By McQUILLEN, Daniel
American Banker , Vol. 162, No. 138
Artificial intelligence systems are making a comeback in the financial services industry, due in large part to the rising use of the Internet and corporate intranets.
Artificial intelligence, or AI, is a term for computer programming techniques that help systems sort data and solve highly complex problems while "learning" from the tasks.
After some false-start commercial application in the 1980s, artificial intelligence systems have gained new luster for their ability to provide tailored information to Web-using bank customers or knowledge-seeking employees.
"We've seen a resurgence-or what I call the second coming-of AI, basically because of the Web," said Allen Bonde, director of Internet computing strategies at Boston-based Yankee Group.
"If you look at what consumers are doing on the Web, they're having a dialogue through a Web site, they're shopping for things, they're doing a lot of self-service. If you can make that interface more intelligent and useful, it has a lot more value."
Artificial intelligence can involve a bevy of programming methods and computer theories, including case-based reasoning, expert systems, fuzzy logic, and neural networks. Though they typically performed well in laboratory environments, many AI technologies fell out of favor after underperforming in real-world applications.
"In the early to mid '80s the whole field was over-hyped," said Philip Klahr, vice president for customer quality with Inference Corp., a Novato, Calif.-based software company.
Now, says Mr. Klahr, with the increasing power and decreasing cost of computers and the wide-scale availability of large amounts of information, AI is again becoming an important area of investment for all companies.
Mr. Klahr said that knowledge management-the capturing and storing of a company's collective knowledge-is an area that benefits from AI.
Banks, for example, are using artificial intelligence programs to help employees sort through the immense amounts of information accessible through corporate intranets.
This information, whether used to educate employees on best practices or for improving the way a customer is served, is becoming more accessible through AI programs.
"A lot of financial institutions have huge data bases of loan histories and customers' preferences that can tell them what kind of people like to invest in what kind of products and so on," Mr. Bonde said. "But for the most part, there aren't a lot of people who understand how to get the information out of it."
The promise of these artificial intelligence technologies, he said, "is that more and more people will have access to information in a timely manner- without having to have a doctorate in computer science. …