10.1 c h a p t e r 10 managing knowledge: knowledge work and artificial intelligence

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c h a p t e r

1010 MANAGING MANAGING

KNOWLEDGE: KNOWLEDGE: KNOWLEDGE WORK KNOWLEDGE WORK

AND ARTIFICIAL AND ARTIFICIAL INTELLIGENCEINTELLIGENCE

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LEARNING OBJECTIVESLEARNING OBJECTIVES

• EXPLAIN ORGANIZATIONAL KNOWLEDGE EXPLAIN ORGANIZATIONAL KNOWLEDGE MANAGEMENTMANAGEMENT

• DESCRIBE USEFUL APPLICATIONS FOR DESCRIBE USEFUL APPLICATIONS FOR DISTRIBUTING, CREATING, SHARING DISTRIBUTING, CREATING, SHARING KNOWLEDGEKNOWLEDGE

• EVALUATE ROLE OF ARTIFICIAL EVALUATE ROLE OF ARTIFICIAL INTELLIGENCE IN KNOWLEDGE INTELLIGENCE IN KNOWLEDGE MANAGEMENTMANAGEMENT

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LEARNING OBJECTIVESLEARNING OBJECTIVES

• DEMONSTRATE HOW ORGANIZATIONS DEMONSTRATE HOW ORGANIZATIONS USE EXPERT SYSTEMS, CASE-BASED USE EXPERT SYSTEMS, CASE-BASED REASONING TO CAPTURE KNOWLEDGEREASONING TO CAPTURE KNOWLEDGE

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QUAKER CHEMICAL QUAKER CHEMICAL

• Quaker Chemical, based, Pennsylvania, is a Quaker Chemical, based, Pennsylvania, is a worldwide producer of worldwide producer of custom-formulatedcustom-formulated chemical specialty productschemical specialty products and and fluid fluid management services.management services.

• Clients: Clients: –Makers of automotive – Aerospace products– Firms in the environment– Can industries– Pulp industries and paper industries.

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QUAKER CHEMICALQUAKER CHEMICAL

Recently underwent a global Recently underwent a global reorganization so that its reorganization so that its sales staff now sells by sales staff now sells by

business linebusiness line rather than rather than by by geographic regiongeographic region..

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• Quaker needed a system that could Quaker needed a system that could rise aboverise above regional barriers and regional barriers and help its sales force:help its sales force:

– Track, manage, and collaborate on client services and accounts

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• Developing new chemical formulas for Developing new chemical formulas for automakersautomakers

• Determining why sales at certain North Determining why sales at certain North American mills are down.American mills are down.

• These problems could be more easily These problems could be more easily solved if the company could solved if the company could gather gather information stored on workers' computers information stored on workers' computers and in their headsand in their heads and make it more and make it more widely available. widely available.

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• Quaker doesn't have off-the-shelf Quaker doesn't have off-the-shelf products.products.

• Quaker formulates unique products Quaker formulates unique products for every customer.for every customer.

capturing what Quaker's laboratory capturing what Quaker's laboratory workers know about Quaker workers know about Quaker

formulas is especially critical.formulas is especially critical.

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QUAKER CHEMICALQUAKER CHEMICAL• In mid-2000, Quaker launched a In mid-2000, Quaker launched a

KNOWLEDGE MANAGEMENT SYSTEMKNOWLEDGE MANAGEMENT SYSTEM called called Quaker Business IntelligenceQuaker Business Intelligence, or , or QBI. QBI.

• The system is a The system is a global intranetglobal intranet with with collaborative software from collaborative software from Intraspect Intraspect Software of BrisbaneSoftware of Brisbane, California, , California, working in conjunction with working in conjunction with Quaker's Quaker's Novell GroupWiseNovell GroupWise collaboration collaboration systemsystem

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QUAKER CHEMICALQUAKER CHEMICAL• Employees can Employees can DROPDROP word processing word processing

documents, e-mail, Web pages, documents, e-mail, Web pages, presentations, and spreadsheets in presentations, and spreadsheets in CENTRAL FILESCENTRAL FILES into the system. into the system.

