AI: Forget dystopian societies, think powerful business tools

For many people who work outside the sphere of technology, the term artificial intelligence (AI) is generally associated with dystopian societies where robots with human-like characteristics have taken control.

The reality, however, is less Hollywood and more Wall Street. Today, the bulk of R&D is geared to leveraging the technology within the world of business to reduce costs, optimize processes and tailor products and services. 

Over the past few decades businesses have been transforming digitally to remain competitive – and adoption of AI is seen as just as important. AI is being put to use, in sectors as diverse as retail, banking, infrastructure, electric power and mining, and the space for growth is huge.

To find out more about AI and the state of play in Chile, BNamericas spoke to Roberto Musso, president of Digevo, a group of specialist tech companies.

Santiago-headquartered Digevo – which started out in web development – operates in 15 countries in Latin America and recently expanded into the US.

Digevo group firms are today working in various countries on AI projects for clients, including multinationals. Some projects are entering the implementation phase, having advanced through the testing stage.

BNamericas: Is AI being leveraged in Chile?

Musso: Generally speaking, in Chile there is a significant lag in terms of adoption of artificial intelligence with respect to developed nations, where it has been used in business for 3-4 years now. The good news is that we can advance rapidly because we’re going to benefit from their experience curve.  

[In Chile] there are companies advancing, largely in terms of testing and trialing, not widespread deployment. 

There are examples in banking, in the likes of credit scoring. In retail, we're working in the area of prediction of demand and we're working in the area of churn prediction in industries with a sharp focus on membership levels, like telecommunications and pensions.  

BNamericas: What are the main facets of AI?

Musso: AI, in particular deep learning [which creates patterns for use in decision-making], can be deployed in three main areas. The most well-known is natural language processing, which we're familiar with because of [Apple virtual assistant] Siri, Google and [Amazon virtual assistant] Alexa, but which also has industrial applications.

The second important application is computer vision, that is to say, the analysis of live video [another area Digevo is working in]. 

The third is prediction, the capacity to predict an outcome based on various variables, just based on the previous observation of many examples.

BNamericas: What type of projects are you working on with clients?

Musso: For example, natural language processing to strengthen debt collection operations. In retail we work in the area of demand prediction, user experience in the store and shrinkage reduction, a very important area. Also in churn prediction, which applies to many verticals.

BNamericas: So, AI can be used in various industries? 

Musso: On a global level, artificial intelligence has space along the value chains of all companies. It has a lot of applications.

BNamericas: What are some of the barriers to widespread adoption?

Musso: The main obstacle is a general resistance to change on the part of companies. This stems from not understanding the possibilities that AI, deep learning in general, presents and, I would suggest, gaps in the long-term vision in terms of the economic benefits that application of this type of technology can bring. This means a lack of incentives. Part of our job is awakening people to what is happening and the possibilities there are.

BNamericas: In terms of levels of adoption of artificial intelligence, where do you think Chile will be in 10-15 years?

Musso: It depends. It won’t be good if we don’t make a special effort. We're going to be far behind the rest of the world, which is investing a lot. We [as a country] have got to be proactive.

In the top levels of management of a company, artificial intelligence needs to have a strategic role. Banking, retail, mass consumption, even the extractives industries – mining, forestry and fishing – can benefit from artificial intelligence. They just need to realize this.

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Investment is not huge and returns that clearly justify the outlay are generated. Companies’ interest in gathering data will grow, and they must obtain structured data. They will have to hire teams, not big teams, of data specialists and algorithm specialists, collaborate with startups, link up with universities working in artificial intelligence. Magic will then start to happen.  

The state has a role in giving things the initial push. The rest will follow because of commercial dynamics.  

BNamericas: Do you think companies will develop solutions in house or hire third parties such as consulting firms?

Musso: This is not that clear. But to obtain the speed required today you need to collaborate with third parties. 

Once some momentum has been achieved, we’ll probably see specialization within the industries, within each company. 

BNamericas: So, what should a company that is interested in exploring AI do as a first step?

Musso: First, look for the opportunities that adopting AI would bring and what the impact would be. For this, you’d need to talk to a company like ours or universities, for example; gain an understanding, design a strategic business plan and then develop and deploy the solution.

BNamericas: We understand Digevo works with universities to leverage their talent and skills.

Musso: We have been lucky to be able to collaborate with the main technology universities in Chile and various others across the region. We work on projects together; we hire their artificial intelligence PhD students.   

BNamericas: How important are knowledge transfer programs, those that link the world of business with academia?

Musso: Very important. I would say that it's critical. The world of academia has the duty, time and intellectual capacity to dedicate itself to research new algorithmic solutions, new mathematical models. It has its academic networks but it doesn’t have the business vision in terms of the application of this technology. In contrast, a business like Digevo, for example, to serve its clients, which represent market demand, has this vision. We know how to do business, we know how to build products but we don’t have the technology in the vanguard of research – this is where the universities come in. The collaboration is therefore very natural.

BNamericas: Where does Chile stand in terms of development of knowledge transfer mechanisms compared with other regions? 

Musso: We’re behind. But we [Digevo] are lucky in that if this were not the case, we wouldn’t have been able to link up with the universities so easily [as bigger companies would have got there first].

On a systematic level, there is indeed a lag and, at the end of the day, this impacts the country because companies don't benefit from the technological capacity of the universities and the talent they produce. Also, universities spend a lot on producing research papers and don’t contribute to the creation of economic value in the country. The country needs to resolve this lack of connection – and it's working on it.

BNamericas: Any other comments?

Musso: After the initial internet wave and the following mobile explosion, 10 years later, we never thought we’d have another opportunity of that magnitude until we got involved in artificial intelligence. We’re happy enjoying the opportunity to understand this new era, providing solutions with what are reasonable levels of investment for a company such as ours.

With some clients that are leaders in their field we're developing solutions that, via a video camera, allow us to understand the client experience in a shop, for example, and interact as if they were in a digital space. 

In the area of prediction, we’re learning a lot. We’re realizing Chile has a lack of data but we’ve started to find sources and we need to structure it. We've started to work with prediction in areas such as demand in retail, in churn.

Latin America is in the crosshairs of many companies that want to invest, want to use it [the region] to grow.

Digitization, in each of its innovation waves, promotes equality in emerging countries, since it offers us the same opportunities that developed countries have. In the knowledge economy, value creation no longer requires huge amounts of capital, no weapons, no oil. It just requires talent – and Latin America has it. We need to accelerate the process of capitalizing on this. 

 ABOUT ROBERTO MUSSO

An engineer with a degree from Universidad Técnica Federico Santa María in Chile and an MBA from the country's Universidad Adolfo Ibáñez, Roberto Masso founded Digevo in 2004.

Masso has also founded and co-founded various other tech-focused enterprises, including STI and AxonAxis, later acquired by Unión Fenosa and EquiFax, respectively. He has also been involved as a solar project investor, mentored startups and taught entrepreneurship at several universities, among other roles.