Data & AI Predictions in 2023
As we reveal our data and AI predictions for 2023, join us at 2nd Watch to stay ahead of the curve and propel your business towards innovation and success. How do we know that artificial intelligence (AI) and large language models (LLMs) have reached a tipping point? It was the hot topic at most families’ dinner tables during the 2022 holiday break.
#1. Proactively handling data privacy regulations will become a top priority.
Regulatory changes can have a significant impact on how organizations handle data privacy: businesses must adapt to new policies to ensure their data is secure. Modifications to regulatory policies require governance and compliance teams to understand data within their company and the ways in which it is being accessed.
To stay ahead of regulatory changes, organizations will need to prioritize their data governance strategies. This will mitigate the risks surrounding data privacy and potential regulations. As a part of their data governance strategy, data privacy and compliance teams must increase their usage of privacy, security, and compliance analytics to proactively understand how data is being accessed within the company and how it’s being classified.
#2. AI and LLMs will require organizations to consider their AI strategy.
The rise of AI and LLM technologies will require businesses to adopt a broad AI strategy. AI and LLMs will open opportunities in automation, efficiency, and knowledge distillation. But, as the saying goes, “With great power comes great responsibility.”
There is disruption and risk that comes with implementing AI and LLMs, and organizations must respond with a people- and process-oriented AI strategy. As more AI tools and start-ups crop up, companies should consider how to thoughtfully approach the disruptions that will be felt in almost every industry. Rather than being reactive to new and foreign territory, businesses should aim to educate, create guidelines, and identify ways to leverage the technology.
Moreover, without a well-thought-out AI roadmap, enterprises will find themselves technologically plateauing, teams unable to adapt to a new landscape, and lacking a return on investment: they won’t be able to scale or support the initiatives that they put in place. Poor road mapping will lead to siloed and fragmented projects that don’t contribute to a cohesive AI ecosystem.
#3. AI technologies, like Document AI (or information extraction), will be crucial to tap into unstructured data.
According to IDC, 80% of the world’s data will be unstructured by 2025, and 90% of this unstructured data is never analyzed. Integrating unstructured and structured data opens up new use cases for organizational insights and knowledge mining.
Massive amounts of unstructured data – such as Word and PDF documents – have historically been a largely untapped data source for data warehouses and downstream analytics. New deep learning technologies, like Document AI, have addressed this issue and are more widely accessible. Document AI can extract previously unused data from PDF and Word documents, ranging from insurance policies to legal contracts to clinical research to financial statements. Additionally, vision and audio AI unlocks real-time video transcription insights and search, image classification, and call center insights.
Organizations can unlock brand-new use cases by integrating with existing data warehouses. Finetuning these models on domain data enables general-purpose models across a wide variety of use cases.
#4. “Data is the new oil.” Data will become the fuel for turning general-purpose AI models into domain-specific, task-specific engines for automation, information extraction, and information generation.
Snorkel AI coined the term “data-centric AI,” which is an accurate paradigm to describe our current AI lifecycle. The last time AI received this much hype, the focus was on building new models. Now, very few businesses need to develop novel models and algorithms. What will set their AI technologies apart is the data strategy.
Data-centric AI enables us to leverage existing models that have already been calibrated to an organization’s data. Applying an enterprise’s data to this new paradigm will accelerate a company’s time to market, especially those who have modernized their data and analytics platforms and data warehouses.
#5. The popularity of data-driven apps will increase.
Snowflake recently acquired Streamlit, which makes application development more accessible to data engineers. Additionally, Snowflake introduced Unistore and hybrid tables (OLTP) to allow data science and app teams to work together and jointly off of a single source of truth in Snowflake, eliminating silos and data replication.
Snowflake’s big moves demonstrate that companies are looking to fill gaps that traditional business intelligence (BI) tools leave behind. With tools like Streamlit, teams can harness tools to automate data sharing and deployment, which is traditionally manual and Excel-driven. Most importantly, Streamlit can become the conduit that allows business users to work directly with the AI-native and data-driven applications across the enterprise.
#6. AI-native and cloud-native applications will win.
Customers will start expecting AI capabilities to be embedded into cloud-native applications. Harnessing domain-specific data, companies should prioritize building upon module data-driven application blocks with AI and machine learning. AI-native applications will win over AI-retrofitted applications.
When applications are custom-built for AI, analytics, and data, they are more accessible to data and AI teams, enabling business users to interact with models and data warehouses in a new way. Teams can begin classifying and labeling data in a centralized, data-driven way, rather than manually and often-repeated in Excel, and can feed into a human-in-the-loop system for review and to improve the overall accuracy and quality of models. Traditional BI tools like dashboards, on the other hand, often limit business users to consume and view data in a “what happened?” manner, rather than in a more interactive, often more targeted manner.
#7. There will be technology disruption and market consolidation.
The AI race has begun. Microsoft’s strategic partnership with OpenAI and integration into “everything,” Google’s introduction of Bard and funding into foundational model startup Anthropic, AWS with their own native models and partnership with Stability AI, and new AI-related startups are just a few of the major signals that the market is changing. The emerging AI technologies are driving market consolidation: smaller companies are being acquired by incumbent companies to take advantage of the developing technologies.
Mergers and acquisitions are key growth drivers, with larger enterprises leveraging their existing resources to acquire smaller, nimbler players to expand their reach in the market. This emphasizes the importance of data, AI, and application strategy. Organizations must stay agile and quickly consolidate data across new portfolios of companies.
The AI ball is rolling. At this point, you’ve probably dabbled with AI or engaged in high-level conversations about its implications. The next step in the AI adoption process is to actually integrate AI into your work and understand the changes (and challenges) it will bring. We hope that our data and AI predictions for 2023 prime you for the ways it can have an impact on your processes and people.
Think you’re ready to get started? Find out with 2nd Watch’s data science readiness assessment.