Applied Artificial Intelligence: An Introduction For Business Leaders

by Mariya Yao

Pick the Right “True North” Metric How can you tell if your AI strategy is creating long-term and sustainable value? Answering this question can be the most difficult and most impactful step of your machine learning process. Even after you've ascertained that an AI initiative is likely to positively impact the bottom line of your business, you need to define a more specific "true north" metric for each major project in order to keep your machine learning projects on the right trajectory. Goals like "Increase revenue by X dollars" or "Cut costs by Y percent" are almost always too high-level to be useful, since a confluence of intermediate factors drive your end result. Choosing a more specific metric helps you to qualify your AI strategy and also check that your decisions align and advance your business and technology in the right direction. Facebook's true north metric for platform growth is the number of members who connect with ten friends in seven days.(77) Just having a user sign up for an account is insufficient to inspire the engagement rates that Facebook needs to later monetize that user through advertising. Similarly, Slack focuses on teams that have exchanged at least 2,000 messages.(78) Once a team has reached this threshold of usage, they're much more likely to stick around and eventually upgrade to paid plans. Identifying the right true north metric can be a challenge. Ask yourself the following questions to avoid the common mistakes executives make. Is this a...