• They can They can SUBSCRIBESUBSCRIBE to certain folders to certain folders relating to their jobs in the same way they relating to their jobs in the same way they would subscribe to an e-mail mailing list.would subscribe to an e-mail mailing list.

• The system ALERTS them automatically The system ALERTS them automatically when changes are made to the individual when changes are made to the individual files files RELATING TO THEIR JOBRELATING TO THEIR JOB tasks. tasks.

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QUAKER CHEMICALQUAKER CHEMICAL• When an employee When an employee LOGSLOGS on to his or her on to his or her

computer, the Intraspect software computer, the Intraspect software POPS UPPOPS UP with the look and feel of a simple Web page. with the look and feel of a simple Web page. Employees can Employees can CONTROL CONTROL what is added to what is added to their "their "HOME PAGEHOME PAGE" or to the files belonging " or to the files belonging to their group and they can customize their to their group and they can customize their home page to fit their job needs. home page to fit their job needs.

• The Intraspect system can beThe Intraspect system can be INTEGRATED INTEGRATED with a data warehouse that Quaker uses to with a data warehouse that Quaker uses to track its track its FINANCIAL INFORMATIONFINANCIAL INFORMATION..

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QUAKER CHEMICALQUAKER CHEMICAL• About About 800800 of Quaker's of Quaker's 1,1001,100

WORKERSWORKERS use the Intraspect use the Intraspect system. system.

• According to Thomas Baker, According to Thomas Baker, Quaker's manager of business Quaker's manager of business intelligence development, the intelligence development, the system stores nearly system stores nearly 27,00027,000 documents in over documents in over 7,0007,000 folders. folders.

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QUAKER CHEMICALQUAKER CHEMICAL• PREVIOUSLYPREVIOUSLY, if a manager had trouble finding out , if a manager had trouble finding out

why a customer experienced why a customer experienced SURFACE SURFACE IMPERFECTIONSIMPERFECTIONS while rolling steel in a specific while rolling steel in a specific type of mill, he or she would type of mill, he or she would E-MAIL OTHER E-MAIL OTHER QUAKER COLLEAGUESQUAKER COLLEAGUES. .

• NOWNOW that manager can that manager can INITIATE A DISCUSSIONINITIATE A DISCUSSION within QBI, sending an alert to all managers in the within QBI, sending an alert to all managers in the company's steel division. company's steel division.

• The system archives the message threads from The system archives the message threads from that discussion and these threads can be that discussion and these threads can be ACCESSED LATERACCESSED LATER by workers trying to answer a by workers trying to answer a SIMILAR QUESTIONSIMILAR QUESTION..

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QUAKER CHEMICALQUAKER CHEMICAL• Many of these benefits are Many of these benefits are DIFFICULT DIFFICULT

TO QUANTIFYTO QUANTIFY. .

• However, Quaker claims that QBI has However, Quaker claims that QBI has already saved the company already saved the company FOUR FOUR MONTHSMONTHS of labor worth of labor worth $300,000$300,000 by by enabling enabling THREE DIFFERENT LAB THREE DIFFERENT LAB SITESSITES to access formulas stored in the to access formulas stored in the system rather than system rather than DUPLICATEDUPLICATE the the research.research.

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MANAGEMENT CHALLENGESMANAGEMENT CHALLENGES• Designing knowledge systems that Designing knowledge systems that

GENUINELY ENHANCEGENUINELY ENHANCE organizational organizational performance. performance.

• Information systems that truly enhance Information systems that truly enhance the productivity of knowledge workers the productivity of knowledge workers may be difficult to build because the may be difficult to build because the manner in which information technology manner in which information technology can enhance higher-level tasks, such as can enhance higher-level tasks, such as those performed by those performed by MANAGERSMANAGERS and and professionals, is professionals, is NOT ALWAYS CLEARLY NOT ALWAYS CLEARLY UNDERSTOODUNDERSTOOD. .

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MANAGEMENT CHALLENGESMANAGEMENT CHALLENGES

• Some aspects of organizational knowledge Some aspects of organizational knowledge cannot be cannot be CAPTURED EASILY OR CAPTURED EASILY OR CODIFIEDCODIFIED..

