COORPORATION

Kirill, Tibe, Michalina, Andy

Contents
Discussion ............................................................................................................................................... 2
Why these 3 questions ........................................................................................................................... 2
Impact of AI on the labor market ........................................................................................................... 2
Impact of AI on business ethics .............................................................................................................. 3
Impact of AI on business ........................................................................................................................ 5
References .............................................................................................................................................. 7

Discussion
https://m.youtube.com/watch?v=piqhlyGEus0&feature=youtu.be

Why these 3 questions

We chose these three specific questions because we wanted to find out how our future will look like
and the impact AI will have on us. The three questions are business related and since all of us study
International Business Management it is our goal to become professionals in the business industry.
Will we have to adapt a lot? Will AI take over our jobs? Will AI dominate over us? All these questions
and more we answered.

Impact of AI on the labor market

The rapid growth of AI definitely has the chance to disrupt labour markets and replace a lot of jobs.
They can replace the work done by people and will surely change the worldwide labour market to
some degree (Frank, 2019). The question still remains how exactly AI could impact the labour
markets and jobs of people. Lots of people fear of losing their jobs due to fast growing technology,
which is arguably understandable, because AI is an unknown territory for a lot of people, and people
tend to fear things that are unknown to them (Roe, 2018).

Technology increases productivity but speaking of AI it could be a little different because it could
threaten the jobs of some people, meaning they are replaced by machines. But, should people really
fear AI? When we go back in time and look at some inventions that also changed the fundamental
structure of the labour market, then we can recognize that unemployment is rarely the case. For
example, when equestrian travel was replaced by automobiles, it created a demand for gas-stations,
motels and fast-food restaurants. So, even if technology threatens the employment of some jobs, it
can still create new needs and opportunities, and not necessarily meaning that jobs will be lost
(Frank, 2019).
So will there be enough work in the
future? Fears like this are still
unfounded. While growth is
happening in the Artificial
Intelligence industry, there will be
adaptations that are gradually going
to be made. By looking at history as
a guide, around 9 percent of labor
demand in 2030 will be in new
professions that are currently not
existing. As long as there is a
consistent economic growth,
investments and innovation there
should be enough employment
opportunities (James Manyika,
2017).

Some jobs will go away, and that is very normal. It has always been like that, nowadays there are
almost no seamstresses, because the task has been replaced by something more efficient, a
machine. But that same labour that has lost its job will find a new role. Besides that AI systems are
good, but they lack people and management skills, like setting business objectives. They can
however solve specific business problems, but it is still up to the human to settle the nuances of
those specific problems (Roe, 2018).

There is this misconception in enterprises to what AI can do. In addition, lots of people also push AI
into the digital transformation scenarios to soon, or prematurely. While most experts are still
researching how well a computer can distinguish pictures between dogs and cats.

So concluding that, AI could in some way change skill demands in businesses, career opportunities
and other similar things. On the graph “How AI could change the job market”, you can clearly see
that some industries will create new jobs and some will lose their jobs (a forecast). (BBC News,
2018). It is also unknown what AI will do to the labour market as researchers and policy makers
don’t have enough data and info to forecast the real impact of AI on the labour market (Frank,
2019).

Impact of AI on business ethics

The concept of AI needing an implementation of ethics is not an uncommon item of discussion. AI
can be seen as technology or maybe more precise software, that can imitate human behaviour when
it comes to decision making. But how do we make AI, a technology that acts mostly out of rational
datasets, act ethically (Galligan, Katyal, Mohlenkamp, Parry, & Adkins, 2019)?

We can employ deep learning, machine learning and all types of other methods to train the AI to
make more ethical considerations when it is making its choices and analyses. But even still some
parameters in the system when for example you are selecting for recruiting or to whom certain
mortgages should be given can still be interpreted as discriminatory by the AI. The system could then
systematically reject certain applicants based on their demographic group, that in essence due fit
the criteria. This would be due that the AI has learnt that someone from this demographic is unlikely
to match the criteria and be eligible (Galligan, Katyal, Mohlenkamp, Parry, & Adkins, 2019).

By now a conclusion can be drawn about the importance of which inputs an AI system should
receive and evaluate on and which should not be included. Artificial Intelligence will always try to
learn from as much data as it can, so it is important to not give it data about things that are not
representative. If you do, the system will learn and make inaccurate decision concerning morals and
ethics (Galligan, Katyal, Mohlenkamp, Parry, & Adkins, 2019).

There is a lot of risk involved in the integration of AI systems in companies. Chatbots for example can
learn extremely inappropriate or offensive behaviours when replying to questions from customers.
This can tarnish the company’s image. Besides this there is also the importance of hacking, allowing
an artificial intelligence to execute certain business tasks means that you open yourself up through
certain cybersecurity risks. Data could be stolen, the system could be taught new behaviours, or
simply it can be shut down possibly resulting in loss of profits or efficiency (Galligan, Katyal,
Mohlenkamp, Parry, & Adkins, 2019).

