OUTLINE FOR TODAY 16TH

JULY

DEVELOPING AND IMPLEMENTING

COGNITIVE TECHNOLOGIES
Types of cognitive technologies
From DevOps to MLOps

DERIVING VALUE FROM COGNITIVE

TECHNOLOGIES

COGNITIVE TECHNOLOGIES:

Artificial Intelligence (AI) applications,

tools
—> Making sense and understanding what
are the different technologies such as
machine learning (ML) and large language
model (LLM)- enabled systems and their
implications on business

Types of cognitive technologies

AI is an umbrella concept that is used

loosely to describe technologies that
resemble intelligent behaviour to
automate and/or augment work tasks

Cognitive technology (CT) encompasses

both rule-based automation and systems
that can learn

• Aimed at specifically to substitute

and/or complement tasks that involve
human cognition

Three categories for cognitive

technologies*:

● Process automation

● Cognitive insight

● Cognitive engagement

PROCESS AUTOMATION

Encompasses robotic process automation

(RPA) and cognitive automation

Typically applied to back-office

administrative and financial activities

RPA mimics humans’ actions, both

inserting and retrieving data from various
IT systems

Rule-based automation, follows specific

premeditated steps, not programmed to
learn and improve by itself

• Its workings are thus transparent

and explainable for the user

Usually high ROI

Replacing administrative employees

neither the primary objective nor a
common outcome

• Might even lead to backsourcing

(bringing back previously outsourced
tasks, production, or functions in-house to
be done internally)
Example for backsourcing:
COGNITIVE INSIGHT

ML-enabled systems that detect patterns

in vast volumes of data and interpret their
meaning, “analytics on steroids”

• E.g., predicting what a customer is

likely to buy, identifying credit fraud in
real time, and detect insurance claims
fraud

Typically used to improve performance on

jobs only machines can do • E.g., high-
speed data crunching and automation

Differs from traditional analytics in three

ways:
● More data intensive and detailed

● Typically trained on some specific

data set

● Ability to improve over time

COGNITIVE ENGAGEMENT

Cognitive technologies that engage

employees and customers using natural
language processing (NLP) chatbots/
intelligent agents and ML

Companies tend to take a conservative

approach to customer-facing cognitive
engagement technologies, e.g., in
deploying chatbots to use

In most cases, the goal is not to reduce

head count but to handle growing
numbers of employee and customer
interactions without adding employees

CONTEXT: consulting company

Developing and deploying

cognitive technologies

Cognitive technologies are increasingly

being used to solve business problems,
but many of the most ambitious projects
encounter setbacks or fail
○ Although it is relatively easy
to pilot ML projects in
organizations, scaling and
deploying them have proven
to be challenging*

○ Only one in 10 companies

implementing ML initiatives
have realized satisfactory
outcomes**

● So why does this happen? Why do

the projects experience delays and
setbacks?

DERIVING VALUES FROM

COGNITIVE TECHNOLOGIES
Enhance the Features, Functions, and
Performance of Our Products (51%):
○ The most cited benefit,
indicating that over half of the
executives believe AI
significantly improves product
capabilities and performance.

Make Better Decisions (35%):

○ A significant proportion of
executives (35%) recognize
AI's role in enhancing
decision-making processes,
leveraging data-driven
insights for more informed
decisions.

Optimize Internal Business Operations

(36%):
○ AI helps streamline and
improve efficiency within the
company's operations, cited
by 36% of the respondents.

Free Up Workers to Be More Creative by

Automating Tasks (36%):
○ Similarly, 36% of executives
see AI as a tool for automating
mundane tasks, thereby
enabling employees to focus
on more creative and high-
value work.
Create New Products (32%):
○ AI is seen as a catalyst for
innovation, with 32% of
executives noting its ability to
help create new products.

Optimize External Processes like

Marketing and Sales (30%):
○ 30% of executives identify
AI's impact on enhancing
external business functions,
such as marketing and sales
strategies.

Pursue New Markets (25%):

○ AI is also valued for its
potential to open up new
market opportunities, as cited
by 25% of the respondents.

Capture and Apply Scarce Knowledge

Where Needed (25%):
○ AI aids in capturing and
utilizing critical knowledge
that might be otherwise hard
to harness, according to 25%
of executives.

Reduce Head Count Through Automation

(22%):
○ While less frequently cited,
22% of executives
acknowledge that AI can lead
to workforce reductions by
automating certain jobs.

Deriving value from CTs

● Advancements in cognitive
technologies are quickly changing
the competitive environment for
businesses
● Companies are engaging in a large
variety of cognitive technology
projects in the search for an
adequate strategic response