• The information that organizations finally The information that organizations finally manage to capture may become manage to capture may become OUTDATEDOUTDATED as environments change.as environments change.

• It is It is VERY DIFFICULTVERY DIFFICULT to to INTEGRATEINTEGRATE knowledge management programs with knowledge management programs with business strategybusiness strategy..

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MANAGEMENT CHALLENGESMANAGEMENT CHALLENGES– IDENTIFYING and implementing

APPROPRIATE organizational applications for ARTIFICIAL INTELLIGENCE.

–Only CERTAIN KINDS of information problems are APPROPRIATE for artificial intelligence (AI) applications.

–Many AI applications IMPROVE performance through TRIAL AND ERROR and may not be reliable enough for MISSION-CRITICAL PROBLEMS.

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MANAGEMENT CHALLENGESMANAGEMENT CHALLENGES–EXPERT SYSTEMS are EXPENSIVE and

TIME-CONSUMING to maintain because their rules must be reprogrammed every time there is a change in the organizational environment. –MANY THOUSANDS of businesses have

undertaken experimental projects in expert systems, but ONLY A SMALL percentage have created expert systems that ACTUALLY CAN BE USED ON A PRODUCTION BASIS.

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KNOWLEDGE MANAGEMENT IN KNOWLEDGE MANAGEMENT IN THE ORGANIZATIONTHE ORGANIZATION

• As knowledge becomes a As knowledge becomes a CENTRAL CENTRAL PRODUCTIVEPRODUCTIVE and and STRATEGIC ASSET. STRATEGIC ASSET. ORGANIZATIONAL SUCCESS increasingly ORGANIZATIONAL SUCCESS increasingly DEPENDSDEPENDS on the firm's ability to: on the firm's ability to:– PRODUCE KNOWLEDGE– GATHER KNOWLEDGE– STORE KNOWLEDGE– DISSEMINATE KNOWLEDGE. –With KNOWLEDGE, firms become more

EFFICIENT and EFFECTIVE in their use of scarce resources.

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• 55 percent of the U.S. labor force consists of 55 percent of the U.S. labor force consists of knowledge and information workers.knowledge and information workers.

• Producing unique products or services or Producing unique products or services or producing them at a lower cost than competitors producing them at a lower cost than competitors is based on is based on SUPERIOR KNOWLEDGESUPERIOR KNOWLEDGE of the of the production process and superior design.production process and superior design.

• KnowingKnowing how to do things effectively and how to do things effectively and efficiently in ways that other organizations cannot efficiently in ways that other organizations cannot duplicate is a duplicate is a PRIMARY SOURCE OF VALUEPRIMARY SOURCE OF VALUE and a and a factor in production that cannot be purchased in factor in production that cannot be purchased in external markets. external markets.


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• Some management theorists Some management theorists believe that these believe that these KNOWLEDGE KNOWLEDGE ASSETSASSETS are as important as the are as important as the PHYSICALPHYSICAL and and FINANCIALFINANCIAL assets.assets.


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• KNOWLEDGE MANAGEMENTKNOWLEDGE MANAGEMENT refers to the refers to the SET OF PROCESSESSET OF PROCESSES developed in an developed in an organization to organization to CREATECREATE, , GATHERGATHER, , STORESTORE, , TRANSFERTRANSFER, and , and APPLYAPPLY knowledge. knowledge.

• INFORMATION TECHNOLOGYINFORMATION TECHNOLOGY plays an plays an important role in knowledge management important role in knowledge management by by SUPPORTING THESE BUSINESS SUPPORTING THESE BUSINESS PROCESSESPROCESSES for creating, identifying, and for creating, identifying, and leveraging knowledge throughout the leveraging knowledge throughout the organization.organization.


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• Organizations create and gather knowledge Organizations create and gather knowledge through a variety of through a variety of ORGANIZATIONAL ORGANIZATIONAL LEARNINGLEARNING mechanisms. mechanisms.

