Just like “the cloud” turned out to be something programmers handled long before the term became trendy, AI is now creating more buzz in the stock market than anywhere else.
You’d think small business owners would have learned their lesson chasing trends like “the cloud,” but I can’t blame them. I’ve been working in electronics and programming for 65 years, and I still don’t fully understand the physics of how it all works.
While we’ve made huge advances in data processing over the past 50 years, it’s important to know that the term “AI” was first used in 1956 at Dartmouth College. It was originally meant to inspire students to design “expert systems” that enhanced existing products rather than replacing them.
Unfortunately, by the mid-1970s, that vision faded when the “nerds” took over the small business computer industry, and IBM fumbled, handing the market to a college dropout with an office near a gentlemen’s club in Arizona. Funny enough, it’s true — Bill Gates became the second richest man in the world partly because his mother sat next to the IBM president at a United Way meeting.
AI is no longer a distant dream; it’s here, shaping our daily lives and transforming industries at a rapid pace. Yet, despite its growing influence, many are only beginning to scratch the surface of what AI can do. Understanding AI isn’t optional anymore — it’s essential.
What Is Artificial Intelligence?
You may be wondering. Don’t worry, you’re not alone. I’ve been working with computers since the 1970s, and it’s still a tricky question to answer. It’s not that I don’t know what AI is — it’s that the answer depends on the perspective of the person asking.
It’s like asking, “Can you explain transportation?” You might be an expert, while I just know how to drive my truck. Both of us see transportation differently.
Most people think data processing experts are geniuses. That’s not always true. I’ve met plenty of mediocre programmers who, despite themselves, have written brilliant code. But they often don’t share their knowledge because they fear judgment. Enough psychoanalysis.
At its core, AI is the simulation of human intelligence by machines.
Take this example: 1+1 = … and your calculator replies “2”. That’s AI. Now, expand that to the Terminator movie, where Arnold Schwarzenegger plays a machine who ends up saving a kid he was sent to kill. Computers can learn, reason, solve problems, understand language and adapt — but they’re no smarter than your calculator or your watch. Computers have no soul. The killer robot in the movie only saves the kid because a programmer told it to do so.
We build factories to produce goods, but when a part breaks, human intervention is still needed to create a workaround. AI leverages vast datasets and techniques like machine learning, deep learning and natural language processing to predict, automate and understand more than you might expect.
AI ranges from narrow AI, which focuses on specific tasks (like chatbots or voice assistants), to general AI, which aims to match human intelligence. Today, narrow AI dominates, but general AI is advancing quickly and could arrive sooner than we think.
In Part 2, we’ll discuss why AI is crucial for modern business.
Bill Scott, boasting 48 years of experience, is the president of StoreReport and StoreReportAI. Scott works with large IBM systems, specifically AS400s. Most of his career has been spent in oil and gas distribution and convenience store industry management. Scott started selling computers and software in this space in 1980, and currently focuses on research, writing, consulting and speaking about AI and inventory management.
