(Notes from an Executive Short Program called Digitalization for Growth and Innovation, hosted by Ragnvald Sannes and yours truly, in Sophia Antipolis right now.Disclaimer: These are my notes, I am writing fast and might get something wrong, so nothing official by Accenture or anyone else.)
Cyrille Bataller is a managing director and the domain lead for Intelligent Computing, with the Emerging Technology group at Accenture. He leads Accenture’s exploration of the Cognitive Computing field
Skilled work increasingly done by machines – doctors, lawyers, traders, professors etc. Large potential impact, also societal, but exciting new technology. Cognitive computing is IT systems that can sense, comprehend and act – and are perhaps the most disruptive technology on the horizon. They can interact with their environment, learn by training instead of coding, and can analyse and use enormous amounts of data. The quest for cognitive computing has a long history – and has had a varied history, with periods of advances and periods of setbacks, or at least less interest. We differentiate between “strong” AI – achieving consciousness – and “weak AI” – having the machine mimic certain capabilities of humans.
Accenture’s ambition has been to create a toolbox of cognitive computing capabilities under a single architecture, such as text analytics, research assistants, image analysis, multimedia search, cognitive robots, virtual agents, expert systems, video analytics, identity analytics, speech analytics, data visualisation, domain-specific calculations, recommendation systems and self-adjusting IT systems. These are all examples of human traits and capabilities as well…
Some detail – image analysis is about deep learning, using neural networks to mimic how the brain works. Use layers of increasingly complex rules to categorize complex shapes such as faces or animals. In one case, they used neural networks to recognize and classify images of cars as undamaged, some damage or totalled to an accuracy of 90%. By applying text analysis as well, this could be used by an insurance company to analyze insurance claims. Google has acquired a company called DeepMind to look at images on the web, eventually recognizing cats.
Another example is use of robotics in business operations – from minibots, companies such as XL and AutoHotKey to automate application software, to standard robots to using virtual assistants to do user support, for instance. You can have a team of robots in the cloud to work alongside your real back office. These robots can observe and learn and gradually take over or optimize these activities, such as updating documents (powerpoints, for instance). Could be used to observe how an accountant works, for instance, and issue certification based on following proper procedures. You could have 20-30 people in the back office and 100s of robots learning from them and doing the regular stuff.
Virtual agents: Amelia, handling a missing invoice situation. Amelia can understand, learn and solve problems. Generates a flowchart which can then be optimized and analyzed.
Video analytics is another application that is receiving lots of attention. One problem with CCTV videos is that they are almost only used forensically – checking a certain date and time – because nobody has time to watch the videos themselves. Can be used to count cars and recognize events, measure queuing times at customs and immigration, measure service times, monitor for lost objects on a train, analyze the age distribution on public transport, detect emotions, understand the hot and cold zones in the shopping center, find leaks in an industrial setting, etc.
The following framework (from the perspective document referenced below) shows a four-quadrant framework that can help guide companies in choosing the approach towards cognitive computing:
(Notes from an Executive Short Program called Digitalization for Growth and Innovation, hosted by Ragnvald Sannes and yours truly, in Sophia Antipolis right now. Disclaimer: These are my notes, I am writing fast and might get something wrong, so nothing official by Accenture or anyone else.)
Smart Cities – a discussion with Simon Giles.
Simon Giles is the global lead for global cities initiative in Accenture. He is located in the Health and Public Services group, and
– work with large, established cities on the process of digitalization
– work on digital masterplanning on new cities (Asia, Middle East) or fundamental redevelopment
– work with large organizations on understanding the consequences of increasing urbanism
The Global Cities team has worked in more than 80 cities around the world, they are all unique (and that is very important when working with them – not just the government, but also physical and demographic legacy. Huge differences even within Norway, for instance.) However, some common themes emerge:
digital transformation everywhere: The increasing IoT and addressable devices gives enormous rise in data amounts and sources. Can the cities deal with it? The rise of citizens digital service delivery expectations paired with a data explosion is pushing the IoT agenda forward. Example: Landing in Sophia Antipolis, firing up the Uber app, immediate booking and invoice submission, 30% cheaper than regular taxi. Some consequences: Digital privacy and security is going to be a huge hurdle and has to be taken seriously. As for democratisation, people both have to understand their rights, but also the benefits
mobility of talent. Digital talent can work anywhere, so how do you attract them? There is a war for talent, especially cities transitioning from a post-industrial to a knowledge economy. How do you make the city as attractive as possible for the people you want to attract? Healthcare, education, job prospects…
resource stress. Availability of resources (water, power, waste management, pollution etc.) increasingly a problem, need to understand flows and dynamics at a much more sophistication, digital technology can help shed light on what literally used to be a dark system. Moving from mitigation to adaptation – energy efficiency, transition from hydrocarbon mobility to electromobility. Differs between cities – water stress in California, for instance.
