PricewaterhouseCoopers (PwC) revealed its AI investment plan to place $1 billion into expanding and scaling its artificial intelligence (AI) portfolio over the next three years through a partnership with Microsoft.
The company hopes that by utilizing Microsoft’s AI technology, including OpenAI’s GPT-4 and Microsoft’s Azure OpenAI Service, PwC can better assist its clients.
This can be achieved by generating more comprehensive insights, increasing efficiency, and creating innovative products and services while also building stronger trust with their stakeholders.
Bret Greenstein, data and analytics partner at PwC, explains the investment was made with a holistic perspective of the benefits generative AI technology can bring to their own business, and then how those benefits can be delivered to their clients.
“As a consulting firm, we do a lot of services, everything from SAP implementations, data transformations, finance HR transformation, audit, tax,” he says. “We have a whole range of range of things we do, and we’re changing our delivery models to leverage generative AI because so much of the work we do is knowledge work with a lot of text and code.”
He explains that by adopting generative AI early on, PwC essentially treating itself as a client, which taught the company everything it needed to do, to do it for others.
“We call ourselves ‘Client Zero’ and we treat it like an actual client engagement. All the disciplines requirements, sign off prioritization, everything you need to do that we do for clients, we do it for ourselves, and it’s pushed us right to the edge of what generative AI can do– right to the edge of scalability and functional requirements.”
Greenstein says its PwC’s goal to learn fast, help the market mature fast, and then help clients to jump on the technology as quickly as they can.
“They really appreciate the lessons, the best practices, avoiding the pitfalls,” he says. “We don’t come in with theory, we come in with scars.”
He adds the partnership with Microsoft allows for deep relationships at the engineering level so they can talk about what they’re learning, provide feedback and get early access to emerging technologies.
“It’s really about teaming for the success of the client and understanding what is available and what is coming through Microsoft,” Greenstein says. “Combining that with our ability to apply the technology helps produce client outcomes.”
Josep Bori, thematic research director at GlobalData, notes since the release of GPT-3 in 2020, but more so after the release of ChatGPT last November, there has been increasing interest in generative AI, and how these large language models can be used in the enterprise.
“As such, it makes a lot of sense for large management consulting firms such as PwC to embrace the opportunity to provide AI advisory services,” he says. “Along with lots of interest and, frankly, hype, there is also lack of understanding of what are the true capabilities and current limitations of such technology, which determines which business processes and tasks can actually be automated with it and in what timeframes.”
Bori explains the PwC collaboration with Microsoft on AI follows the classic commercial approach whereby large enterprise software vendors establish a very symbiotic relationship with large consulting firms, which effectively become the sales channel.
“We have seen this before with enterprise resource planning technology, which saw all the leading consulting firms establishing strategic relationships with SAP and Oracle,” he notes. “We expect more partnerships like this one to happen in the coming months, as most enterprises do need help in navigating the emerging AI enterprise market.”
Alex Pavlov, partner at RTP Global, cautions investors seeking companies in the generative AI space first need to understand what they are investing in.
“They will never find a generative AI model that can compete with Google or Microsoft’s Open AI, since no one has the computational power or the billions of dollars that it will cost to improve on GPT-4,” he says.
Ultimately, most “ChatGPT startups” will fail because the product innovation is just a thin layer of application on top of OpenAI and the solutions are unlikely to stand the test of time.
“That’s why for entrepreneurs, the goal should not be competition, but innovation,” Pavlov says. “Identify how this technology can make your business or product better, whether this is through improving your customer experience, reducing your costs, or improving your ability to upsell.”
He predicts that similar to the public cloud, there will be a dominance of a few small players for the infrastructure component of generative AI.
Namely, Microsoft and Google will dominate the infrastructure component as they are among the very few companies with the compute power it needs – and they are the only two currently pursuing it.
“In the next couple of years, we will also see the complexity of these generative AI models rapidly increase, which in turn will result in a slowdown in content innovation,” he says. “Growth will stall, with the success stories coming from companies embedding ChatGPT into their existing products to improve processes, customer experience and customer service.”