IoT & AI

Top 5 takeaways on DLA Piper event on digital transformation and AI

Interesting insights at DLA Piper event of presentation of our book on legal issues of AI

Great panelists and a vivid debate occurred at DLA Piper event of presentation of our book on legal issues of digital transformation and AI.

On December 4, 2019, there was an event of presentation of a book authored by a large number of team members of the Italian Intellectual Property and Technology department of my law firm, DLA Piper, organized together with our publisher, Wolters Kluwer Italia, UGI – Unione Giuristi per l’Impresa and IoTItaly, the association for the growth of the IoT in Italy.

I summarize below my personal top 5 takeaways that arose from the discussion:

1. Digital transformation needs an approach tailored to your business and target customers

Tania Orrù from Brunello Cucinelli emphasized their approach to digital transformation that is aimed at introducing technology in their business, building innovation on the existing tools and needs of their workers, rather than imposing it. Only with this approach, a tailor’s board becomes “smart” with no disruption and with improvements in terms of the level of service and efficiency.

At the same time, she stressed that the company has a quite limited database of highly profiled customers where profiling is not used for marketing communications but is part of their service. Clients appreciate the level of profiling since it shows the level of attention of the company to the quality of their service.

Such points are crucial in a context where

  • there is a sort of “rush” to innovation without understanding that their workforce still is the main resource of businesses and
  • at the same time, companies show off large databases that often include inactive email accounts, customers that have not bought any item from the brand for several years and contacts that have not been collected in compliance with data protection laws. Such databases have no value for the company but represent a risk under privacy laws.

2. Data is a resource but also a significant cyber risk

Large databases can lead to compliance risks but also become a target for cyber attacks. And this was the point raised by Silvio Cavallo from Pillarstone.

Cybersecurity is not an issue to be dealt with only in case of a data breach and is not only related to GDPR compliance. Cybersecurity compliance shall become part of the standard compliance program of any company with components that impact on

  • the internal organization and liabilities,
  • the security measures to be implemented,
  • IT and services suppliers and
  • measures to be adopted to react to a cyberattack, limiting risks and potential adverse effects on the company, also through a cybersecurity insurance coverage, and arrangements with forensics experts and law firms to ensure a prompt reaction, without delays.

3. AI regulators are still uncertain between imposing ethical principles, ad hoc rules or leaving the market to its self-regulations

Gabriele Mazzini is working at the European Commission on the setting up of the legal regime applicable to artificial intelligence, and the main issue is which type of rules (if any) shall be introduced.

During the last years, the European Commission set our ethical principles applicable to artificial intelligence, and there are initiatives in similar scenarios (e.g., on connected cars) where self-regulation by market operators has been successful.

However, rules on for instance product liability can be hardly adjusted to a context where the definition of a “defect” may be challenging to apply, also because AI systems “learn” through their usage. Therefore the lack of defects at the time of the purchase cannot be a valid benchmark to avoid future malfunctionings.

4. AI needs to receive instructions, but cannot be bias-free

Luisella Giani from Oracle and Fabio Moioli from Microsoft emphasized the need to set the perimeter of operation of artificial intelligence systems, to avoid that it reaches conclusions which are based on merely statistical assessments, without taking into account ethical principles.

No human assessment will ever be bias-free since everyone has his personal views. But AI systems and human beings need to complement each other to avoid distortions of machines in their behavior.

We are facing a transitional phase where there is still no sufficient trust in machines, but trust can be a crucial element to determine the success of companies investing in the market. Several businesses are already using artificial intelligence however, the adoption of this technology requires an in-depth assessment to limit potential risks.

This aspect is a key takeaway stressed by Luca Sacchi of Piaggio on smart mobility. Vehicles are already smarter than we would think due to their electrical components that are purposely not visible to drivers since they need to support them, rather than replace them.

5. Italy needs to face a cultural change to exploit artificial intelligence fully

Stefano Galli from Sprint Reply gave an outlook on the situation in the Italian market as to the adoption of AI. There are several beta tests, but not enough companies have fully integrated artificial intelligence into their business.

The financial services and the insurance sectors are ahead of the other market, and we often use AI, without even being aware that an artificial intelligence system supports, for instance, the decision on whether an insurance coverage shall be granted or the identification of potential fraud.

AI can support humans in repetitive works, such as quality control. But the tricky element is that it does not need to be seen by Italian companies as a threat that might steal their job, but as a support to their working activity which, at the same time, will require an improvement of their skills.

Such a scenario is also happening in the legal market, according to Antonella Loporchio of Wolters Kluwer Italia. Lawyers use only 30% of the potentials of their tools and tend to remain in their “comfort zone” of functionalities that they know. Legal tech technologies already rely on artificial intelligence and can support, for instance, in the identification of the outcome of cases and repetitive activities.

We enjoyed the event, and I hope that also our guests appreciated it. And if you want to know more about the legal issues of artificial intelligence, don’t miss our book “Come preparare la propria azienda alla Digital Revolution“.

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Giulio Coraggio

I am the head of the Italian Technology sector and the global head of the IoT and Gaming and Gambling groups at the world-leading law firm DLA Piper. IoT and artificial intelligence influencer and FinTech and blockchain expert, finding solutions to what's next for our clients' success.

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