constraints on public spending. Need to reduce cap ex and op ex spending, as well as increase productivity. But not all investments are equal – a $400m bridge is seen as normal, a $400m investment in digital infrastructure as profligate.
emerging prosumers Citizens increasingly have a voice through digital tools and participate more actively. Need to think creatively about how to use the data created by citizens to make better decisions and services.
Cities’ role has changed over time – from a meeting place for exchange of agricultural products to a centre for industrial production, introducing sanitation etc. Glasgow and Liverpool became rich because they were on the leading edge of the industrial economy, as market makers. What does that mean in the digital economy? There seems to be an abdication of responsibility from city politicians and managers, thinking digital is completely global – but there are definite winners and losers in that contexts: London and Berlin dominating in Europe, for instance, by making very small changes, such as Tech City in London, relatively small but enough to win the war for talent. Cities need to be more active, governance changing from verticals (water, power, etc.) to a more integrated model. How do we organize for digitization. In Europe, we really are laggards in that respect – companies have CIOs, moving into new technologies etc.. In the US we see city CIOs. In London they did, but did not give that person any power, so he left. The operating model for cities will change.
In the corporate world, we are very articulate about value – shareholder value etc. In the public world, we don’t have that tradition, vocabulary and methodology for doing that. We need to create the equivalent of a business case, focusing on economic prosperity, efficient and effective operations, and high quality public services.
The Global Cities initiative posits the following value proposition for cities:
how do you create economic prosperity?
how do you create effective and efficient public services?
how do you create social and environmental sustainability?
how do you create strong financial management and governance?
how do you create a good experience for the citizens? (so much is driven by expectations, you have to understand perceptions, no matter what else you measure)
Break this down further into sub-questions where projects can be evaluated to determine the equivalent of a business case – not to measure profits, but outcome to manage the taxpayers’ money as effectively and efficiently as possible.
Also have developed an operating model consisting of processes such as
strategy and planning
performance management (better use of data to drive decisions)
digital citizen (single face to the customer, need single face to the government)
asset management and operations
back office (shared across functions)
digital enterprise (common digital infrastructure, i.e. a common GIS system across all agencies)
Analysis of data becomes more important. For example: There was a bridge in a city in Brazil, lots of congestion, discussion on whether to build a new bridge, increase ferries, or build a tunnel. Analysis showed that two government agencies that had moved to the other side of the bridge created most of the traffic, moving them back would obviate the need for a new bridge…
Cities are organized as a legacy of the industrial economy, geared to make cities work like machines. Now we are in a digital economy, thinking about becoming a place where things are designed and services are sold. The CIO role that came in the 90s in the US is happening now in cities, moving from provisioning to thinking about where the data is and how we can use it.
In New York anyone can call 311 to get in touch with the city’s public services. They log the requirement, and get back to you. By the way, why should this be phone call, why not an app? In general, public services do not do front desk. Need to professionalize and de-politicize the relationship between the strategy/policy setting and the service delivery.
Case study: Accenture is working with two larges cities in setting an agenda for a more systematic approach, based on sensing and responding to activity, and that might be smart metering or smart transportation, but it is not systematic and not city-wide. A Smart City is not that because the power company has put in 5000 smart meters…you get death by pilots, they never scale. In these cities we are seeing much more systematic approaches, taking a common approach. It does not make sense that individual ministries which inevitably will implement IoT set up their own platforms. In two cities Accenture work with, they go beyond the platform, extracting data from all platforms and an kind of device and make it available for analytics.
Cities to watch are Dubai and Singapore – converging city and state, so they have powers to act, and they have ambition. Smart Dubai is a digital platform to create data across the city. Singapore has a Smart Nation program. Rather than having islands of smartness in verticals, they want to be able to look at data across functions, providing new services, and a platform for entrepreneurs and innovators to build on. Government as platform, and as service.
