Leaders are increasingly aware of AI’s potential to reshape the business landscape. But they may still lack an understanding of how to apply it within their organizations, or they might expect that it can solve more complex problems than technology currently allows. A study in 2012 conducted by eBay Research Labs economists looking at eBay’s digital advertising strategy showed the perils of blurring correlation and cause. The study revealed that certain digital ads, which had appeared hugely effective for eBay, were not actually effective returns on investment. The ads hadn’t brought the e-commerce giant any new customers because people who saw them were already going to go to the site.
These are the sorts of quandaries machine learning research is not yet able to disentangle, according to Susan Athey, an economics of technology professor at the Stanford Graduate School of Business, who cites the eBay research in a paper published in Science. Athey says that to reap the benefits of the new technology, business leaders need to figure out which are the right problems to apply it to.