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Hacking the Crystal Ball: How Artificial Intelligence Augments Profitability Justin Wisz Vestorly
©2016 Pershing LLC. Pershing LLC, member FINRA, NYSE, SIPC, is a wholly owned subsidiary of The Bank of New York Mellon Corporation (BNY Mellon). Trademark(s) belong to their respective owners. For professional use only. Not for distribution to the public. The information contained herein, including any attachments, is proprietary to, and constitutes confidential information of Pershing. It may not be reproduced, retransmitted or redistributed in any manner without the express written consent of Pershing LLC. Information and content presented in this presentation is not intended or construed as an offer, solicitation or a recommendation to purchase any security. The authors, presenters and their respective companies are not affiliates of Pershing LLC and Pershing LLC is not the author of, responsible for and shall not be liable for any content presented herein. The contents may not be comprehensive or up-to-date, and Pershing LLC will not be responsible for updating any information contained within this presentation. Pershing makes no representation as to the accuracy, completeness, timeliness, merchantability or fitness for a specific purpose of the information provided in this presentation. Pershing assumes no liability whatsoever for any action taken in reliance on the information contained in this presentation, or for direct or indirect damages resulting from use of this presentation, its content or services. Any unauthorized use of material contained in this presentation is as the user’s own risk. The views expressed within this presentation are those of the contributors or authors only and not those of Pershing LLC or any of its subsidiaries or affiliates. Reproduction, distribution, republication and re-transmission of material contained in this presentation is prohibited unless the prior written consent of Pershing LLC has been obtained.
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A BRIEF HISTORY OF ARTIFICIAL INTELLIGENCE AND OUR LOVE/HATE RELATIONSHIP WITH IT
SCIENCE FICTION AND AUTOMATA SPUR THE HUMAN OBSESSION WITH ROBOTS 1768- 1774 “ Th e Th r e e A u tomaton s”
1800s Ju l e s V e rn e p op u l ari zes science fictio n.
1950 Al an T u r i n g c r e a t e s t h e “T ur i n g Te s t ” t o d e t erm i n e i f a c om p u te r has r e a l i n t e l l i g e n c e
1997 IBM’ s De e p Bl u e b e ats th e worl d c h amp i on at c h e ss
2011 IBM ’ s Watson b ea ts its h u man c omp e ti to rs a t Je o pa rdy
2012 Googl e ’ s X Lab d e v e l op s a ma chine l e arn i n g al gori thm tha t ca n au ton omou sl y b row se Yo uTube v i d e os to fi n d v i deo s o f ca ts
2015 Pe w R e se a rch C enter Study finds th at most A m erica ns expect tha t by 2 0 6 5 , robo ts a nd co mputers w ill “ d e fi n i te l y ” or “pro ba bly” do much o f th e work c u rrently do ne by hum a ns
% o f ad u lts who s a y t ha t i n t he ne x t 50 ye ars r o b o ts an d co m p ut e r s wi l l d o m uc h o f the wo rk cur r e nt l y d o ne b y hum a ns
15%
50%
25%
7%
Definit e l y
Prob ab l y
Proba bly No t
Definitely No t
2016 G o o gle's Alpha G o AI bea ts Lee Se-do l a t G o
2016 G o o gle Ma ps vs. da d’s superio r sense o f directio n
WHAT EXACTLY IS AI AND WHY ARE WE SCARED OF IT?
THREE REASONS PEOPLE ARE CONFUSED ABOUT THE TERM “AI”
WE ASSOCIATE AI WITH MOVIES
AI IS A BROAD TOPIC
WE USE AI ALL THE TIME IN OUR DAILY LIVES, BUT WE OFTEN DON’T REALIZE IT’S AI
“As soon as it works, no one calls it AI anymore.”
-John McCarthy coined the term “Artificial Intelligence” in 1956
IN AI THEORY, THERE ARE THREE TYPES OF AI
ARTIFICIAL NARROW INTELLIGENCE is AI that specializes in one area and does it better than people can.