For example: In one of the cities, it rains almost every day in some area, no taxis available. Match data from meteorological services, taxi fleets, and people location (from cell phone towers), create an algorithm to reroute taxis to desired areas in advance of a rainstorm. The city can create this urban information marketplace to make that possible, to allow entrepreneurs to work based on this platform. To do this, you need citizens that are skilled, connected and have a culture for using and innovating with the platform.
Norway should think about setting up IoT as a platform and make it and its services available to the cities. Brisbane is a good case study on consolidation, from around 20 units to 1, has 2 million people. Could deliver much better public services. Political perspective should be about how to deliver more on top of that platform.
Question: What should I do as fresh politician to promote this?
Politicians need to articulate the value proposition, because industry will respond. For example: Immigrant communities can become a cost to society because of limited inclusion and integration. Politicians need to deconstruct that problem, identify root problems (why aren’t they getting those jobs?), and use digital technology to help them. Start with the small things, where you can make a difference. Find problems to solve, describe what a day in the life of an immigrant community will be two years from now, with digital, and make it a stark and dramatic contrast.
Secondly, establish a capability for analysis, make it small, bring in someone for a few months, demonstrate value propositions. Then signal to the rest of the government about what you could do if you had more data… Demonstrate the value proposition, then expand. And don’t do pilots, technical proof of concepts, make sure whatever you do is scaleable.
Question: The sharing economy, self-driving and electric cars?
At the moment, the relationship with the sharing economy – AirBnB and Uber, mostly – is antagonistic. Uber is doing well because they have a better value proposition than the taxi companies, which are ripe for disruption. It will happen at some point anyway because the fundamentals are solid. But taxi drivers are important voters, so politicians will appease them, but the sharing economy will thrive anyway. How do you manage that transition without losing your seat and disappointing citizens. You lose trust with the public if you stop evolution, the voters will move with their feet (and money).
An interesting view on Tesla’s Model X – there are a few design elements there that point towards a strategy. The gullwing doors are great for mums lifting kids and parking, but also gives good access to the front and back of the car when it is self-driving. The self-docking technology with the “snake” means that it can self-dock and pick up people. Think of this in the context of having a fleet of these things. (Search for article on deconstructing the Tesla launch.). More self-driving functionality will be added eventually, everything is there except the LIDAR. Will become increasingly self-driving, Uber has already done a deal with Tesla and might be the first fleet of self-driving cars. What does that mean for public service providers? Will standard diesel buses be there? Interesting things coming out of MIT, ethics of self-driving for instance.
Question – what about the high levels of unemployment?
That’s a pretty big topic, much writing about the future of work and the implications of the sharing economy. Increasing automation, AI, self-driving cars and so on. If left unchanged, you will see massive unemployment, but this has happened before. The economy of New York city in 1905 had many thousands of people working with horses, and they all lost their jobs over the next 15-20 years. I think we will see the development of the “gig” economy, more freelancing and part-time work. This has massive implications about how we think about support – the traditional job centre will be a much more fragmented activity. The idea of a citizen wage is interesting but a long way off, more about having social services where the onus is on you to create value over that. Cities will need to think about upskilling those workers…
Question – how can we rethink the fragmented nature of the Norwegian public structures?
At the basic level, some services need to operate at scale – no reason a municipality should have its own HR system, for instance. At the same time, don’t throw out the baby with the bath water – from a front office perspective, you need the closeness to the needs of the people. But a community of 10000 does not have the capability to develop their own analytics – so what is the role of the central government in providing a platform? The municipality can become a buyer of services from a common platform. Only a few cities large enough in Norway to do something, so you need to demonstrate value there, then have the central government provide it as a platform for everyone.
This week, I am hosting a seminar on “Digitalization for Growth and Innovation” for the Norwegian Business School, at Skema Business School and the Accenture Interactive Innovation Center and Technology Lab in Sophia Antipolis. We asked Skema if someone could talk to the participants (managers from Norwegian companies) about the founding and evolution of the Science and Technology Park in itself. We got a very interesting discussion by Philippe Mariani, responsible for Strategy and Development of the Sophia Antipolis Foundation – and (drum roll) a visit by the founder of Sophia Antipolis himself, Senator Pierre Laffitte.