• Through:Through:• TRIALTRIAL and and ERRORERROR• CAREFUL MEASUREMENTCAREFUL MEASUREMENT of planned of planned

activities.activities.• FEEDBACKFEEDBACK from customers and the from customers and the

environment in general.environment in general.Organizations create new Organizations create new SOPsSOPs and business and business

processes that reflect their experienceprocesses that reflect their experience


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CHIEF KNOWLEDGE OFFICER (CKO)CHIEF KNOWLEDGE OFFICER (CKO)

DIGITAL FIRM:DIGITAL FIRM:

• The chief knowledge officer is a The chief knowledge officer is a SENIOR EXECUTIVESENIOR EXECUTIVE who is who is responsible for the responsible for the FIRM'S FIRM'S

KNOWLEDGE MANAGEMENT KNOWLEDGE MANAGEMENT PROGRAMPROGRAM. .

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• This knowledge base may include:This knowledge base may include:

1.1. Structured, Structured, INTERNAL KNOWLEDGEINTERNAL KNOWLEDGE (explicit (explicit knowledge), such as product manuals or knowledge), such as product manuals or research reportsresearch reports

2.2. EXTERNAL KNOWLEDGEEXTERNAL KNOWLEDGE of competitors, of competitors, products, and markets, including competitive products, and markets, including competitive intelligence intelligence

3.3. INFORMALINFORMAL, internal knowledge, often called , internal knowledge, often called TACIT KNOWLEDGETACIT KNOWLEDGE, which resides in the minds , which resides in the minds of individual employees but has not been of individual employees but has not been documented in structured formdocumented in structured form

Systems and Infrastructure for Knowledge Management

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Companies can use information systems to Companies can use information systems to codify their codify their BEST PRACTICESBEST PRACTICES and make and make knowledge of these practices widely knowledge of these practices widely available to employeesavailable to employees

BEST PRACTICESBEST PRACTICESSuccessful solutions or problem-solving Successful solutions or problem-solving

methods developed by specific methods developed by specific organization or industryorganization or industry


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• The knowledge can be The knowledge can be PRESERVEDPRESERVED as as ORGANIZATIONAL MEMORYORGANIZATIONAL MEMORY to to TRAIN TRAIN FUTUREFUTURE employees or to help them with employees or to help them with decision makingdecision making

ORGANIZATIONAL MEMORYORGANIZATIONAL MEMORY

• Stored learning from organization’s history Stored learning from organization’s history • Used for decision making and other purposesUsed for decision making and other purposes


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KNOWLEDGE MANAGEMENT IN THE KNOWLEDGE MANAGEMENT IN THE ORGANIZATIONORGANIZATION

KNOWLEDGE MANAGEMENT:KNOWLEDGE MANAGEMENT:

Office Automation Systems Office Automation Systems (OAS)(OAS)

Knowledge Work Systems Knowledge Work Systems (KWS)(KWS)

Group Collaboration Systems Group Collaboration Systems (GCS)(GCS)

Artificial Intelligence Applications Artificial Intelligence Applications (AI)(AI)

**

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• Information WorkInformation Work is work that consists primarily is work that consists primarily of of CREATING OR PROCESSING INFORMATIONCREATING OR PROCESSING INFORMATION..

• It is carried out by It is carried out by Information workersInformation workers who who usually are divided into two subcategories: usually are divided into two subcategories:

1.1. DATA WORKERS,DATA WORKERS, who primarily process and who primarily process and disseminate information disseminate information

2.2. KNOWLEDGE WORKERS,KNOWLEDGE WORKERS, who primarily create who primarily create knowledge and information.knowledge and information.

INFORMATION AND KNOWLEDGE WORK SYSTEMS

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• Most data work and a great Most data work and a great deal of knowledge work deal of knowledge work takes place in offices, takes place in offices, using office systems using office systems including most of the work including most of the work done by managersdone by managers

Distributing Knowledge: Office and Document Management

Systems

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Office systemsOffice systems

• Manage and coordinate work of data and Manage and coordinate work of data and knowledge workersknowledge workers

• Connect work of local information workers Connect work of local information workers with all levels and functions of organizationwith all levels and functions of organization

• Connect organization to external worldConnect organization to external world

• Example: Word processing, voice mail, and Example: Word processing, voice mail, and imagingimaging

Distributing Knowledge: Office and Document Management

Systems

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The Three Major Roles of Offices

