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Artificial intelligence (AI) is the first technology that learns and improves on its own. Previous technologies relied on humans to get better at their tasks. For example, my wife’s SUV came from the factory with technologies to keep her a safe distance from cars around her. However, the car doesn’t learn from its own experiences and get better over time — any improvements in functionality must be downloaded and installed as software updates.
Fully autonomous vehicles do learn to drive better over time — and they will eventually share these experiences with each other. This means your future car will know exactly what to do if a deer jumps in the road, even if it’s never encountered one itself. Additionally, it will see the deer long before a human can and communicate with the autonomous vehicles around it, coordinating a response that keeps everyone safe (apart from the deer).
AI Capabilities and Business Productivity
AI will bring new levels of productivity to all businesses, including distributors. It can write computer code such as application programming interfaces, figure out product configurations, produce business documentation such as requirements docs, analyze any data about your company that you allow it to access, write marketing and training copy, evaluate competitors, do financial analysis, and a lot more.
AI can also create images. For example, I asked DALL-E to create an image based on this prompt: A panoramic view of a golf course. There are beautiful mountains in the background.
It generated four images, including Figure 1. It may seem hard to believe, but this is not a real scene; it’s a completely synthetic image.
The Risks of AI for Distributors
One of the most disturbing characteristics of AI is called “emergent abilities.” In other words, AI is already doing things other than its creators intended. ChatGPT has been known to give answers citing specific academic articles that do not exist. AI personas have shown behavior that can only be described as temperamental, jealous and mean-spirited — in other words, just like people act sometimes!
While this behavior isn’t an issue in applied AI systems distributors use for specific tasks, it could present a problem when dedicated corporate generative AI systems (think ChatGPT but armed with your data) become available.
Another big risk is deepfakes. Criminals are using the images, video and voice recordings of business executives to dupe companies out of money. A UK energy company was duped out of $243,000 when a divisional general manager received a call he thought was from the parent company’s CEO telling him to transfer funds. A Japanese executive transferred $35 million based on a deepfake call by someone posing as a company director looking to fund an acquisition.
This is an issue at home, too; some criminals are synthesizing children’s voices and then calling parents posing as kidnap victims.
AI’s Effect on Distribution Jobs
AI’s capabilities will reduce the number of people required to run your business. It’s very difficult at this early stage of the AI revolution to predict which jobs will be affected. Here are some questions for distribution leaders:
How many fewer designers and writers will you need when AI can create great content and information quickly and cheaply?
How many fewer analysts will you need when an enterprise generative AI model has access to all your data and can answer nearly any question about your business?
How many fewer customer service people will you need when AI can interact over the phone with detailed knowledge of every product you carry, every transaction you’ve ever completed and every customer you’ve ever had?
How many drivers will you need when autonomous trucks become widely available?
You can see the trend here; as AI advances, it will displace many jobs, despite the frequent reassurances you can find from so-called experts claiming that “people + AI” is the real goal.
Do You Need to Care About AI?
Yes! AI is the next technological revolution, and it will be bigger than the digital transformation we’ve experienced. I say this for three reasons:
1. AI is a sweeping technology that will touch every aspect of our lives.
2. AI is the first technology that will eventually be smarter than human beings, and it improves on its own — it learns. This is the definitive distinction between AI and previous technologies; it means that AI doesn’t rely on human beings to improve. The genie is out of the bottle and there’s no way to put it back inside.
3. Over the next few years, AI-enabled companies will beat laggards — and the difference will be much greater than when digital leaders had advantages over slow adopters.
The good news is that it’s a pretty level playing field right now. Modern AI providing real advantages to business is relatively new. You aren’t behind if you start now. The bad news is that you probably don’t have AI in your business strategy today. It’s like not having e-commerce in your strategy in 1995; you’re not late yet, but you’ll need to work hard to be a leader.
I dislike hyperbole, and I know we’re in a “hype cycle” with lots of breathless excitement about AI. However, AI is going to follow Amara’s Law, coined by American scientist and futurist Roy Amara:
“We tend to overestimate the effect of a technology in the short run and underestimate the effect in the long run.”
If you’re already learning about AI, figuring out how to add expertise to your team and incorporating this new technology into your strategy, congratulations; you’re ahead of the curve. You’ll need to work hard to stay there. If you’re skeptical about AI and think it will fade away like NFTs (nonfungible tokens) and most virtual currencies, you’re dead wrong.
AI is real, it’s profound and it’s forever. Get moving or get left behind.