Sales talk: how conversational AI can win over customers

Conversational AI can mimic human interactions. With today’s consumers turned off by the hard sell, the technology holds strong potential for businesses

When it comes to sales, businesses should reverse Elvis’s famous advice: a little more conversation and a little less action, please. 

The secret to success with today’s consumers revolves around small talk and a long-term approach. Direct approaches – seeking to add notches to the sales equivalent of a bedpost – are a huge turn-off for customers. 

Happily, so-called conversational AI is now mature enough to assist adroitly with the more mundane topics, enabling humans to enter the chat room later, at the most appropriate point.

Conversational AI refers to tech solutions such as chatbots or virtual agents that use vast volumes of data, machine learning and natural language processing to imitate human interactions. Businesses today must adopt the technology as a matter of urgency, with laggards likely to lose out.

Technology doesn’t have working hours like a human employee does, meaning that customers can gain the help they desire on their terms

Over 70% of customers expect conversational service, meaning human-like interactions – complete with emojis, gifs, images and videos – whenever they engage with a brand, according to Zendesk. But only 40% of businesses can deliver this successfully. 

Little wonder the global software-as-a-service company recently announced new capabilities for its Sunshine Platform, a customer relationship management service, including conversational automation via bot technology. The upgrade enables organisations to expand automation to messaging apps such as Facebook Messenger and WhatsApp and allows them to build and train custom bots to address common issues.

“A quick conversation can resolve most things in life,” says Matthias Goehler, Zendesk’s chief technology officer in EMEA. “Embracing advances in AI to deliver conversational exchanges with customers easily is a natural direction for customer experience (CX) teams to take.”

Resolving customer issues 

One of the most significant benefits of conversational AI is that all customer communications are retained, Goehler adds. This means a more complete picture is achieved, allowing businesses to understand people’s personal preferences better and enrich their experience. It facilitates a personalised, data-driven service, removing some of the burdens on human agents and empowering them to do more for the customer in less time, he says.

“A conversational approach makes interactions more informed – built with the context of the customer’s history. When done right, it can even help increase a customer’s spending with you by making useful and simple recommendations to purchase from within a chat.”

Katie King is the author of two books about AI for sales and marketing and a member of the government’s All-Party Parliamentary Group Taskforce for the enterprise adoption of AI. Companies that embrace conversational AI will charm employees and customers alike, she says. 

“Often, many of the queries that cross the service agent’s desk are frequently asked questions with simple answers,” she says. “While these queries might be easy to answer, they still take up valuable time and limit the agent’s capabilities to handle some of the more complex issues. It’s overwhelming and leads to faster employee burnout and potential staffing issues for the company.”

Conversational AI can help tackle this challenge, so appeals to many organisations, notes King. “AI can cut out that first step of the process by engaging the customer and potentially resolving their issue without human intervention,” she says. “Additionally, technology doesn’t have working hours like a human employee does, meaning that customers can gain the help they desire on their terms.”

When done right, it can even help increase a customer’s spending with you by making useful and simple recommendations to purchase

With the surge in energy prices, concerned customers of E.ON – the largest energy and renewable electricity supplier in the UK – have certainly wanted help. Conversational AI is easing the load. 

Nikolai Berenbrock is the company’s head of conversational experiences. He says the company currently has more than 50 conversational AI solutions across the group, serving customers and employees and covering about 30% of demand. “This has enabled us to offer a better customer service experience and a massive reduction in our operational costs,” Berenbrock says.

E.ON uses AI to automate repetitive tasks so that agents are “available to jump in where they can make a valuable difference”, he adds. The technology “allows us to scale our customer service in a location and time-independent way, so that we can be where our customers are by offering our service on our website in a LiveChat channel, WhatsApp, Facebook Messenger, telephony channel, etc, whenever they need us, 24/7.” 

Talking up the possibilities

Jason Costain is head of fraud prevention at NatWest, which serves 19 million customers across 12 banking and financial services brands. He offers another example of how conversational AI is being utilised. 

“Using voice-biometric technology, we’re building a clear picture of our customers’ voices and what criminal voices sound like,” he says. “We can detect when we get a fraudulent voice coming in across our network as soon as it happens. Using a combination of biometric and behavioural data, we now have far greater confidence that we are speaking to our genuine customers and keeping them safe.”

Demand for conversational AI isn’t limited to customer experience, says Goehler. “We’re seeing huge demand from companies using our solutions for employee experience, with tickets filled by corporate employees jumping 31% last year – nearly double the rates seen by customer-facing support teams at B2B and B2C companies,” he says, signposting the direction of travel.

Despite the clear advantages of conversational AI and the momentum behind the technology, Goehler sounds a note of caution to business leaders who, to quote another Elvis song, can’t help falling in love with the technology. “While just over half of EMEA companies report that chatbots are becoming more human-like, AI can’t – and shouldn’t – be a 100% solution,” he says.

Zendesk research indicates more than 60% of customers will walk away after one poor experience – up 22% from last year. Perhaps this shouldn’t be a surprise. After all, who can blame their suspicious minds?

This article was first published in Raconteur’s AI for Business report in June 2022

Where should cash-strapped public sector organisations allocate funds?

Upskilling employees, smarter outsourcing and new technology could help reduce costs and reduce debt – and deliver better service

TS Eliot’s poem The Waste Land, published exactly a century ago, begins with the words: “April is the cruellest month.” One hundred years on, considering the exorbitant rise of energy costs for British citizens and businesses in April 2022, it’s hard to disagree. Unfortunately, it appears worse is to come, with many feeling the world will end with a whimper – so how can the public sector cope?

On 5 May, the Bank of England lifted interest rates to a 13-year high and forecast that inflation would soar above 10% in the coming months, warning that the surging rise in living costs could plunge the economy into recession this year. But it’s not only citizens who are squeezed; the public sector is already in the red – just as demand for public services is likely to reach unprecedented levels.

The latest Office for National Statistics figures show that total public sector debt stood at £2,344 billion at the end of March 2022. This is equivalent to 96.2% of Gross Domestic Product (GDP), a level not seen since the early 1960s.

Further, public sector net borrowing was £151.8 billion in the year to March 2022. This was the third-highest borrowing figure since records began in 1947, and is around 6.4% of GDP.

Given this gloomy backdrop, how should public sector organisations plagued by money worries invest in technology solutions that best serve struggling citizens? Granted, costly gambles on the metaverse and vanity projects are not a good idea right now, but what’s the best way to allocate funds?

Jon Crowcroft is a co-founder of iKVA, an artificial intelligence knowledge management company, chair of The Alan Turing Institute, and Marconi professor of communications systems in the computer laboratory at the University of Cambridge. He is well placed to answer these critical questions.

Investing in skills to address huge delivery challenges

“My advice would be to match the budget to the current skills base, or organisations will face the challenge of undertaking a huge retraining exercise that will overwhelm their resources,” he says. “Government departments such as transport, energy and healthcare are relatively technologically advanced and staffed by individuals who inherently use technology for timetabling systems, power grid maintenance and data analysis. Computing is embedded into job roles in these departments, particularly in healthcare.”

Other areas, such as the legal sector, have more limited skills, Crowcroft says. Their relative ability should inform where additional funds will be required to support the deployment of technological solutions. 

Alex Case is public sector industry principal at Pegasystems and a former senior civil servant at 10 Downing Street and the Cabinet Office, who recently oversaw cross-Whitehall Brexit delivery. He has also led large-scale public sector reform initiatives in the UK and Canada – and is in no doubt of the scale of the task ahead.

“The government continues to face huge delivery challenges, from coronavirus, Brexit, the war in Ukraine or the cost-of-living crisis, including dealing with backlogs, driving levelling up, getting the health service back on track, transforming social care and dealing with the safety of tall buildings. These need government operations to run effectively and efficiently and for the least amount of cost possible.”

Low-code can revolutionise how government designs and builds IT. It can help a business to get what it wants and needs from a new system, not the system the IT team thinks the business needs

Low-code software development uses drag-and-drop features instead of extensive coding language to build applications. The result is that it is faster to complete and non-professional coders can use it. This makes it an excellent option to accelerate innovation and reduce costs, suggests Case. Its uses across government departments could include streaming and improving outdated and clunky customer service processes, digitising inefficient and complex programmes and back-office processes, and modernising debt collection while reducing fraud.

“Low-code can revolutionise how government designs and builds IT. It can help a business to get what it wants and needs from a new system, not the system the IT team thinks the business needs.”

Additionally, he says this approach can bridge the frequent divide between business users, subject matter experts, product owners, and the technical design and developer teams.

Where, though, should the public sector focus its investment now? Crowcroft contends that it is less where and more how the money should be spent, celebrating the increased adoption of AI. “During the pandemic, the public sector successfully used AI and automation to meet increased demand for services,” he says. 

“AI can automate bureaucratic processes that are currently resource-intensive, reducing the human workload. This will offer cost-savings, improve accuracy, and enable people to do other things that have a positive return for their organisations, such as analysing data to identify where other improvements can be made.”

An example of this is in the care sector, says Crowcroft. By automating some of the paperwork, the amount of time a care worker can spend with people in need increases. “The processes at the human level are reflected in documentation, and that shouldn’t be the case anymore,” he adds.

One obvious way for the public sector to reduce costs is by being smarter with outsourcing while improving in-house skills. For instance, the value of contracts awarded by the UK government and public bodies to consultants was £2.5bn in 2020-21, as organisations used the private sector to deal with the pandemic. 

“Consultants will always have a place in the public sector,” concludes Crowcroft. “But using technology to unlock data insights and training our people to understand the information – will improve confidence in their decision-making.”

Is low-code the answer to public sector worries?

“The government knows that low-code can help take the pressure off and has invited proposals for innovative platforms and software for digital public services,” says Mark Smitham, lead for public sector marketing at Mendix, a low-code platform. “Their shared vision is to deliver more user-centred, cost-effective, local public services through open, collaborative and reusable work.”

He suggests Knowsley Council is a prime example of a local service provider that used low-code to adapt to the increased demand from residents and local businesses. “In just 24 hours, the council built an application that enables Knowsley residents to request assistance or volunteer their services to support their local community,” Smitham continues. “This application connected people who need help with those who can help, providing support for 7,000 vulnerable residents.”

Elsewhere, a low-code platform is being used to address the growing issue of financial debt with core business transformation at StepChange, the UK’s largest debt management charity, says Alex Case, public sector industry principal at Pegasystems. “Additionally, low-code solutions are being deployed to tackle costly fraud and errors for the Department for Work and Pensions. It is transforming how the country registers land and property, and even supporting how the Ministry of Defence recruits essential skills to predict and deal with a fast-paced and changing environment.”

This article was first published in Raconteur’s Public Sector Technology report in May 2022

Fast-track to remote-first success: Experienced experts reveal their tips so others can accelerate their journeys

When Airbnb CEO Brian Chesky unveiled the company’s remote working policy at the start of May, in only 105 words, there was much to admire about its boldness and simplicity. However, one detail concerned Paul McKinlay, vp and head of remote for Cimpress/Vista, which implemented a similar strategy two years ago. It was Chesky’s comment that remote working “will become the predominant way companies work 10 years from now.”

The Airbnb boss’s prediction is supported by electronics firm Ricoh Europe’s research, which polled 3,000 employees in the U.K. and Ireland, France, Germany, Spain, Italy and the Netherlands last month. Almost half of the respondents (47%) think we’ll all work remotely in a decade’s time and that the traditional office space won’t exist.

But for Boston-based McKinlay that timeframe isn’t nearly fast enough. He warned that global leaders need to “act much sooner” and develop fully-fledged hybrid and remote-friendly working models for the benefit of their team members, shareholders and business results.

WorkLife spoke to a range of execs from different companies, which have already implemented successful hybrid and remote-first models, for tips on what to focus on. Here’s what they had to say ….

This article was first published on DigiDay’s future-of-work platform, WorkLife, in May 2022 – to continue reading please click HERE.

Web creator Sir Tim Berners-Lee on the future of data

Data literacy will drive innovation, easing global warming and empowering citizens, according to Sir Tim Berners-Lee and Sir Nigel Shadbolt

Billions of us use the World Wide Web as our primary tool to interact online. Today, its creator Sir Tim Berners-Lee is on a new mission: to ensure data is used appropriately to create the public sector of the future.

Berners-Lee partnered with artificial intelligence (AI) expert Sir Nigel Shadbolt in 2012 to found the Open Data Institute (ODI). At the ODI Summit in early November, the pair of computer scientists warned that now is a pivotal moment. As we hurtle into the digital era powered by data-hungry algorithms and AI, it’s critical to collaborate with good intentions and maximise the potential of technology, for the sake of the planet and its inhabitants. 

The acceleration of digital transformation necessitated by the coronavirus chaos is exciting, but there’s a responsibility for authorities around the world to keep pace with this incredible change. Those in power must set standards, encourage data to be opened and shared responsibly, and narrow the ever-widening skills gap. The quicker that data literacy in both private and public sectors can be improved, the better for everyone.

As Berners-Lee points out, the pandemic has unconsciously boosted public awareness of how data can save and enrich lives. “Something that took off hugely was communication through data, with the government telling us to ‘flatten the curve’ [and limit the spread of the virus],” he says. “I would imagine that the data literacy of the general population has gone up a chunk.” 