Sophia Antipolis (sophia = wisdom, antipolis=not a city, actually an old term for Antibes) was founded in 1969, by Pierre Lafitte, who now is 91 and still involved in the development of the area. Back then, his idea was seen as a utopia, with plans for 20000 researchers in 20 years, but it garnered lots of attention. Now it pretty much is reality, genuinely a dream come through. There are 1400 companies with 30000 employees, 60000 people if you count supporting services. The whole place is laid out as a park, no straight roads, lots of threes – and it can actually be difficult to think of it as a city if you look at it from the air:
Sophia Antipolis works as an ecosystem, and attracts more revenues than the tourism industry in the south of France. SKEMA, the business school, is an important part of the ecosystem. In the beginning, it was very difficult to convince somebody to come and start here, one strategy was to utilize the strength of the network, arrange a concert in the middle of the forest, using the newspapers to attract attention, running specialized conferences on biotech, nanotechnology, etc., inviting 15-20 high-level people, do proceedings, these people then became ambassadors for the area.
Pierre Laffitte instituted some principles for the area:
1) that there should be no skyscrapers, no building higher than the hills. As a result the area feels like a park, and also feels quite small, even though it is large.
2) There should be no fences around companies, in order to facilitate cross-fertilization (a concept which is very important to the people building the area. In the beginning this even extended to asking companies not to have closed lunch areas, but invite others in.
3) As much as possible, a company settling in SF would have to have someone on the board with a different background – a writer, teacher, artist – in order to be critical, a devil’s advocate, and to foster innovation.
Sophia Antipolis is now a brand name, people here identify with the place, call themselves sophiepolitans – there is a sense of belonging, employees want to stay in the area. It is relatively easy to put up your own company, you will find a market, so the place is growing. There are strong anchor tenants, such as Amadeus, but also many small technology companies who sometimes start as vendors to the anchor tenants and then expand. It is not really a French place, but international to a very large degree.
There have been many attempts at building technology parks, and Sophia is one of the places that work. Much of it has to do with establishing a culture – many other areas are currently trying to invest a lot of money, but it is not working because there is not a culture of sharing, communicating and starting projects and companies.
One difference from Silicon Valley is that there are fewer venture capitalists and angel investors, which is indicative of Europe in general.
Question to Pierre Laffitte and Philippe Mariani: What is the role of government in the creation of technology parks and new companies?
Governments give money to big companies, in the US they have the small business act. We need something like that in Europe – bottom up, now top down. There is much good will from governments in Europe, but they have not found a good way to help small companies. Also, Europe has more interest in fundamental research, not the research between the industrial and the fundamental. We need to put together the managers with the people with ideas and research.
Q: Other differences between the US and Europe — what can we learn?
In the US, if your company fails, you are not considered a failure. In Europe, the banks will not finance you if you have had a company failure, which is why Europe has fewer serial entrepreneurs. We also have fewer business angels, and most of them are not so rich.
Q: Challenges for the future of Sophia Antipolis?
Two challenges in particular: One is developing ethics for a numerical (digital) society. There has been a transition from family capitalism to most short-termism. Now you have to make money in the face of short-termism, should be more open to other types of people than the shareholders only. We need to have another type of capitalism more about stakeholders than shareholders.
Secondly, there is an acceleration, the lifecycles are shorter and shorter. Our form of cross fertilization has worked for 40 years, but that won’t last, we have to reinvent a way to exist as an ecosystem. We are launching initiatives on ethics and “numeration”, cybersecurity, cyberhacking. want to become a think tank for exploring the digitalization, allowing it to continue to evolve – for one thing, the the government does not understand and the only thing they do is forbid it.
Q: What was the most important getting Sophia Antipolis started?
Having lots of friends in good positions who did not think it as stupid as many people thought! Innovation is always connected with difficulty to change, you have to convince people that it is positive. We wanted to develop something that did not create pollution, to create something connected with the future and the brain and to balance, not only to raw materials.
Q: How do you get get people together, so it is not just a park with businesses?
There are many ways to get people to come together. We asked companies not to have closed cafeterias, people having lunch together from different companies. We have the veteran companies meet with the new companies when they come in. We have common breakfasts, like small conferences. We also have clubs set up for various subjects and interest groups – there is even one called the Nordic Link for wealthy individuals from the Nordic countries who settle in the region and want to get involved in technology companies.
It doesn’t happen by itself, many cites think that it is just the structure is the enabler, The Foundation is here to do what the companies cannot do because they have no time. You have to push to make this happen, not easy because the benefit of the activity is hard to quantify. One thing that has not worked as we hoped is to have have cultural activities, tried to be the Florence of the 21st century, but because art was seen as an add-on, something separate, that did not take off as we had hoped.