Figure 10-2

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OFFICE WORKERSOFFICE WORKERS

Office workers span a very Office workers span a very broad range: professionals, broad range: professionals,

managers, sales, and clerical managers, sales, and clerical workers working alone or in workers working alone or in

groups. Their major activities groups. Their major activities include the following:include the following:

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OFFICE AUTOMATION OFFICE AUTOMATION SYSTEMSSYSTEMS

MANAGING DOCUMENTS:MANAGING DOCUMENTS:

• CREATIONCREATION• STORAGESTORAGE• RETRIEVALRETRIEVAL• DISSEMINATIONDISSEMINATION• TECHNOLOGY:TECHNOLOGY: Word processing, Word processing,

desktop publishing, document imaging, desktop publishing, document imaging, Web publishing, work flow managersWeb publishing, work flow managers

**

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SCHEDULING:SCHEDULING: FOR INDIVIDUALS & GROUPS:FOR INDIVIDUALS & GROUPS:

• ELECTRONIC CALENDARSELECTRONIC CALENDARS

• GROUPWAREGROUPWARE

• INTRANETSINTRANETS

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COMMUNICATING:COMMUNICATING: INITIATING, RECEIVING, MANAGING:INITIATING, RECEIVING, MANAGING:• VOICEVOICE• DIGITALDIGITAL• DOCUMENTSDOCUMENTS• TECHNOLOGY:TECHNOLOGY: E-mail, voice mail, E-mail, voice mail,

digital answering systems, GroupWare, digital answering systems, GroupWare, intranetsintranets

**

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OFFICE AUTOMATION SYSTEMSOFFICE AUTOMATION SYSTEMSMANAGING DATA:MANAGING DATA:

EMPLOYEES, EMPLOYEES, CUSTOMERSCUSTOMERS, VENDORS:, VENDORS:

1.1. DESKTOP DATABASESDESKTOP DATABASES

2.2. SPREADSHEETSSPREADSHEETS

3.3. USER-FRIENDLY INTERFACES TO USER-FRIENDLY INTERFACES TO MAINFRAME DATABASESMAINFRAME DATABASES

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• DOCUMENT IMAGING SYSTEMS:DOCUMENT IMAGING SYSTEMS: Systems Systems convert documents, images into digital convert documents, images into digital form (e.g.: optical character recognition; form (e.g.: optical character recognition; microfiche)microfiche)

• JUKEBOX:JUKEBOX: Storage & retrieving device for Storage & retrieving device for CD-ROMs & other optical disksCD-ROMs & other optical disks

• INDEX SERVER:INDEX SERVER: Imaging system to store / Imaging system to store / retrieve documentretrieve document

**

OFFICE AUTOMATION SYSTEMSOFFICE AUTOMATION SYSTEMS Document Management : :

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Components of an Imaging System

Figure 10-3

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Web Publishing and Document Management

Figure 10-4

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CREATE KNOWLEDGECREATE KNOWLEDGEKNOWLEDGE WORK SYSTEMS:KNOWLEDGE WORK SYSTEMS:

INFORMATION SYSTEMS THAT AID INFORMATION SYSTEMS THAT AID KNOWLEDGE WORKERS TO KNOWLEDGE WORKERS TO CREATE, CREATE, INTEGRATEINTEGRATE NEW KNOWLEDGE IN NEW KNOWLEDGE IN ORGANIZATIONORGANIZATION

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REQUIREMENTS OF REQUIREMENTS OF KNOWLEDGE WORK SYSTEMSKNOWLEDGE WORK SYSTEMS

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CREATE KNOWLEDGECREATE KNOWLEDGEKNOWLEDGE WORKERS:KNOWLEDGE WORKERS:

1.1. KEEP ORGANIZATION UP-TO-DATE IN KEEP ORGANIZATION UP-TO-DATE IN KNOWLEDGE:KNOWLEDGE: Technology; science; Technology; science; thought; the artsthought; the arts

2.2. INTERNAL CONSULTANTS IN THEIR INTERNAL CONSULTANTS IN THEIR AREAS.AREAS.

3.3. CHANGE AGENTS:CHANGE AGENTS: Evaluating; initiating; Evaluating; initiating; promoting changepromoting change projects projects

