I was part of a very insightful discussion on “The Role of AI in Managing Business Risk” with Kaushal Sampat and Dr. Vishnu Ramchandran as part of the Rubix Knowledge Series. Vishnu is the CTO at Rubix and has built several Risk Management platforms for Credit Bureaus, Banks, Credit Insurance, and Companies.
Kaushal is the former CEO of Dun & Bradstreet in India and one of the founders of Rubix. We talked about how AI is revolutionizing Financial Risk Management by helping better Credit Decisions and predicting Credit Risk, SupplierRisk, and Compliance Risk at speed and scale. AI also provides powerful tools for Risk Prediction, Risk Mitigation, and Risk Management especially during periods of uncertainty.
Just to give you a tiny peek into the into the conversation, here is one question we dealth with in the chat. This should give you a sense of the overall dialogue and all the fun we had doing it.
Question: Is Artiﬁcial Intelligence in its current form ‘real’ or is it ‘hype’? There is an expectation that AI will have a revolutionary impact on business, government and society and yet many people are still skeptical. Do you think that businesses will actually be able to commercially harness AI in the next decade? If yes, then in which areas?
Response: — AI is a real technology and has been applied in a lot of places. But the jury is still out on whether it can be applied at scale.
— Leading management consultancies such as McKinsey and BCG and universities such as MIT have done studies to determine what it will take for AI to scale. They have a few interesting ﬁndings:
† Companies that have deployed AI eﬀectively and done well were already digitally savvy to begin with. They were well along the path of automating their systems, processes, supply chains and plants. Hence, they were already creating and generating good data that could be used by the AI systems that they implemented.
† These companies also invested substantially in training their employees. Studies have shown that as much as 50% of the AI budget actually goes into training, at least in those companies that have deployed AI successfully.
† The third important prerequisite is creating the right Culture. Employees need to feel comfortable that AI will coexist with them and not take their jobs.
All of these things play a role in the ultimate adoption of AI. Just putting AI into a company has never worked, and the chances of it failing are very high if you don’t have the prerequisites in place. This is why most companies never get past executing a few proofs of concept (POC) projects for AI, and they are unable to transition to an enterprise AI solution.
— There is no denying the fact that there is hype around AI. Every start-up or company that is trying to raise funds calls itself AI-enabled because doing so makes it more attractive to investors. In fact, even customers like to buy products that are fashionable!
— Having said that, there are companies that have been truly successful at implementing enterprise AI. Let’s look at the World Economic Forum’s Lighthouse Projects and study some of the manufacturing companies that have been super successful at this. You will observe that in these companies there is a much larger program running across the enterprise and AI becomes an enabling lever. AI is a powerful technology but it is not a silver bullet — it cannot be looked at in isolation if you want to implement it at scale.
Do send in your comments and suggestions