ARTIFICIAL GENERAL INTELLIGENCE refers to a computer as smart as a human across the board—a machine that can perform any intellectual task that a human being can.
“A very general mental capability that, among other things, involves the ability to reason, plan, solve problems, think abstractly, comprehend complex ideas, learn quickly, and learn from experience.” -Professor Linda Gottfredson
WE’RE FURTHER THAN YOU THINK FROM THIS CAPABILITY. A big reason is “transfer learning”, which is what AI researchers call reasoning by analogy. This is the ability to take lessons learned in one domain and apply them to another.
ARTIFICIAL SUPER INTELLIGENCE
“An intellect that is much smarter than the best human brains in practically every field, including scientific creativity, general wisdom and social skills.” -Nick Bostrom Oxford philosopher and leading AI thinker
Futurist Ray Kurzweil defined the singularity as an event when the Law of Accelerating Returns has reached such an extreme pace that technological progress is happening at a seemingly-infinite pace.
REALITY CHECK The AI in existence today is actually ANI. Humans have conquered the lowest caliber of AI, and it’s everywhere.
AI IS EMERGING IN BUSINESS SOFTWARE TOOLS AND AVOIDING IT FOR BUSINESS USE IS A MISTAKE
THE HUMAN AND THE MACHINE
“Weak human + machine + better process was superior to a strong computer alone and, more remarkably, superior to a strong human + machine + inferior process.” -Gary Kasparov
THREE MAIN BUSINESS USES OF AI
AUTOMATION OF MUNDANE TASKS
ENHANCED DELIGHT FOR CLIENTS AT SCALE
DISCOVERY OF DATA YOU OTHERWISE DID NOT KNOW
Q: WHAT DOES A TECHNOLOGY COMPANY DO?
A: REDUCES FRICTION IN PEOPLE’S LIVES
A FAILSAFE RUBRIC FOR EVALUATING TECHNOLOGY IN YOUR PRACTICE
VALUE Yes, I access info I didn’t know before
Reduces work (ie: 6 hours per week saved)
Does it reduce work or create work?
More work
Is there ROI data?
Yes, for sure
Kind of, not really
Do clients enjoy it?
Not sure
FAIL
BEWARE THE SAME CIRCUS, DIFFERENT CLOWNS EFFECT Commonly encountered when switching technologies, the SCDC effect occurs as a result of thinking a new provider of the same technology will reduce friction in your life simply because they are a different provider.
WHAT IS VESTORLY?
REDUCTION IN FRICTION FOR ADVISORS • C ont ent p e o p l e w an t b as e d o n d at a • Reduct i o n i n w o r k flo w w i t h au t o ma t e d t a sks • D a t a y o u o t h e r w i s e d i d n o t h av e
THE CONSUMER EXPERIENCE THROUGH VESTORLY.
YOU CHECK EMAILS
YOU CHECK SOCIAL MEDIA
YOU BROWSE THE WEB
YOU DO IT ALL ON YOUR PHONE
...AND EVERYTHING IS TRACKED.
WHAT YOU JUST SAW IS THE CONSUMER EXPERIENCE THROUGH VESTORLY.
HOW IT WORKS
AI THAT FINDS AND SHARES CONTENT U s i n g a r t i fi c i a l i n te l l i ge n c e , V e storl y l e arn s y ou r audience to perso na liz e c on t e n t at a rate i mp ossi b l e on th e h u ma n sca le.
UNLOCK HIDDEN DATA B r e a kt h r o u g h b r o wse r te c h n ol ogy p rov i d e s i n d i v i d ua l da ta never befo re ac c e ssi b l e to p rof e ssi on al s.
IMAGINE THE DATA...