Driving change 

By improving their data literacy, leaders and members of the public could understand and challenge how data is presented, Shadbolt suggests. As public sector technology and its application develops in the coming years, fuelled by more and better-quality data, greater scrutiny will help shape products and services for the digital era. 

The opening of more data sources will super-charge the public sector of the future and drive innovation, says Shadbolt. The chair of the ODI – who’s been principal of Jesus College at Oxford University since 2015, among other roles – points to the success of open data pioneer Transport for London (TfL). Often held up as an exemplar of open data, TfL offers data feeds and guidelines about air quality, cycling, walking, planning and more. 

In 2017, Deloitte calculated that TfL’s release of open data generated annual economic benefits and savings of up to £130 million for travellers, the capital and the organisation itself. Additionally, many private businesses have taken advantage and cashed in on the open application programming interfaces (APIs).

“Imagine that a lot of data relevant to everything climate-related was just being routinely published using standard APIs,” Shadbolt continues. “It’s what we saw happen with TfL. And there’s just a bunch of sectors and areas to go for.”

However, it can be dangerous to blindly follow data. Shadbolt wonders whether Boris Johnson’s refrain during the pandemic that the government would “follow the data” to justify its pandemic-related decisions coronavirus sent out the wrong message. “It was quite a bad phrase, in some respects,” he says, “because while there should be a basic ability to understand the data, we need to interrogate and critique that data.”

Data can be good, but it never gives a complete picture

Questioning data sources is not just essential to fight fake news on social media and elsewhere – it will also enable public sector organisations to build greater trust, Berners-Lee says. With more connected data, they could trigger a shift from reactive to proactive services. 

It’s a virtuous circle, because trusted and quality datasets will widen the possibilities and reach of public sector technology and empower citizens. “Provenance is important for data quality, and provenance is important for trust,” he says.

Building trust

For example, Berners-Lee says a doctor should be able to look at the digital notes of a person with diabetes and open a data narrative explaining how this diagnosis was made and other relevant history. Public trust in the data used by the public sector is central to the adoption of technologies and services, he points out.

The general public seemed to go into different categories regarding coronavirus data, Berners-Lee says. Some accepted recommendations for pushing the curve down, but others “don’t listen to the same people as we might. Instead, they find groups of people –

the conspiracy theorists – usually on social media, who make up all kinds of strange things about the pandemic, vaccines or climate change, for that matter.”

Shadbolt says experts act in good faith with the information available at a specific time, but their visibility is limited if they have scant amounts of data. The wider the variety of good quality data sources, the fuller the picture. “We’ve talked a lot about how it’s important, particularly during the pandemic, not to regard the scientists, medics and people in white coats as telling you the whole truth,” he says. “They’re trying to give the best information, very often under conditions of considerable uncertainty.” We must take a nuanced approach, he argues, understanding that “the data can be good, but it never gives a complete picture.”

Those in the public sector and beyond must be “critically reflective” of data. “All our responses are made, in a sense, standing on the edge of error. But that’s what science is: it can believe something is wrong and can revise what we believe as these things unfold.” 

While the collaborative use of data will create smarter public services in the UK, this approach is crucial on a larger scale if humanity is to overcome its biggest challenges. It’s been vital in the response to coronavirus, while a cooperative, non-competitive and can-do attitude is also essential to reduce global warming.

“We’ve just been living through an existential crisis – a global pandemic – and we’re in the midst of another one unfolding, with the climate challenge,” says Shadbolt. “Data will be an essential part of [solving this]: the infrastructure, the institutions we might need, the trust we have [in its use], and our literacy.”

Sir Patrick Vallance, the UK’s chief scientific advisor, echoed this view at the 2021 United Nations Climate Change Conference (COP26). He warned that the challenge of global warming is a greater risk than Covid-19 and more people will die from it than the pandemic if the public sector doesn’t act quickly. Vallance also said the climate crisis could last 100 years and require “a combination of technology and behavioural change”.

Provenance is important for data quality, and provenance is important for trust

Shadbolt concurs but stresses that opening data and boosting cross-sector collaboration will accelerate meaningful change on a macro and micro scale and increase the capabilities of public sector technology. “While environment data is in the news because of COP26, there is other information that can help spur action,” he says, hinting that greater transparency from public sector organisations will ratchet up pressure on private companies to keep clean. For example, he notes that data on utility companies discharging sewage will help the Environment Agency, which struggles with funds and support. 

“We are starting to gain a sense of what data’s going to make a difference – everything from emissions to insulation. There’s a whole network of interconnected data types that we can bring together, much of it held in the public sector, and some of it held in the private sector,” he says. “We need to begin that work on joint public-private enterprises, though we are beginning to see the private sector, with its commitments to ESG, saying ‘we now have to have a public purpose as well as a private one.’” Publishing some of this data “would be a great first step”, he adds. 

Information advantage

Berners-Lee and Shadbolt were appointed as information advisors to the government in June 2009. The duo led the team that developed data.gov.uk, a single point of access for UK non-personal governmental public data. This offers real-time information on a range of topics, such as government spending, digital service performance, crime and justice, transport and more.

When the pair founded the not-for-profit ODI nine years ago, the mission was to “connect, equip and inspire people around the world to innovate with data”. Almost a decade later, the ODI continues to provide free and paid-for training courses and learning materials both in-house and online. These cover theory and practice surrounding data publishing and use. The ODI has long championed open data as a public good, but always emphasised that effective governance models are necessary to protect citizens.

Some 20 months since the start of the coronavirus crisis, people are beginning to appreciate the ODI’s work and concerns around data standards. “When the pandemic began we provided a data publication template,” says Shadbolt. “The challenge was so many people wanted to contribute data. It needed sorting and we had to determine what was helpful. If there was just a little more awareness around open standards to publish data, so that it is in a more interoperable format, it would be better for everyone.”

For public sector technology to thrive, however, public trust is critical, says Berners-Lee, who notes a difference in attitudes to tech in the UK compared to the US. “Typically in the UK people trust the government and don’t trust [the tech] industry, and in the US people trust industry and don’t trust the government,” he says. More should be done to assuage fears about how tech giants handle user data, he adds. “To an extent, it’s how people are brought up and therefore cultural. But for people in the UK to trust these large American companies then you need to have serious legislation and regulation.”

The backlash against the allegedly avaricious Facebook, which according to a recent whistleblower puts user engagement ahead of safety, is a cautionary tale for public sector organisations seeking to embrace technology solutions and partner with companies without fully knowing their policies on data privacy and other questionable values, suggests Berners-Lee. More than ever, at the outset, digital products must be “good by design”.

Data management is integral to these processes. Here too the coronavirus has proven useful, testing the robustness of so-called ‘trusted research environments’. “In these environments, the data stays behind a firewall and it’s modelled and analysed with tools that can go behind the firewall,” Shadbolt explains. “The data never actually leaves the highly secure data storage areas where 47 million patient records are linked, but incredible insights are gained.”

Offering an alternative, he says: “The other solution is to leave the data with the people who generate it, which is very local. There are different technical solutions there and there are different institutions we can build to share this. It’s a complicated area, but the ODI is looking very carefully at making data sharing more effective.”

Unfinished business

What does the future hold for the ODI as it nears its 10-year anniversary? “We started off explaining to people working in the public sector how to put your data on the web,” says Berners-Lee. Now, however, “we realise it’s important to cover the whole spectrum, from public to private, but it’s also about developing policies as well.”

This assessment chimes with Shadbolt. “There is unfinished business,” he says. “The whole commitment to getting data out there was started with open data initiatives that were very much focused around the public sector – everything from hospital data to educational data to transport data. That work has gone well. We’re now looking at extending those learnings. As governments move on [in their digital transformation journeys], you want to ensure that momentum is kept up and that the infrastructure is there to help sustain publishing the data out.”

Returning to the global climate crisis, he says of the ODI’s mission: “We did anticipate that in trying to build a trusted research data ecosystem it would become one of the consequential questions for the future of the planet and the future of our wellbeing. There’s a huge amount of work to do. We’re trying to make sense of it in terms of programmes of work, from data literacy to institutions, from ethics to infrastructure.”

Shadbolt adds: “Fundamentally the ODI’s work is about listening, it’s about trying to take ideas and put them in a format that allows that to scale. We may be an organisation of 60-odd people but we think we can have a fantastic impact and so we need to reach out and sustain ourselves to make a better future.”

This article was first published in Raconteur’s Public Sector Technology report in December 2021

Enriching and empowering: realising the potential of data-enabled public services

Out of necessity, public bodies dialled up their digital services during the pandemic, but now is a pivotal moment to consider how to achieve a joined-up, secure, frictionless citizen experience

When considering the rapid and radical shift to digital services in the public sector during the coronavirus crisis, Ernest Hemingway’s line from The Sun Also Rises of bankruptcy happening “gradually, then suddenly” comes to mind. In this case, though, the prognosis is somewhat more optimistic.

The hurried but necessary jump into the digital era has enabled people to be empowered and enriched by data-driven public services. Now the leap has been made, the direction of travel is clear. However, there is still work to be done before achieving a connected, frictionless digital experience that benefits the state and its citizens.

“Data-driven, smart digital technologies have provided crucial support to public bodies through the pandemic, but they’ve also allowed our under-pressure services to become smarter and more responsive to our needs as citizens,” says Steve Thorn, executive director at Civica, whose software helps sustain and enhance public services around the world.

“For some public services, the digital journey was already well underway, and the pandemic catalysed this journey. For others, such as our schools, the pandemic required a more fundamental change, with face-to-face teaching giving way to online classrooms.”

Thorn singles out the track and trace applications and vaccination certificates as “prime examples of the power of data-driven, smart technologies to deliver better outcomes for citizens,” and says that more outstanding capabilities are within reach. But, he warns, the government must take its next steps carefully. 

“Public bodies across Britain and the rest of the world already sit on rich seams of data, which are growing by the day as our society becomes more digitised,” he says. “Raw data is, though, of little value. Data must be collected, managed, used and shared effectively if it is to deliver any real benefits.”

Standards, skills and sharing

To better navigate the route ahead, with the ultimate goal of providing a connected, frictionless customer experience to citizens, Civica works with the public sector on what it calls the three ‘Ss’ – namely standards, skills and sharing. 

Thorn says: “Any public body, be it a parish council or Whitehall department, must ensure that it has robust standards in place for managing data, the right people with the right skills to use that data and finally, processes in place to share data safely and effectively, so it is it is delivering the best outcomes for the greater number of people.”

Andrew Hood, chief executive of Edinburgh-based analytics consultancy Lynchpin, agrees that now is a good time for the public sector to reflect on the good and the bad digital offerings throughout the coronavirus crisis. He sees great potential in Internet of Things (IoT) technology but similarly urges caution. “The pandemic has surfaced a lot of the practical opportunities and threats around data sharing and IoT in obvious terms when viewed through the lens of things like contact tracing apps and digital vaccine passports,” Hood says.

For some public services, the digital journey was already well underway, and the pandemic catalysed this journey. For others, such as our schools, the pandemic required a more fundamental change, with face-to-face teaching giving way to online classrooms

He points to the different strategies taken by the UK’s four nations in terms of deploying open source versus proprietary solutions. “There is potentially much to learn from what has worked well and less well when considering other similar applications outside of the pandemic,” he says.

“Whether to centralise or decentralise how data is shared across millions of devices became a very key consideration for contact-tracing apps. How [do we] achieve enough sharing to enable the outcome of alerting those that had been nearby others without creating Minority Report-style databases of the movements of the entire population?”

The software robot revolution 

For David Burrows, public sector industries leader at UiPath, a robotic process automation dollar unicorn, the benefits of the public sector doubling down on automation and IoT technologies to create a more streamlined physical service for citizens – for example, with smart roads, touch-fre metering and much more – are compelling. 

Further, with the UK effectively gaining data sovereignty post-Brexit, the government is perfectly positioned to speed ahead of other European nations if all key stakeholders use the exact strategy roadmap and collaborate.

But to improve citizens’ experiences and public services, alike, and to make use of better infrastructure, it comes back to managing data. “Automation is one tool being used by UK government to achieve the frictionless digital experience needed to improve public services and more effectively serve citizens,” says Burrows. “As software robots can handle huge volumes of data more quickly and efficiently than humans can, it can significantly streamline back-office activity and reduce the risk of administrative bottlenecks.”

He points to the recent work UiPath has done with the Department for Environment, Food and Rural Affairs’ National Licencing and Permitting Service for water abstraction – taking water from an underground or surface source, such as a river, stream or canal. “Once the team has made the technical expert decision on whether a licence should be issued or rejected, there is significant administration to be done to inform the applicant and to update internal and external consultees and the IT system,” says Burrows.

Now, software robots can handle this admin work, cutting the non-decision-making admin down from 65 minutes per transaction to just shy of seven minutes. “The result,” he says, “is that citizens can have their licenses in a fraction of the time, all while public servants can concentrate on more valuable work.”

Looking further ahead, Burrows adds: “With some 22% of government infrastructure decision makers recently telling Forrester that their departments will implement RPA in some shape or form by the end of this year, there is no doubt that automation will continue to play a significant role in government customer strategy.”

