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In the age of Artificial Intelligence, what is a company's true competitive advantage?
The internet has disrupted the business of many middle-man. Digitization has brought greater commodization and driven even more cut-throat cost competition. With future artificial intelligence, the expert services and once privilleged knowledge domanin of many companies will become more easily learnt and available to new entrants.
In the future, what is a company's true source of competitive advantage?
What are the true core competence of a company?
Reflecting on these questions will help a company to better position and survive in the future economy.
Tomorrow and today, a competitive advantage has to be relevant for the customer and difficult to get copied by the competitor.
To process his personal defeat against IBM’s “Deep Blue”, Chess Grand Master Garry Kasparov organized a “freestyle chess tournament” where groups of humans, chess programs and mixed human-AI-teams could join and play against each other. To his surprise, a team of average players, using average chess programs, won the tournament, this based on a superior process. He concluded: “Weak human + machine + better process was superior to a strong computer alone and, more remarkably, superior to a strong human + machine + inferior process.”
IBM's Watson's UK Director Paul Ryan stated at the 2017 CES that every major decision, business and personal, will be made with the assistance of cognitive technologies."
Companies where smart humans and smart machines combine their abilities and work together without frictions reach a better output and due to this, establish a competitive advantage.
We are not far away (3 to 5 years) from when Fortune 1000 companies will use their Machine Learning Algorithms (AI for the Enterprise) to compete with each other. Which means the companies who have better AI will have a competitive edge. So how do you create a better AI than the competition? The answer lies in AI design components such as business heuristics, feature engineering and a rich diverse data-set. If data is the fuel for AI then the more data you use to train the AI, the better the effectiveness and efficiency of the AI.
So the true competitive advantage in the future will be powered by the humans in the organization who know how to design and build AI that delivers performance metrics that matter in the market - such as increased revenue, reduced cost, improved customer satisfaction, and reduced organizational risk.