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CAD/CAM CAD/CAM

• Computer Aided Design/Computer Aided Computer Aided Design/Computer Aided Manufacturing: Provides precise control Manufacturing: Provides precise control over industrial design, manufacturingover industrial design, manufacturing

VIRTUAL REALITYVIRTUAL REALITY

• Interactive softwareInteractive software creates photorealistic creates photorealistic simulations of real world objects (Virtual simulations of real world objects (Virtual Reality Modeling Language: Reality Modeling Language: VRMLVRML))

CREATE KNOWLEDGECREATE KNOWLEDGEEXAMPLES KNOWLEDGE EXAMPLES KNOWLEDGE

SYSTEMSSYSTEMS

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INVESTMENT WORKSTATIONSINVESTMENT WORKSTATIONS• investment workstations is investment workstations is High-end PCsHigh-end PCs used in used in financefinance

to to analyze analyze trading situations, that trading situations, that integrateintegrate a wide range of a wide range of data from both data from both internal internal and and external external sources, including sources, including contact management data, real-time and historical market contact management data, real-time and historical market data, and research reports. data, and research reports.

• Previously, financial professionals had to spend Previously, financial professionals had to spend considerable time accessing data from separate systems considerable time accessing data from separate systems and piecing together the information they needed. and piecing together the information they needed.

By providing one-stop information faster and with fewer By providing one-stop information faster and with fewer errors.errors.

CREATE KNOWLEDGECREATE KNOWLEDGEEXAMPLES KNOWLEDGE EXAMPLES KNOWLEDGE

SYSTEMSSYSTEMS

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SHARE KNOWLEDGESHARE KNOWLEDGEGROUP COLLABORATION SYSTEMS:GROUP COLLABORATION SYSTEMS:

• GROUPWARE:GROUPWARE: Allows Allows interactive interactive collaborationcollaboration..

• Communication, Collaboration, and Communication, Collaboration, and coordination.coordination.

• It allows groups to work together on:It allows groups to work together on:• DocumentsDocuments• Schedule meetings,Schedule meetings,• Access shared folders, Access shared folders, • Participate in electronic discussionsParticipate in electronic discussions• Develop shared databasesDevelop shared databases• Send e-mail.Send e-mail.

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• INTRANETS:INTRANETS: Good for relatively stable Good for relatively stable information in information in central repositorycentral repository..

• Ford Motor CompanyFord Motor Company• Intranet delivers information about news, Intranet delivers information about news,

people, processes, products, and competition people, processes, products, and competition to 95,000 professional employees. to 95,000 professional employees.

• Employees can access online libraries and a Employees can access online libraries and a Web Center of Excellence with information on Web Center of Excellence with information on best practices, standards, and best practices, standards, and recommendations.recommendations.

10.10.5050 Figure 10-7

ENTERPRISE INFORMATION PORTALSENTERPRISE INFORMATION PORTALS

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• TEAMWARE:TEAMWARE: Consists of Consists of intranet-based intranet-based applicationsapplications for: for:

• Building a work teamBuilding a work team• Sharing ideas and documentsSharing ideas and documents• BrainstormingBrainstorming• Scheduling, tracking the status of tasks and Scheduling, tracking the status of tasks and

projectsprojects• Teamware is similar to groupware, although its Teamware is similar to groupware, although its

application development capabilities are not as application development capabilities are not as powerfulpowerful as those provided by sophisticated as those provided by sophisticated groupware products. groupware products.


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CAPABILITIES OF CAPABILITIES OF GROUPWAREGROUPWARE

• PUBLISHING, REPLICATIONPUBLISHING, REPLICATION

• DISCUSSION TRACKINGDISCUSSION TRACKING

• DOCUMENT MANAGEMENTDOCUMENT MANAGEMENT

• WORK-FLOW MANAGEMENTWORK-FLOW MANAGEMENT

• PORTABILITYPORTABILITY

• APPLICATION DEVELOPMENTAPPLICATION DEVELOPMENT

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ARTIFICIAL INTELLIGENCE ARTIFICIAL INTELLIGENCE (AI) SYSTEMS:(AI) SYSTEMS:

AI:AI: COMPUTER-BASEDCOMPUTER-BASED SYSTEMS SYSTEMS WITH ABILITIES TO LEARN WITH ABILITIES TO LEARN LANGUAGE, ACCOMPLISH TASKS, LANGUAGE, ACCOMPLISH TASKS, USE PERCEPTUAL APPARATUS, USE PERCEPTUAL APPARATUS, EMULATE HUMAN EXPERTISE & EMULATE HUMAN EXPERTISE & DECISION MAKINGDECISION MAKING

**

AI

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AI FAMILYAI FAMILY

NATURALNATURALLANGUAGELANGUAGE

ROBOTICSROBOTICS PERCEPTIVEPERCEPTIVESYSTEMSSYSTEMS

EXPERTEXPERTSYSTEMSSYSTEMS

INTELLIGENTINTELLIGENTMACHINESMACHINES

ARTIFICIALARTIFICIALINTELLIGENCEINTELLIGENCE

AI

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AIBUSINESS INTERESTS BUSINESS INTERESTS IN AI IN AI

1.1. PRESERVE EXPERTISEPRESERVE EXPERTISE2.2. CREATE KNOWLEDGE BASECREATE KNOWLEDGE BASE3.3. MECHANISM NOT SUBJECT TO FEELINGS, MECHANISM NOT SUBJECT TO FEELINGS,

FATIGUE, WORRY, CRISISFATIGUE, WORRY, CRISIS4.4. ELIMINATE ROUTINE / UNSATISFYING JOBSELIMINATE ROUTINE / UNSATISFYING JOBS5.5. ENHANCE KNOWLEDGE BASE (generating ENHANCE KNOWLEDGE BASE (generating

solutions to specific problems that are too solutions to specific problems that are too massive and complex to be analyzed by human massive and complex to be analyzed by human beings in a short period of time)beings in a short period of time)

**

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Rules in an AI Program

ARTIFICIAL INTELLIGENCE

Figure 10-9

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EXPERT SYSTEMSEXPERT SYSTEMS

KNOWLEDGE - INTENSIVE KNOWLEDGE - INTENSIVE CAPTURES HUMAN EXPERTISE CAPTURES HUMAN EXPERTISE

IN LIMITED DOMAINS OF IN LIMITED DOMAINS OF KNOWLEDGEKNOWLEDGE

**

AI

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• KNOWLEDGE BASE:KNOWLEDGE BASE: Model of Human Model of Human KnowledgeKnowledge

• RULE - BASED EXPERT SYSTEM :RULE - BASED EXPERT SYSTEM : AI system AI system based on IF - THEN statements (Bifurcation); based on IF - THEN statements (Bifurcation); Rule Base: Collection of IF - THEN knowledgeRule Base: Collection of IF - THEN knowledge

• KNOWLEDGE FRAMESKNOWLEDGE FRAMES:: Knowledge organizes Knowledge organizes in chunks based on shared relationshipsin chunks based on shared relationships

**

AI

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• AI SHELL:AI SHELL: Programming environment of Programming environment of expert systemexpert system

• INFERENCE ENGINE:INFERENCE ENGINE: Search through rule Search through rule basebase– FORWARD CHAINING:FORWARD CHAINING: Uses input;

searches rules for answer– BACKWARD CHAINING:BACKWARD CHAINING: Begins with

hypothesis, seeks information until hypothesis accepted or rejected (Should we add this person to the prospect database?)

AI

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ARTIFICIAL INTELLIGENCE

Figure 10-10

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Building an Expert System

• The The team membersteam members must must selectselect a problem a problem appropriate for an expert system. appropriate for an expert system.

• The project will The project will balancebalance potential potential savingssavings from the from the proposed system against the proposed system against the cost.cost.

• The team members will develop The team members will develop a prototypea prototype system to system to test assumptionstest assumptions about how to encode about how to encode the knowledge of experts. the knowledge of experts.

• Next, they will develop a Next, they will develop a full-scale systemfull-scale system, , focusing mainly on the addition of a focusing mainly on the addition of a very large very large number of rulesnumber of rules. .

