CHAPTER 6

Conclusion

Support the Local Economy, Regional Infrastructure, and National Productivity Goals

There is a strong case to be made that as Procurement and Purchasing specialists and decision makers, you should put your immediate goals for your company or government body in the wider context of innovation development. How did this innovation come to be? Was it from your immediate regional infrastructure in terms of a tech hub, incubator, or accelerator that has been largely funded by taxpayers’ money? Is the new venture a privately owned startup with transparency over who owns the intellectual property? Or is it a spin-out from a large corporation or a university, which means the entrepreneurs do not necessarily own the IP completely?

These factors matter because it is easy enough to Spend Other People’s Money—in this case the budget you have been allocated by your department, unit or boss—on a surefire brand that everybody knows. Without mentioning names here, it is a low risk option to just sign for the package that comes from a big name Software as a Service provider that is omnipresent. What could go wrong?

You need to reframe the way you look at purchasing innovation and put it in terms of payoff: I take more risk but can always justify it with the knowledge that it has created jobs in the local economy. It has put my company or government body in good stead with the regional infrastructure providers, for example, local government services and Chambers of Commerce/business groups because we have bought from local sellers rather than foreign companies that may not even pay corporate tax in your country, so no trickled down into funding the said infrastructure and tech hubs!

Above all, you can reframe your purchasing decision in terms of national productivity goals. What is that tangibly speaking and put into your everyday office life and work routine? Well, let’s focus on the example of emails and chatbots. As we have seen in this book, many business intelligence firms are picking chatbots or IVAs as the future of communications, which inevitably makes emailing redundant, if it is not already so in many aspects.

Chatbots Are the Future According To a Londoner Lobby Platform and The Mayor in 2019

The following extract from the CognitionX Taster White Paper 2019 makes it very clear that “most chatbot deployment plans are in the next year or so, most chatbot plans expect substantial investment and impact, the use of natural language is expected to grow substantially.”1 We need to take their research seriously because although CogX is a relatively new AI bots platform campaigning to support the UK niche industry, it has support at the highest levels of government, which is all important in the British economic context.

It has been backed by the London mayor Sadiq Khan who spoke at their annual conference in the capital in summer 2019. And it has the express backing of the current UK government through CogX’s high profile cofounder Tabitha Goldenstaub from Wimbledon and a successful serial entrepreneur. Goldstaub has a powerful reputation as a feminist in the tech world, visibly campaigning to get more women into STEM and especially into artificial intelligence companies in order to reduce algorithmic bias in its development and commercial roll-out.

As the previous CogX excerpt summarizes, chatbots will be taking over the world! It describes the “future of chatbots as ubiquitous, much like speech in humans.” Just as well because as we can see from this American use case as shown in the following, even absolutely necessary business or educational human conversations are far from guaranteed with the next generation(s), partly the fault of technology and partly solved by it.

Figure 6.1 © Realfiction, Copenhagen, 2019. The Danish manufacturer of this frame that creates 3D hologram experiences like this dinosaur skeleton suddenly coming to life, is a pioneer in CX tech. The Customer Experience, even for visitors to a natural history museum, has reached a new bar of expectations and consumer satisfaction. Mixed Reality experiences like this one is providing a benchmark for user interaction or UX

Boston’s Botification of University Campuses for Next-Gen Humans

Let’s look at the excellent statistics of this Boston-based challenger tech company AdmitHub. Full disclosure: I met the cofounder Andrew Maggioli at the Re-Work Deep Learning Summit, their inaugural Chatbots Track, end of 2016. I enjoyed Andrew’s case studies he shared during his keynote and have followed AdmitHub’s exponential growth since then admiringly given they have forged ahead despite all the misconceptions about 2D chatbots as discussed in this book. They have convinced enough users in their vertical of higher education of their specific use case.

The point here about productivity is that AdmitHub’s research has found that Generation Z only opens 20 percent of the emails sent to them by the higher education administrators, the Admissions Centers, their lecturers, and the associated university service providers.2 That represents a staggering 80 percent loss in productivity for this student–admin communication! I have heard this pain point repeated by UK, Australian, French, and German higher education operators who have come to my company AI Bots as a Service for Requests for Proposals, so it definitely is a global trend.

This means for the precious university budgets—again largely taxpayer and government funded in most advanced economies—large amounts are being wasted on communicating students who ignore these communications. What should they do? Send out pigeons and smoke signals to the recalcitrant Gen Zers? Interrupt their Wi-Fi on campus to broadcast Official News and comms like in the Golden Days of 1950s television and radio alerts to the nation before that?

