Sat, Jan 07, 2017 - Page 12 News List

Japanese firm to replace workers with AI system

RISE OF THE MACHINES:Japan’s Fukoku Mutual is laying off 34 employees and it plans to replace them with IBM’s Watson Explorer artificial intelligence system

The Guardian, TOKYO

A future in which human workers are replaced by machines is about to become a reality at an insurance firm in Japan, where more than 30 employees are being laid off and replaced with an artificial intelligence (AI) system that can calculate payouts to policyholders.

Fukoku Mutual Life Insurance Co believes it will increase productivity by 30 percent and see a return on its investment in less than two years.

The firm said it would save about ¥140 million (US$1.2 million) a year after the ¥200 million system is installed this month. Maintaining it will cost about ¥15 million a year.

However, the move is unlikely to be welcomed by the 34 employees who will be made redundant by the end of March.

The system is based on IBM Corp’s Watson Explorer, which, according to the technology firm, possesses “cognitive technology that can think like a human,” enabling it to “analyze and interpret all of your data, including unstructured text, images, audio and video.”

The technology is able to read tens of thousands of medical certificates and factor in the length of hospital stays, medical histories and any surgical procedures before calculating payouts, the Mainichi Shimbun reported.

While the use of artifical intelligence is expected to drastically reduce the time needed to calculate Fukoku Mutual’s payouts — which reportedly totaled 132,000 during the current financial year — the sums are not to be paid until they have been approved by a member of staff, the newspaper said.

Japan’s shrinking, aging population, coupled with its prowess in robot technology, makes it a prime testing ground for artifical intelligence.

According to a 2015 report by the Nomura Research Institute, nearly half of all jobs could be performed by robots by 2035.

Dai-Ichi Life Insurance Co has already introduced a Watson-based system to assess its payments — although it has not laid off any employees — and Japan Post Insurance Co is interested in introducing a similar setup, the Mainichi Shimbun reported.

Artificial intelligence could also soon be playing a role in Japanese politics.

Next month, the Japanese Ministry of Economy, Trade and Industry is to introduce artificial intelligence on a trial basis to help civil servants draft answers for ministers during Cabinet meetings and parliamentary sessions.

The ministry hopes the system would help reduce the long hours bureaucrats spend preparing written answers for ministers.

If the experiment is a success, it could be adopted by other government agencies, Jiji news agency reported.

However, the march of Japan’s artificial intelligence robots has not been entirely glitch-free. At the end of last year a team of researchers abandoned an attempt to develop a robot intelligent enough to pass the entrance exam for Tokyo University.

“Artificial intelligence is not good at answering the type of questions that require an ability to grasp meanings across a broad spectrum,” National Institute of Informatics professor Noriko Arai told Kyodo news agency.

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