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• The system will be The system will be pruned to achieve pruned to achieve simplicitysimplicity and power. and power.

• The system is The system is tested tested by a range of experts by a range of experts within the organization against the within the organization against the performance criteriaperformance criteria established earlier. established earlier.

• Once tested, the system will be Once tested, the system will be integrated integrated intointo the data flow and work patterns of the the data flow and work patterns of the organization.organization.

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Knowledge engineerKnowledge engineer

• Specialist extract information and Specialist extract information and expertise from other professionals expertise from other professionals

• Translates information into set of rules for Translates information into set of rules for an expert systeman expert system


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• Countrywide Funding Corp. is a Countrywide Funding Corp. is a loan-underwritingloan-underwriting firm with about firm with about 400 underwriters400 underwriters in 150 offices in 150 offices around the country. around the country.

• The company developed a The company developed a PC-based expertPC-based expert system in system in 1992 1992 to make preliminary to make preliminary creditworthiness decisions on loan requests. creditworthiness decisions on loan requests.

• The company had experienced The company had experienced rapid, continuing rapid, continuing growthgrowth and wanted the system to help ensure and wanted the system to help ensure consistent, high-qualityconsistent, high-quality loan decisions. loan decisions.

• CLUES (Countrywide's Loan Underwriting Expert CLUES (Countrywide's Loan Underwriting Expert System) has about 400 rules. System) has about 400 rules.

Examples of Expert Systems

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• CountrywideCountrywide tested tested the system by sending every loan the system by sending every loan application application handled by a human underwriterhandled by a human underwriter to CLUES as to CLUES as well. well.

• The system was refined until it agreed with the underwriters The system was refined until it agreed with the underwriters in in 95 percent95 percent of the cases. of the cases.

• Countrywide will not Countrywide will not rely on CLUESrely on CLUES to reject loans, because to reject loans, because the expert system cannot be programmed to handle the expert system cannot be programmed to handle exceptional situations such as those involving a self-exceptional situations such as those involving a self-employed person or complex financial schemes. employed person or complex financial schemes.

• An underwriter will An underwriter will review all rejectedreview all rejected loans and will make loans and will make the final decision. CLUES has other benefits. Traditionally, the final decision. CLUES has other benefits. Traditionally, an underwriter could handle an underwriter could handle six or sevensix or seven applications a day. applications a day.

• Using CLUES, the same underwriter can evaluate at least Using CLUES, the same underwriter can evaluate at least 16 16 per dayper day. .

Examples of Expert Systems

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EXPERT SYSTEMS EXPERT SYSTEMS LIMITATIONS:LIMITATIONS:

• Often reduced to problems of Often reduced to problems of classificationclassification

• Can be large, lengthy, expensiveCan be large, lengthy, expensive

• Maintaining knowledge base criticalMaintaining knowledge base critical

• Many managers unwilling to trust such Many managers unwilling to trust such systemssystems

**

AI

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CASE - BASED CASE - BASED REASON (CBR)REASON (CBR)

AI USES DATABASE OF CASES:AI USES DATABASE OF CASES:• USER DESCRIBES PROBLEMUSER DESCRIBES PROBLEM• SYSTEM SEARCHES DATABASE FOR SYSTEM SEARCHES DATABASE FOR

SIMILAR CASESSIMILAR CASES• SYSTEM ASKS MORE QUESTIONSSYSTEM ASKS MORE QUESTIONS• FINDS CLOSEST FITFINDS CLOSEST FIT• MODIFIED AS REQUIREDMODIFIED AS REQUIRED

**

AI

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10.10.6969

• Compaq Computer of Houston, Texas, Compaq Computer of Houston, Texas, gave purchasers of its Pagemarq printer gave purchasers of its Pagemarq printer case-based reasoning software to help case-based reasoning software to help reduce customer service costs.reduce customer service costs.

Examples of CBR SYSTEMSExamples of CBR SYSTEMS

10.10.7070

c h a p t e r

1212 MANAGING MANAGING

KNOWLEDGE: KNOWLEDGE: KNOWLEDGE WORK KNOWLEDGE WORK

AND ARTIFICIAL AND ARTIFICIAL INTELLIGENCEINTELLIGENCE