Business leaders from Expedia, Save the Children and tech startups tell Horizon and VC communities of how AI is driving performance improvements
By Mark Chillingworth
Artificial intelligence will be a central technology for organisations moving away from a product oriented strategy and moving towards becoming service providers. Four business technology leaders described how artificial intelligence (AI) is enabling organisations to adapt to changing economic and societal conditions.
Ariane Gorin, Senior Vice President of Expedia Affiliate Network, Save the Children CIO Karl Hoods, John Phillips of technology service provider Zuora and Antoine Amann, founder of startup Echobox were discussing AI at the Next World Capital Thought Leadership Forum and speaking in a debate moderated by Horizon Business Innovation podcast editor Mark Chillingworth in London.
Although on the surface the four organisations, a charity, online travel agency and two technology startups may not have a great deal in common, all four business technology leaders are at the forefront of developing new business models and shared their experiences and views with the Next World Capital event attendees and the Horizon podcast for CTOs and CIOs.
“We provide hotel inventory to our partners through APIs and we work with thousands of partners around the world,” Ariane Gorin of Expedia affiliate network says of how AI technologies are reshaping the highly competitive online travel industry . “We have a great asset in all of the hotels we have listed, but the question is how do you make your partners want to work with us? Which hotels to show? What is the sort order? What images do we show? So there is a huge amount of data science, machine learning, AI and that is really transforming our business to make a more personalised offering,” she says. The Expedia affiliate network is a partnership business model that works with a wide range of online travel agencies, airlines and corporate travel agencies and re-markets hotel inventory and Gorin describes it as a “big data business”
Although AI is a natural progression for online businesses such as Expedia, John Phillips of subscriptions, billing and financial services cloud provider Zuora says that businesses that can trace their heritage back to the dawn of mass production are seeing AI as key to their move away from manufacturing and selling products. Zuora is working with one of the instigators of mass production Ford to develop a membership model as the car maker pivot their business model into transport services. “We are seeing a shift in the way we want to consume and the shift is away from ownership and a move to services and customers want to pay for value and outcomes,” Phillips says; adding that Ford is planning an ID based membership model: “this is a big change for a big company like Ford to move away from the necessity of selling you a product.” he says.
The move by Ford has parallels with the journey technology giants like Microsoft have been on as they move away from licence model and onto cloud computing, a subscription service.
“Data is what drives our platform and it is what will drive that new relationship Ford has with its customers,” Phillips says. “We work with a lot of media organisations we have the Financial Times and News UK as customers and they are very comfortable changing the offer and changing the price based on the data they are receiving and we took that to Ford and others in automotive and they say: ‘We work for seven years on a new model and then you ask us to put it out there and change the pricing based on the data, you are mad.’ Then we start to work with them, these systems self level and find the right price point and bundle and that concept for those in heavy manufacturers is hard to grasp, but if we have the right data, if we have the right analytics and it gives them a power they have never had before.”
Identity and teams
AI has an image problem amongst the mainstream media, which often groups it with robotics as a way of using a cyborg style image to represent both technologies as a threat. Yet the panel of business technology leaders describe AI as an opportunity to automate processes that are too sizeable to be efficient as a manual process and as a way of enabling workers to deliver better value to the customer.
“We help big media organisations automate a lot of the manual work that they used to do day-to-day, like the social media publishing,” Echobox founder Antoine Amann says. “You had a team of editors that decided what should be on what social media platforms at what time. We have produced an AI technology that does all the analysis and then shares all the content in real time. We will automate the distribution of content on homepages and email newsletters soon and we save organisations a huge amount of money and we increase revenues and deliver a cost decrease,” he says of the embattled media industry.
Gorin agrees and says the automation abilities of AI are the real benefit, she says adding that understanding changes in customer behaviour is critical for improving services as well as preventing fraud. “The data’s capability to tackle fraud, for a retail company getting just a few points ahead in fraud can make a significant difference to the bottom line,” she says. “So algorithms can improve customer service, revenue optimisation and they can improve the bottom line of operations and you have to think about how it will transform the front line of the business and when you hire people you have to look at candidates and ask ‘are these people who can think about how do I use data as a differentiator?’”