REDUCTION IN FRICTION FOR THE ENTERPRISE • C o mplia n c e “ ap p r o v e - f o r - o n e - ap p rov e -f or -a l l ” • C o mplia n c e ar c h i v i n g e x c h an g e • D a t a t he y o t h e r w i s e d i d n o t h av e
AN ENTERPRISE CASE STUDY: PERSHING S i n gl e Si gn - On Con te n t Prov i si on i n g an d A p p rova l CM S M ap p i n g En te rp ri se Data V i su al i zati on
VESTORLY BY THE NUMBERS Ve s t o r l y u s e r s c u r r e n t l y e x p e ri e n c e th e f ol l owi n g: • 8 ho ur s p e r w e e k i n l a bor sav e d . • 5 0 0 % i n c r e a s e i n e m a i l CTR ov e r p re v i ou s sy ste m. • 7 0 0 % i n c r e a s e i n l e a d c ap tu re on p e rson al we b si te s ov er previous C TAs. • 2 7 . 4 % o f c l i e n t l i s t s h a ri n g c on te n t an n u al l y . • 6 9 . 2 % o f r e c i pi e n t s e n gagi n g an d op ti n g i n .
ROI CALCULATION • B as ed o n 1 0 0 C l i e n t s • 2 7 . 4 % o f c l i e n t s s h a r e an n u al l y . • 6 9 . 2 % E n g a g e m e n t r a te f or c on te n t sh are d b y c l i e n ts • * Ind u s t r y a v e r a g e c l o se rate on c l i e n t re f e rral s: 70% 1 0 0 x 27 . 4 % x 6 9 . 2 % = 1 9 c l i e n t re f e rral s x 7 0 % i n d u stry sta nda rd clo se ra te = 1 3 ne w c lie n t s p e r year
* S o ur ce : I n f i n a t a , F i n a nc i al Ti me s
FULL SUPPORT GUARANTEES SUCCESS Re lat io ns h i p M a n a g e r s s u p p ort e n te rp ri se s an d h ome offic e s. Cus t o m e r S u c c e s s A s s o c i a te s su p p ort re p re se n tati v e s. O ngo ing e d u c a t i on a n d pr omoti on .
RECRUITING THE BRIGHTEST MINDS OF THE NEXT GENERATION
REALITY CHECK Robo-advisors aren’t the existential threat to financial advisors.
WWW.VESTORLY.COM
#PershingINSITE Follow us @Pershing
Hacking the Crystal Ball: How Artificial Intelligence Augments Profitability Justin Wisz Vestorly
©2016 Pershing LLC. Pershing LLC, member FINRA, NYSE, SIPC, is a wholly owned subsidiary of The Bank of New York Mellon Corporation (BNY Mellon). Trademark(s) belong to their respective owners. For professional use only. Not for distribution to the public. The information contained herein, including any attachments, is proprietary to, and constitutes confidential information of Pershing. It may not be reproduced, retransmitted or redistributed in any manner without the express written consent of Pershing LLC. Information and content presented in this presentation is not intended or construed as an offer, solicitation or a recommendation to purchase any security. The authors, presenters and their respective companies are not affiliates of Pershing LLC and Pershing LLC is not the author of, responsible for and shall not be liable for any content presented herein. The contents may not be comprehensive or up-to-date, and Pershing LLC will not be responsible for updating any information contained within this presentation. Pershing makes no representation as to the accuracy, completeness, timeliness, merchantability or fitness for a specific purpose of the information provided in this presentation. Pershing assumes no liability whatsoever for any action taken in reliance on the information contained in this presentation, or for direct or indirect damages resulting from use of this presentation, its content or services. Any unauthorized use of material contained in this presentation is as the user’s own risk. The views expressed within this presentation are those of the contributors or authors only and not those of Pershing LLC or any of its subsidiaries or affiliates. Reproduction, distribution, republication and re-transmission of material contained in this presentation is prohibited unless the prior written consent of Pershing LLC has been obtained.
#PershingINSITE
A BRIEF HISTORY OF ARTIFICIAL INTELLIGENCE AND OUR LOVE/HATE RELATIONSHIP WITH IT
SCIENCE FICTION AND AUTOMATA SPUR THE HUMAN OBSESSION WITH ROBOTS 1768- 1774 “ Th e Th r e e A u tomaton s”
1800s Ju l e s V e rn e p op u l ari zes science fictio n.