Also scanning the horizon and hoping for more joined-up public services and tools that will enrich the lives of citizens, is Thorn. “The pandemic has provided many great examples of how digital technologies can solve individual challenges – be that supporting homeschooling or allowing GPs to interact with patients at a distance. But digital transformation is more than solutions to individual problems.”

Offering a final word of advice, he adds: “Digital transformation is a wider journey towards a future where our public services are ultimately better able to anticipate and respond to our changing needs as citizens and as a society.”

And, as encouraging as the progress that has been made in the last two years especially has been, we are at a pivotal moment. As such, the potential of connected public services is likely to be realised gradually, not suddenly – and that’s no bad thing.

This article, sponsored by Vonage, was first published on Raconteur in December 2021

Seven key steps to improving the digital customer experience

Country manager of UK and Ireland, Matthew Parker from Vonage, a global business cloud communications leader, shares his thoughts on the key lessons from the recent ‘Reimagining digital customer experience and brand engagement’ roundtable event

At the roundtable (written up here), the passion for customer experience came across from everyone, loud and clear. There were plenty of great statistics in there, too; I love stats. I wrote down seven things during the discussion, and these are my key takeaways.

Humans: We discussed the evolution of humans and how technology has to be intuitive. I think there is a link between humans and smart automation. Certainly, natural language processing and understanding sentiments in emails and messages is an area of investment and innovation. As another classic example, though, you want to know where your parcel is on its journey to your door. It’s a commonly asked, simple question that can be solved by automation. Tracking technology means that humans are not needed, but there are plenty of other things that do require human input and touch.

Trust: Someone mentioned trust. And a few people had different definitions of trust, but the two words I took away, linked to developing consumer trust and loyalty, were security and integrity.

The ecommerce journey:  This was another subject. There was a great stat on ecommerce growth: the pandemic spurred a 130% increase in ecommerce adoption. But looking at the ecommerce journey is so important, especially when working out where to remove friction.

Experimentation: Someone said: “Have a go and try digital transformation.” I love that. I attended an Amazon Web Services (AWS) summit a few years ago, and despite that digital transformation had been around for a long time, thousands of people there were wondering where to start. The speaker on stage, from AWS, said: “Just have a go, just have a go, pick your burning platform and just have a go.” In many ways, that’s still going on, which is great to hear.

Brand connection and value exchange: Together these make a potent combination. There has to be something for the customer in return for their data. 

The use of data: This final point wraps the session up nicely. Collecting data in itself is not necessarily a bad thing, but it has to have a context in terms of how an organisation will use the data. That’s the essential bit. Then there is the integration of that data in the customer journey. For example, we all get driven mad if we are on an interactive voice response for 20 minutes and then, having filled out the information, the human customer support person asks us the same questions.

This article, sponsored by Vonage, was first published on Raconteur in November 2021

Reimagining digital customer experience and brand engagement

As companies strive toward a frictionless digital experience, they must find ways to improve customer loyalty and trust. How will digital customer experience evolve in the coming year?

The pandemic-induced explosion of ecommerce and the acceleration of digital transformation means that most companies will re-examine and revamp their customer experience strategies and capabilities in the coming year. With customer loyalty increasingly difficult to gain and sustain, pioneering, data-powered technologies will improve the seamlessness of these digital experiences and deliver better brand engagement.

A dozen leaders in the customer experience (CX) space spanning a range of industries – including healthcare, travel, insurance, and banking – met to discuss challenges and solutions, and debate the direction of travel in the coming year. 

The lively discussion, supported by Vonage, a global business cloud communications leader, examined customer loyalty and trust, delivering CX with less friction, and how digital CX and brand engagement might develop in the coming year.

The conversation took off with Jack Smith, director of digital at British Airways (BA), who stressed the importance of ‘human touch’ with CX, an even more crucial point in the digital age. He said that BA is both “fortunate and unfortunate” because it is a well-recognised UK organisation.

When Smith joined BA, in 2017, there was much work to do on the digital CX front. “The challenge was that the digital channels didn’t represent the same human touch evident on our flights,” he said. “The tone of voice was robotic, like a booking system, and there was no conversation.”

While chatbots and other digital solutions are popular, Smith warned: “These wonderful bits of technology and digital channels miss the point if you are led by tech; you have to remember there’s a person at the other end.”

Lucy Jones, vice president of clinical at Oviva, noted that organisations now have the challenge of meeting ever-rising customer expectations. These have drastically evolved with the shift to digital platforms for ecommerce and thanks to the acceleration of digital transformation in health and communication since the start of the pandemic. As a result, retaining customer loyalty is perilously tricky.

Building trust is a must

“Digital loyalty is not like bricks-and-mortar businesses where the cost and complexity of transitioning [to a rival] is enough to buy a little slack,” Jones said. “In the digital space, it’s simple for that alliance to be lost if we are not meeting customer expectations.” Therefore, she added, it is imperative to build trust through “providing a seamless experience, avoiding wait and holding true to your promises.”

Avoiding friction is essential, agreed James Elliott, head of customer and commercial experience at Bupa Global. “We’re desperately trying not to make the mistake of creating infinite loops for customers to fall into,” he said. “We are attempting to educate customers to make the right choice, but still 40% of them want to contact us via email, which is not an optimal, quick experience. 

Elliott added: “We want to create a digital-first portal to triage and prioritise customer needs, whether it’s an urgent phone call or a scheduled outbound call at their convenience. What you don’t want is to spend 20 minutes searching through the frequently asked questions and then another 20 minutes finding a customer service telephone number.”

Digital loyalty is effectively achieved through more personalised and omnichannel [experiences], but fundamentally it won’t work just with technology; it has to have an emotional connection with the customer

Educating customers was also high up on the list for Dr Alice Pan, global chief medical officer at Bima,a provider of health and insurance solutions for the emerging middle class in Asia and Africa. Digital technologies, she says, can not only support diagnosis and treatment of health conditions but also enable prevention and wellness promotion.

But there has been a learning curve for Bima as well. Lockdowns and the need for treatments led to Bima offering a telemedicine service in the last year, and the uptake has been incredible. “Our internal research shows that after the first use of telemedicine, the percentage of people selecting it as their preferred channel of accessing healthcare went from 5.8% to 58%,” she said. “It shows that trying something for the first time can shatter preconceptions.”

Be true to your purpose

Conny Kalcher, group chief customer officer at Zurich, identified a “major change” in what customers – especially younger generations – expect from organisations. “They want to buy from brands that do good, not just [those] doing well in business,” she said. When Kalcher took up her new role at the global insurance firm in July 2019, she updated the company’s purpose to be more ambitious and less self-interested. 

“It was ‘we are here to protect you,’ but – guess what – all insurance companies are here to protect you,” she said. “It was not a unique message, so we co-created with customers to develop a new, inclusive purpose, which is ‘create a brighter future together.’ The younger parts of our customer base desire not just a brand purpose, but a sense of community. However, if you define your purpose, it’s not just nice words on a piece of paper; you have to live by that purpose.”

However, Dr Anthoula Madden, managing director of customer experience at Accenture, said the supposed digital divide between generations is narrowing. She pointed out that the pandemic triggered a 160% increase in ecommerce from “new or low-frequency users.” She said: “The generational gap around digital seems to be fading away, and more consumers of all ages are very comfortable with shopping online, especially using their smartphones.”

Research from Oviva supported this. Jones said: “I was surprised that 60% of customers across Europe will either mostly or only use a mobile phone for engaging in shopping and interacting with services such as healthcare; and it’s not just those under the age of 25, it’s across the board.”

Additionally, Madden encouraged businesses to invest in technology solutions, but do so in an agile way, testing and learning what might work best. “You need to be prepared to experiment. Fail fast. Just try it out, and if it doesn’t work, try something else.”

Value exchange: more choice and customer empowerment

For Stephen Gilbert, EMEA loyalty solutions director at Collinson, a company that offers loyalty programme solutions and owns airport lounge and experiences programme, Priority Pass, funding tech projects is not enough. He said: “Digital loyalty is effectively achieved through more personalised and omnichannel [experiences], but fundamentally it won’t work just with technology; it has to have an emotional connection with the customer.”

Gilbert added: “That’s the strategy piece you have to determine. There has to be a perceived value exchange between the customer and the brand. That is one of the keys to a loyalty programme.” But, he warned: “If organisations don’t see this as part of their branding and view it as digital marketing alongside a piece of technology, it will fail.”

What you don’t want is to ask people to remember the first, third and seventh digits of a passcode they have not used in years and leave them in a doom loop of password hell.

That insight resonated with Sue Bradley, director of customer experience delivery at Tui, the world’s largest leisure, travel and tourism company. Tui announced it was investing more in advertising to support the launch of the new ‘Live Happy’ campaign and to drive online sales. Bradley revealed the thoughts behind the recent ‘Live happy’ campaign.

“We wanted ‘Live happy’ to be inspirational,” said Bradley. “Tui offers a wide range of products, as well as the beach package holidays which we’re well known for, we also offer cities, tours cruises and ski. Our customers want to know that they are going to have fun when they go on holiday and at Tui, we help create those moments that make life richer. We also recognise the importance of experience. This week we launched the ‘Makers of happy,’ [referring to] our colleagues who make it memorable and personal for our customers.”

Tui has also released a new smartphone application to guide the customer journey. As well as being able to chat to the team 24/7, the app shows flight information, plus details about transfers including coach number and location. “It makes it far simpler,” said Bradley. “But what we found is more than ever, in this time of a global pandemic, people want that human touch.”

Reducing friction: beware the password doom loop 

Integrating people into the digital experience was a key focus for most. Kalcher said: “A younger person might not want to talk to an agent, they prefer to find their own way, while other customers might need that personal assurance. So, it’s all about understanding your different customer segments and letting customers choose how to interact with the company.”

Smith concurred that empowering the customer is vital. But some brands miss the mark in this respect. “People often confuse ‘automation’ and ‘digital,’” he said. “They think that digital is a way to remove and automate processes, and it’s not. It can be hugely enabling, but there has to be that human need and human touch. 

He added: “For example, if you have a healthcare app that provides the patient with all their details and data, they are empowered. But it doesn’t mean they want to be left alone.”

On the topic of friction, Lisa Scott, chief marketing officer of Banked, a global payments network “built on modern bank rails,” said the Strong Customer Authentication rules, introduced by the Financial Conduct Authority, has meant another layer of verification has slowed the online purchase process in the financial services industry – and perhaps that is no bad thing. The frustration, though, is that there are so many methods of secondary authentication across various apps. 

“Do you want that additional verification to be an SMS message notification,” she asked. “Could it be something like your fingerprint or facial recognition? If they can make it simple and quick, and thereby reduce friction, then that’s good. What you don’t want is to ask people to remember the first, third and seventh digits of a passcode they have not used in years and leave them in a doom loop of password hell.”

Direction of travel: be cleverer with data use 

Looking at how CX might develop in the coming years, Ashish Bhardwaj, senior solutions architect at Informa, emphasised the importance of data. Make sure you gather customer data and compliment it with secondary data,” he said. “You can personalise experiences and make relevant, proactive suggestions for the customer. The use of data and the tone in which it is communicated should be a careful choice from the marketing and communications teams.”

Madden confessed to being a “big fan” of the John Lewis app. “It’s amazing,” she said. “It shows your loyalty card, all your receipts, and it’s quite personalised. As long as I can see some value in engaging with that brand, then I will do so, but if you are a brand that keeps bombarding me with meaningless emails, I will block you.”

Looking further ahead, Mohammad Al-Ubaydli, CEO of Patients Know Best, predicted that sustainability could – and should – feature more prominently in CX, for the greater good. He said of COP26 that he sensed a groundswell of public demand for greater environmentally friendly processes.

Al-Ubaydli said: “When I consider the next 10 years in healthcare, the big question is: with an ageing population, how can you continue to deliver universal coverage? Everyone’s talking about not having enough money to help, but even if there was enough money, there are not enough professionals to look after everyone. The only solution is digital. If a person obtains their test results and knows what to do, it avoids clogging up an appointment with the doctor.

With the COP26 refrain of “keep 1.5 alive” possibly still ringing in his ears, Al-Ubaydli suggested that the desire to embrace digital solutions would be much greater in 20 years, as patients strive for more sustainable – and less wasteful – healthcare. “If we want to be able to afford universal coverage structurally, then you must allow people to have the medical data to look after themselves.”

He added: “About 5% of the vehicles on the UK’s roads are related to the National Health Service. Indeed, 5% of carbon emissions in the developing world are healthcare-related. So, if you can prevent the need to travel, stop the need for operations and so on, that is a serious contribution to reducing carbon. By protecting the patient, you protect the healthcare system, and ultimately you protect the planet.” 

Clearly, environmental concerns are one more factor to add to the already complicated world of digital CX, which has undergone incredible evolution in the last couple of years, spurred by the coronavirus fallout. Customers are increasingly demanding, but organisations that fail to keep pace will see brand engagement and loyalty melt away.

This article, sponsored by Vonage, was first published on Raconteur in November 2021

How business and government can reap rewards of open data

Private sector leaders are wary about sharing data, but if the government offers guidance on artificial intelligence, citizens will benefit from a spirit of innovation

The UK could build a smarter state, improving public services by connecting data from various disparate sources. This will demand greater data sharing between different branches of government – Whitehall, councils, regulators and emergency services – and collaboration between the public and private sectors. 