The answer lies in chatbots because the 2D bots are in the medium that Gen Z does engage with: texting or more accurately Instant Messaging. AdmitHub has published a white paper asserting that as opposed to the ignoring of 80 percent of emails sent to them, 98 percent university or college students will open and read text messages or IM notifications, and do so more or less immediately. Radically in terms of productive communications and the massive resources spent in terms of staff, time, and organization on campus, 40 percent of Gen Z students will also reply to the administrators’ messages!

AdmitHub has cleverly integrated this emerging data into their sales pitch and I note the majority of its Bostonian staff are sales and marketing account managers. Their 2D AI bots they are now calling their chatbot solution can help with that 40 percent conversion rate and restore some element of productivity to student–administrator communications.

Let’s face it—less than one-fifth of your target audience even reading what you say about something as important as their upcoming exam dates, changes of rooms, exam results, and admission info can only be considered an unproductive waste of time. Chatbots to the rescue in that at least they will get the message through and have double the chance of obtaining a response, a reaction if not an action from the target of the comms.

Entrepreneurial, Intrapreneurial, and the Sales Dead End

As we have seen in the previous checklists section, a different approach is required for entrepreneurs engaged with outside of your organization as opposed to recruiting intrapreneurs, that is, new recruits hired to run a pilot from within your company. If you misstep and end the pilot, it could be the end of the venture externally. You could have just killed off a startup in the public domain. Bad kudos for you and word gets around in the tech scene you are a partner/purchaser to avoid. Naming and shaming can happen these days very indiscreetly, but it does happen.

Closing down an internal R&D unit is another matter. Financial risk is often absolutely minimized by being forced to operate in a predefined budget, with money “given” to the intrapreneurial team before they even startup in their allocated office space. A comfortable feeling of being nurtured and removing the enormous stress of bootstrapping and “having to find the money to cover costs somehow” also removes the urgency that is lived and breathed in a normal startup scenario.

Figure 6.2 © Realfiction Copenhagen, 2019. This dinosaur is an example of an animated life-sized hologram. This type of Mixed Reality is the multimedia format used by AI BaaS to “implant various bot brains” effectively turning the giant hardware device into a shell or physical framework for a live, organically developing Cognitive Interface

So ending that pilot you have created as a greenfield project causes less financial pain to the intrapreneurs because they are, after all, salaried staff and have the emotional security of knowing when the next paycheck arrives. And being notified ahead of time that their pay will end if the project has “failed” or is discontinued.

Often these team members will be redeployed by HR to other parts of the company and have become more “employable” by virtue of having done this pilot project with famous Brand X or established Company Y. The kudos of having been paid to experiment puts them in a good place in the employment market as many of them will be “strategically recruited” to new ventures that are scaling up. So those who are prepared to take more financial risks and be in a less secure form of employment in a startup—perhaps already backed by VCs or a business angel, or otherwise existing on first revenues—will usually have a choice of positions in the startup ecosystem.

My comments on someone’s personal, cultural, ethnic, and psychological attitude to risk-taking and ability to adapt to pressurized situations for long period of times will greatly determine whether an intrapreneur converts to a full-time salary or contract employee status instead of staying in the permanently fluctuating, ever uncertain emerging tech scene. Even if you do end up with a C-suite title and there are less than five of you in the business! More work, more flexibility, more control over the business development, and hopefully resulting in more financial benefits and direct payment “rewards” in return for the hectic lifestyle.

Both have a sales dead end though the intrapreneurs are better protected. A startup winding down or ending suddenly could mean the entrepreneurs lose their house, car, and savings. That is the meaning of risk, sweat equity, and skin in the game!

As this book makes clear with reference to many case studies where enormous amounts of work and preparation went into requests for proposals, presentations, contract negotiations, and readiness to begin the project yet ended abruptly in a “sales dead end,” this can be fatal for many entrepreneurs. Corporate purchasers and civil service procurement units must, at all times, be aware that they are engaging with high-value innovators in society. They are to be respected for that fact alone. And treated with courtesy when communicating the probability of projects being approved—and paid for—or the reasons as to why they may not.

Sadly in today’s society globally, new ventures are routinely “used and abused” by both the public and private sectors. Many like big public broadcasters, telcos, energy corporations, state-run infrastructure like transport or large banks have endless funds to keep R&D units going and growing for decades on end. With very few results when you compare their careful, cautious greenfield experiments with the do-or-die soft launches and big splashes of startups on a shoestring. These intrapreneurs often “lead on” or falsely engage their emerging competitors outside of their organization, promising to license their niche innovation and pay them for their software or device.

