November 19, 2021 • By Xanat Hernandez
On October 5, 2021, Director of the Center for Digital Transformation Vijay Gurbaxani invited Stanford Professor and Director of the Stanford Digital Economy Lab Erik Brynjolfsson to speak on the topic “The AI Awakening: What It Means for Productivity and Business Performance.” Brynjolfsson’s research focuses on the effects of IT on strategy, productivity, performance, digital commerce and intangible assets.
What is the AI Awakening?
Brynjolfsson and Gurbaxani believe we are on the precipice of the AI Awakening, the point at which machine learning crosses the threshold and surpasses human ability to complete certain tasks.
Brynjolfsson says: “I believe we are in the early stages of a major transformation of work…and it rivals some of the things we’ve seen in the past such as the steam engine, electricity and some of the other earlier general-purpose technologies.”
For example, Brynjolfsson cited the ability of machine learning programs to identify images and perform other vision related tasks. In many ways, these neural networks have surpassed the human ability to recognize images, which can be applied in many ways, such as identifying people’s faces on social media or interpreting medical images.
As machine learning continues to improve and surpass human ability, entrepreneurs and business leaders have a choice: the fallible human option or the more accurate AI solution.
What does the AI Awakening Mean for Productivity?
Brynjolfsson describes the productivity boom immediately following the AI awakening as a J curve. Instead of immediately yielding productivity gains, the AI awakening relies on a company’s ability to restructure their business process and workforce skills. Technology alone is not enough to boost productivity. Over time, companies that invest in machine learning and restructure their business practices see improvements in productivity and performance.
How does the AI Awakening Affect Workers?
Brynjolfsson stresses the idea that machine learning and AI can only automate certain aspects of a person’s job . For example, a grocery check-out kiosk will be automated to a certain extent, but there will still be workers managing and assisting the check-out process. Similarly, machine learning can help a radiologist interpret a medical image, but it cannot create a treatment plan.
Later in the Q&A portion of the talk, Brynjolfsson and Gurbaxani described a vision of AI that boosted the human potential for creativity and innovation instead of supplanting human labor.
Brynjolfsson says: “We could do a lot more to have humans and machines work together and keep humans in the loop, they can add a lot of value and stay indispensable rather than looking for ways to replace humans and devalue their skills.”
In the same vein, Gurbaxani explained: “At the end of the day technological progress comes from the discovery of new knowhow…and I think machine learning amplifies our ability to generate new knowhow.”
Both scholars believe that society can use technology to tap into a worker’s creativity, leadership and coaching ability.
Education and Training Will Prepare Us for the AI Awakening
Brynjolfsson and Gurbaxani argue that it is crucial for businesses to prepare for this upcoming revolution in workplace structures and additional education and training is part of the answer.
Brynjolfsson says: “We have a vision of machine learning becoming more important in the economy; it's going to transform many kinds of work and tasks and the most successful firms are those that are using that knowledge to retrain and reorganize their businesses.”
The presentation and conversation can be watched here.