1950 Al an T u r i n g c r e a t e s t h e “T ur i n g Te s t ” t o d e t erm i n e i f a c om p u te r has r e a l i n t e l l i g e n c e
1997 IBM’ s De e p Bl u e b e ats th e worl d c h amp i on at c h e ss
2011 IBM ’ s Watson b ea ts its h u man c omp e ti to rs a t Je o pa rdy
2012 Googl e ’ s X Lab d e v e l op s a ma chine l e arn i n g al gori thm tha t ca n au ton omou sl y b row se Yo uTube v i d e os to fi n d v i deo s o f ca ts
2015 Pe w R e se a rch C enter Study finds th at most A m erica ns expect tha t by 2 0 6 5 , robo ts a nd co mputers w ill “ d e fi n i te l y ” or “pro ba bly” do much o f th e work c u rrently do ne by hum a ns
% o f ad u lts who s a y t ha t i n t he ne x t 50 ye ars r o b o ts an d co m p ut e r s wi l l d o m uc h o f the wo rk cur r e nt l y d o ne b y hum a ns
15%
50%
25%
7%
Definit e l y
Prob ab l y
Proba bly No t
Definitely No t
2016 G o o gle's Alpha G o AI bea ts Lee Se-do l a t G o
2016 G o o gle Ma ps vs. da d’s superio r sense o f directio n
WHAT EXACTLY IS AI AND WHY ARE WE SCARED OF IT?
THREE REASONS PEOPLE ARE CONFUSED ABOUT THE TERM “AI”
WE ASSOCIATE AI WITH MOVIES
AI IS A BROAD TOPIC
WE USE AI ALL THE TIME IN OUR DAILY LIVES, BUT WE OFTEN DON’T REALIZE IT’S AI
“As soon as it works, no one calls it AI anymore.”
-John McCarthy coined the term “Artificial Intelligence” in 1956
IN AI THEORY, THERE ARE THREE TYPES OF AI
ARTIFICIAL NARROW INTELLIGENCE is AI that specializes in one area and does it better than people can.
ARTIFICIAL GENERAL INTELLIGENCE refers to a computer as smart as a human across the board—a machine that can perform any intellectual task that a human being can.
“A very general mental capability that, among other things, involves the ability to reason, plan, solve problems, think abstractly, comprehend complex ideas, learn quickly, and learn from experience.” -Professor Linda Gottfredson
WE’RE FURTHER THAN YOU THINK FROM THIS CAPABILITY. A big reason is “transfer learning”, which is what AI researchers call reasoning by analogy. This is the ability to take lessons learned in one domain and apply them to another.
ARTIFICIAL SUPER INTELLIGENCE
“An intellect that is much smarter than the best human brains in practically every field, including scientific creativity, general wisdom and social skills.” -Nick Bostrom Oxford philosopher and leading AI thinker
Futurist Ray Kurzweil defined the singularity as an event when the Law of Accelerating Returns has reached such an extreme pace that technological progress is happening at a seemingly-infinite pace.
REALITY CHECK The AI in existence today is actually ANI. Humans have conquered the lowest caliber of AI, and it’s everywhere.
AI IS EMERGING IN BUSINESS SOFTWARE TOOLS AND AVOIDING IT FOR BUSINESS USE IS A MISTAKE
THE HUMAN AND THE MACHINE
“Weak human + machine + better process was superior to a strong computer alone and, more remarkably, superior to a strong human + machine + inferior process.” -Gary Kasparov
THREE MAIN BUSINESS USES OF AI
AUTOMATION OF MUNDANE TASKS
ENHANCED DELIGHT FOR CLIENTS AT SCALE
DISCOVERY OF DATA YOU OTHERWISE DID NOT KNOW
Q: WHAT DOES A TECHNOLOGY COMPANY DO?
A: REDUCES FRICTION IN PEOPLE’S LIVES
A FAILSAFE RUBRIC FOR EVALUATING TECHNOLOGY IN YOUR PRACTICE
VALUE Yes, I access info I didn’t know before
Reduces work (ie: 6 hours per week saved)
Does it reduce work or create work?