Working together and sharing data in an open, transparent and secure manner will drive innovation through artificial intelligence and ultimately enable and empower citizens. But progress is stalling in the private sector, due to a combination of poor data literacy at the leadership level, fears of ceding a competitive advantage, and a general wariness of unintended consequences. How, then, can the public sector tap into external data sources and encourage a more collaborative spirit?

While there is no simple answer, the government’s National AI Strategy, published in late September, offers some guidance and encouragement for business leaders. The document, which sets out a 10-year plan to make the country a “global AI superpower”, is the country’s first package solely focused on AI and machine learning.

Chris Philp, digital minister at the Department for Digital, Culture, Media and Sport, is confident the publication will accelerate the development of AI and spark collaboration between public and private sectors. “We want to make sure that there are clear rules, applied ethical principles and a pro-innovation regulatory environment that can create tech powerhouses dotted across the country with the most supportive business environment in the world,” says the Croydon South MP.

He hopes the new strategy will help narrow the skills gap to take advantage of the AI opportunity. And while data sharing is essential, standardisation is just as important; unless data is collected and managed according to common, robust rules, it might be unreliable, which directly impacts on outcomes for the citizen.

Leading by example

Matthew O’Kane is multinational IT consultant Cognizant’s global head of AI solutioning. While he welcomes the National AI Strategy, he argues that the government should take the lead in dialling up collaboration and openness.

“The government can and should set an example in the AI space by ensuring seamless data sharing across government departments,” he says. “Data is the fuel that powers AI, so through the democratisation of data across government, leaders would be able to maximise the potential to extract value from AI investments.”

Fakhar Khalid, chief scientist at Sensat, a cloud-based 3D interactive virtual engineering platform, agrees, and believes universities should open their doors, too. “A clear mindset change is needed from the top down,” he says. “Government must encourage risk in innovation and provide supportive infrastructure and resources to organisations that are willing to take such calculated risks to propel the UK as the global leader in AI innovation.”

According to Khalid, not only are strong, open and transparent collaborative platforms needed within central and local government, but there is also an urgent requirement for more academic research to impact the public and private sectors. 

“While the government must lead the country by example, academia needs to invest more in ensuring their higher education research is fed to the industry more often than it currently does. The UK has a strong academic foundation but is slow to turn those into any commercial success.”

Chicken-and-egg scenario

Dr Mahlet Zimeta, head of public policy at the Open Data Institute, acknowledges that business leaders tend to “hoard” data, but argues that if sharing is done sensitively and sensibly, everyone stands to benefit.

“Organisations are often concerned about unanticipated use cases for their data and who might gain value from it,” she says. “They are nervous because they don’t know what business model to use. It’s difficult, as most use cases only arise when the data has been made available – it’s a chicken-and-egg scenario.”

However, Zimeta points out that there has recently been a “step change in data sharing”, with a range of industries and sectors collaborating to help the response to the coronavirus crisis. There was truly an international effort; for example, science journals changed their subscription models, allowing open access to their papers to accelerate the speed of research and development. 

“It was exciting and shows the benefits to society and the economy when more data is accessible – and as far as I know, no businesses went bankrupt as a result of making their data available.” Finally, while Zimeta calls for more cross-sector collaboration to build a smarter state, she says it’s important not to forget another potential collaborator: citizens themselves. “It’s often presented as ‘private and public’, but civil society is a crucial innovator. This data is vital, too.” She adds: “We need to start thinking about a three-way collaboration.”

Data collaborators, it’s over to you.

This article first appeared in Raconteur’s special report, Building a smarter state and improving public services with connected data, sponsored by Civica, in November 2021

Raise the bar with accounts receivable automation to release cash

Thanks to pioneering technology, there is now a golden opportunity for financial controllers to free enormous sums of tied-up working capital. This will empower employees and enable them to drive value and strategy, writes Kevin Kimber, Managing Director, Global AR, BlackLine

The coronavirus crisis has prompted most organisations worldwide to spend big on automating their financial services – but only a tiny fraction have upgraded their accounts receivable processes. Today, with the advanced technology and pioneering tools available, those who fail to automate their AR processes miss a golden opportunity to empower the finance teams and unlock the cash held hostage.

In November 2019, months before the pandemic hit Europe, PricewaterhouseCoopers calculated that a staggering $1.2 trillion of excess working capital was tied up on global balance sheets. While there is clearly a latent opportunity to free this enormous amount of cash, ahead of the coronavirus crisis automating AR operations was not a priority for businesses.

Back then, the reluctance to focus on upgrading AR processes for the digital age was, to an extent, understandable, given the ease of borrowing for businesses. Now, though, organisations realise that optimising these processes has never been more critical. A recent Institute of Finance and Management survey suggests 55% of finance leaders are less than satisfied with how their company’s AR procedures have performed during the recession. And over half (52%) say that too many manual processes are the biggest weakness.

The combination of the lines of credit being significantly compressed and the increased demand to have cash more readily available – to drive innovation, boost agility and strengthen resilience – has elevated the need to embrace AR automation.

Historically, solution vendors possibly didn’t know how best to position the value and business benefits of automating AR processes. It’s so easy to pigeonhole AR automation as a single process primarily about headcount reduction and driving efficiencies. While these points are valid, there is so much more from which to benefit. 

Articulating the benefits of automating the AR process

Presenting the point that “if you deploy a technology like ours, you can reduce your headcount from, say, 16 to five people” does not go far enough – there are so many additional advantages now. However, if we reframe the case for AR automation, it becomes so much more compelling.

For example, a large, global B2B manufacturer with a high volume of low-value invoices might offer 30-day payment terms. Each day is worth $150 million, so customers paying 63 days late means $9.5bn late and at risk.

Not only is this woefully inefficient, but there is also friction generated between the increasingly frustrated finance team and the customers whom they are chasing for payment.

Deploying technology like BlackLine enables that cash to be collected and applied much faster, giving access to cash quicker, reducing the need to borrow to cover working capital exposure and tightening customer relationships. Ultimately, through artificial intelligence and machine learning, automating that process will enable businesses to unlock the cash held hostage.

More than that, investment in AR solutions starts a virtuous circle: the business becomes more agile, innovative, and resilient – all essential elements for organisations seeking to thrive in the coming months and years – because the cash is available. 

Looking at the broader picture, it’s a fallacy that robots are taking our jobs. On the contrary, they are enhancing and improving them. Humans are empowered to make smarter, data-driven decisions. And at BlackLine, we are transforming the relationship finance teams have with technology.

According to Adobe’s Future of Time study, published in late August, UK business employees waste more than a day a week on low-value tasks that should be automated. So much so that almost two-thirds (59%) of respondents are seeking new jobs with better technology to reclaim work-life balance.

Automation propels finance teams from the back office to driving strategy 

Indeed, the reduction of repetitive manual tasks transforms finance departments to be more human and less robotic – they become enablers rather than blockers. Automating the AR process means that risk is easier to manage. 

For instance, BlackLine AR Automation solutions put key information at the fingertips of organisations – from live payment data to debtor performance – so teams can quickly identify customer trends and maximise cash and debtor performance metrics.

It also helps to optimise relationships with customers. Access to and analysis of the data provides a markedly better understanding of customer behaviours, allowing the finance team to be more proactive, and helpful, when engaging. For example, how and when are they paying? What levels of credit are they on? With managing existing customers and looking for new customers crucial for growth, deepening these relationships is vital. 

Further, when supported by automation and data-hungry AI algorithms, finance teams are propelled from the “back office” to the heart of the business, driving both value and strategy.

Automated solutions, such as BlackLine’s, instantly improve a business’s cash flow, better protect revenue, and boost working capital and customer-centricity. We know what customers need to thrive in the digital age. Armed with our expert help and pioneering tools, they can unlock the cash held hostage while empowering their finance teams. Organisations that prioritise automating AR processes today will win tomorrow.

Small steps to accounts receivable automation – but large rewards

1. Understand that business outcomes are being challenged, unnecessarily. In 2019 PricewaterhouseCoopers estimated that $1.2 trillion of excess working capital was tied up on global balance sheets. A more recent IOFM survey suggests days sales outstanding (DSO) has increased by 59%. Additionally, PYMNTS’s B2B Payments Innovation Readiness Playbook shows businesses that rely on manual AR processes often have a 30% longer average DSO.

2. Most AR processes are not fit for purpose – so say finance leaders. The IOFM survey finds that 55% of respondents are less than satisfied with their AR operation. Over half (52%) report that too many manual processes are the biggest weakness. Further, only 23% have utilised some kind of cash application automation. Notably, the lowest number of days taken to collect debt for those businesses using AR automation is 12.

3. Realise the potential of automating AR processes. Organisations that have upgraded to BlackLine’s AR automation solutions all report huge – and immediate – benefits. “You can reduce your costs by at least 75%,” says the head of credit, Atkins Group. Meanwhile, Veolia’s UK credit manager says the solution “has allowed the credit controllers to focus on collecting cash and managing risk”.

4. BlackLine AR Intelligence delivers real-time insight into customer financial behaviour to mitigate financial risks and improve cash flow and working capital performance. With cash flow vital to every business, AR automation is a future-proofed solution.

This article first appeared in BlackLine’s special report, Optimising the accounts receivable department, published by Raconteur in November 2021

Five ways automation enables finance teams to be more human

As we stride into the fourth industrial revolution, finance teams can work alongside machines to drive strategy and value. And, as the war for talent rages investing in technology is crucial to attract and retain skilled workers

The argument that robots will replace human jobs misses the crucial point that machines empower workers with a pulse. It has been this way for hundreds of years – since the original industrial revolution in the mid-18th century when the Luddites, led by Ned Ludd, a Leicester weaver fearful of change, attacked factories and their owners. However, it soon became obvious man worked much better alongside machine.

Now, as we stride into the fourth industrial revolution, which uses modern smart technology to automate traditional manufacturing and industrial practices, robots are taking over more menial, repetitive tasks. This capability frees up workers to be more human. For finance teams especially, this automation of processes enables them to be more human and drive value and strategy – here follow five ways how.

1. Paper processes are old news

In the finance world, paper has been essential for centuries – but in the digital age, we can speed up processes, and save the trees, argues Nitin Purwar, India-based industry practice director of banking at UiPath. “Within finance, data-intensive and repetitive tasks are commonplace,” he says. “Often further weighed down by legacy systems, paper-based documents and unstructured data, these processes can take up a large proportion of a professional’s day.”

Purwar argues that “this work isn’t what humans are best at and often isn’t what we enjoy doing. By automating these processes, finance professionals can be freed to spend more time on value-added, strategic activities that require judgement and skill, thus enhancing the employee experience all while saving the department time, money and improving the accuracy of processes.”

2. Manual ways of working are highly inefficient – and a turn off for talent

Businesses that embrace automation stand to gain a competitive advantage – not least when it comes to attracting and retaining talent. Adobe’s Future of Time study, published in late August, finds that UK business employees waste more than a day a week on low-value tasks that should be automated. Tellingly, almost two-thirds (59%) of respondents are seeking new jobs with better technology to reclaim work-life balance.

Purwar from UiPath uses an example to explain the benefits of automation in this regard.“One infrastructure solutions firm we work with used to process all invoices manually, printing, signing, scanning and uploading 400,000 invoices a year. Now, a robot affectionately named Archie processes all invoices digitally, freeing up on average 11 minutes per invoice of time that employees can now spend focusing on value-added tasks instead. That amounts to thousands of hours per year saved.” 

There is more potential to realise, which is why organisations should double down on automated solution. Kevin Kimber, managing director of global accounts receivable at BlackLine, suggests that while many businesses seek robotic process automation, now “advancements in artificial intelligence and machine learning take what is possible to the next level”.

3. Financial leaders can show their human skills and improve collaboration

Ash Finnegan, digital transformation officer at Conga, which provides commercial operations transformation solutions, points out that the pandemic has forced financial leaders to show their human sides and manage change.

“Out of necessity, most digital transformation journeys have been accelerated, with artificial intelligence being a major focus,” she says. “Financial leaders have invested heavily in AI and wider automation technology, entirely restructuring their back office to deliver their services remotely.”

Neil Murphy, global vice president at ABBYY, a digital intelligence company, posits workers who embrace automation can “work more efficiently, collaborate better, and ease the burden of administration in their day-to-day roles. Deploying AI-powered robots gives this opportunity, gifting finance teams more time to focus on more creative, problem-solving tasks and alleviate the pressure. Now more than ever, it’s time to put the human touch back into the finance.” 

4. Automation elevates financial professionals to become trusted advisors

Glen Foster, director of small business and partners at accounting software company Xero, says “time truly is money” for financial professionals. Xero data shows these workers can use up to 30% of their time on manual data entry – equivalent to 1.5 days a week.

By contrast, automation and digital software can free up most of that time. “Cloud accounting tools allow you to automate time-consuming tasks like data entry, bank reconciliation and payments so that you can spend more time advising, analysing data and focusing on growth,” he says. 

“Providing advice and insights on financials is more valuable to clients and businesses than manual, repetitive data entry skills. This ultimately sets accountants and finance professionals up as trusted advisors.”

5. Improve relationships with customers – and add value

FreeAgent survey from 2020 calculated that 81% of accountants have discovered that using automated software has freed up an average of two working hours a week. The same report states that this time saved could generate an additional £68,000 in revenue a year.

