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Web 2.0 meets AI and the “Law of Diminishing Returns” from Sam Ceccola
The following is a guest post from a good colleague and friend Sam Ceccola, who is effectively the CTO for the USA. I am sure it will promote some good posts ! Andy
I have been reflecting over Christmas on my experiences in the IT community serving clients that are constantly pushing the envelope through the use of computer systems to gain intelligence in ways that will really drive a business forward. These clients range in type from those that sell insurance to those that fight the war on terrorism.
There has been an ongoing struggle over the past thirty years on just how intelligent can our computer systems become… For the most part the pragmatists have won out, the perception is that we should run for the hills any time someone even mentions any type of artificial intelligence. I want to discuss the reality of the current situation and propose a different way of looking at the business objectives at hand…
Let’s start with a basic economic principle, which has governed business for quite some time. The law of diminishing returns as defined by Wikipedia as the point where each additional unit of input yields less value than the cost of an additional unit of output” This basic and well-accepted economic principle is the key point in the understanding of why AI concepts will be a successful part of delivering business innovation in today’s technology. Twenty-Five years ago, Artificial Intelligence was all but destroyed by a series of movies; “do you recall the movie war games” that made it seem as if AI concepts were impractical, unaffordable in fact fictional.
Twenty-Five years ago when computers where unknown to the masses there was an overwhelming perception, that computers were always correct. We ask a question of a computer and we would get the correct answer. After all how could a computer be wrong? Today of course this is a standing joke used widely by comedians to get a laugh, and in this we see a very different perception of IT systems today. As computer scientists and idealists we tried to engineer systems that were always right, that took us down the path of needing more processing power in effort to consume every piece of data we had (remember the data warehousing efforts?) and every single permutation of logic.
Pursuing this approach, based on the Moores Law and ever more available cheap power, caused the industry to perceive AI was just an academia and R&D exercise, leaving them to pursue the path of creating a single version of the truth where one input equals one output. Again today this is a further standing joke as we now understand the futility of trying to keep pace with the rate at which data, and in lots of new forms too, is being created.
Back to my earlier point about the “Law of Diminishing returns” and the concepts of edge computing. The Law of Diminishing Returns applied to computing effectively says the cost of considering one more piece of data or one more instruction of logic outweighs the value and impact of considering that new piece of data. But we need at least one new factor in our definition; cost should also be defined in time. In an increasing number of cases considering another piece of data, adds to the processing time, causing the decision to do something to be delayed until it’s too late. That’s why we have to reconsider our approach to fit the new demands that Businesses have for ‘right time’ information.
If we accept the premise that we could find a way not to have to consider all pieces of data or all permutations of logic then this allows us to accept the premise of edge computing and trust. Further it allows us to move from the traditional hub spoke architectures (Data Warehousing) to edge, peer to peer and federated models that apply the law of diminishing returns. And the connection with the whole Web 2.0 model where external data is of as much value as internal, and the explosion in data volumes and types that this produces still further reinforces my argument.
However this by itself does not ensure success, we must jump another hurdle. In past year we have realized that a one size fits all approach does not work. The power of personalization and end user collaboration on our business results is being demonstrated by the value of Web 2.0 technologies. As we build more intelligent systems, we need to embrace this paradigm shift and not rely on the computing logic itself to define our intelligence, We can not code every single permutation into the logic, nor can we assume that on generic version fits all. So how do we provide edge services that are generic enough for the masses but specific enough for individual?
In other words, how do we provide edge services that are relevant to the end user? In the spirit of Web 2.0, let’s allow the users to define the relevance. In my opinion this is best done, by providing edge services that support a model driven architecture. Where that architecture is a vocabulary model defined by the end user that defines relevance, relationship and such. A Semantic Model, something that some call Web 3.0 arguing that without this approach we will be in capable of making use of the Web 2.0 environment in much the same way as search engines are struggling with Web 1.0.
Let’s look at an example; I need to find information on the Internet about a person, in order to determine if this person has a relationship with Osama Bin Laden. One first may decide to use Google to do that search. Google defines relevancy by the number of links to a web page. If I do the search per Google, I may return 120 million results with the ones near the top of the list the most relevant by Google’s definition. However, maybe the most relevant by Google’s terms are not by my terms. Google provides the most relevant to the masses. Not the specifics of the individual’s context..
Again, the answer lies in another increasingly popular concept that is becoming widely understood; The Long Tail. If we apply a basic economic theory of long tail economics, the results I am looking for are in the long tail. I should also define relevancy by trust and for this search, involving a known terrorist, the web sites that end with .mil or .gov are the most relevant. If I could apply a model of relevancy to the same search and therefore have the most relevant be a the top of the result set for me as well as the search engine the facts will be available quicker and in a better structure so I will be able to make my decision quicker.
