Everyone is talking about AI. And beyond knowing that it’s artificial intelligence, per my market interviews with companies, many people could not describe what it was. If AI is the future it’s important to understand it. So the next time that someone asks you what AI is you can intelligently say that it is when machines are built to think predictively like humans. It essentially uses probability equations to select the highest probable outcome as it’s prediction.

But many business leaders are still unsure of how to incorporate AI into their companies since it seems so novel and complex. In fact, it really isn’t novel at all since the concept of AI has been around since the 1950’s. But because more and more companies are adopting AI into their business models, AI, or prediction technology, is essentially becoming more robust and cheap. When it comes to thinking about how to use AI in your business, just like with any strategy you want to identify the main pain points of your business. Typically one of your major metrics will be related to increasing revenues from your largest opportunity or reducing your highest costs.

AI is best utilized as a tool where humans are slow and less productive or uninterested. For example, crunching mathematical equations or performing repetitive tasks, or tasks where quality needs to supersede human error 100% of the time. So when thinking about how you would use AI in your organization, pinpoint within your most costly or profitable channels where you might have math, repetition, or 0 tolerance for error.

Examples include running financial analysis, automating repetitive manual labor in manufacturing goods, or performing surgury. To give you even a broader sense of where AI is best applied let’s take a look how a few companies are using AI

• Zip Recruiter and Korn Ferry are using AI solutions to parse down their candidate pool for recruitment in order to select the candidates that their algorithm predicts will be the most successful. Since there is an enormous amount o data and number of variables involved, too much for the human brain to handle on it’s own, AI is a great way to crunch the information to ideally make the best decisions in hiring.

• Tesla and Google as we all know have created autonomous vehicles. The reduce the element of human error in driving by creating machines that can take action (accelerate, brake, turn) based on its predictions of good outcomes and bad outcomes based on what the sensors are sensing in the environment.

In order for AI to be truly intelligent, it needs to pass what is called the “Turing test” created by Alan Turing. This is where a human is unable to tell if they are interacting with a machine or a person. Very few machines have been able to pass this test. Although there is one flaw to this theory. Often times machines are smarter than humans in certain matters, such as math as we mentioned before. So if a human is talking with a robot that appears to be human and it answers extremely complicated math questions correctly, the human will obviously know that it’s a machine working behind that face because no human can mentally calculate that quickly.

So now that you can articulate what AI is, try seeing how you can best apply it to your business. One of the best tools I recommend to use is called the AI Canvas I pulled from HBR.