John Miller, chief operations officer of Addition, a London-based financial services firm, adds: “Automation has allowed humans to do what they do best: offer advice to the client, knowing that the routine tasks are done robustly and accurately.”

This article first appeared in BlackLine’s special report, Optimising the accounts receivable department, published by Raconteur in November 2021

Will the new national strategy make the UK an AI superpower?

Westminster’s new AI strategy is a step in the right direction, but there are hurdles – particularly concerning regulation, data-sharing and skills – that could hinder the UK’s progress

In the global AI investment, innovation and implementation stakes, the UK lies in a creditable third place. Trailing the US and second-placed China, it holds a slight lead over Canada and South Korea, according to the Global AI Index published in December 2020 by Tortoise Media. The moral of Aesop’s most famous fable involving a tortoise may be ‘more haste, less speed’, but Westminster is seeking to hare ahead in this race over the coming decade. Its national AI strategy, published in September 2021, is a 10-year plan to make the country an “AI superpower”. But what does that mean exactly?

Although Westminster has already poured more than £2.3bn into AI initiatives since 2014, this strategy will accelerate progress, promises Chris Philp, minister for technology and the digital economy at the Department for Digital, Culture, Media and Sport. 

“It’s a hugely significant vision to help the UK strengthen its position as a global science superpower and seize the potential of modern technology to improve people’s lives and solve global challenges such as climate change,” he declares.

The Croydon South MP explains that the strategy has three main aims. These are to ensure that the country invests in the long-term growth of AI; that the technology benefits every sector of the economy and all parts of the country; and that its development is governed in a way that protects the public and preserves the UK’s fundamental values while encouraging investment and innovation. 

“We have heard repeatedly from people working in and around AI that these issues are entirely connected,” says Philp, hinting at the complexity of the task at hand.

What will life be like for people living and working in an AI superpower? “There are huge opportunities for the government to capitalise on this technology to improve lives,” he says. “We can deliver more for less and give a better experience as we do so. For people working in the public sector, it could mean a reduction in the hours they spend on basic tasks, which will give them more time to find innovative ways of improving public services.” 

Philp continues: “For businesses, we want to ensure that there are clear rules, applied ethical principles and a pro-innovation regulatory environment that can create tech powerhouses across the country.”

AI will also be crucial in helping the UK to meet its legal obligations to achieve net-zero carbon emissions by 2050. Pleasingly for Philp, progress is already being made in this field. He notes that the Alan Turing Institute has been “exploring AI applications that could help to improve power storage and optimise renewable energy deployment by feeding solar and wind power into the national grid”.

The artificial elephant in the room is human resistance to data-sharing

The strategy has been generally well-received in the tech world, with most people acknowledging that it’s an important step in the right direction. But some experts have identified a few potential shortcomings.

Peter van der Putten is assistant professor of AI and creative research at Leiden University and director of decisioning and AI solutions at cloud software firm Pegasystems. He is “encouraged to see a shift from broad strategic statements to more concrete, action-oriented recommendations”, but he would have preferred to see a more complete ethical framework for AI application. 

“A large portion of the document focuses on AI governance, but it appears that a lot of the emphasis is still on analysis, discussion and policy-making. There is less on proposing hard legislation or determining which authority will be accountable for governance,” van der Putten explains. “This is an area in which the UK will need to accelerate, given that both the EU and China have made relatively concrete proposals for the regulation of AI recently.”

Liz O’Driscoll is head of innovation at Civica, a supplier of software designed to improve the efficiency of public services. She believes that the UK has “made great progress so far, with many organisations starting to embrace data standards and invest in data skills. But the artificial elephant in the room is human resistance to data-sharing. Privacy remains crucial, especially when it comes to citizens’ information, but wider uncertainty about issues such as regulation, public perception and peer endorsement will also prompt many in the public sector to play it safe with AI.”

There are some encouraging signs that people’s general reservations about data-sharing are softening, thanks to the success of collaborative AI solutions during the Covid crisis, O’Driscoll adds. 

“Sharing data has been essential in our defence against the virus. It has enabled key public services to stay focused on people who are most at risk,” she says. “Success stories have entered the public domain, so we need to make the most of these cases and continue driving further positive change.”

It’s clear that more education about the benefits of data-sharing and work on AI ethics are required, but could a shortage of recruits prove to be the most significant challenge for the national AI strategy? A survey published by Experian in September indicates that more than two-thirds (68%) of UK students wrongly believe that they would need to earn a STEM qualification to stand a chance of landing a data-related job.

Dr Mahlet Zimeta, head of public policy at the Open Data Institute, thinks that the widely held view that “the UK needs to produce more people who can code” is unhelpful at best. 

“Although improving data literacy is important, we’re going to need a much broader range of skills, including critical thinking,” she argues. “Leaders require a change of mindset to maximise the potential of AI. At the moment, it feels as though no one wants to be the first mover, but this is why experimenting and being transparent about the results will drive progress.”

From the government’s perspective, Philp urges both “students and businesses to equip themselves with the skills they’ll need to take advantage of future developments in AI”. For employers, this will include ensuring that their staff “have access to suitable training and development opportunities”, he adds, pointing out that the government’s online list of so-called skills bootcamps is an excellent place to start. Tortoise Media’s Global AI Index ranks the UK fourth in the world on its supply of talent and third for the quality of its research. The country is a relative laggard in terms of both infrastructure (19th) and development (11th), so there is plenty of ground to make up on both the US and China. The national AI strategy suggests that some haste will be required if the UK is to even keep these rivals within its sights. Ultimately, though, if all goes to plan, humanity stands to win.

This article was first published in Raconteur’s AI for Business report in October 2021

Is China dominating the West in the artificial intelligence arms race?

The US has warned that it is behind its historical foe in the East, and the European bloc is also concerned, but there are ways in which the UK, for example, could catch up, according to experts

If you ask technology experts in the West which country is winning the artificial intelligence arms race, a significant majority will point to China. But is that right? Indeed, Nicolas Chaillan, the Pentagon’s first Chief Software Officer, effectively waved the white flag when, in September, his resignation letter lamented his country’s “laggard” approach to skilling up for AI and a lack of funding. 

A month later, he was more explicit when telling the Financial Times: “We have no competing fighting chance against China in 15 to 20 years. Right now, it’s already a done deal; it is already over, in my opinion.”

The 37-year old spent three years steering a Pentagon-wide effort to increase the United States’ AI, machine learning, and cybersecurity capabilities. After stepping down, he said there was “good reason to be angry.” He argued that his country’s supposed slow technological transformation was allowing China to achieve global dominance and effectively take control of critical areas, from geopolitics to media narratives and everywhere in between.

 Chaillan suggested that some US government departments had a “kindergarten level” of cybersecurity and stated he was worried about his children’s future. He made his outspoken comments mere months after a congressionally mandated national security commission predicted in March that China could speed ahead as the world’s AI superpower within the next decade.

 Following a two-year study, the National Security Commission on Artificial Intelligence concluded that the US needed to develop a “resilient domestic base” for creating semiconductors required to manufacture a range of electronic devices, including diodes, transistors, and integrated circuits. Chair Eric Schmidt, the former Google CEO, warned: “We are very close to losing the cutting edge of microelectronics, which power our companies and our military because of our reliance on Taiwan.”

Countering the rise of China

Jens Stoltenberg, the Nato Secretary-General since 2014, echoed the US concerns about how China is galloping away from competitors due to its investment in innovative technology, which other countries have embraced. The implicit – yet hard-to-prove – worry is that the ubiquitous tech is a strategic asset for the Chinese government. But is this a case of deep-rooted, centuries-old mistrust of the East by the West?

 The former Norwegian Prime Minister, ever the diplomat, was at pains to stress that China was not considered an “adversary.” However, he did make the point that its cyber capabilities, new technologies, and long-distance missiles were on the radar of European security services. 

 In late October, Stoltenberg admitted that Nato would expand its focus to counter the “rise of China” in an interview with the Financial Times. “Nato is an alliance of North America and Europe,” he said, “but this region faces global challenges: terrorism, cyber but also the rise of China.”

 Ominously, Stoltenberg continued: “China is coming closer to us. We see them in the Arctic. We see them in cyberspace. We see them investing heavily in critical infrastructure in our countries. They have more and more high-range weapons that can reach all Nato-allied countries.”

 But is China truly so far in front of others? According to the venerated Global AI Index, calculated by Tortoise Media, the US leads the race, with China second. In late September, the UK – currently third in the rankings, slightly ahead of Canada and South Korea – unveiled its National AI Strategy, which sets out a 10-year plan to make it a “global AI superpower”.

 UK plans to become global AI superpower

Some £2.3 billion has already been poured into AI initiatives by the UK government since 2014, though this document – the country’s first package solely focused on AI and machine learning – will accelerate progress, enthuses the Department for Digital, Culture, Media and Sport’s digital minister, Chris Philp. 

“The UK already punches above its weight internationally, and we are ranked third in the world behind the US and China in the list of top countries for AI,” he said. “AI technologies generate billions [of pounds] for the economy and improve our lives. They power the technology we use daily and help save lives through better disease diagnosis and drug discovery.”

A self-styled AI champion and World Economic Forum AI Council member, Simon Greenman, states that the UK is home to the most significant number of AI companies and start-ups (8%) aside from the US (40%). Additionally, venture capital investment in UK AI projects was £2.4bn in 2019. 

“Money isn’t the issue,” says the Checkit Non-Executive Director, when discussing the perceived lack of progress being made by the UK. “The problem is we don’t have enough good commercial AI skills, such as product management and enterprise sales, to put the theory, research, and vision into practice.

“For instance, the ‘Office of AI’ doesn’t have an AI implementation budget. If we’re going to realise the potential that AI can bring to the UK, the government needs to put its money where its mouth is and appoint somebody who has a central budget to implement large-scale AI deployments when it comes to public policy.”

Greater collaboration needed

Fakhar Khalid, Chief Scientist of London-headquartered SenSat, a cloud-based 3D interactive virtual engineering platform, is more optimistic about the UK’s chances of becoming an AI superpower and calls for patience. While he agrees that “the US and China are the leading nations in terms of AI innovation and commercialisation,” he notes that China published its first AI strategy in 2017. The US followed with equivalent plans two years later. 

 “Although these strategies have recently started to emerge in the public and policy domain, these countries have been investing healthily in their ecosystems since the early 1990s,” he says. “In the 90s, the US was not only the leading country for AI education, but its academic innovation also had strong ties with the industry, ensuring a direct impact on the growth of their economy.”

Hinting at the different types of government that enable more collaboration in China compared to the US, the UK, and even Europe as a bloc, he continues: “China, on the other hand, has been radical and ambitious in building its technology capabilities by strongly linking government, academia, and industry to show the beneficial impact of AI on their economy. The government centrally controls China’s AI strategy with hyperlocal implementation.

“The UK’s long overdue AI strategy is a clear indication that we are here to declare ourselves as the key leader in this field, yet we have much to learn from these nations about commercialising our research and creating a strong and impactful link between academia and industry.”

For Dr Mahlet Zimeta, Head of Public Policy at the Open Data Institute in the UK, while China and the US are ahead in the AI race, there are ways in which her country can catch up. “The territories that are lined up to be global AI superpowers are China, US, and the European Union,” she says, “because the great access to and availability of data means the analysis is better. They have massive advantages of scale, but the UK could show international leadership around AI ethics.”

With a greater focus on data skills, standards, and sharing, and encouraging an international collaborative ecosystem driving AI innovation, the West can leap ahead of China. And perhaps, in time, all AI superpowers will work together, in harmony, to the benefit of humanity.  

FSA CIO on her career in tech: ‘It’s where the future is already happening’

The FSA’s groundbreaking CIO talks the future of technology careers, data openness and going beyond the status quo

What makes a successful chief information officer (CIO) in 2021? Ask Julie Pierce, the trailblazing director of openness, data and digital at the Food Standards Agency (FSA), who ranked fifth overall and was the highest-placed woman in the venerated CIO 100 list for 2019. 

Having learnt the news about the CIO 100, which recognises the UK’s “most transformational and disruptive” CIOs, Pierce recalls feeling “happy [and] honoured”. Following a pause, she adds: “And surprised.” Why? “If someone had told me I would be recognised at this level back when I was, say, 30, I would have thought it impossible, for so many reasons. So my reaction was: ‘Oh my God!’”

To an extent, her reaction to the accolade is understandable in an industry dominated by men. But the recognition is also a cause for celebration. Given that only one in six technology specialists in the UK are female and just 10% are IT leaders, the Bristol-based Pierce proudly serves as a role model for other women seeking to reach the top in tech.

The incredulity is misplaced, though, when one considers her groundbreaking 41-year career. After starting off with a misstep in oil exploration – more of which below – she enjoyed 13 years as a consultant at PwC, where she was one of the first female partners. Her CV also includes stints with the Home Office and the Metropolitan Police Service.

More recently, Pierce has excelled as CIO at the Animal and Plant Health Agency and the Department for Environment, Food and Rural Affairs (Defra). In August 2015, she moved from Defra to the FSA, a non-ministerial government department which monitors risks and issues of concern regarding food.

The case for data openness

As director of openness, data and digital (“a long but pretty cool title”) at the FSA, she performs a raft of duties. These include the CIO role, while also covering science and Wales. 

