Also: Tesla autopilot, combustion engines, and hiring freezes.
Good morning.
A.I. continues to make strong inroads into corporate operations, as yesterday’s conversation among executives at Fortune’s Brainstorm AI virtual event demonstrated. And it’s no longer just about reducing costs, it’s about growing revenue. New research from Accenture, which sponsored yesterday’s event, suggest early adopters are reaping substantial dividends:
“The companies who are building comprehensive artificial intelligence capabilities, who have the foundation of building a platform but also the right level of organization support and sponsorship… These companies are already experiencing 50% higher revenue growth than their peers.“
—Sanjeev Vohra, senior managing director and global lead, Accenture Applied Intelligence
But it was also clear from the conversation that A.I. remains far from delivering on some of its more-ballyhooed promises. Some excerpts from the conversation:
“What people really want—and this is my vision for our company—is to recreate the human travel agent that those of us who are older can remember… They would know what you could afford and know what you like…and god forbid anything went wrong, you made one call and it all got fixed. What we want is to recreate that human being into technology. And we are so far from that.”
—Glenn Fogel, CEO, Booking Holdings
“Healthcare has been later in the cycle than other industries [in adopting A.I.] and a large reason for that is the conservative nature of physicians, the conservative nature of hospitals, and the regulatory framework which acts as a deterrent to fast adoption of new technology.”
—Kevin Lobo, CEO, Stryker
“Visa using A.I. helps prevent about $26 billion in fraud. So those are big numbers.”
—Michael Nunes, senior director and head of government advisory, Visa
“Where we are now is going on a journey, where you put A.I. in every pillar of the company. You talk about audit, you talk about HR, you talk about supply chain. And what we are seeing is that we are now kind of moving into higher level use cases. Initially they were all testing the water. There was a lot of anxiety. But now we are seeing people with much meatier use cases surfacing.”
—Rohit Chauhan, EVP, A.I., Mastercard
“I would say machine learning today is almost everywhere. I know company deep learning is probably the next step,”
—Alexis Garcin, CEO, Michelin North America
“My background is in building social and emotional intelligence into our machines. I’m seeing a lot more interest in a number of areas such as the future of work. We can now quantify a Zoom meeting like this and basically break it down by air time and give you a lot of metrics that didn’t exist before.”
—Rana el Kaliouby, deputy CEO, Smart Eye
“If there is a recession, I don’t think it’s going to change anyone’s A.I. agenda. It is a must have, it’s not a nice to have.”
—Will Breetz, SVP of product management, Salesforce
“We’re measuring vibration, we’re measuring atmospheric pressure, and we’re using that information to predict when a potential failure may happen and how do we send our mechanics to the job site with the appropriate tools, with the appropriate parts.”
—Neil Green, EVP and chief digital officer, Otis Elevator Co.
The event is part of the lead up to our Brainstorm AI event, being held in San Francisco on Dec. 5 and 6. If you are interested in attending, please send me a note, or go here for details. Other news below.
Alan Murray
@alansmurray
alan.murray@fortune.com
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Bridging the Pay Equity Gap: Virtual Conversation, June 9 As companies talk about their diversity, equity, and inclusion strategies, how can leadership and boards be persuaded to adopt role-based compensation structures and address areas of bias in the recruiting and promotions process? Register here to learn more. |
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Tesla autopilot
FTC Chair Lina Khan says Tesla’s autopilot system is on the agency’s radar, after lawmakers alleged the company misled consumers and put the public in danger by marketing a full self-driving mode that doesn’t quite achieve that level of autonomy. (Bonus read: Khan is also promising “muscular” scrutiny of buyout-backed mergers.) Reuters
Combustion engines
The European Parliament yesterday voted to take combustion-engine cars off the market by 2035. However, progressives blew up (for now) plans for a new emissions trading scheme, carbon border tax and social climate fund, due to conservatives trying to water down targets. CNN
Hiring freezes
Intel has become the latest tech firm to press pause on new hires, to “help us weather macroeconomic uncertainty, execute on our strategy and meet our commitments to customers, shareholders, and employees.” Fortune
American LNG
There was an explosion yesterday at the Freeport liquefied natural gas export facility in Texas, which will result in a three-week shutdown. That’s bad news for European importers, who are desperate for the stuff at the moment; within the U.S., it means more domestic supplies hence lower prices. Bloomberg
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What’s top of mind for Millennials and Gen Zs? According to Deloitte’s 11th annual Gen Z and Millennial Survey, these generations are deeply concerned about the state of the world and their own futures. There is a need and an opportunity for business leaders to respond by shaping work models that meet their workforce’s expectations around work/life balance, learning and development, and sustainability. Learn More
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Gun control
The U.S. House of Representatives yesterday voted through legislation that would ban high-capacity ammunition magazines and raise the minimum age for buying most semiautomatic rifles to 21. However, Senate Republicans will likely block or water down the measures. Fortune
Coastal threat
Coastal communities around the world will be forced to relocate due to rising sea levels, the U.K.’s Environment Agency has warned. CEO James Bevan: “Some of our communities, both in this country and around the world, cannot stay where they are. That’s because while we can come back safely and build back better after most river flooding, there is no coming back for land that coastal erosion has simply taken away or which a rising sea level has put permanently, or frequently, underwater.” CNBC
El Salvador
El Salvador may default on its sovereign debt next year. The increasingly authoritarian President Nayib Bukele may be a big Bitcoin fan, but if he needs to turn to the IMF for cheap financing, he may need to amend his cryptocurrency law to contain macro risks. Fortune
Zero COVID
China is seemingly shoring up its zero-COVID policy with hundreds of thousands of permanent testing centers, despite the economic damage that the approach entails. Financial Times
This edition of CEO Daily was edited by David Meyer.
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