While Artificial Intelligence is becoming an ever-present aspect of our (business) life, a study has
shown that only 53% of organisations have a person assigned to keeping AI ethical. Numbers also
show that 6 out of 10 companies receive legal scrutiny or customer backlash through their
employment of AI (Page, 2020).

Another controversy of Artificial Intelligence is the replacement of well-paying employment for

people it has. A study done by McKinsey Global Institute has shown that half the paid activities
people do around the world could theoretically be replaced by robotics. A study of 800 occupations
showed that more that 800million jobs could be lost to Artificial Intelligence by 2030, which is 20
percent of workforce around the world. This means that there are going to be a plethora of
unemployed people left. In the United States alone, which had a level of employment of about
150million in 2018, there will be an estimated elimination of 39million to 73million jobs, which is
1/4th to 2/4th in loss of current employment (James Manyika, 2017).

So what will happen to the raise of displaced workers? The McKinsey report mentions that around
20million of the displaced workers will easily transfer to another job, but 20million and more than 50
million displaced workers will need new employment (Taylor, 2018).

In lesser developed countries, Artificial Intelligence will have a smaller impact. Workers in lesser
fortunate countries are paid so little that employers would not benefit from Artificial Intelligence
costs. As an example by the same report, India is estimated to lose 9 percent of employment due to
AI (Taylor, 2018).

The ethical question in the business industry

is not only about efficiency, but about the
type of society people want to take place in
and the role of Artificial Intelligence within
that society. There should be a balance
between multiple aspects. On what pace
does Artificial Intelligence need to evolve
in? To what extent should companies go?
How secure and reliable are these AI going
to be? What are companies going to do with
the employees that are being replaced with
AI? etc (Taylor, 2018)

Both the Federal Trade Commission in the

US and the European Commission have
already set up some guidelines regarding the use of AI. In Europe these regard the use of key ethical
principles when developing these programs. In the US focus is pointed at the transparency of AI,
when a customer is affected, they must be able to receive the data points the AI used to disqualify
them for the product. This also means giving consumers the right to correct these data points (Page,
2020).
Of course, AI does not only have negative influences on ethics. When utilised well, they can be used
to increase our social and environmental wellbeing. While the pitfall of discrimination exists, the
opposite can also be achieved with AI. The total unbiased and rational decision making, not taking
any demographic information into account. Ignoring all biases that a human individual can
sometimes hold (Page, 2020).

Impact of AI on business

Artificial intelligence is transforming how businesses innovate and communicate their goods and
services. We are already seeing many AI implementations based on machine learning algorithms or
one of the subcategories of machine learning – deep learning (a process in which a computer learns
to perform natural tasks for the human brain, such as speech recognition, image identification or
forecasting). AI will help you grow your company in almost every industry, including automotive,
pharmacy, HR, IT, finance, marketing, e-commerce, retail, and trade. Machine learning
revolutionized analytics, allowing for more precise data-driven business decisions to be made. It
solved many problems that conventional analytical methods either couldn't solve or where the
method of arriving at the response was too time-consuming and therefore too expensive. Google,
Microsoft, Facebook, and Amazon, for example, spend a significant amount of money in AI research
and development (Uzialko, 2019).

However, it's important to remember that AI's capabilities aren't limited to the very best. Machine
learning algorithms are now being used successfully in a variety of industries. Even the fashion
industry makes use of artificial intelligence. The Fashion AI artificial intelligence system, which
operates in Alibaba stores in China, is a good example. In just one day, it earned $25 billion for this
network as a digital personal stylist. How do you do it? The customer enters the shop, selects a
sweatshirt, and proceeds to the fitting room with it. A wide screen scans the selected item using
built-in sensors and recommends what to choose to build a trendy and pleasant collection. It also
tells you where you can find this item in the shop (Lee, 2019).

Machine learning algorithms, which are a type of artificial intelligence, have a major effect on
business today. It is now commonly used in marketing, call centers, chatbots, placement, targeting,
machine translation of messages, advertisement campaign planning, load control in logistics centers,
finance, creditworthiness assessment, regulatory enforcement, risk management, and fraud
prevention, the fashion industry in the form of virtual stylists, and many other areas (Uzialko, 2019).

Machine learning has a huge impact on our lives, and we are mostly unaware of it. Facebook, Netflix,
and Spotify use artificial intelligence solutions. This is where AI comes into play, assisting in the
creation of customized content, as well as movie and music recommendation systems that are
tailored to the user's tastes. Speech recognition (Google Now and Siri from Apple, Xbox, Skype) and
image recognition are all done with machine learning. Where else? Anti-spam filters in e-mail
inboxes, ad optimization, auto-correction and auto-suggestions while texting on a smartphone, and
navigation systems, which enable not only to find the best route, but also to present offers of
commercial and service facilities along the way (Whitman, 2015).