● Confusion on how to leverage

especially the new cognitive
technologies with learning abilities

● Many companies are not meeting

the expected outcomes in creating
tangible business value

. It's Hard to Integrate Cognitive

Projects with Existing Processes
and Systems (47%):
○ This is the most cited
challenge, indicating that
nearly half of the respondents
find it difficult to incorporate
cognitive technologies into
their current workflows and
infrastructure. Integration
issues can stem from legacy
systems that are incompatible
with new technologies, the
complexity of aligning new
tools with established
processes, or the need for
significant changes in
business operations to
accommodate these projects.
. Technologies and Expertise Are
Too Expensive (40%):
 ○ Cost is a significant barrier for
40% of respondents.
Implementing cognitive
technologies often requires
substantial financial
investment in both the
technology itself and the
expertise needed to develop
and maintain it. High costs
can deter organizations from
adopting these technologies,
especially if the return on
investment is uncertain or
long-term.
. Managers Don’t Understand
Cognitive Technologies and How
They Work (37%):
○ Over a third of respondents
indicate that managerial
understanding is a key
obstacle. Effective
deployment of cognitive
technologies requires that
managers not only
understand the technology
but also how it can be applied
to solve business problems.
Lack of awareness or
knowledge can lead to
resistance, misalignment of
project goals, or failure to
fully leverage the
technology's potential.
. We Can’t Get Enough People with
Expertise in the Technology (35%):
○ The shortage of skilled
professionals is another major
challenge. Cognitive
technologies, such as AI and
machine learning, require
specialized knowledge and
skills that are in high demand
but short supply.
Organizations struggle to find,
hire, and retain talent with the
 necessary expertise to
develop, implement, and
manage cognitive technology
projects.
. Technologies Are Immature (31%):
○ Nearly a third of respondents
believe that the technologies
themselves are not yet mature
enough for widespread
adoption. This could mean
that the technologies are still
in development, lack
robustness, or have not been
proven at scale. Immature
technologies can lead to
higher risks and uncertainty
about their performance and
reliability.
. Technologies Have Been Oversold
in the Marketplace (18%):
○ This challenge suggests that
some respondents feel that
cognitive technologies have
been hyped beyond their
current capabilities.
Overselling can create
unrealistic expectations about
what the technology can
achieve, leading to
disappointment and
skepticism when the actual
performance does not meet
the exaggerated claims.
These challenges highlight the
complexities and hurdles organizations
face when attempting to integrate
cognitive technologies into their
operations. Overcoming these obstacles
often requires strategic planning,
investment in education and training, and
incremental implementation to build
confidence and demonstrate value.
 4o

revise, no caps

ChatGPT
The image presents a bar chart detailing
the challenges faced in integrating
cognitive technologies (CTs) into existing
business processes and systems,
according to a Deloitte 2017 report. Below
is an elaboration on each of the obstacles
highlighted in the chart:

It's hard to integrate cognitive projects

with existing processes and systems
(47%):
○ Integration issues can stem
from legacy systems that are
incompatible with new
technologies,
○ the complexity of aligning
new tools with established
processes, or the need for
significant changes in
business operations to
accommodate these projects.

Technologies and expertise are too

expensive (40%):
○ Implementing cognitive
technologies often requires
substantial financial
investment in both the
technology itself and the
expertise needed to develop
and maintain it.
○ High costs can deter
organizations from adopting
these technologies, especially
if the return on investment is
uncertain or long-term.

Managers don’t understand cognitive

technologies and how they work (37%):
○ Effective deployment of
cognitive technologies
requires that managers not
only understand the
technology but also how it
can be applied to solve
business problems.
○ Lack of awareness or
knowledge can lead to
resistance, misalignment of
project goals, or failure to
fully leverage the
technology's potential.

We can’t get enough people with

expertise in the technology (35%):
○ Cognitive technologies, such
as AI and machine learning,
require specialized
knowledge and skills that are
in high demand but short
supply.
○ Organizations struggle to find,
hire, and retain talent with the
necessary expertise to
develop, implement, and
manage cognitive technology
projects.

Technologies are immature (31%):

○ This could mean that the
technologies are still in
development, lack
robustness, or have not been
proven at scale.
○ Immature technologies can
lead to higher risks and
uncertainty about their
performance and reliability.

Technologies have been oversold in the

marketplace (18%):
○ Overselling can create
 ○
unrealistic expectations
about what the technology
can achieve, leading to
disappointment and
skepticism when the actual
performance does not meet
the exaggerated claims.

Steps to seek value from CTs

• Despite companies’ expanding

experience with cognitive tools, companies
face significant obstacles in development
and implementation

1. Understanding the technologies

2. Creating a portfolio of projects

● Identifying opportunities: getting rid

of bottlenecks, overcoming scaling
challenges (knowledge is hard to
scale, e.g., in financial advisement
work, creating “robo-advice”),
inadequate IT and personnel
resources

● Determining use cases

● Selecting the right technology

3. Launching pilots

● Proof-of-concept (POC), piloting

Business process redesign: how

should workflows be redesigned

4. Scaling up
Deriving value from ML
projects

● ML technology enables new value

creation mechanisms through which
organizations can pursue their
organizational goals

● Value creation mechanisms describe

the way organizations intend to
achieve certain value targets (e.g.,
increased efficiency)

● Organizations dynamically shift from

one value creation mechanism to
another as their capabilities evolve
and business conditions change
over time

● Critical role of data scientists in

orchestration activities to create and
sustain value through ML

• Setting up ML models, but also involved

in many managerial activities in these
projects

Knowledge Creator:
– focuses on creating new
knowledge and understanding
through the ML system.
– starts with the ML system
generating descriptions and
 explanations through the user
interface
– The organizational knowing
process further interacts with the
ML model and historical data —>
predictions and indirect feedback

Task Augmentation:

– encompasses the process of

enhancing existing tasks by
leveraging ML.
– The flow initiates with the ML
system generating prescriptions
and predictions —> influence users’
decisions
– lead to the execution of actions that
in turn contribute to the collection
of new data —> feeds back into the
system, further enriching its
knowledge and capabilities.

Autonomous Agent:

– the autonomous operation of ML

systems in real-world scenarios.
– The ML system generates
prescriptions and predictions —>
guide the intelligent product/
service to take actions.
–
– These actions —> yield data, which
is used by the ML system to
enhance its decision-making and
prediction capabilities
– the cycle continues with closed-
loop feedback.