Importantly, Pierce is a fervent advocate of open and transparent data. Indeed, in the public sector, and further afield, the FSA is often held up as an exemplar of what is possible through opening up data. This progressiveness is in no small part thanks to Pierce.

“Being open and transparent [with data] is so important to me,” she says. “And at the FSA it is fundamental to our core being; we are here to be open and transparent on behalf of the consumer.” 

Pierce explains that her agency raises the alarm when “things are not quite right for consumers concerning food safety and authenticity”. As an example, she points to a recently implemented service that uses predictive analytics and machine learning to monitor global risks. 

The FSA publishes 70% of its datasets. Pierce argues convincingly that fellow CIOs should push to open data and drive collaboration internally and externally. The FSA has been trying to persuade businesses to be open and publish their data, she says.

At the FSA it is fundamental to our core being; we are here to be open and transparent on behalf of the consumer 

“We can see the large amount of data collected about food in public and private sector. For instance, we can see the opportunities from data-rich digital platforms where they may be sitting on real insights as to food risk, allowing us all to take action before something goes wrong.”

Under Pierce’s direction, the FSA has “put as much effort as possible in the last few years” to develop the infrastructure necessary to open data and make it “easier for businesses to consume that data”.

Beyond the status quo

Pierce believes in “transformation through the application of modern digital technology and insights from predictive analytics to business problems”. And in a clarion call for fellow CIOs, she has urged on LinkedIn: “Let’s be really different; let’s go beyond merely automating the status quo.”

Pierce has always sought to go beyond the status quo, but she originally had little interest in technology. Having graduated from the University of Wales, Bangor, in 1980 with a first-class degree in mathematics and physical oceanography, Pierce sought a hands-on role in the oil-exploration industry. The fact that it was “completely male-dominated” made it more attractive because of the challenge.

Ironically, she switched directions and flourished when the path was blocked in her chosen profession because of her gender. As a woman, she was forbidden to step foot on either the boats or the rigs. Pierce’s impressive career in tech can be traced back to that early change of tack. 

Let’s be really different; let’s go beyond merely automating the status quo

However, the combination of fierce ambition and talent has elevated her. It is this desire that modern CIOs must possess to excel, she suggests.

“My FSA role includes the CIO and a lot more. That in itself is one of the things I’m most proud of: that I have risen and gone above the CIO role into other aspects of the business.” Indeed, to secure a place in the boardroom, CIOs must demonstrate the many different ways they can add value. 

Pierce says there has never been a more exciting time to embark on a career in tech and climb the ranks to CIO and above. “It’s an absolutely fascinating sector, as it’s moving and evolving so quickly,” she says. “It’s becoming more relevant, ubiquitous, and essential to everything we do. Therefore, you can choose any sector to work in – food, healthcare, financial services, whatever.

“What makes a career in tech so attractive nowadays is that it is accessible in so many more ways compared to when I began. You can come in through some of the more innovative data ideas, such as artificial intelligence or robotics, or via looking at accessibility and the way users engage with the tech, or the hardware route.”

After a final pause, she adds: “It’s the place really where I think the future is already happening.”

This article originally appeared in Raconteur’s Future CIO report in September 2021

Five ways to better manage supply chain disruption

The fallout from the pandemic exposed deep-rooted issues and a worrying lack of visibility, but these practical insights will help in case of future crises 

1. Don’t focus on cost alone

The countless stock delays and shortages over the past 18 months caused by a lack of preparedness and agility for the coronavirus-induced disruption have, for the first time in decades, called into question the running of lean supply chains designed to boost efficiencies and profits. They have laid bare a fragile and complex system that “has ultimately morphed into an investment plan focused on quick fixes and last-minute saves”, according to Patrick Van Hull, industry thought leader at Kinaxis, a global supply chain management company. 

Malcolm Harrison, group chief executive of the Chartered Institute of Procurement and Supply, agrees that many had seemingly dialled-up risk in the hunt for greater financial rewards. “Ensuring resilience and achieving value have always been the overarching objectives for procurement and supply professionals,” he says. “Focusing on cost alone is a risky strategy for any organisation. We’ve had decades of strong, lean and sometimes single-sourced supply chains working so efficiently that we hardly noticed them.”

The pandemic, he says, has encouraged supply chain managers to renew their focus on multi-supply strategies, local sourcing and best value in the supply chain, including working with competitors.

2. Invest in technology

Dirk Holbach, chief supply chain officer of laundry and home care at Henkel, says it was a tremendous advantage that his organisation was already far along its digital transformation journey before the pandemic. “The real-time visibility along our supply chain, which is a result of deploying Industry 4.0 technologies, allowed us to focus on the right challenges and to make the best decisions,” he says.

Van Hull points out that companies invested in digital transformation pre-pandemic were financially outperforming industry averages and surged further ahead of rivals over the past 18 months. “These types of results present a significant opportunity for supply chains, which historically have struggled with translating operational capabilities and digital transformation into financial success,” he says. 

3. Develop supplier relationships

While investment in technology is vital to increase supply chain resilience, old-fashioned human-to-human talking to solve problems is just as important when disruption inevitably strikes. Developing and nurturing supplier relationships accumulates mutual trust that can be cashed in when required, whether that buys favourable prices, shorter lead times or extra stock.

And, as the idiom suggests, a problem shared is a problem halved. “Embrace collaborative supply chain risk management,” urges Dr Alireza Shokri, associate professor in operations and supply chain management at Northumbria University. “Invest time in a collaborative culture, build trust and use these relationships to strengthen prevention and mitigation strategies.”

Shelley Harris, commercial director of IPP, which pools and provides pallets and boxes across Europe, agrees. “Our partner relationships are key, helping us to face new challenges as well as to work as efficiently and productively as possible,” she says.

The strength of its supplier relationships has allowed IPP to continue to fulfil its customer deliveries, despite the challenges the wider industry is facing, notably driver shortages. “We’re stronger because of long-standing relationships – we’ve seen a minimal impact on our operation and resulting service to our customers,” she says.

4. Improve transparency

The number-one way to manage disruption, according to Harrison, is a deep understanding of your supply chain and a focus on transparency. While this requires the right technology, as businesses have had to operate more efficiently in the digital space with more automation, it starts with understanding the different tiers of the supply chain. 

“Transparency across all tiers of the supply chain is a challenge,” he acknowledges, “but that visibility contributes to value in that it [helps to] remove fraud and corrupt practices and [helps businesses] look for signs of modern slavery among their suppliers.” 

Harrison stresses it is important to understand the robustness of different suppliers – and their suppliers. Transparency allows a business to identify potential problems, for example if a component is sourced from a single country or location and to track shipments.

This chimes with Van Hull’s thoughts. “Increased transparency is highly desirable for supply chains to sense disruptions as they are happening and respond immediately,” he says. “That is even more useful when it can be tied to financial outcomes, such as reduced inventory and cash buffers, improved capacity utilisation and lower cost resolution of demand-supply mismatches.”

5. Get the training right

Holbach believes training is imperative to maximise the potential of technology solutions. Empowering local teams and using their expert knowledge will strengthen the supply chain. They will flag potential issues early, giving the network a better idea of where to go for help with routing or stock if required. 

“We’ve had to react with agility during the pandemic and that was only possible by trusting our teams worldwide,” says Holbach. “It created the freedom to act fast, find the best solutions and keep our customers and consumers supplied with essential products.”

He believes a progressive approach to training starts from the top of an organisation. “As leaders, you should never stop learning,” he says. “To prepare for the unknown, you have to have the right mindset when confronted with new and difficult situations.”

Harrison echoes this insight, saying that supply chain professionals need to be equipped with the right skills and commercial judgement, which can only be achieved through training and development. This means being up to date, qualified, informed and skilled.

“What this pandemic has shown is that you need to invest in both technology and people to ensure supply chains are resilient, then we will manage better through the next global shock,” he says.

This article was first published in Raconteur’s Supply Chain Resilience report in September 2021

‘Just do it’: digital transformation lessons from Estonia

The Baltic state is a digital trailblazer, having made 99% of its public services available online. The government’s CIO, Siim Sikkut, offers his advice for businesses contemplating their own transformations

The smallest of the Baltic states by both area and population, Estonia has served as a political pawn in the hands of several neighbouring powers over the centuries. Since regaining its independence after the collapse of the Soviet Union 30 years ago, this republic has been punching massively above its weight in one respect: technological innovation.

In 2005, for instance, it was the first country to enable online voting. In 2012, it was the first to use blockchain technology for governance. By the time that Wired magazine named Estonia the “most advanced digital society in the world” in 2016, almost all public spaces in the country had been served by free Wi-Fi for a decade. Today, under the government’s so-called e-Estonia programme, 99% of government services are accessible online, while 70% of the country’s 1.3 million citizens regularly use digital ID cards. 

“We joke that our e-services are impossible only for marriages and divorces – you still have to leave the house for those,” says the man in charge of e-Estonia, Siim Sikkut, who has been the government’s CIO since 2017. 

He explains that the country desperately needed a technological “reboot” after gaining its freedom from the debilitating grip of Russian rule in 1991. With this in mind, the state committed itself to electronic governance – a decision that established a digital-first approach on which the country’s pioneering innovations have been based ever since. 

Sikkut, who also chairs the national task force on artificial intelligence, graduated from Princeton University with a degree in public and international affairs in the same year that online voting started. He initially joined the Ministry of Finance before becoming a digital policy adviser at the Ministry of Economic Affairs and Communications, when he co-founded Estonia’s ground-breaking e-residency scheme. Among other things, this offers entrepreneurs based anywhere in the world a digital ID granting them and their businesses remote access to markets in the EU.

Spearheading the world’s digital revolution

Sikkut, 38, is modest about the role he has played in creating what the e-Estonia website calls “an efficient, secure and transparent ecosystem”.

“I stand on many shoulders,” he says. “When I moved to my current role, it wasn’t a question of what to digitise next. All the low-hanging fruit had been picked. It has been about how to keep going to the next level of digitisation. We need to keep everything running while innovating and iterating.”

I hope that our experience in Estonia shows that it’s not rocket science. With commitment, anyone can achieve a digital transformation 

What might have been classed as a risky commitment to technology three decades ago has fostered a more progressive and open society, both online and offline, according to Sikkut. A Eurobarometer survey in 2018 found that 49% of Estonians trusted their government, compared with the EU-wide average of 34%, for instance. 

Indeed, it is said that in Estonia you are only two calls away from the prime minister – the implication being that people in this small country are community spirited and willing to help each other out.

Size matters: but trust trumps all

“It does help that there are few degrees of separation here,” Sikkut says. “With our small population, we get things done – both the connection and decision cycles are much shorter here than in other countries. But our talent pool is much smaller too, so our size is both a constraint and an opportunity.”

It’s no coincidence that the capital, Tallinn – where Sikkut lives with his wife and their three young children – is often referred to as Europe’s Silicon Valley. Estonia is estimated to have produced more start-ups per capita than any other European country in recent years. According to Startup Estonia’s online database, 1,104 enterprises have been established in the country since 2013 – including Uber rival Bolt and payment company Wise (TransferWise until it was renamed at the start of this year).

Any entrepreneur seeking to up the pace of their business’s digital transformation has much to learn from Estonia’s experience. Sikkut believes that strategic partnerships are key in this respect. He points to e-Estonia’s soon-to-be-launched digital testbed framework, a collaboration model that will offer free access to the government’s tech stack, on which any business worldwide can build new products or services and gain proofs of concept.

“I’d say to business leaders: ‘You have to be open for innovation and open to partnership,’ like we’re trying to be with our testbed framework. If someone comes to you with a good idea, take it on board, try it out and then perhaps you can move more quickly,” he says. “We’re looking to increase the speed of innovation in Estonia again by being open and encouraging experimentation with new ideas. The emergence of AI has been a game-changer, for instance, as we embark on this new stage of digitisation.”

Taking people with you

What other advice would Sikkut offer business leaders looking to introduce new digital tools and services? 

“If you build something that saves people time, money or effort and offers them value, they are likely to use it and refer it to others,” he says, adding that “you still might want to throw in incentives for people to start using them. For example, we offer much quicker tax reimbursements to those who complete their forms online rather than on paper.”

Sikkut stresses that it’s essential to spend an adequate amount on training people in how to use new digital tools. “We’ve invested in infrastructure and worked on skills to ensure that people can use our online services. You have to take care of your users so that you can bring them along with you,” he says.

His advice for any entrepreneur who may be approaching digital transformation with trepidation is to learn from his country’s success and stop dithering. 

“Just do it,” Sikkut says. “You’ll never have a perfect plan. Take an engineer’s attitude: try things out, fix them if they fail and try them again before scaling up your operations. I hope that our experience in Estonia shows that it’s not rocket science. With commitment, anyone can achieve a digital transformation. You don’t have to build everything from scratch. There are solutions that you can reuse and you can partner with people who’ve gone through it already – including us here in Estonia.” 

He continues: “The latest technology will probably not solve all your problems. What matters most is being open to possibilities and open to partnerships. If you give bright people a conducive environment, magic will happen.”

