ChatGPT: A Signal of the Next Revolution

What should businesses start considering and what will it mean for future reporting narratives and disclosures?

The next business and economic revolution is upon us; after many interesting conversations, I have begun dubbing it the “Synthetic Revolution”. This revolution is being driven by the rapid advancement of artificial intelligence (AI) and its integration into various industries.

On 30 November 2022, ChatGPT was launched. ChatGPT is a language generation model developed by OpenAI. It uses deep learning techniques to generate human-like text based on the input it is given. It has been trained on a diverse range of internet text, enabling it to answer questions, complete sentences, summarise information and more. 

The goal of ChatGPT is to provide a more natural and intuitive way for humans to interact with artificial intelligence and automate various language tasks. 

Here are four reasons why ChatGPT is profound and significant, and a signal that AI advancement is about to start making very real transformations to how we live, work and make sense of our world:

1. Advanced Natural Language Processing (NLP) capabilities: ChatGPT is trained on a massive amount of text data, which allows it to understand and generate human-like language. This makes it well suited for tasks such as language translation, question answering and text summarisation. It is one of the most accessible AI tools to be launched, which is why its adoption is beyond anything seen before.
2. Large-scale language model: ChatGPT is a large-scale language model, which means it has the capacity to process and understand large amounts of information and generate accurate responses.
3. Open-domain capabilities: Unlike many AI tools that are designed for specific tasks or industries, ChatGPT can be applied to a wide range of applications, making it versatile and useful for many different types of businesses.
4. Easy integration: ChatGPT is designed to be easily integrated with other tools and systems, making it simple for organisations to use in their existing workflows. You can already download the Chrome extension ‘ChatGPT writer’ that, when prompted, responds to your emails for you.

Clearly, this is an exciting time full of opportunity, but one where thoughtful consideration will be required on the implications of applying AI tools to potentially every aspect of an organisation's value chain.

Seeing and exploring a multitude of AI tools, such as ChatGPT, I started discussing this with the team. Particularly, the rapid advancement and application of AI tools, and what we should be discussing and supporting in preparation for future reporting cycles. This revolution is set to have a profound impact on the way we live and work. But how exactly will it change the corporate communication landscape? Let's explore!

In the modern marketplace, AI is playing a critical role in providing personalised experiences and revolutionising the way businesses operate. AI has the ability to offer custom product recommendations and results, bringing a tailored touch to your value proposition. Predictive pricing strategies powered by AI can predict pricing trends and adjust prices in real-time, based on demand and supply, making outdated pricing strategies a thing of the past. 

Moreover, AI can help optimise inventory levels, predicting product demand and eliminating overstocked or empty shelves. Fraud detection is another key area where AI is making a difference, by detecting fake reviews, counterfeit products and suspicious behaviour, ensuring marketplaces remain honest and trustworthy.

In addition, AI-powered automated stakeholder services provide instant, accurate and personalised support, ensuring stakeholder satisfaction. The search capabilities of marketplaces are also revolutionised by AI, with more accurate results and an understanding of stakeholder intent. Predictive analytics, powered by AI, enables businesses to anticipate stakeholder behaviour and make proactive decisions.

Finally, chatbot and voice assistant integration with AI is allowing marketplaces to chat with their stakeholders like never before, using natural language. Overall, the integration of AI in the marketplace is leading to significant advancements and providing seamless value creation and delivery.

The integration of AI into business operations has the potential to revolutionise the traditional business model. AI can automate repetitive tasks, allowing employees to focus on more critical tasks and leading to increased efficiency, productivity and cost savings. Additionally, AI can bring a new level of personalisation to products and services by customising them for each customer. Predictive analytics using AI can help businesses identify patterns and trends in data for informed decision making. Customer service can also be improved with AI, as it can automate responses to common queries and provide more accurate answers to complex ones. The implementation of AI can also create new revenue streams by developing AI-powered products and services. Supply chain processes can be optimised through AI-powered inventory management, demand forecasting and logistics. Finally, AI can assist in identifying and mitigating risks such as fraud and cybersecurity.

Companies implementing AI need to consider several key areas to achieve effective governance. AI has the potential to improve decision making by analysing large amounts of data, and identifying and mitigating risks such as fraud and cybersecurity. To increase transparency and accountability, AI provides a clear record of decision-making processes and outcomes. 

The use of AI raises important ethical considerations, such as privacy and bias, that companies must consider. The board may need to be educated on AI, its potential risks and benefits, as well as new regulations that may arise. Companies are expected to report on their ESG performance, as well as their AI practices, in response to growing stakeholder interest in the ethical and social impact of AI. 

To ensure data privacy and security, companies should establish robust policies and technical safeguards. Bias and fairness should be addressed, and the company should be transparent and explain their use of AI. The company must comply with all relevant laws, regulations and ethical standards, and have a data governance policy in place. 

Technical infrastructure and integration with existing systems and processes should also be considered. 

Stakeholder engagement will be crucial in ensuring their awareness and comfort with the company's AI strategy. When considering AI in their risk framework, companies should consider data privacy and security, governance, ethical considerations and ESG reporting.

If we look in a bit more detail into risk frameworks, organisations reporting on the adoption of such powerful AI will lead to further dialogue, considerations and disclosure on the following: 

• Data privacy and security: companies must protect the confidentiality and sensitivity of information by implementing strong privacy and security policies and technical measures.
• Bias and fairness: to ensure that AI models are unbiased, companies must consider and address the potential for unfairness, promoting transparency and explainability.
• Legal and ethical standards: companies are required to abide by relevant laws, regulations and ethical standards while using AI.
• Data governance: companies must establish a data governance policy to ensure the data used by AI is accurate, reliable and consistent.
• Technical infrastructure: to support the use of AI, companies need to have a secure, stable and scalable technical infrastructure in place.
• Integration with current systems and processes: integration of AI with existing systems and processes should be considered, and any changes required must be implemented.
• ESG reporting: companies should report their AI practices and ESG performance to stakeholders, who are increasingly interested in the ethical and social impact of AI.

It's difficult to predict the exact state of AI over the next couple of years, but it is likely that AI tools like ChatGPT will continue to play an increasingly integrated role in our lives and work. 

The communications team here at JP are passionate about supporting our fantastic clients with their future endeavours. We love working together to simplify even the toughest narratives and come up with communication plans that really resonate with the people that matter most to you. Please contact our team if you have a project you would like us to support you with.