However, I must flag the sad circumstance—from hearsay and personal experience—that nine times out of ten, these trusting young ventures are exploited for their knowhow, ideas, and often blatantly their intellectual property. It is copied by the salaried intrapreneurs or else modified and sourced elsewhere “cheaper” by executives who think having to deal directly with apparently freewheeling, overly passionate entrepreneurs is too much hassle and potentially an irreparable loss of status for them personally if things go belly up down the track.

Looking back over my 20 years in this startup ecosystem space, from Berlin to Sydney, London to San Francisco, Melbourne to Singapore, France to Africa and the overarching dominance of a seemingly unassailable U.S. tech giants, at times working in unison like a cartel in terms of internet presence and pricing, countered only by comparatively few, equally opaque, technology monopolizing monoliths coming out of China, Japan, and South Korea, I can see how innovation has been shamelessly stifled.

The U.S. Democrat leader Elisabeth Wilson and her cohort have rightfully called for U.S. tech giants to be curtailed in their power to destroy and obstruct even fledgling competitors. In fact, Facebook openly admits they have a “radar system” to detect any emergent threat coming from the global startup ecosystem that could take even a fraction of a fraction of their market share away.

We see the fast-acting, smothering actions of other tech giants belonging to the FAANGs when a threat emerges from a city’s ecosystem, as most hubs of entrepreneurship are now developed per city and via regional infrastructure. They buy up the promising startup and put it in their stable of young unknowns. The M&A of a small company by a giant corporation is universally portrayed in the mainstream media as a triumph, and a commercialization success story for the respective government that has poured millions of taxpayers’ money into building the tech hub the M&A took place in.

How sad it is that the next generation of innovators are being told by their official government funders, the state-sponsored business advisers, their tech solicitors, accountants, and above all their ecosystem peers that the ultimate goal and measure of success is to be bought by an invariably American corporation? What happened to aspiring to be a family-owned company run for generations? What about making the innovation and all the decades of resources, unpaid, used to create the USP, pay for itself by keeping the company going yourselves?

What about aspiring to become an SME or KMU part of the Mittelstand (middle sector) as it is called, quite respectfully and often admiringly, in Germany? Even a listing on the public stock exchanges seems to have been removed as an achievable milestone in the hope you might just be merged or acquired instead. And be considered a smart winner for having the nous to cash in on your hard work and endless hours of your seven day week to get your venture “over the line.”

It signals a loss of confidence in the robustness of your intellectual property, if you prefer to sell out to a big competitor rather than keep the company going and make it a challenger to the tech giants. Sure, they sabotage and make life tough for you as small fry in the global economy. But I think this issue has to be raised among us. From the buyer and seller side, the innovators and the purchasers need innovation to thrive and grow in the technological age of Industry 4.0.

If the tech entrepreneurs are all too willing to hand over their IP and proprietary algorithms at the drop of a hat to a giant competitor, where will the diversity of the market and drive for competitive prices and quality improvements come from?

Following is an excerpt from Jonathan Reichental’s list of five things to consider for the “future of government services.” He and his coauthor of this paper have identified what makes best practices for government procurement and above all, governmental adoption of new tech.3 The first two “recommended behaviors” for civil servants and government officials are (a) leadership and (b) vision. Here is what Reichental and Choudhury say about the other best practices and leading examples of where they are applied: Estonia in the EU, Dubai in the Middle East, and the United Arab Emirates (UAE).

Afterword

As I finish writing this book at the end of autumn 2019, I look back on my physical and virtual journeys while working on it for the past year or so. Almost in a “multiverse” sense! As an ad hoc subscriber to the Posthumanism school of thought, where IT innovation can optimistically improve our daily lives and introduce Equal Opportunity rather than destroy it, I am also a mystic in the sense of the Japanese and their Shintoism, which allows them to form meaningful relationships with not just AI-infused robots and objects but the spiritual forces of nature.

More and more people are making the connection between Shintoism and a way to “deal with” AI-powered entities, such as the BBC’s Aleks Krotoski in her Digital Human Series episode on “Animism:”4

Aleks Krotoski explores our anxieties around AI and automation. Comparing western philosophy to that of the east, she’ll ask if some of fears around technology are cultural. Much of western thinking is still strongly influenced by Christian traditions which places humanity at the top of the tree of creation. We rebel against anything that challenges that. Whether it be Galileo telling us we’re not the center of the universe or Darwin telling us we’re nothing more than shaved monkeys.