This article was first published in Raconteur’s Business Transformation report, published in June 2021

Mastercard cyber chief on using AI in the fight against fraud

Ajay Bhalla, Mastercard’s president of cyber and intelligence solutions, thinks innovations like AI can tackle cybercrime – and help save the planet

The fight against fraud has always been a messy business, but it’s especially grisly in the digital age. To keep ahead of the cybercriminals, investment in technology – particularly artificial intelligence – is paramount, says Ajay Bhalla, president of cyber and intelligence solutions at Mastercard. 

Since the opening salvo of the coronavirus crisis, cybercriminals have launched increasingly sophisticated attacks across a multitude of channels, taking advantage of heightened emotions and poor online security.

Some £1.26 billion was lost to financial fraud in the UK in 2020, according to UK Finance, a trade association, while there was a 43% year-on-year explosion in internet banking fraud losses. The banking industry managed to stop some £1.6 billion of fraud over the course of the year, equivalent to £6.73 in every £10 of attempted fraud.

If you don’t test things to break them, you can be sure their vulnerabilities will be discovered down the line

The landscape has rapidly evolved over the past year, says Bhalla, due to factors like the rapid growth of online shopping and the emergence of digital solutions in the banking sector and beyond. These changes have broken down the barriers to innovation, driving an unprecedented pace of change in the way we pay, bank and shop, says the executive, who’s responsible for deploying innovative technology to ensure the safety and security of 90 billion transactions every year. 

“Against that backdrop, cybercrime is a $5.2 trillion annual problem that must be met head-on. Standing still will mean effectively going backwards, as fraudsters are increasingly persistent, agile and well-funded.”

AI: the new electricity

It isn’t just the growing number of transactions that attracts criminal attention, but the diversity of opportunity, according to London-based Bhalla, who has held various roles at Mastercard around the world since 1993. 

“As the Internet of Things becomes ever more pervasive, so the size of the attack surface grows,” he says, noting that there will be 50 billion connected devices by 2025. 

Against this backdrop, AI will be essential to tackle cyber threats. 

“AI is fundamental to our work in areas such as identity and ecommerce, and we think of it as the new electricity, powering our society and driving forward progress,” says the 55-year-old.

Mastercard has pioneered the use of AI in banking through its worldwide network of R&D labs and AI innovation centres, and its AI-powered solutions have saved more than $30bn being lost to fraud over the past two years. 

In 2020, it opened an Intelligence and Cyber Centre in Vancouver, aimed at accelerating innovation in AI and IoT. The company filed at least 40 AI-related patent applications last year; it has developed the biggest cyber risk assessment capability on the planet, according to Bhalla. 

“We are constantly testing, adapting and improving algorithms to solve real-world challenges.”

Turning to examples of the company’s work, Bhalla says Mastercard has built an ability to trace and alert on financial crime across its network, a world first. He also points to the recently launched Enhanced Contactless, or ECOS, which leverages state-of-the-art security and privacy technology to make contactless payments resistant to attacks from quantum computers, using next-generation algorithms and cryptography. 

“With ECOS, contactless payments still happen in less than half a second, but they are three million times harder to break.”

Building security through biometrics


Such innovations are transforming customers’ interactions with financial services providers. For example, Mastercard has combined AI-powered technologies with physical biometrics – like face, fingerprint and palm – to identify legitimate account holders. These technologies recognise behavioural traits, like the way in which customers hold their phone or how fast they type, actions that can’t be replicated by fraudsters. 

“We see a future where biometrics don’t just authenticate a payment; they are the payment, with consumers simply waving to pay.”

Excited by developments in this area, Bhalla says Mastercard recently detected an attack that involved hundreds of devices attempting to log in from a phone that had reported itself as lying flat on its back. “Given the speed at which the credentials were typed, we knew it was unlikely it could be done with the phone flat on a surface,” Bhalla says. “In this way, a sophisticated attack that looked otherwise legitimate was detected before any fraud losses could occur.”

Cybercrime is a $5.2 trillion annual problem that must be met head-on. Standing still will mean effectively going backwards, as fraudsters are increasingly persistent, agile and well-funded

Mastercard might boast an impressive list of successful fraud-fighting solutions, but wrong turns are vital for the journey, Bhalla admits. “If you don’t test things to break them, you can be sure their vulnerabilities will be discovered down the line,” he says. “At Mastercard, trust in and reliance on our services is far too important to take that risk, so rigorously testing solutions before they get anywhere near the end user is our standard operating procedure.”

Trust is a must

A keen rower and golfer, Bhalla volunteers as an executive-in-residence at the University of Oxford’s Saïd Business School. He has a bachelor’s degree in commerce from Delhi University and a master’s degree in management from the University of Mumbai. 

Even with his experience and tech knowledge, Bhalla insists that Mastercard and others within the industry must go back to basics and focus on customer experience. The company’s leadership in standards has been core to earning and retaining the trust of its customers, he notes. 

The technology may be evolving quickly, but one core principle remains, says Bhalla. “Our business is based on trust, which is hard-won and easily lost.”

The correct operating processes and standards must be in place from the outset so that both customers and businesses can have confidence in the technology and trust that it will be useful, safe and secure. 

“What has changed is the sharp focus now placed on developing leading-edge solutions that prevent fraud and manage its impact, which is not surprising given that the average cost of a single data breach has now grown to $3.86 million,” Bhalla says.

Providing a blueprint for business leaders, Bhalla strongly believes that “innovation must be good for people … and address their needs at the fundamental design stage of the systems and solutions we create.”

“We see a future where biometrics don’t just authenticate a payment; they are the payment, with consumers simply waving to pay

Bhalla is using tech to fight fraud and drive financial inclusion, with Mastercard aiming  to connect 1 billion people globally to the digital economy by 2025. His ambitions are wider still, with much of his work focused on “protecting the world we have”. 

Mindful that climate change is high on the agenda, especially for younger generations, Mastercard has launched a raft of programmes in the area, including this year’s Sustainable Card Badge, which looks to identify cards made more sustainably from recyclable, recycled, bio-sourced, chlorine-free, degradable or ocean plastics.

Much like fighting fraud, global warming is reaching a crucial stage. Thanks to the efforts of industry leaders like Bhalla, the world stands a better chance of ultimate triumph on both fronts.

This article was originally written for Raconteur’s Fighting Fraud report, published in June 2021

The worrying rise of ransomware as a service

The Colonial cyberattack that cost a US fuel pipeline $4.4m in May highlights why businesses need to treat the fast-emerging threat of ‘ransomware as a service’ more seriously

A wry observation doing the rounds among cybersecurity experts is that the hackers who’ve transformed ransomware attacks into a multibillion-dollar industry are more professional than their high-profile corporate victims. 

It was certainly no laughing matter for the CEO of the Colonial Pipeline, one of the largest fuel-distribution networks in the US, when an attack in early May disabled the 5,500-mile system, triggering fuel shortages and panic-buying at filling stations. Within hours of the breach, Joseph Blount controversially paid a $4.4m (£3.1m) ransom to DarkSide, the Russian hacking group that mounted the attack, on the basis that it was “for the good of the country”. Despite this, the network was still out of action for a week.

The Colonial Pipeline case is one of many similar incidents, which have increased sharply in number since the pandemic started but have tended to go under the radar, as the victims are understandably reluctant to publicise their security failings. This high-profile example has exposed the rise of so-called ransomware as a service (RaaS), which DarkSide and various other professional hackers are now offering. 

Ethically speaking, you have to consider that you are enabling cybercrime by paying a ransom

The number of cybercrimes committed worldwide in 2020 was 69% higher than the previous year’s total. Ransomware was involved in 27% of these and a total of $1.4bn was demanded, according to a report published in May by US data security company Zscaler. In the UK, cybersecurity specialist Mimecast believes that as many as 60% of companies suffered a ransomware attack during the year. 

Ransomware is on the rise (Soumil Kumar from Pexels)

“Covid-19 has driven a huge ransomware surge,” reports Deepen Desai, Zscaler’s chief information security officer. “Our researchers witnessed a fivefold increase in such attacks starting in March 2020, when the World Health Organization declared the pandemic.”

Criminals seeking to exploit the network vulnerabilities created by the general shift to remote working during the Covid crisis either developed more sophisticated hacking methods or, seeking a shortcut, paid for RaaS. 

RaaS business model rings alarm bells

“RaaS has enabled even the least technically advanced criminals to launch attacks,” says George Papamargaritis, director of managed security services operations at Obrela Security Industries. “Gangs are advertising their services on the dark web, collaborating to share code, infrastructure, techniques and profits.” 

The RaaS model means that the spoils are split among three partners in crime: the programmer, the service provider and the attacker. “This is a highly structured and organised machine that operates much like many other legitimate organisations,” he adds.

The earliest reference to RaaS can be traced back to 2016. But, as Jen Ellis, vice-president of community and public affairs at Rapid7 and co-chair of the Ransomware Task Force, notes: “There are indications that it’s on the rise as more criminals take the chance to make a quick, easy and relatively risk-free profit by entering the ransomware market.”

This collaborative approach to ransomware attacks is terrible news for businesses, warns Ian Pratt, global head of security for personal systems at Hewlett-Packard. “Once, it was the preserve of opportunistic individuals who targeted consumers with demands of a few hundred pounds. Today, criminal gangs operating ransomware make millions from corporate victims in so-called big-game hunts,” he says. “This should have the alarm bells ringing in boardrooms.”

By educating themselves and their employees, business leaders can improve company-wide security protocols and so minimise the risk of ransomware attacks. Pratt explains that “users are the point of entry for most attacks”, accounting for 70% of successful network breaches. Malware is “almost always delivered via email attachments, web links and downloadable files”.

Prevention better than cure

Michiel Prins, co-founder of HackerOne, a vulnerability-disclosure platform connecting businesses with penetration testers, agrees. “Difficult as it may seem to prevent these attacks, prevention is always better than cure when it comes to ransomware,” he says. “This means maintaining a nimble and adversarial approach to cybersecurity that takes into account the perspective of an attacker, getting beyond traditional solutions that miss more elusive vulnerabilities.”

Prins argues that working with ethical hackers will “strengthen an organisation’s overall security posture”, as potential weak spots are reported and fixed “before serious damage is done”. Additionally, establishing a so-called bug-bounty programme, which rewards people for highlighting faults in the coding, “signals a high level of security maturity,” meaning that the criminals might look for easier prey.

If they do fall victim to an attack, should organisations accede to ransomware demands? CrowdStrike estimates that just over a quarter of victims end up paying the hackers to unlock their systems. Nearly 60% of UK businesses would enter negotiations, according to Sam Curry, chief security officer at Cybereason. 

Gangs are advertising their services on the dark web, collaborating to share code, infrastructure, techniques and profits

“We’d advise against paying ransoms. But in extreme situations, where lives are at risk or a national emergency is likely, it could be better to pay,” he says. “Before making that decision, it’s essential to notify your legal counsel, your insurer and the relevant law-enforcement agencies.”

Even when a business does cough up, there’s no guarantee that this will put an end to its problems. Peter Yapp, former deputy director at the UK’s National Cyber Security Centre and now a partner at law firm Schillings, cites the Travelex attack in December 2019 as an example. Many of the company’s web pages were still out of action two months later and a $2.3m ransom was eventually paid to the hackers. Later in 2020, Travelex sank into administration, “partly due to the losses and reputational damage caused by the attack”, he says.

Charles Brook, threat intelligence specialist at cybersecurity company Tessian, acknowledges that it’s a tough decision. “Ethically speaking, you have to consider that you are enabling cybercrime by paying a ransom,” he says. “But I can sympathise with organisations that may have no other option.”

There are other considerations, Brook adds. “If you pay, you could put a target on your back for further attacks. And, even after your files are decrypted, there may still be something malicious left behind.”

With the hackers in the ascendancy, Yapp believes that the government needs to step up its efforts to combat ransomware. “This has become such a serious problem that perhaps it’s time to lobby for the UK’s new National Cyber Force to fight back against these criminals in a different, military, way,” he suggests.

Perhaps the hackers won’t have the last laugh, after all.

This article was originally written for Raconteur’s Connected Business report, published as a supplement in The Times in June 2021

Is your business harnessing the power of conversational search?

The proliferation of smart devices and the improving capabilities of AI-powered voice assistants mean that voice search-ability is no longer a mere ‘nice to have’

Hey, Siri. Are marketers and their businesses investing enough time, money and effort in improving their conversational search rankings? 

Given that Juniper Research forecasts that consumers will be using voice assistants on more than 8.4 billion devices by 2024, while MarketsandMarkets predicts that the global conversational AI market will grow from £3.4bn in 2020 to £9.8bn in 2025, there’s a strong case that they should be doing more.

Consumers embrace new technology if it makes life simpler and more effortless for them. Otherwise, what’s the point?

Firms that have already invested in achieving higher voice search rankings are benefiting from it. For instance, translation service Lionbridge started optimising for voice search in July 2019. Twelve months later, it had almost 47 times more ‘featured snippets’ – the short text at the top of a page of Google search results. This improvement aided a 127% year-on-year increase in traffic to the firm’s website.

“Businesses should view optimising for conversational search as mandatory,” argues Olga Andrienko, head of global marketing at Semrush, which manages Lionbridge’s marketing analytics. “We have already seen the dramatic effect it can have on businesses’ search results. As voice assistants are further integrated into people’s everyday lives, this influence will grow.”

Nick McQuire, chief of enterprise research at tech consultancy CCS Insight, agrees. “As one of AI’s most important areas of development, conversational search is progressing rapidly,” he says.

