SAP logo is seen at SAP company offices in Woodmead, Johannesburg, South Africa. Photo: Reuters.
SAP logo is seen at SAP company offices in Woodmead, Johannesburg, South Africa. Photo: Reuters.

Three ways AI can be used to reignite economic growth

By Rudeon Snell Time of article published Mar 6, 2020

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JOHANNESBURG - Following Finance Minister Tito Mboweni’s Budget Speech, South Africans can breathe a sigh of relief that their tax burden won't increase in the short term. However, without urgent measures and radical new thinking, the task of accelerating economic growth will be immensely difficult.

While much of the work needs to take place at a policy level, the president and his team have already shown awareness of how important technology is in solving today's challenges and in building our capacity to compete on the future world stage.

The introduction of coding and robotics at primary school level is a welcome development for our country.

Powerful technologies such as Internet of Things, machine learning, artificial intelligence (AI) and advanced analytics could transform our economy and bring unprecedented levels of efficiency to government and industry, unlocking economic growth and kick-starting a sluggish economy.

In the area of AI, the government has an opportunity to take advantage of three opportunities that could support such efforts, including:

* Intelligent robotic process automation for more efficient public services:

An efficient public service is a vital cog in our economic engine, and has been identified as a top priority for President Cyril Ramaphosa’s government, as evidenced by his recent comments that the time it takes to register a business has been reduced from months to a single day.

One of the major obstacles to improved service delivery is the prevalence of slow, manual paper-based processes in critical public services.

According to a Deloitte report, unprecedented budgetary pressure and rising demand on public services have created greater urgency for automation as a measure to free up internal capacity to improve the state’s responsiveness to the public.

The government could unlock immediate improvements in overall efficiency by using robotic process automation (enabled by AI) to automate the processing of permit applications, the renewal of vehicle licences, incident reporting, crime reporting, contract administration, university admissions and a slew of other paper-heavy administrative functions. This also contributes to the establishment of intelligent public enterprises which can meet citizen needs with greater efficiency and agility through the use of conversational AI (chatbots) providing 24/7 service offerings.

Automation would also free frontline public servants up to reduce the amount of time it takes to engage with essential government services, potentially saving the economy billions in lost productivity.

By deploying conversational AI (in the form of chatbots) to key citizen-facing government channels, the state can also expand its channels for citizen interaction while reducing reliance on state employees without diminishing the overall citizen experience.

* Intelligent buildings for improved energy use:

The president has repeatedly indicated his government's interest in building Fourth Industrial Revolution capabilities, with the establishment of a smart city featuring twice in his State of the Nation addresses.

While the idea of building a smart city - slated for Lanseria in Johannesburg - has come in for some criticism, there is no doubt that building greater intelligence into our critical infrastructure is the only way toward a more sustainable future.

Intelligent buildings that combine Internet of Things, AI, and advanced analytics leveraging big data, can improve buildings’ energy efficiency and enable easier integration of sustainable power sources from independent power producers. The move to more environmentally-friendly and sustainable cities can also be accelerated through AI tools that analyse optimal energy usage based on multiple factors, and may assist Eskom by reducing demand at critical times.

In a welcome development, the government has also announced plans to allow municipalities to purchase power directly from independent power producers, specifically those generating renewable energy such as wind and solar.

A combination of these measures may relieve the ongoing shortfalls in our country's electricity generation capacity that has made rolling blackouts a regular feature of South African life.

* AI and robotics in manufacturing to maximise output, minimise defects:

The revival and continued growth of our manufacturing sector has been highlighted as a key enabler of job creation and economic growth by the current administration.

According to a McKinsey report, manufacturers who fail to read, interpret and act on their own machine-generated data to improve their performance and meet dynamic needs of customers will lose out to competitors who can.

According to Accenture, AI-powered technologies could boost profitability by 38percent across 16 industries - including manufacturing - by 2035. By deploying AI and robotics to South Africa’s vital manufacturing sector, the government could improve the quality of manufacturing outputs, generate critical insights through better data analysis, and enable predictive maintenance to reduce critical downtime and maximise output - and profitability.

The introduction of greater automation in the manufacturing sector also creates exciting opportunities to upskill staff with new digital skills to ensure the smooth running of manufacturing environments, enhancing the skills base and building greater competitiveness into the sector and broader economy.

As Mboweni noted in his closing Budget speech remarks, winning takes patience, prudence and perseverance. But technology also gives us an opportunity to accelerate progress exponentially by radically reducing the time it takes to make improvements. AI offers such opportunities: with the correct policies and private sector support, we may yet reignite economic growth and build a better future for all.

Rudeon Snell is a senior director: Intelligent Enterprise Solutions for EMEA at SAP.

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