AI innovations and industry disruptions
#001 - Wednesday 26th July 2023
Hey it's Nik. Welcome to the first Covelent Weekly. I'm thrilled you're here and slightly terrified at the same time. Our aim - to keep this focussed and of value to you. Naturally, this will get better with time. So with that in mind, let's jump in.
Spotlight (what’s been top of mind this week)
Industry
1. E-commerce - Reverse logistics has become increasingly crucial for businesses seeking to fine-tune their e-commerce supply chains and secure a competitive edge. It's quite evident why this is the case, as returns policies rank among the top three decisive factors for European consumers when making online purchases. (Statista) Embracing the intricacies of reverse logistics can undoubtedly pave the way for enhanced efficiency and customer satisfaction in the realm of e-commerce.
2. Manufacturing - The momentum of China's manufacturing sector is experiencing a deceleration, an issue covered by the Financial Times. The intricacies of the country's economy are facing headwinds due to the lingering effects of the COVID-19 lockdown in Shanghai, alongside the persisting trade tensions with the United States. As a result, the global manufacturing industry is feeling the adverse consequences of this downturn.
3. Life Sciences - Precision medicine, an innovation bridging healthcare and business, personalises treatments using unique patient data. This groundbreaking approach is unlocking unexplored market opportunities, revolutionising care, and introducing a novel business frontier in healthcare. Through embracing precision medicine, businesses can tap into a rich vein of potential, offering unique value, fostering loyalty, and treating previously untreatable conditions, thus catalysing new avenues for growth and innovation.
Technology
1. AI - Multimodality has been a real area of interest of late. Particularly for its applications in areas such as customer service. Multimodal combines multiple AI models into a single system, enabling it to learn and reason from diverse data types for improved performance. I.e. a multimodal AI system trained on text, image and voice data can excel in tasks like machine translation, image classification, and natural language understanding. Taking our example of customer service, a customer facing a payment issue can can write in and submit images about what they're facing or even speak using their voice and the AI can analyse the spoken content, and combine it with the text and image data to offer a comprehensive understanding of the customer's problem. Establishing trust and building CLV for a fraction of the cost.
2. Cloud (and AI) - Amazon, Microsoft and Google all announced new AI powered features to their platforms this week. Allowing businesses to immediately tap into the power of AI. Google's GCP announced a new natural language processing (NLP) API enabling customers to integrate verbal communication into their AI products. AWS, announced Lex which too allows for conversational AI. and Microsoft's Azure launched Cognitive Search, enabling the use of AI into the search functions of apps built with Azure which include Real Madrid. All three, drastically amplify their customer interaction and foster innovation, thereby catalysing growth in today's digital economy.
3. ChatGPT (still AI) - ChatGPT Code Interpreter Model is out of Alpha and into Beta and interprets, analyses, and generates human-like text, empowering non-tech professionals to validate data with ease. It's an inclusive revolution in data analysis. For example, administrators can now translate complex datasets into comprehensible reports for CEOs on the fly. Barriers between technical expertise and business acumen are blurred, democratising data and offering novel insights for strategic decision-making. The takeaway - training on the applications of AI need to happen across the organisation for the benefits to be felt the most.
The CEO Digest (a thought for you leaders)
What's weighing on the minds of those leading the organisations of today.
Algorithmic decision-making
A really interesting paper published by a long time collaborator of mine Isabel Fisher PhD, Reader in Information Systems at Warwick Business School, with whom I’ve had the pleasure of working with the last few years on both teaching and research projects, looks into the uses algorithmic decision making.
The paper explores the potential of AI in grading high-stakes assessments, with a specific focus on the case of AQA (Assessment and Qualification Alliance), the largest exam board in England. It discusses the ethical, practical, and technological challenges and risks associated with algorithmic decision-making in education.
For me, the take aways were that AI and algorithmic decision-making in the world of education presents both opportunities and challenges. Leaders must first tackle the issue of accuracy. AES tools, for instance, while efficient, have inherent limitations - they can't comprehend essay content like a human does. The risk of inaccurate grading is real; even the usage of impressive but empty words can manipulate some AES systems. The solution? A proactive approach towards understanding these systems, identifying potential weaknesses, and ensuring they're addressed to maintain assessment integrity.
Fairness is another critical factor. Just like their human counterparts, AI systems aren't immune to bias, though it may be more elusive and difficult to identify. The research sheds light on this, highlighting an AES system bias against male upper elementary students. This is a clear call to action for educational institution leaders. They must be vigilant of such risks, taking steps to ensure their AI tools are fair and unbiased. This could mean using diverse training data sets or conducting regular audits to detect and rectify bias. In a nutshell, accuracy and fairness are non-negotiable in our quest to integrate AI into education.
Latest Insights (published research and content)
Your Questions Answered (the Ronseal of titles)
I asked a few of you if you had any interesting questions ahead of this publication with the view to tackle them here. Below are a couple that got the gears turning. If you find this useful and want to send in your own questions - just hit reply to this email or email us here and i’ll pick it up.
Tips to align distinct cultures after a merger?
Merging organisational cultures is more than just a challenge - it's a wealth of untapped opportunity for those willing to strategically navigate it.
The crux of successful integration lies in a thorough cultural assessment. Delving deep into the values, beliefs, and norms of both organisations lays the groundwork for a solid, well-informed integration plan, highlighting the commonalities and distinctions that need to be reconciled.
In guiding employees through this change, clear communication is essential. Leaders need to paint a vibrant vision for the post-merger future, outlining the benefits and potential outcomes. This will transform apprehension into anticipation, aligning employees with the shared objectives.
Successful cultural integration is a team sport. Inclusion is key - bring stakeholders from both sides into the process, granting them the power to help shape their new workplace culture. Foster collaboration across diverse teams, creating a fertile ground for organic relationships and unity.
It's beneficial to establish a network of "culture champions" - agents of change who disseminate the newly merged culture, ensuring its propagation throughout the organisation.
Finally, remember that cultural integration is a marathon, not a sprint. It demands patience, a readiness to adapt strategies as the integration unfolds, and a commitment to continuous refinement.
How to effectively communicate a new strategy?
A little less comprehensive - I’ve always encouraged focussing on clarity and simplicity, ensuring that the same straightforward message is consistently shared across all channels. Frame the strategy with a compelling narrative, engage your audience through interactive dialogues, and secure visible endorsement from leadership. Lastly, don't forget to repeat and reinforce the strategy regularly to aid understanding, acceptance, and execution throughout your organisation.
The Nugget (of pure gold, hopefully something new to you)
The Meta Ad Library, with its vast database, serves as a goldmine of insights for businesses. By revealing ad trends and competitor strategies, it informs smarter campaign planning. Simplicity and transparency are its strengths, breaking down complex ad data into understandable narratives. A business can leverage these insights to make well-informed, strategic decisions, positioning itself competitively in the digital marketing landscape. It truly democratises advertising knowledge, contributing significant value to your business.
That’s a wrap on issue #001. Feedback at this stage in invaluable. I’d love to hear your thoughts. Was it too long? Certain sections not of interest? Do you have any suggestions for new sections? Feel free to reach out.
See you next Wednesday.
// N
P.s. I’ll be writing some additional content which you can find in the section Special Reports. In the interest of email hygiene you’re not subscribed to this be default. So if you want, you can subscribe by clicking the link below.
The first special we’ll be looking into the exact steps Satya Nadella took at Microsoft in developing the macro strategies that changed the perception of Microsoft with their customers and competitors and the leadership tactics implemented to drive the cultural change they were in such desperate need of.