It can be argued that the invention of AI is just that sort of challenge to our supremacy. But in Japan they see things very differently; Shintoism leads to a philosophy without the Christian hierarchy. In their “creation” everything is alive and connected to everything else. Just like the modern digital world. What can we learn from looking at technology differently.

I share the “general public’s” concerns about how the unchecked, that is, unregulated roll out of Artificial Intelligence applications can be detrimental for large segments of a country’s population. In Chapter 2 with the first case study, I raised the alarm of what happens when we get chatbots influencing humans during an election campaign. This has now been proven to be the case with the noncompromising Zealot Bots as named by University of Cambridge researchers.5

The Guardian’s expose, as discussed earlier in this book, has pointed to the international creation of a “digital poorhouse” that is being created by the governments of the United States, UK, Australia, and India primarily, according to their investigative journalism.6 It is not so much the robotic form of humanoid robots like Pepper running amok or playing with our emotions and manipulating humans, as in the 2019 German cult classic documentary Hi, AI so cleverly presented to us in narrative filmic form, rather it is the AI-powered applications like facial recognition and data mining that causes me sleepless nights.

Facial recognition unchecked, as the UK Civil Liberties groups have determined by calling out police use of it without the public’s awareness, and even corporate use of facial recognition on the streets around Kings Cross and London—maybe elsewhere in the UK, who knows?—is now on the agenda of Civil Rights organizations to fight within their own countries, not abroad in developing or poor countries where we normally expect human rights to be broached if not consistently abused. They are taking their cause to the TV talk shows and the internet social media forums. Facial recognition technology’s main problem is its low success rate or big failure to correctly identify people. For that reason, it has recently been banned by the U.S. authorities in policing because it cannot reliably identify criminals and/or distinguish between the sought target and ordinary members of the public.

Do you know you are under surveillance by AI-powered software? If not, how can you find out? The starting point is obviously all the surveillance issues surrounding the tech giants and social media companies’ use of our personal data and private messaging. For me the biggest risks are social manipulation and deskilling of humans—basic “skills” like raising children and how to vote, things that are so private and public but never been disrupted in a negative way to the core.

In the autumn of 2019, a backlash about Amazon Alexa was unleashed by a reportage on Channel 4 news about how Alexa reading bedtime stories to kids had contributed to them “not knowing what a book is or how to use it” as well as their poor verbal skills such as speaking in a whole sentence or even in an intelligible way. As the articles echoing the Channel 4 report show, four- and five-year-olds were looking at their peers conversant in the English language for their age group “as if they were not understanding foreigners.” Quite shockingly, even for me as an industry expert, these kids were trying to swipe books as they did not know about turning pages.

I am focusing on this broadsheet, the working class Daily Mail7 coverage, for several reasons. The “scandal” was heralded by the supposedly “intellectual’s choice of news delivery,” Channel 4 news. However, as I explain in the following, it wasn’t, tragically, really news at all in Britain.

News Headline: Parents’ reliance on AI means some children are starting school unable to speak in sentences as it emerges many are even being read bedtime stories by devices like Alexa

The following discussion the by piece by Daily Mail readers, shows an increasing anti-tech stance by this segment of the population. They want to go back to the good old days of manners, proper education of toddlers, traditional schooling like reading books, and more importantly, restoring the parental relationship and role by reading bedtime stories yourself to your child, not replacing parents with machines like a Virtual Assistant device, a robot, a Smart TV, a permanently online tablet, a smartphone or gaming terminal.

But as I searched for further media coverage of this Channel 4 breaking news story, I found disconcerting headlines repeating the findings. From 2013! And 2018! What does that mean? Even though the earlier breaking news stories, which were founded again on government-backed or state-run polling of primary school teachers and kindergarten carers, did not mention Amazon Alexa as it was prior to the market dominance of this branded device, they had the same findings.

Kids starting schools in nappies, unsocialized, unable to speak the English language in a rudimentary form or full sentences, low attention span, not being familiar with books, and very low on literacy and verbal skills. In fact, earlier reports and studies had already dubbed this phenomenon in Britain as the “Education Underclass.” Then enter Amazon Alexa, which in its own marketing material online, touts that it can only enhance a young child’s educational experience and support learning by reading to children.

Curiously apart from the Daily Mail take up of the Channel 4 2019 reportage, the only other reference I found quickly online was a discussion on the famous www.mumsnet.com I read through the comments section in the thread that began the discussion about the Channel 4 piece the night before. Quite unexpectedly, a number of mothers, in fact the majority of comments, were trying to downplay the whole situation, one even saying it wasn’t reliable data because “only 100 teachers were interviewed.” Others justified late toilet training, dummy sucking, nappies in school and so on.