So my conclusion is that we are and will be driven towards a change in our approach, call it AI, Semantics, or whatever, we need it. Partly driven by scaling issues, but increasingly driven by time and needing contextual understanding. Increasingly we can’t afford to either wait for, or pay for a 100% correct analysis, (and in all probability the time to handle the task would mean that new data would have been created so the result can never be 100% accurate), when an 80% solution will answer my business needs. The pieces are pretty much there today and you can expect to see new players offering products that combine Semantics (Vocabulary Modeling), Artificial Intelligence and the law of diminishing returns as industry specific business driven solutions.
That is why the industry whether its Military Systems, Finance Systems, or Healthcare Systems are now moving towards the ‘Intelligent Enterprise’. The New Business Intelligence is not the static stale data that resides in the BI Systems of today. But are moving towards the federated real-time model driven Systems of the future.
-Sam Ceccola-
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Comments
# on January 9, 2008 12:06 PM, Gary Nuttall said:
I'd like to offer a corollary that the concept of the "Law of diminishing returns" when applied to information already exists. I believe that it's known as the "Value of Complete Information". i.e. by treating information as a costable commodity, at what point does the cost of the additional information exceed the revenue it'll generate. Interesting to note that it is known as the VALUE of Complete Information and not the COST or PRICE - See, business is ahead of IT when adopting a value oriented approach!
Regarding the Web2.0/intelligence principle, I would suggest that if Web2.0 is the "Semantic Web" then Web3.0 will be the "Contextual Web".....which I think is the point made in the blog about relevance. Context helps us to apply a relevance rating when assessing information linkages. I wonder if we'll establish some form of contextual set analysis (or matrix) in order to qualify the relevance of linkages....but how we'll work out what the relevance of the context of some of the relationships will be is beyond me!
# on January 9, 2008 12:18 PM, andy mulholland said:
There is an alternative and very tangential thought to this around people and communities. I think you can argue the same case for context and invloving people, or waiting for their opinions.
just think about e mail and responses. do you wait for the last person to respond to have a complete set of opinions or can you conlude that the first responses will be from those most contexturally aware of the topic?
# on January 9, 2008 12:45 PM, Gary Nuttall said:
I agree that context isn't just in a single dimension - it has a time attribute too....This Person is CURRENTLY a Customer of XXX. Even better is when you extend the linkage to encompass possible outcomes....e.g. This person MAY BECOME a Customer of XXX. Now you have the additiona fun of considering in what context CURRENT applies - for a salesperson, current means in the last x days. From a marketing perspective it could be x years.
When defining BI elements, relatively simple (ho ho!) definitions such as 'Profit' vary from department to department. Introducing a department-context-time bound element is really going to be great fun to model!
# on January 9, 2008 3:39 PM, andy mulholland said:
I am going to try to get something out around this whole area of tying people, events, content and context together in a new white paper by end of Febuary.
it will try to tie together the blogs together in one coherent picture. big task but it needs to be started to get more engagement from others to refine the arguements i will lay out so we start to get closer to the truths.
# on January 9, 2008 10:53 PM, John Maloney said:
Sam, et al,
Your post and comments gets tantalizingly close to the value networks perspective. Allow me to perhaps help get you all the way there…
First, the context of the law of decreasing returns is scarcity. It is often a zero-sum game: you need to choose between two options - one wins, one loses. For computing, it is manifest in rigid analytical reductionism, hierarchy and a very confining process engineering mindset. It is the Newtonian model of business computing. It has always been about controlling scarcity – memory, CPU, network, man-hours, etc.
Today, business computing is about limitless abundance. The economics of abundance and information turn standard laws of business governance and leadership on their head.
The value networks mindset introduces the law of increasing returns. It is eponymously known as the network effect.
For example, if you share half an apple, you are left with only half an apple. However, if you share information, you are not left with less value than what you started; you have doubled your information’s value.
In a world of abundance, only the whole system view makes sense. Breaking things down into little parts, then reassembling them, and expecting a different result, never works. Only by serving the networks and really understanding how things organize themselves, can firms enjoy the law of increasing returns and the co-creation of value.
The value network effect inhabits the complex ecologies and the whole ecosystem. It is released, realized through visualization and optimization of the whole system, not the constituent parts.
For example, today the telecommunications industry is undergoing enormous changes. To see how one major player has begun to transform and embrace the value network effect, and achieve significant advantages, see Telenor Value Networks –
http://kmblogs.com/public/item/194339
The enterprise IT transformation from scarcity to abundance, from process to network and from ordered mechanics to network patterns is not easy. The value network shift in comprehension is the first step in mastering the law of increasing returns for business computing. See:
http://www.value-networks.com/
-j
http://xri.net/=jheuristic
# on January 15, 2008 7:12 AM, Niraj J said:
Excellent post.
my two cents.
I think you should have called the post "AI meets CI to capitalize the long tail"
The point being that combining Collective Intelligence and Artificial Intelligence will enable the ROI on the Long tail.
Check out the links at
http://www.gandalf-lab.com/blog/2007/10/collective-business-intelligence-and.html
In web 2.0 world. Data is King- and for better AI and techniques like Monte Carlo Analysis. extracting "Relevant Context specific information" from large amounts of Databases is going to be key.