Tom Peters, for example, in his book The Excellence Dividend, refers to the advancement of technology as the Tech Tsunami. He notes "there is a larger threat looming, one that has been building for a long time, and which, over the next five to fifteen or twenty years, is likely going to knock us back on our heels with once-in-a-century consequences. It's not globalization. It's not immigration. It's technology."
He's not alone in that assessment. The World Economic Forum released a report predicting that by 2025, there will be more machines in the work-force than humans. And it is not only blue-collar jobs that are threatened. For the first time in history, white-collar professionals are in danger as well. An Oxford University analysis claims that, in the next two decades, nearly 50 percent of American white-collar jobs will be at risk, either to automation or artificial intelligence (AI). As Daniel Huttenlocher, dean of Cornell Tech, has written, "The industrial revolution was about augmenting and replacing physical labor, and the digital revolution has been about augmenting and replacing mental labor."
THE RISE OF ROBO RESTAURANTS
One perhaps surprising field that has taken advantage of the shift to technology is the restaurant industry, where a shortage of available workers has driven up costs and limited the ability of some restaurants to open additional locations. Spyce, a casual fast-food place begun by four MIT graduates, is set on opening the first truly robotic restaurant chain in the US. Its founders say the robots help improve consistency and speed and prepare food in three minutes or less, while enabling the company to serve its food at reasonable prices.
Another example is the Chinese restaurant chain Haidilao, which has partnered with Panasonic to open up a fully automated kitchen in Beijing. The new establishment will feature robots that take orders and prepare and deliver raw meat and fresh vegetables to customers to put into soups prepared at their tables. The automated kitchen will reportedly be used to help Haidilao expand to as many as 5,000 locations around the world.
NEED RESERVATIONS? THERE IS AN APP FOR THAT
You needn't go all the way to a robotic kitchen to encounter AI in the food world. When commanded, Google Duplex will call a restaurant and make reservations. The software is very advanced, with a realistic human voice that mimics the "uhhs" and "umms" typical of most conversations. It's undoubtedly a harbinger of things to come, as this software could easily expand to booking appointments for other businesses such as hair salons, doctors' offices, and hotels.
Another feature of Google's Duplex and its AI capabilities across the globe is the possibility of eliminating language barriers. "There's the opportunity to [give people] the ability to call a business in a country where [they] don't speak the language," says Nick Fox, Google's vice president of product and design. "I'd be able to speak to the assistant in a language that I speak and then it could speak to the business in a language that makes sense to them. That's a really interesting way this system can be used to break language barriers."
The applications of AI are just beginning to be explored. In fact, Servion predicts that AI will power 95 percent of all customer interactions by 2025 and will do it so effectively that customers will not be able to "spot the bot."
TECHNOLOGICAL DISRUPTION AND DISLOCATION
There is no arguing that machines and AI are faster, cheaper, more efficient, and make fewer mistakes than humans. When a bank started using chatbots to handle more than 1.5 million claim requests each year, it found that the work of 85 bots was equal to the output of 200 full-time human employees at only 30 percent of the cost. As for the future, Juniper Research predicts that chatbot conversations will be responsible for cost savings of more than $8 billion per year by 2022, up from $20 million in 2017.10
But what are some of the implications of these sweeping technological shifts? One result is the commoditization of professional knowledge. For decades, professionals were able to charge premium fees for their expertise, which was considered a rare and valuable skill. As a result of living in a world with access to the internet, the value of expertise in many professions has been dramatically reduced. Much of what customers would have called an expert for in the past—in private banking, consulting, or even engineering, say—can be found online in a few minutes today.
This raises the question: How can professionals differentiate themselves? The marketplace is flooded with companies offering the same products, and it is nearly impossible to tell any of them apart. I believe that today the only way a company can differentiate itself is through building relationships with its employees, customers, and the community.
I repeat: Technology is not the answer. Even the most highly developed machines cannot show genuine compassion and empathy or recognize customer pain points on a personal level. AI cannot engage humans emotionally. The most important asset needed to truly connect with customers is the ability to empathize, yet AI solutions are
incapable of placing themselves in another person's shoes. It is time to make the human part of the customer experience our top priority. In their book Race Against the Machine, Erik Brynjolfsson and Andrew McAfee say, "The root of our problems is not that we're in a Great Recession or a Great Stagnation, but rather that we are in the early throes of a Great Restructuring. Our technologies are racing ahead, but our skills and organizations are lagging behind."
Businesses have created this situation for themselves by not focusing on the customer experience, not making it a priority, and not training customer-facing employees how to connect with customers. Yes, this is a crisis; but it's also a potential turning point: Organizations and professionals can complain, or they can adapt to what the future holds.
This excerpt ends on page 19 of the hardcover edition.
Monday we begin the book Seeing Around Corners by Rita McGrath.