Future of Management

AI as management assistant: The artificial intelligence program AlphaGo got a lot of attention for beating 18-time Go world champion Lee Sedol four out of five games last week. The significance of this achievement is rooted in the extraordinary number of possible moves in Go: 2.08168199382 … × 10¹⁷⁰, reportedly more than the number of atoms in the universe.

That’s too many possibilities for brute computing force to handle (which is how IBM’s Deep Blue beat chess master Garry Kasparov 20 years ago). Yet AlphaGo, created by Google DeepMind, formerly British AI company DeepMind Technologies, mastered the 2,500-year-old board game on its own in a matter of months. “It started by studying a database of about 100,000 human matches, and then continued by playing against itself millions of times,” reported science correspondent Geoff Brumfiel at NPR.

Go bragging rights are nice for Google, but what does AlphaGo’s victory mean for management? “These machine-learning methods will also have significant impact on how we perform unstructured and complex business processes and decision-making tasks in day-to-day work,” explains Lei Tang, chief data scientist at Clari, a sales analytics company, in VentureBeat. “AI routinely considers options ignored by human beings … In this sense, AI is creative, helping humans achieve more.”

Tang says that “self-driving” enterprise applications will be managerial assistants that “detect relevant context changes (location, target customer, timing) and deliver relevant information at the moment it is most helpful.” Better yet, like AlphaGo, they will “become smarter as they analyze the results of ongoing operations, such as marketing campaigns, lead conversions, sales meetings, email flows, interactions with customer success teams, or customer churn.”

Buying digital capabilities, the smart way: There’s a piece of stock advice that comes along with every digitization manual: Develop your company’s digital capabilities. Like any other capability, there aren’t a whole lot of choices for following that advice: You can build, borrow, or buy it. That’s it.

Unsurprisingly, many companies are choosing to buy digital capabilities. Consulting firm Strategy& figures that 20,000 digital deals were announced between 2011 and 2015. Further, more and more of the buyers are non-tech companies — 48% more in 2015 than 2011. Making these acquisitions pay is likely to be a challenge, especially when buying outside your industry.