Robots are perfect villains. Mechanical, metallic and merciless. Now they’re getting a software upgrade. And they’re coming for your job.
Much like the Gilded Age – when industrialization in the late 1890s began to sweep family farmers off their land and into cities – today’s inevitable march of increased productivity is taking aim at white-collar workers.
Japanese life insurer Fukoku Mutual announced it will replace 34 insurance claim workers with IBM Watson Explorer software this month. Happy New Year!
These robots are not Hollywood chic. They are not even tangible. They’re just software powered by artificial intelligence. Bits of code, 1s and 0s structured specifically to interpret digitized data and to destroy jobs. In that order. Now they are ready to be deployed in large numbers.
“No office job is safe. Lots of lawyers, accountants,
even surgeons, will be
automated away.”
– Sebastian Thrun
“No office job is safe,” writes Sebastian Thrun, a professor of computer science at Stanford University. “Lots of lawyers, accountants, even surgeons will be automated away. Having spent my career watching the long, slow carnage of my own industry, I have some insight into how that will feel, and how to cope.”
Coping will not stop the software robots. Artificial intelligence is accelerating their learning. They are already good at repetitive, judgment tasks based on data analysis. They are deployed to perform in customer service, quality control, fraud analysis, diagnosis and recommending treatments. Every new data point makes them better, and cheaper.
Fokoku will spend just $1.7 million to install Watson, and $128,000 per year on maintenance. According to reporting from Quartz, that’s a savings of $1.1 million per year over the human claim workers. Trading people for software will pay for itself in only two years. After that, all of the savings go straight to the bottom line. You can imagine how quickly financial officers are lining up for some AI business magic.
And that’s the kicker. Investing in AI makes good business sense.
Dai-ichi Life Insurance, Japan Post Insurance and Nippon Life Insurance are also trialing Watson and other AI systems to increase productivity.
IBM’s Watson is certainly not the only game in town. Research firm IDC predicts demand for cognitive systems will grow at an incredible rate – from just $8 billion in 2016 to $47 billion by 2020.
“Near-term opportunities for cognitive systems are in industries such as banking, securities and investments, and manufacturing,” said Jessica Goepfert, of IDC. “In these segments, we find a wealth of unstructured data, a desire to harness insights from this information, and an openness to innovative technologies.”
Where Will YOU Be When the K Wave Crashes?
When the K Wave crashes into the American economy … You’ll either be one of the lucky few who are rich and secure; or one of the millions who are hungry, desperate, and afraid. Now you might be tempted to say, “Dow 31,000 sounds pretty good to me, Larry, I’ll just hold onto my U.S. stocks and watch them double in value.” In other words, you might be tempted to sit tight and do nothing. But sitting tight is the worst thing you could do, for three reasons … to find out what those reasons are click here before it’s too late!
For investors, the best way to play this trend is still in the cloud. Amazon (AMZN, Alphabet (GOOGL) and Microsoft (MSFT) are ramping-up their public cloud platforms and fortifying services with open-source AI modules. And Splunk (SPLK) is building software to help developers work with very large data sets.
The outlook for human workers is perilous. There will be displacement. The outlook for investors in productivity-enhancing AI software remains bright. This trend is just getting started.
Best wishes,
Jon Markman