During a congressional hearing, Mark Zuckerberg discussed the importance of artificial intelligence
(AI) in protecting Facebook users (Gershgorn, 2018). Google AI assesses the risk of a heart attack
based on a photo of the retina of the eye in autonomous Uber vehicles. Artificial intelligence is used
in e-marketing and e-commerce to profile consumers based on their activity habits, resulting in
specific targeted ads and product ideas that may be of interest to us (Vincent, 2018). Machine
learning is often used to track product and service interactions on social media, analyze customer
moods and develop new deals tailored to their needs based on this information. It aids in the
improvement of order systems and the prevention of future problems in trade and logistics. How?
For example, predicting increased demand for a given product based on collected data (e.g. website
visits, searched key phrases). This allows the company to increase production ahead of time,
reducing the possibility of a shortage of goods, schedule how many trucks will be required to
transport it, and, in the long run, ensure that consumer needs are met effectively. Big data and
machine learning algorithms allow for a deeper understanding of consumer desires and needs,
resulting in a smoother and faster buying process. Driver assistants, automated driving systems, and
optimizing factory development processes with robotics using machine learning are all examples of
AI in the automotive industry (Pineda, 2019).

Workflow optimization, time savings, production process optimization, operational activity

automation, more efficient disease detection, better product and service adaptation to consumer
needs, reliable supply and demand forecasting, obtaining a unique market advantage, and improved
business performance are just a few of the many advantages of using AI in a company.

Artificial intelligence must provide solutions that dramatically reduce costs, increase sales, and allow
for the effective use of resources if it is to live up to the expectations put in it. AI also necessitates a
substantial financial investment. However, businesses which have chosen to use them demonstrate
that it is worthwhile. Better productivity combined with a deeper understanding of consumers and
recipients revolutionizes how businesses work, resulting in a good return on investment in AI in the
long run. Many who are left behind can face not only substantial losses, but also eventual exclusion
from the market. Today, machine learning has enormous potential, which is being realized more and
more boldly as a result of implementations in a variety of businesses (Pineda, 2019).

References
Galligan, M., Katyal, V., Mohlenkamp, M., Parry, C., & Adkins, C. (2019). AI ethics: A business
imperative for boards and C-suites. Retrieved April 14, 2021, from Deloitte:
https://www2.deloitte.com/us/en/pages/regulatory/articles/ai-ethics-responsible-ai-
governance.html

Gershgorn, D. (2018, April 10). Mark Zuckerberg just gave a timeline for AI to take over detecting
internet hate speech. Opgehaald van Quartz: https://qz.com/1249273/facebook-ceo-mark-
zuckerberg-says-ai-will-detect-hate-speech-in-5-10-years/

James Manyika, S. L. (2017, november 28). McKinsey Global Institute. Opgehaald van mckinsey.com:
https://www.mckinsey.com/featured-insights/future-of-work/jobs-lost-jobs-gained-what-
the-future-of-work-will-mean-for-jobs-skills-and-wages#

Lee, N. (2019, November 11). How Alibaba turned a fake holiday into a $25 billion shopping
extravaganza that's bigger than Black Friday and Cyber Monday combined. Opgehaald van
Business Insider: https://www.businessinsider.com/singles-day-alibaba-25-billion-largest-
shopping-holiday-2018-11?IR=T

Page, C. (2020, October 1). AI Has Resulted In "Ethical Issues" For 90% Of Businesses. Retrieved April
14, 2021, from Forbes: https://www.forbes.com/sites/carlypage/2020/10/01/ai-has-
resulted-in-ethical-issues-for-90-of-businesses/?sh=5f4ad0be3ff0

Pineda, D. (2019, August 15). The impact of AI in business. Opgehaald van Medium:
https://medium.com/swlh/the-impact-of-ai-in-business-a14d8e98b7b9

Taylor, B. (2018, january 15). BCcampus. Opgehaald van opentextbc.ca:

https://opentextbc.ca/businessethicsopenstax/chapter/robotics-artificial-intelligence-and-
the-workplace-of-the-future/#OSX_Ethics_10_04_Automation

Uzialko, A. (2019, April 22). How Artificial Intelligence Will Transform Business. Opgehaald van
Business News Daily: https://www.businessnewsdaily.com/9402-artificial-intelligence-
business-trends.html

Vincent, J. (2018, February 19). Google’s new AI algorithm predicts heart disease by looking at your
eyes. Opgehaald van The Verge: https://www.theverge.com/2018/2/19/17027902/google-
verily-ai-algorithm-eye-scan-heart-disease-cardiovascular-risk

Whitman, W. (2015). Artificial Intelligence in the Rising Wave of Deep Learning . Opgehaald van Pdf
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negatively-impact-employee-

experiences/#:%7E:text=AI%20is%20most%20damaging%20to,as%20in%20the%20

doctor’s%20example.

BBC News. (2018, July 17). AI will create as many jobs as it displaces - report. Retrieved

April 15, 2021, from https://www.bbc.com/news/business-44849492