Bringing AI to the masses

Conversational search development has accelerated “because it sits at the centre of two important trends”, McQuire suggests. First is the improvement in AI speech technology. Second is the need to improve information search in businesses. “This area”, he says, “is often listed as ‘broken’ by customers owing to information silos, especially across several data stores, documents and applications.”

McQuire continues: “The fact that all the big tech firms have started to tackle this area with products and tools demonstrates the scale of the customer need.”

Conversational search is a more complex matter than people simply using their voices instead of keyboards, though. For instance, on what smart device is the search being conducted – a screen-less Apple HomePod, a Google Nest Hub Max or an in-car Amazon Alexa?

While companies can pay to appear on the first page of a conventional typed search on a computer screen, mastering conversational search is not so straightforward. For one thing, marketers don’t always have the same real estate for advertising. 

If a device being used for voice search has no screen, how likely is it that a business will pull traffic to its website if it ranks outside the top three search results? Equally, if the device has a screen, a more visual response is presumably better. Notably, the average answer length for the three most popular voice assistants – Siri, Alexa and Google Assistant – is 23 words, according to Semrush.

Convenient and contextualised answers

Semantics aside, the crucial point for marketers is that consumers want their problems solved quickly. So says Kashif Naqshbandi, CMO at IT recruiter Tenth Revolution Group, who adds: “Most of the time they are not just looking for a ‘what’, but also a ‘how’ and ‘why’. This is why question-driven conversational search has spiked.”

Naqshbandi explains that few people are now searching online for, say, a “mountain bike” and then clicking through web pages of information. Instead, they are asking specific questions – for instance, “what sort of mountain bike should I buy?” – to seek a contextualised answer.

“Consumers are more accustomed to these fast, personalised interactions that help them cut through the digital noise and find a solution,” he says. “Marketers have to evolve to deliver interactive, dialogue-based experiences to stay competitive.”

Euan Matthews, director of AI and innovation at ContactEngine, a developer of conversational AI systems, agrees that people ultimately want to save time wherever possible and are happy to pay for convenience. 

“Consumers embrace new technology if it makes life simpler for them. Otherwise, what’s the point?” he says, attributing Amazon’s continuing ascendancy to the time it saves customers. But he adds that a “big pitfall” for marketers is to focus only on the search element.

To illustrate his point, Matthews says that some devices, when asked about the best local Indian restaurant, say, will now offer a follow-up option of booking a table through Google, and – if the user accepts – they will add this booking to the digital calendar. 

“This time saving is not because of the conversational search,” he says. “It’s more because that search has been seamlessly married with the ability to execute a transaction on your behalf. Marketers must consider how to marry conversational search and the transactional capability of the voice assistant, because this is what saves consumers time and makes it more likely that they’ll progress down the sales funnel.”

The direction of travel is clear, so marketers must alter their course accordingly. “We will see more advances in the ability for conversational search to end in a transaction – and this will drive uptake,” Matthews predicts. 

Will it ever replace keyed search? “I doubt it,” he says. “Some searches are best not voiced aloud.”

This article was originally published in Raconteur’s Future of Marketing and CX report in June 2021

Hyperautomation will revolutionise work – but what exactly is it?

Experts agree that the growing maturity of a cluster of technologies has transformative potential, but businesses must act fast if they’re to gain a competitive edge

Hyperautomation has been thrust into the spotlight for the second time in six months by Gartner. In October 2020, the research giant named it as one of its top strategic technology trends for 2021. Its latest report on the subject, published at the end of April, forecasts that the global market that enables hyperautomation will be worth almost £430bn in 2022 – a 24% increase on the previous year’s figure. 

“Hyperautomation has shifted from an option to a condition of survival,” says Fabrizio Biscotti, research vice-president at Gartner. 

But what is hyperautomation, why is it generating such interest now, and – most crucially – how can businesses best harness its potential? 

In essence, hyperautomation is a strategy that enterprises adopt to quickly identify, vet and automate as many processes as possible, applying a disciplined, holistic approach and mix of technologies. It spans the whole spectrum of operations, using digital tools to simplify many time-consuming tasks. These tools include AI systems, robotic process automation (RPA), low-code application platforms and virtual assistants. 

The concept is becoming increasingly relevant, Biscotti says, because organisations will “require more IT and business process automation as they are forced to accelerate their digital transformation plans in a post-Covid, digital-first world”. 

Gartner’s October 2020 report had noted: “Many organisations are supported by a patchwork of technologies that are not lean, optimised, connected, clean or explicit. At the same time, the acceleration of digital business requires efficiency, speed and democratization. Organisations that don’t focus on efficiency, efficacy and business agility will be left behind.”

Tackling low-hanging fruit

Peter van der Putten is director of AI solutions at cloud software firm Pegasystems and an assistant professor of AI at Leiden University in the Netherlands. He suggests that the drive towards hyperautomation has been “gathering pace for a while as the technologies have matured”. 

Their simultaneous emergence has created far-reaching possibilities. There is low-hanging fruit to be gobbled by business leaders, he says, although those who invest heavily in hyperautomation stand to gain the most from it.

“There is more to hyperautomation than streamlining workflows to save time and reduce cost,” van der Putten stresses. “There are strategies that businesses can use to link automation with business outcomes more directly. Realising the potential of hyperautomation hinges on robust governance and the quality of executive-level support – how it is implemented across an organisation and not in narrow niches.”

Hyperautomation will do to the knowledge worker what the industrial revolution did to the manual worker

For instance, the ability to manage exceptions through AI enables finance, IT and governance experts to deliver value for industries that already use new networks or decentralised cloud services. A recent global survey of 1,300 business leaders by Pegasystems identified key areas where hyperautomation has already been benefiting financial services providers. Respondents reported achieving quick wins in a number of functions, including finance, data management and production. They expect to see significant advances in areas such as supply chains and “partner ecosystems” over the next five years.

As an example of what’s possible with hyperautomation, take credit broker Loan.co.uk. The business, which has been building intelligent systems since 2014, has transformed mortgage lending from a process that’s traditionally been opaque, complex and painfully slow. The total automation improvements to date have “saved our 40 advisers and processors on average three hours and 45 minutes a day”, reports CEO Paul McGerrigan.

The company’s AI helper, Albot, can search thousands of lenders’ offers in less than a second while matching more than 10,000 criteria, delivering the lowest rate appropriate for the applicant’s circumstances. 

“Our smart AI underwriter can fully underwrite about 100 cases in 30 seconds, including credit searches,” McGerrigan says. “Previously, it would have taken an adviser 20 minutes to underwrite one complex case.” 

A workplace revolution

The company’s new approach has significantly increased transparency and, in turn, engendered greater trust among its customers. McGerrigan urges other companies to embrace hyperautomation, which, he says, “will do to the knowledge worker what the industrial revolution did to the manual worker. We are seeing the largest shift in how we work in 100 years. Most firms have been taken by surprise at the speed of change, while some are still asleep.”

Guy Kirkwood, chief evangelist at UiPath, an RPA software provider, agrees that the potential for hyperautomation is huge. “In the US alone, 2.6 trillion hours of work a year are automatable,” he says, noting that the pandemic-induced lockdowns have added impetus to the trend. 

“Work will be revolutionised,” Kirkwood predicts. “Almost over night, employees were expected to work from home, deal with unfavourable economic conditions and handle a huge rise in their workloads in areas such as customer service and data entry. Many turned to automation to adapt.”

He points to a firm providing smart infrastructure that used to print, sign, scan and upload 400,000 invoices a year manually. The business “now has a robot that performs these tasks digitally. This means that no employee needs to physically be in the office to process an invoice.”

Now that businesses have been catapulted into the digital age, regardless of their industry, we are on the verge of a new era of work in which hyperautomation will play a much greater role. Companies that make the leap today and go big on automation will be winners tomorrow. 

This article was originally published in Raconteur’s AI for Business report in May 2021

Trust is a must: why business leaders should embrace explainable AI

The EU’s proposed regulation on artificial intelligence has earned widespread praise. The prospect of harmonised rules presents an ideal opportunity for firms to improve transparency and reduce bias in their processes by investing in AI that’s easier for humans to understand 

The European Commission vice-president responsible for media and information matters, Margrethe Vestager, neatly summarised the founding philosophy of the EU draft legal framework on AI at the time of its publication in April. 

“Trust is a must,” she said. “The EU is spearheading the development of new global norms to make sure AI can be trusted. By setting the standards, we can pave the way to ethical technology worldwide.” 

Trust is a must (Anna Shvets from Pexels)

Any fast-moving technology is likely to create mistrust, but Vestager and her colleagues decreed that those in power should do more to tame AI, partly by using such systems more responsibly and being clearer about how these work. 

The landmark legislation – designed to “guarantee the safety and fundamental rights of people and businesses, while strengthening AI uptake, investment and innovation” – encourages firms to embrace so-called explainable AI.

If we want AI to play a role in decision-making, then we have a right to understand how the AI came to a decision, regardless of its complexity

Most business leaders have welcomed the initiative, understanding that the goal is to increase public trust in AI by promoting the use of more transparent systems. 

Peter van der Putten is director of AI solutions at cloud software firm Pegasystems and an assistant professor of AI at Leiden University in the Netherlands. He believes that the EU has produced a “sensible, risk-based framework” that distinguishes “prohibited, high-risk and low-risk” AI applications from each other.

“This is a significant step forward for both EU consumers and companies that want to reap the benefits of AI but in a truly responsible manner,” he says.

The end of ‘computer says no’ 

Given that many organisations are using opaque algorithms to make significant decisions – sometimes with disastrous results – the creation of a legal framework that would encourage them to adopt explainable AI is welcome. So says Matt Armstrong-Barnes, chief technologist at Hewlett Packard Enterprise. 

“If we want AI – constructed using complex mathematics – to play a role in decision-making, then we, as citizens, have a right to understand how the AI came to a decision, regardless of its complexity,” he argues. “Explainable AI can answer the fundamental question: why? Once we know this, the decision can be evaluated to ensure that it’s made without bias. ‘Computer says no’ is no longer acceptable or desirable.”

Pip White, MD of Google Cloud in the UK and Ireland, agrees. “Your ability to understand your AI and machine-learning models entirely is key to your ability to roll out the technology confidently, particularly in regulated industries where trust is critical,” she says. “It’s also paramount in helping to unpick bias and other gaps in data or models. Ultimately, the more informed you are about the ‘why’ of AI-driven decisions, the more useful and responsible your AI deployments will be.”

But not all experts believe that that the draft law, which proposes fines of up to 6% of a company’s global revenue for the most severe breaches, will have a sufficiently positive effect if enacted in its current form. 

By setting the standards, we can pave the way to ethical technology worldwide

“You have to admire the EU for arriving late to the party and telling everyone to turn the music down,” says Mark K Smith, founder and CEO of ContactEngine, a conversational AI company. “I agree that AI needs regulation, but a regulation that stifles innovation would be unhelpful and lead only to developments being encouraged elsewhere.”

A well-timed reset

Van der Putten, who stresses that AI was never intended to replace human intelligence, believes that the proposed law will serve as a “reset moment” for the technology and its proponents, because it will help to improve trust. 

The EU’s intervention is timely, concurs Joe Baguley, EMEA vice-president and chief technology officer at enterprise software firm VMware. A survey by his company at the start of this year found that only 43% of Britons trust AI.

“This absence of trust can be attributed to AI’s perceived lack of transparency, which must be a key consideration for business leaders,” Baguley says. “There is no doubt that AI has the potential to revolutionise the workplace and society, but the need for explainable AI will become more pressing, as fears about the technology remain high.”

He continues: “If developers themselves don’t know why and how AI is thinking, this creates a slippery slope, as algorithms keep becoming more complex. Offering the public more insight into how AI makes decisions will give them more confidence and, in turn, help them feel more secure about the organisations that use the technology.”

The legal implications for AI in other jurisdictions

Kasia Borowska, managing director of AI consultancy Brainpool, believes that the rest of the world needs to catch up with the EU in regulating the technology. 

“The next step needs to involve making these regulations international, because uneven laws between different blocs could have catastrophic consequences in the long term,” she warns. “International leaders should look at this urgently. We know that AI will give unparalleled advantages to those in less controlled countries.”

How should businesses in the UK respond to the lead that Brussels is taking? “Be more guide dog than guard dog,” advises Caroline Gorski, group director of R² Data Labs at Rolls-Royce. “Create your own simple framework that meets the EU requirements. Focus on defining what can be done rather than what can’t, then break it down into steps, with auditable standards for each step. Join them all up and create a procedure.”

Simon Bullmore, co-founder and CEO of data-literacy consultancy Mission Drive, suggests that firms seeking guidance on explainable AI should engage the Open Data Institute, the Alan Turing Institute and the Office for Artificial Intelligence.

He urges business leaders to treat the EU’s initiative as a chance to invest in explainable AI – and to educate both themselves and their employees in the technology. 

“Regulators step in when they lose trust in the market’s competence and desire to self-regulate,” Bullmore says. “Part of the challenge of using AI is the disconnect between what leaders know about AI and what their organisations are doing with it.” 

Now that the rules of the game are changing, it will be the proactive leaders that gain the competitive edge by going back to basics with AI. 

This article first appeared in Raconteur’s AI for Business report in May 2021