Consumers Prefer Less Interaction

Table of Contents

  1. What is Technology’s Growing Role with Humans?
  2. What Are Machine Learning, Automation, and AI?
  3. What are Some Technology-based Business Reforms?
  4. Removing Humans from Order Fulfillment
  5. Using Automation in Streamlining In-Store Checkout
  6. Reinventing Commerce with Automation and AI
  7. Conclusion
  8. FAQ

Human error. It’s a common concept now, but consider the implications. Humans make mistakes. Machines don't. Of course, in the real world, this isn't always true. In most tasks to which they're suited, however, computers make mistakes only very rarely, and only on particularly complex tasks.

These days, people are getting more and more comfortable with the idea of handing certain tasks over to computers. From ATMs to self-checkout machines, to self-driving cars, it seems like computers are taking over new tasks every day. How can merchants take advantage of the steady advance of technology to better serve their customers?

What are AI, machine learning, and automation?

When discussing the ways in which technology is taking on new tasks and new challenges, there are three terms that you'll often hear to describe the cutting-edge machines and programs that are breaking these barriers: AI, machine learning, and automation. While it's not uncommon to see these terms used interchangeably, when you get into the specifics, there are differences between them.

Artificial intelligence

AI is a very familiar concept, even if in practice most people don't know how far we've come in the field. AI is the pursuit of developing thinking machines that can perform many of the tasks that humans can. More specifically, these tasks include things like decision-making, creative thinking, and predictive planning. 

AI is decades old, and has been the subject of countless science fiction films and novels in that time. Today, however, much of the original AI research done in the 70s and 80s has splintered into distinct sub-disciplines like optical character recognition, voice recognition, natural language processing, image analysis, and others. Each of these individual areas has flourished, and their advances have enabled technology such as voice assistants and chatbots.

Machine learning

Machine learning is a subset of AI that focuses on the ability of machines to learn on their own using data and automated testing. One prominent example of this is computers that can play chess. These computers traditionally start with data about chess openings and famous games as input, although some newer versions instead start completely from scratch. Then, the computer plays chess against itself millions of times. While simulating these games, it keeps track of what decisions are more likely to lead to winning and what decisions are more likely to lead to losing, building a framework that allows it to weigh the benefits of individual moves.

Typically, machine learning algorithms start by just trying things at random and seeing what works, but as they evolve with time and testing, they can become extremely proficient at whatever task they were created for.

Automation

Automation focuses on the ability of a computer to complete a given task without human intervention. The automated assembly lines that are commonplace in most modern factories are one example, but the tasks those machines are assigned to are simple and repeated. Much of modern automation is focused on tasks that are varied and complex, with self-driving cars being the most prominent example.

How has technology changed business?

The concept of technology changing businesses isn’t new. It’s been happening for hundreds of years.

The industrial revolution saw craftsmen replaced by factories and bespoke production replaced by mass production. The assembly line reduced an employee’s interaction with the end product to a single repeated task. 

Since breaking up processes into simple, repeatable steps, we’ve been able to take advantage of newly developing robotics technology—the first time we were able to completely remove the human element. Instead of people performing these tasks (and introducing the aforementioned human error), simple robots could perform the tasks much faster, and with superhuman levels of precision. While taking advantage of these technological advancements represented a huge financial investment, it’s been paying off for decades.

These types of technological leaps represented a back-end change, in a sense.  While the actual consumers reaped the benefits in the form of better quality and reduced prices, they didn’t see the change directly. In the last few years, however, the tools available have greatly expanded. Now, businesses are able to make changes that directly impact the consumer, removing the human elements that they deal with in their day-to-day lives.

Automating order fulfillment

Many businesses are already taking advantage of new technology to send products to their customers. Larger companies like Amazon and Walmart are testing out drone delivery services. While businesses that move large amounts of inventory will find it cheaper to use a box truck, small businesses may find it advantageous to remove the expense of a third-party shipper, or a delivery driver on staff. Business owners will be able to make use of drones, delivering single packages to customers on the same day, often in minutes of the customer making the order.

Already, most brick-and-mortar stores have digitized inventory systems. The Internet allows for automated restocking, as inventory systems networked with suppliers can automatically place orders when supplies get low. What about the employee who has to receive and stock the goods when they arrive? Once again, we look to Amazon. After acquiring Kiva Systems (now Amazon Robotics) in 2012, they began working on inventory management systems for their warehouses.

These systems didn’t just log inventory; they unloaded trucks, stocked inventory, and pulled shipments for customers.

We can safely assume that, as with most technologies, once they’ve been established, they’ll become affordable enough to be viable for many smaller businesses.

In the near future, when the lights go out and the doors are locked, stores could come alive with the whirring of mechanical stock boys, efficiently refilling shelves for the next day.

Automating in-store checkout

We’ve already seen big box

stores like Walmart, Kroger, and Meijer add self-service lanes where people can check out themselves. Now, even many local grocery stores offer self-checkout, and the trend has also expanded to places like McDonald's.

It won't be long before we see this technology spread to smaller stores, removing yet another human from the equation. Many stores are streamlining the checkout process even further by allowing customers to scan the products into an app on their phones as they put each item in the cart. When customers reach the register, the app simply generates a barcode for the entire order, which the customer scans to get their total payment due.

Reinventing commerce with AI

All these advances, while interesting, are replacing human components with technology. The most interesting possibilities will be in how business owners use these new building blocks to reinvent their businesses.

W. Brian Arthur wrote a piece on something he calls the virtual economy. During his research, he came across an interesting fintech phone app in China “for borrowing money on the fly while shopping.” The app uses voice recognition software to validate the user, then, on the fly, pulls their credit information, shops them around to lenders, and gives the available options to the user in seconds.

Since before the turn of the century, business and commerce have driven innovation, limited only by the tools at their disposal. As technology advances, those toolsets expand, and the limits begin to evaporate. As the need for human employees fades away, we can only imagine the new era of commerce that this technology will usher us in to.

FAQ

Is technology reducing human interaction?

In some ways, yes. However, intelligent machines are also creating new avenues for human interaction, and potentially supporting new ways for humans to interact in business and their personal lives.
 

Why is human interaction important in business?

Business is essentially a human-to-human practice. Even your cardholders making purchases is a major part of your business’s human interaction. However, with an increasing emphasis on online shopping and digital commerce, human interaction in business is starting to be shaped by intelligent technology.
 

How does automation affect business?

Automation streamlines mundane activities like making payments, making sales, and collecting data. This, in turn, puts more importance on human decision-making and insight to drive business and business technology.

 


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