In the movie Moneyball, Oakland A’s General Manager Billy Beane uses an innovative strategy called “sabermetrics” to catapult an underperforming baseball team to success. Bean is introduced to sabermetrics by his assistant Peter Brand (played by Jonah Hill in the film), who has mastered a series of calculations to identify players that other teams underestimate. Brand’s system allows his low-budget A-team to assemble the optimal lineup to continue a record-breaking winning streak.
In the future, every company will have a chance to participate in stories like Moneyball. But these opportunities will come from artificial intelligence, not from smart analysts like Peter Brand.
Companies are already leveraging processes like AI-powered sabermetrics. Volkswagen is using artificial intelligence to design parts for electric vehicles that are much lighter than traditional parts. The company used an AI software-powered process called generative design to reduce the wheel weight by 18% and save 20 pounds. We’ve also shed pounds by redesigning the steering wheel, side mirrors and other parts. The weight savings will allow VW to extend the range of his EVs while maintaining affordability. This is a big step forward for the industry and a potentially big advantage for VW.
Performance optimization
AI is also helping optimize the performance of the corporate bond market. This over-the-counter market does not have a central repository for bids and offers of corporate bonds. Instead, dealers have used manual, inefficient processes to make phone calls to find buyers and sellers for their customers’ bonds. Since the global financial crisis, making deals has become even more difficult. Regulation has made big banks less willing to underwrite full issuances and provide “liquidity” to facilitate transactions. New AI-powered platforms like LTX survey the market to identify dealers and investors likely to be interested in buying or selling specific corporate bonds. LTX’s latest application, BondGPT, is a Large Language Model (LLM) chat feature powered by OpenAI GPT-4 that allows users to ask questions and identify bonds on his LTX trading platform based on user criteria. You can By using machine learning tools to generate this information in real time, these systems help investors and dealers source bonds and complete trades faster and at the best prices. Doing so will increase the liquidity and efficiency of the overall corporate bond market.
I believe AI will create these moneyball opportunities in every industry and every profession. As AI models become more and more powerful, it’s up to each of us to find ways to use that technology to create efficiencies and benefits in our jobs and businesses.
save time
Some of these applications are universal. AI can speed up routine tasks or completely automate them. Consider something as basic as a Sudoku puzzle. For most of us, solving a difficult Sudoku can take 10 minutes or more. Today, anyone can download an AI application that instantly solves even the most difficult puzzles. There are countless ways these capabilities can be applied to your business. As just one example, someone tasked with writing a document or report would have already asked ChatGPT or some other AI platform to write the first draft. Its early versions may not be perfect, but leveraging AI right from the start can save hours of research and organization. Preparing for an important sales meeting or job interview? Let the AI program research the people you plan to meet and create a list of individual questions and issues to discuss.
Other AI applications will be specific to your field or job. For example, financial advisors spend hours matching their clients to the best investment products. AI tools can complete that task instantly, allowing advisors to spend time having real conversations with their clients. In this case, AI recommendations may even offer some advantages over advisor selection. Asking AI to recommend only the most appropriate products for a given client ensures that advisors are adhering to their fiduciary responsibilities and that clients are confident that their recommendations are in their best interests. I can.
These examples are just the tip of the iceberg. In the future, each of us will partner with a talented analyst dedicated to solving problems and finding better ways to work and run our business. These AI programs may not be as exciting as Jonah Hill’s, but if applied correctly, they may uncover moneyball opportunities that will make you and your organization a success.
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