New Zealand has to upskill its people to help bring in an era of artificial intelligence (AI) which can double our growth rate in the next 20 years.
That's the opinion of leading business technology expert Mary-Anne McCarthy, Technology Lead for Accenture New Zealand, who says the issue is not whether AI will become an economic force but when it will happen and how well countries and companies will employ it.
Accenture research predicts AI could double global economic growth rates by 2035, an estimate which McCarthy says applies to New Zealand as well. The research also shows that AI technologies are projected to boost global productivity by up to 40 per cent.
"That's because AI will fundamentally change the way work is done and reinforce the role of people in business," she says.
The most commonly quoted example of AI is driverless cars - regarded as a way to cut accidents, deaths, costs and revolutionise transport systems worldwide - but AI relates to any form of machine learning which can complement or even replace human activity.
That has led to a debate and some scare stories about machines replacing people in the workforce, including doomsday scenarios of computers and robots ceasing to be servants and somehow becoming our rivals and conquerors - as in the Terminator movies and others like I Robot.
McCarthy views such fears as fiction; many studies show people are mostly not worried about the advance of AI. However, she says there are unquestionably issues businesses and countries must confront to make the most of AI.
"The way we see it is that there are four areas of change required - one being the re-distribution effect. AI will bring in a lot of job displacements as more manual and process tasks are taken over - freeing that labour to be channelled into more value-added jobs.
"So there is an economic and social need to upskill people for those jobs."
One estimate from the US looked at huge advances that can be made by AI taking over some tasks, like call centres, allowing people to focus on making the customer experience more satisfying. It is currently figured about US$1.6 trillion a year is lost by companies because of poor customer service.
The second issue was preparing younger generations for an AI future - "we are teaching our people to use computers but we are not so good at teaching computers to learn from us," says McCarthy, "though that is changing."
Third, a code of ethics for AI needs to be assembled, including a way to ensure AI's algorithms do not exclude people unfairly. Finally, governments need to pass laws or regulations governing its use.
"Again, the driverless car is probably the best example," McCarthy says. "Today, the law says you must have a hand on the wheel of a car at all times. In the time of the driverless car, it will be possible to have both hands off the wheel - but that needs to be covered by laws we do not yet have.
"It essentially means we need laws that amend today's or introduce new regulations so we can support the growth of AI and economic growth as a whole."
McCarthy says Accenture believe there are three main areas where AI can lead business growth in New Zealand:
• Intelligent automation - where machines and robots take over tasks they can perform significantly faster and more effectively than humans.
• Labour and capital augmentation - re-skilling those same people so they have better skills and more job satisfaction
• Innovation diffusion - "Basically, this just means innovation begets innovation," says McCarthy. "As we increase the ability of our AI, it will potentially discover new advances that could improve our lives - new technologies, new tools, new scientific breakthroughs - and meaning we can push AI itself to new capabilities.
"It also means the innovation it brings can be put to different uses. That same driverless car, for example, could be a huge target for innovative marketing beamed into the car via its screen."
McCarthy says she speaks to many CEOs who are investing in AI: "It's definitely on their road map though it depends a lot on the scale of the organisation right now."
However, Accenture's research included an "absorption capacity index" which rated New Zealand 15th in 27 economies measuring how ready a country is to incorporate advances like AI into their national economy -- ahead of France, Italy, Spain and Portugal but well behind the US, Switzerland, the Scandinavian countries, Netherlands, UK, Germany, Japan and Australia.