Relevant to the backlash against Amazon Alexa reading to children were the repeatedly defensive reactions of these British mothers on Mumsnet. They didn’t actually name Amazon or Alexa but referred to the whole digitization phenomenon that everyone was actually digitized and reading most material online. From books to magazines. A typical comment was “I often catch myself trying to swipe magazine pages” or “I catch myself looking at the top of the page for the time, or tap a book page to turn it” 8 In other words, these mothers on Mumsnet were endorsing the encroachment of interactive tech in their daily lives, AI or otherwise. What was good enough for Mum as a willing Digital Native, was defensible for the toddlers’ behavior in the first classroom of their young lives.

I wrote about the positive effects of 2D and 3D avatars disrupting advertising by being more transparent about users opting in and then the Return on Investment for advertisers with automated direct metrics on human–machine interaction and conversion rates, there belies a real danger of “ads by stealth.” So without ethical opt ins of users either under the GDPR or elsewhere. Take a look at this CNET promotion (is meant to be an article but it reads like an advertorial). The tech journalist uncritically lists all of Amazon Alexa’s “awesome” capabilities without once questioning how the obvious advertisers behind each skill is making money out of you innocently asking a listening device for a recipe, the weather or to turn on switches in your home.9

Anyone with any experience of interacting with media, whether it is TV, print or digital, understands that the business model is frequently: user watches ads = user buys advertised stuff + makes money for the ad platform and the manufacturer or provider of said stuff. Clearly by simply asking for everyday needs like what to cook, how to exercise, even how to sleep, you are providing the “sponsor” or advertiser behind the freely given Skill precious data about you, your daily habits, your preferences for buying stuff, and most importantly, how much you are prepared to shell out thus creating a track record of your spending.

This is gold in the new Data is Oil era. And we are unclear through the advertorials and online incessant pitching of the dominant, essentially monopoly power providing these “free” services into your car, home, and very bedroom, how much we are actually paying for it in terms of privacy and data protection.

Even viewing this slideshow of images of what Amazon Alexa can do for me, embedded within the CNET article discussed earlier,10 I am being tracked by CNET, Amazon, and who knows which third party advertisers who want my cookies for marketing purposes. Once opted in, how can a user ever opt out?

Figure 6.3 © Realfiction, Copenhagen, 2019. Mixed Reality experiences will become ever more sophisticated and overpowering for the senses. Here a woman immerses herself in the hologram illusions of buildings and objects projected over her Real Time perception of a night cityscape. Is it art or a commercial experience? The convergence seems to be necessary in the early 21st century’s new Experience Economy giving way to CX tech and innovations like the ones discussed in this book

To ensure that the future of our digital lives entails diversity and insight, right now there needs to be more freewheeling exchange and less cautious interaction only ever orchestrated and controlled environment university seminars, academic conferences and even the trade show panel debates that can end up being “safe spaces” for peer only meetings. If we fail to get this dialogue between theorists and practitioners firmly established sustainably, we risk what I call disconnectivity.

This occurs when the theorizing on the grand topics of the “ethics of Artificial Intelligence” and how to “control the risks” presented by some uses of AI bots and ubiquitous Virtual Assistants and Cognitive Interfaces actually become irrelevant because they are disconnected from the Mixed Reality of this exciting new world of human–machine interaction. The “Posthumanist Age,” as I explained in the Dedication pages of this book. Enjoy enhanced connectivity and be mindful of who you are excluding and including in your exchanges about this ever riveting subject that will soon become an empowering aspect to our everyday lives, as soon as the hype dissipates and we begin to experience a multitude of (mixed) realities.

Figure 6.4 A large robot with finely-tuned movements cooks popcorn autonomously, i.e. unsupervised by humans on its own, in a kitchen despite what many would perceive to be a high risk, even dangerous situation and task—for robotics and AI. Taken from the film “Hi, AI” by Isa Willinger © Kloos & Co Medien, Berlin, 2019

Figure 6.5 China is now a huge manufacturer of robots with AI interactivity such as reading emotions and recognizing faces of individuals. Meanwhile Japan is reported to be manufacturing several thousand new types of robot every month. Japanese robots are often humanoid like this one with “convincing skin” and realistic blinking eyes. However this has not yet completely removed them from the “Valley of the Uncanny” whereby human-looking and acting robots “freak out” ordinary people who feel uneasy that the robot is almost like them, but not quite. Taken from the film “Hi, AI” by Isa Willinger © Kloos & Co Medien, Berlin, 2019

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