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3 ways businesses can harness the power of "machines, platforms, and crowds" for success

MIT experts say we've entered "the second wave of the second machine age," in which AI has exceeded expectations. Here are three ways business leaders can apply these innovations to stay competitive.

Video: How AI and automation are replacing less-routine work

In the age of artificial intelligence (AI), how do employers learn how to tease apart which tasks machines can excel at over humans? In their widely influential book The Second Machine Age, MIT researchers Erik Brynjolfsson and Andrew McAfee put forth an argument that we have entered an era in which machines have suddenly mastered cognitive tasks--beyond the physical tasks that defined automation in the Industrial Age, or the "first" machine age.

To take this a step further, Brynjolfsson, director of the MIT Initiative on the Digital Economy (IDE) and McAfee, principal research scientist and co-director at the MIT IDE, have recently released a follow-up, Machine, Platform, Crowd: Harnessing Our Digital Future. The new book centers around the idea that we have entered a "second wave of the second machine age"--defined as a time when AI has suddenly exceeded expectations--and offers concrete advice for businesses to harness the benefits of AI and automation.

In the last few years, there have been some major breakthroughs in artificial intelligence. Brynjolfsson points to the fact that even five years ago, machine vision systems couldn't recognize images in huge data sets better than humans--which is no longer true. At that time, he said, these systems experienced a 30% error rate in recognition, whereas the rate today is less than 5%.

So how can businesses and organizations apply these ideas to create a successful digital strategy? Here are some insights from the book.

1. Business leaders need to know about AI

McAfee and Brynjolfsson see a basic knowledge of AI as important to digital transformation. Businesses "need to know what kinds of tasks can be done well with AI and which ones can't," Brynjolfsson told TechRepublic. "They need to see that there's an opportunity here to turbo charge their businesses in lots of areas. They also need to understand some of the basic drivers, like the availability of the right kinds of data, and have the right kinds of people who understand machine learning algorithms involved."

2. AI doesn't need superpowers

Businesses are starting to understand that "you don't need AI to be at super-human capabilities across the board," Brynjolfsson said. While AI is great to use for completing specific tasks, he said he sees a difference between creating AI that's capable of human-level skill versus AI with a superhuman ability.

"The big story that comes away from this is that these technologies are rushing ahead with just breathtaking speed," he said. "If anything, people underestimated what the technologies were capable of, especially in the area of machine learning."

SEE: Why AI will force businesses to rethink balance between the work of humans and machines

3. Don't wait to integrate AI into your digital transformation plan

This book's primary purpose, Brynjolfsson said, is to emphasize the importance for organizations to create business models that adapt to these new technologies. In the past, businesses could take decades to change their models to integrate these kinds of innovations.

"When electricity was introduced, it took about 30 years before companies really restructured and started getting productivity improvements," he said. "We're hoping to shorten that quite a bit this time around by illustrating examples of companies that are already being successful with these technologies and again, the bottleneck is not faster and better technologies, it's changing the business organization to take advantage of the technologies."

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