Artificial Intelligence and Business Strategy
In collaboration withBCG
With all the clamor about the potential of AI, what are companies actually getting now for their AI investments?
Fast-improving technologies are fascinating but frustrating. When technologies progress quickly, executives can feel that they are on a treadmill with the carrot always dangling just out of reach.
They know they are making an investment — they can see the money and effort disappearing — but the benefits can seem like they are perpetually “coming soon.” This is particularly true for a technology like AI, which lends itself well to flashy demonstrations and science fiction. But working in labs and movies is quite different from working in production within organizations.
However, some companies are already seeing tangible benefits from their investments in AI. One example is Airbnb. A conversation with Theresa Johnson, product manager at Airbnb, highlighted three ways AI can help companies and is already helping the online marketplace and hospitality company.
AI is helping organizations access unstructured information. Finding answers would be much easier if all information were structured in neat tables with a limited set of defined values for each column, all nicely filled in with no missing data. Boyce and Codd would be so happy!
But no company exists in this highly normalized world. Instead, data isn’t structured because it is inherently unstructured or the costs of adding structure are prohibitive. For Airbnb listings, some structure is easy — logging a property’s number of bedrooms, number of bathrooms, square footage, amenities like a pool, etc. The difficulty is that, while these data points help, customers can’t narrow down the sheer number of listings to a manageable subset of possibilities using just this easily structured data.
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Instead, Airbnb is using image processing to find similar listings, even if attributes haven’t been coded or customers can’t articulate exactly what they want. Johnson gives the example of using AI to “extract what’s in a photo plus hundreds of other signals to determine, in a human way, other listings that are fundamentally similar.” AI is helping customers get information the company has but that is in formats that were previously tough to access.
AI is helping organizations learn faster. Information takes time to diffuse through organizations. Just because one person knows something doesn’t mean others do. Another “air” company, Airbus, found that AI helped it