Amann agrees with Gorin, but adds that if staff and organisation lose faith in a process or AI, in his experience, it is very difficult for technology leaders to win back the faith in AI. Though Gorin reminds the CTO and CIO community that adoption of AI is the same as any technology adoption it is a process change and has to be done in small iterations.
“We have to be clear with our teams and we talk a lot about test and learn and how do you make sure that the tests you are doing are small enough to make sure that if there is a failure it will not be a disaster,” she says.
“I don’t love the term fail fast and we do believe in it,” Phillips adds. “Millennials are used to things that are less than perfect and they are comfortable that they get better all the time and that is the case and their comfort level with AI is getting better all the time.”
Data and Blockchain
Next World Capital general partner Ben Fu told the community of the correlation between AI and new database technologies such as Blockchain. CIO Karl Hoods has been innovating with Blockchain at Save the Children. The CIO sees the power of the technology to revolutionise the business processes of the charity and enable the organisation to ensure its money and people are focused on its core mission, helping protect, educate and ensure children survive.
“We are looking at identity management in conflict zones, when it comes to a humanitarian crisis we rely on partners,” Hoods says of the need to mobilise large numbers of people from beyond the organisation. Given the vulnerability, Save the Children needs to cross check people with multiple agencies, all of which takes time so the CIO is working on creating an identity passport scheme using the latest technology.
All members of the panel agreed that AI is reliant on good data and therefore the role of the information for CIOs will continue to be critical. Amann says identity demands are dependent on geography.
“Organisations have a tendency to work in silos and the power in AI is to connect different data sets and teams can help us make better decisions as before they never could see the relationship between data sets,”
“The power of Spotify is a great example, the value of it is its recommendation engine, which is only as good as the amount of data it is collecting from its user base, these things are only as good as the collective intelligence,” Phillips of Zuora says of the music service.
“AI will be a service and a utility and the value will be based on the intelligence that is put into AI and that is us. In the future the great worker will know how to use these tools in a very agile way,” he says.
CIO Hoods believes AI and Blockchain will streamline business processes. “We have to find more efficient ways of working and historically charity has been behind the curve and that is because we need people to do the work on the ground. Technology looking at images means people are freed up to do more work on the ground,” he says of why charities must make the leap into these technologies, because it enables them to deliver on their cause.
“Organisations have a tendency to work in silos and the power in AI is to connect different data sets and teams can help us make better decisions as before they never could see the relationship between data sets,” Gorin of Expedia’s affiliate network adds.
Hoods adds that silos will always exist to “some degree” in organisation and says that it is the CIO’s role to “understanding them and what they are doing and then harness that data”.
At Save the Children the organisation has created “a common business model, what do we all mean by supporter so that people agree,” Hoods says of ensuring vernacular is shared. “That works well and then you are not going in and asking for access to a database or a CRM, you take it up a level.”
All the technology leaders agreed data quality is the most important thing. “The hardest thing is to make sure the data is clean enough to make the decisions going forward,” Gorin says.
Both startup organisations work closely with the publishing industry. Amann and Phillips described how the media has failed to adapt to the changing landscape, but with technologies like AI has a major opportunity ahead of it.
“Within news publishers there has been a big culture change but it is not enough and in my opinion,” Amann says. “They have not done enough and you have people quite high up in these organisation who are used to print and they need to think of the digital era and the transition has not been fast enough.”
Phillips argues that too many of the leadership teams in the media have approached the transformation of their sector in the wrong way, but cites examples of new thinking: “We work with organisations like Time Inc and they they have 50 or 70 magazines in the UK and what is much more interesting is what they sit on top of in terms of information,” the Zuora leader says. “Take a magazine like Horse & Hound, the equine business in the UK is very valuable and they have data on what is the best stable to use. We are coming close to a world of highly personalised data services, so the magazine becomes less significant and so does digital, the significance is the membership of the community and the information in that