AI can have practical uses which can boost productivity.
AI can have practical uses which can boost productivity.
Let’s face it, for all the hype in the past year, AI has mostly sucked.
We’ve been “wowed” with new songs by dead singers, deep fake political attacks and a glorified search engine that can answer your questions in Shakespearean sonnet form.
For most of us, the only economic upsideof AI has been a United States stock market tech boom that has lifted KiwiSaver balances despite the doldrums of the local NZX.
But unless AI starts delivering real productivity gains for business fast, there’s a risk that the bubble will pop - like the tech wreck of 2000.
On that basis, it was refreshing to see Spark’s new AI and advanced digital technology showcase focused exclusively on practical real-world applications that will deliver gains.
There were no robot dogs or goofy interactive avatars on display at Spark headquarters this week.
Instead, we saw smart cameras that can be mounted to cars to inspect roads for potholes.
Replacing the slow and laborious travels of two roading engineers, the camera can road identify a range of different surface defects as it drives over them, sort them by size and shape and send them back to head office with GPS co-ordinates - where they can join the queue for eventual repair.
A road assessment that once took 66 days to complete now takes just seven days, Spark says. And road assessors can cover 300km a day compared to the 15km a day achievable using the traditional approach.
Another upside of the AI analysis is much improved macro-data which can build a more accurate picture of which regions are in need of the most attention.
We saw similar technology which can count and scan containers for a freight company without the need for a human to enter the warehouse.
By leveraging an on-site private 5G network, cameras connected to an intelligent computer vision platform can help instantly recognise container codes as they enter and exit gates.
They also check for damage and provide near real-time inventory accuracy for efficient inventory management, Spark says.
We also saw smart meters that can monitor land slippage for geologists and water quality for biologists - in real-time without the need for slow and muddy fieldwork.
And we saw new augmented reality tools to enhance and improve remote medical consultations for GPs.
It’s these kinds of unsexy efficiency gains - not (with all due respect to Peter Jackson) new Beatles songs - that make AI so promising.
These are the advances that will reduce labour costs and energy consumption and ultimately drive down inflation.
To back up its big AI push Spark has published a new study (by NZIER economists which found that a 20 per cent uplift in advanced digital technologies could boost productivity and increase industry output by up to $26 billion in the next decade.
That could potentially boost GDP by up to 2.08 per cent, the study found.
Spark chief executive Jolie Hodson. Photo / Dean Purcell.
Unsurprisingly, for anyone who’s followed New Zealand’s efforts to boost productivity for the past 25 years, we don’t lead the world in adopting this stuff.
In 2022, New Zealand dropped four places in the IMD World Digital Competitiveness Ranking from 23 to 27.
“While New Zealand has one of the highest rates of digital infrastructure development, and has formulated digital strategies and action plans, we have not been able to capitalise on the productivity benefits of digital technologies,” the report says.
“Without clear goals and measures to monitor progress and compare ourselves to other countries, we are flying blind.”
Adoption of digital technology accelerated during Covid said Spark chief executive Jolie Hodson. But we were failing to leverage that growth and take advantage of it, relative to our OECD peers, she said.
“New Zealanders work longer and harder than their counterparts in other developed countries, and we face scale challenges due to our smaller population and geographic isolation.
“This is a persistent challenge that has seen little change over many decades. What is changing, however, is the urgent need to address it.”
The population was growing fast and ageing fast, she said.
Inflation and environmental challenges were “forcing a greater focus on efficiency and cost control within the business community”.
The report concludes that a “digital equity strategy for Aotearoa is urgently needed. This strategy must be linked to Aotearoa’s digital strategy and plans for a just transition.”
To help boost the adoption of advanced digital technologies Spark has launched a $15 million innovation fund (for Spark business customers) over the next three years.
Some $12m was allocated to customers already, with an additional $3m will be available for customers to apply for, Hodson said.
Spark has also launched a mini-MBA scholarship for local executives focused specifically on AI for business.
The scholarship is offered in partnership with the US business school section. Applications for the four-week course (which begins in May) are open to Spark business customers now and until April 4.
Liam Dann is Business Editor-at-Large for the New Zealand Herald. He is a senior writer and columnist, and also presents and produces videos and podcasts. He joined the Herald in 2003.