More work
Is there ROI data?
Yes, for sure
Kind of, not really
Do clients enjoy it?
Not sure
FAIL
BEWARE THE SAME CIRCUS, DIFFERENT CLOWNS EFFECT Commonly encountered when switching technologies, the SCDC effect occurs as a result of thinking a new provider of the same technology will reduce friction in your life simply because they are a different provider.
WHAT IS VESTORLY?
REDUCTION IN FRICTION FOR ADVISORS • C ont ent p e o p l e w an t b as e d o n d at a • Reduct i o n i n w o r k flo w w i t h au t o ma t e d t a sks • D a t a y o u o t h e r w i s e d i d n o t h av e
THE CONSUMER EXPERIENCE THROUGH VESTORLY.
YOU CHECK EMAILS
YOU CHECK SOCIAL MEDIA
YOU BROWSE THE WEB
YOU DO IT ALL ON YOUR PHONE
...AND EVERYTHING IS TRACKED.
WHAT YOU JUST SAW IS THE CONSUMER EXPERIENCE THROUGH VESTORLY.
HOW IT WORKS
AI THAT FINDS AND SHARES CONTENT U s i n g a r t i fi c i a l i n te l l i ge n c e , V e storl y l e arn s y ou r audience to perso na liz e c on t e n t at a rate i mp ossi b l e on th e h u ma n sca le.
UNLOCK HIDDEN DATA B r e a kt h r o u g h b r o wse r te c h n ol ogy p rov i d e s i n d i v i d ua l da ta never befo re ac c e ssi b l e to p rof e ssi on al s.
IMAGINE THE DATA...
REDUCTION IN FRICTION FOR THE ENTERPRISE • C o mplia n c e “ ap p r o v e - f o r - o n e - ap p rov e -f or -a l l ” • C o mplia n c e ar c h i v i n g e x c h an g e • D a t a t he y o t h e r w i s e d i d n o t h av e
AN ENTERPRISE CASE STUDY: PERSHING S i n gl e Si gn - On Con te n t Prov i si on i n g an d A p p rova l CM S M ap p i n g En te rp ri se Data V i su al i zati on
VESTORLY BY THE NUMBERS Ve s t o r l y u s e r s c u r r e n t l y e x p e ri e n c e th e f ol l owi n g: • 8 ho ur s p e r w e e k i n l a bor sav e d . • 5 0 0 % i n c r e a s e i n e m a i l CTR ov e r p re v i ou s sy ste m. • 7 0 0 % i n c r e a s e i n l e a d c ap tu re on p e rson al we b si te s ov er previous C TAs. • 2 7 . 4 % o f c l i e n t l i s t s h a ri n g c on te n t an n u al l y . • 6 9 . 2 % o f r e c i pi e n t s e n gagi n g an d op ti n g i n .
ROI CALCULATION • B as ed o n 1 0 0 C l i e n t s • 2 7 . 4 % o f c l i e n t s s h a r e an n u al l y . • 6 9 . 2 % E n g a g e m e n t r a te f or c on te n t sh are d b y c l i e n ts • * Ind u s t r y a v e r a g e c l o se rate on c l i e n t re f e rral s: 70% 1 0 0 x 27 . 4 % x 6 9 . 2 % = 1 9 c l i e n t re f e rral s x 7 0 % i n d u stry sta nda rd clo se ra te = 1 3 ne w c lie n t s p e r year
* S o ur ce : I n f i n a t a , F i n a nc i al Ti me s
FULL SUPPORT GUARANTEES SUCCESS Re lat io ns h i p M a n a g e r s s u p p ort e n te rp ri se s an d h ome offic e s. Cus t o m e r S u c c e s s A s s o c i a te s su p p ort re p re se n tati v e s. O ngo ing e d u c a t i on a n d pr omoti on .
RECRUITING THE BRIGHTEST MINDS OF THE NEXT GENERATION
REALITY CHECK Robo-advisors aren’t the existential threat to financial advisors.
WWW.VESTORLY.COM
