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Impact of Artificial Intelligence on Business

Conference Paper · January 2018

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 Impact of Artificial Intelligence on Business
Neha Sonia, Enakshi Khular Sharmaa, Narotam Singhb, Amita Kapoorc1
a
Department of Electronic Science, University of Delhi South Campus, Delhi, India
b
Information Communication and Instrumentation Training Centre, India Meteorological Department,

Ministry of Earth Sciences, Delhi, India

c
Shaheed Rajguru College of Applied Sciences for Women, University of Delhi,

Delhi, India

Introduction

Innovation has always been the main engine of an improved standard of living throughout the history.

However, the process of innovation is highly disruptive as it turns old technologies into obsolete. Internet

of things (IoT), data science & big data, cloud computing, artificial intelligence (AI), and blockchain are

the emerging technologies that may create winners as well losers across the world. Some of these

technologies are at least two and a half decades old [1-3] still were not able to prove themselves as routine

technologies in the past. Conversely, in the present era, there is not a single field left where one or

combination of more than one of these technologies has not been explored. There are many factors

responsible for this, such as advancements in computer technology (high-performance computing, grid,

and cloud computing), increase in transparency through code sharing (services like Github, Gist, GitXiv),

and a large number of open source software. The emerging technologies have a large potential to

transform the lifestyle and living standards of humans and the business operating models of companies all

over the world. It becomes important to study both the capabilities and limitations of machine intelligence

and its potential impact on human life, society and business.

Motivation

The present age is possibly the most exciting period of human history where technological innovations

are taking place at the rate of the blink of the eye. Robots working in industries, cars driving themselves,

1
corresponding author: dr.amita.kapoor@ieee.org
smart watches monitoring patient’s health, and AI playing games (e.g. Chess and Go) better than world

champions are some of the technological innovations under AI. Internet today is full of AI-related

articles, its recent advances and its impact on human, society, and business.

2016 has been an amazing year for machine learning, deep learning and AI. Almost every high tech CEO

claimed to make their company an ‘AI company’. The question arises why is it so? Why does every

company want to be an AI company or want to acquire AI companies? Are all other technologies slowly

being augmented (or replaced) with AI? How does AI impacting all the lines of business across the world

such that there is not even a single field left where its impact cannot be seen? AI is 60-year-old

technology yet was not able to show its impact till present era. Then what are the factors which are

resulting in today’s AI exponential growth?

Through this paper, we intend to answer these questions. We initiated our research by scanning a number

of business newsletters, AI magazines, journal papers, conference articles, machine learning posts, annual

reports of the companies, press releases, stock market websites, online forums and many other platforms

to gather the data required to help us in our investigation.

Background: 60 years of AI

The term “Artificial intelligence” [4] was coined by John McCarthy, professor emeritus of computer

science at Stanford University. He organized the famous Dartmouth conference during the summer of

1956 at Dartmouth College, Hanover and started AI as a field. He went on to define the field for more

than five decades with the belief that there will be systems which will evolve intelligence of human order.

Firschein and Coles, 1973 [5] defined seven broad areas of artificial intelligence with their subtopics as

language understanding, problem-solving, perception, modelling, learning and adaptive systems, robots,

and games. They represented the work done in AI, levels of competence that can be attained at that time

in all seven categories of AI and a list of twenty-one hypothetical items as the future products of AI. The

AI products predicted by them are no longer science fiction realm and have become routine technologies.

This has benefitted business in two ways. First, it has resulted in significant growth of leading technology
companies investing in AI. Second, there has been a tremendous rise in a number of AI start-ups

established in last few years benefitting the world’s economy.

Methodology, Data and Result

In this paper, we have investigated the effect of the tremendously increasing intelligent behaviour of

machines on the growth rate and changing behaviour of the business all over the world. We try to answer

the questions raised in the previous section by investigating 100 AI start-ups born all over the world to

meet customer expectations in different application areas. 100 AI start-ups is the list of 100 promising

private companies implementing AI algorithms in 22 different lines of business. This list of 100 AI start-

ups were chosen from the pool of over 1650 companies by CB Insights’ Mosaic algorithm [6], based on

factors like financing history, investor quality, and momentum.

In 2011 the total investment in these AI start-ups across the world was $25.88 million which increased to

$1866.6 million in 6 years (2011 to 2016). Figure 1 depicts 71.13% increase in investment in these AI

start-ups. Across the world, U.S. is leading this revolution with maximum investment. We can see from

the graph that total investment in AI start-ups has increases exponentially in last 6 years.

Figure 1 Year wise investment (in $ Million) in 100 AI start-ups

AI start-ups initiated all over the world are categorized in 22 different fields including autonomous

vehicles, business intelligence, healthcare etc. Figure 2 depicts the percentage of 100 AI start-ups in 22

lines of business which majorly covers all the fields where AI is showing its impact.

Figure 2 Percentage of AI start-ups in different lines of business

From figure 2 we can see that the spread of AI is all pervasive, from education to healthcare, from home

to industry, there is no place where AI is not being used or explored.

Discussion and conclusion

Increase in productivity, time and cost efficiency, human error reduction, faster business decisions,

customer preference prediction, and sales maximisation are some of the key advantages of automation,

cognitive technologies, and data analysis using AI algorithms. It can be analyzed from above data that AI

wave is on and appetite for AI growth is exponential. The investment in AI is showing an upward

trajectory in last 6 years and should remain the same for upcoming years.
 Our future research involves the investigation of top ranking start-ups born across the world in last 5

years. We will be exploring the answers to the questions as- What are the percentage and the world

ranking of AI-based start-ups in the world? What is the percentage of investment in AI worldwide? Is

there any difference in the growth rate of start-ups based on AI and on other technologies? Answers to

these questions will help to predict the future growth of AI in business and world economy. Based on the

answers, prediction can be made, what will be the skill requirement for the jobs of future based on the

development of AI in different lines of business. This will help the human community to get prepared and

accept the changes with the rapid infusion of AI in human life and business.

References

1. Borkar, Vinayak R., Michael J. Carey, and Chen Li. "Big data platforms: What's next?" XRDS:

Crossroads, The ACM Magazine for Students 19.1 (2012): 44-49.

2. Lohr, Steve. "The origins of ‘Big Data’: An etymological detective story." New York Times 1 (2013).

3. Marston, Sean, et al. "Cloud computing—The business perspective." Decision support systems 51.1

(2011): 176-189.

4. Skillings, Jonathan (2006), Newsmaker: Getting machines to think like us, CNET, retrieved 8

October 2008.

5. Firschein, Oscar, et al. "Forecasting and assessing the impact of artificial intelligence on society."

IJCAI. 1973.

6. CB Insights. Mosaic Algorithm. https://www.cbinsights.com/company-mosaic. Accessed on 11th

October 2017.

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