Artificial Intelligence

What it is and why it matters


Artificial Intelligence History

The term artificial intelligence was coined in 1956, but AI has become more popular today thanks to increased data volumes, advanced algorithms, and improvements in computing power and storage.

Early AI research in the 1950s explored topics like problem solving and symbolic methods. In the 1960s, the US Department of Defense took interest in this type of work and began training computers to mimic basic human reasoning. For example, the Defense Advanced Research Projects Agency (DARPA) completed street mapping projects in the 1970s. And DARPA produced intelligent personal assistants in 2003, long before Siri, Alexa or Cortana were household names.

This early work paved the way for the automation and formal reasoning that we see in computers today, including decision support systems and smart search systems that can be designed to complement and augment human abilities.

While Hollywood movies and science fiction novels depict AI as human-like robots that take over the world, the current evolution of AI technologies isn’t that scary – or quite that smart. Instead, AI has evolved to provide many specific benefits in every industry. Keep reading for modern examples of artificial intelligence in health care, retail and more.

Chess board and Neural Network graphic


Neural Networks

Early work with neural networks stirs excitement for “thinking machines.”

Shapes and arrow graphic with classical and modern machine learning


Machine Learning

Machine learning becomes popular.

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Present Day

Deep Learning

Deep learning breakthroughs drive AI boom.

AI has been an integral part of SAS software for years. Today we help customers in every industry capitalize on advancements in AI, and we’ll continue embedding AI technologies like machine learning and deep learning in solutions across the SAS portfolio. Jim Goodnight, CEO, SAS in meeting Jim Goodnight CEO SAS

Artificial Intelligence and Machine Learning

Quick, watch this video to understand the relationship between AI and machine learning. You'll see how these two technologies work, with examples and a few funny asides.

Plus, this is a great video to share with friends and family to explain artificial intelligence in a way that anyone will understand. 

Why is artificial intelligence important?

  • AI automates repetitive learning and discovery through data. But AI is different from hardware-driven, robotic automation. Instead of automating manual tasks, AI performs frequent, high-volume, computerized tasks reliably and without fatigue. For this type of automation, human inquiry is still essential to set up the system and ask the right questions.
  • AI adds intelligence to existing products. In most cases, AI will not be sold as an individual application. Rather, products you already use will be improved with AI capabilities, much like Siri was added as a feature to a new generation of Apple products. Automation, conversational platforms, bots and smart machines can be combined with large amounts of data to improve many technologies at home and in the workplace, from security intelligence to investment analysis.
  • AI adapts through progressive learning algorithms to let the data do the programming. AI finds structure and regularities in data so that the algorithm acquires a skill: The algorithm becomes a classifier or a predictor. So, just as the algorithm can teach itself how to play chess, it can teach itself what product to recommend next online. And the models adapt when given new data. Back propagation is an AI technique that allows the model to adjust, through training and added data, when the first answer is not quite right.
  • AI analyzes more and deeper data using neural networks that have many hidden layers. Building a fraud detection system with five hidden layers was almost impossible a few years ago. All that has changed with incredible computer power and big data. You need lots of data to train deep learning models because they learn directly from the data. The more data you can feed them, the more accurate they become.
  • AI achieves incredible accuracy through deep neural networks – which was previously impossible. For example, your interactions with Alexa, Google Search and Google Photos are all based on deep learning – and they keep getting more accurate the more we use them. In the medical field, AI techniques from deep learning, image classification and object recognition can now be used to find cancer on MRIs with the same accuracy as highly trained radiologists.
  • AI gets the most out of data. When algorithms are self-learning, the data itself can become intellectual property. The answers are in the data; you just have to apply AI to get them out. Since the role of the data is now more important than ever before, it can create a competitive advantage. If you have the best data in a competitive industry, even if everyone is applying similar techniques, the best data will win.

Artificial Intelligence in Today's World

See AI in Every Industry

Peek inside an AI-enabled hospital, an AI-assisted retail store and a predictive analytics system that talks. This report from Harvard Business Review examines the AI landscape, takes a look at the AI workforce – and explains why you shouldn’t swear at Siri.

AI and the Internet of Things

Data is all around us. The Internet of Things (IoT) and sensors have the ability to harness large volumes of data, while artificial intelligence (AI) can learn patterns in the data to automate tasks for a variety of business benefits.

Integrate AI into your Analytics Program

For AI to be used effectively, it’s important that the strategy around it feeds into your larger business strategy, always taking into account the convergence of people, process and technology.

Separate Hype From Reality

AI is helping to embed "greater smartness into machines" but it is not taking over the world, says Oliver Schabenberger, SAS Executive Vice President and Chief Technology Officer.

How Artificial Intelligence Is Being Used

Every industry has a high demand for AI capabilities – especially question answering systems that can be used for legal assistance, patent searches, risk notification and medical research. Other uses of AI include:

Health Care

AI applications can provide personalized medicine and X-ray readings. Personal health care assistants can act as life coaches, reminding you to take your pills, exercise or eat healthier.


AI provides virtual shopping capabilities that offer personalized recommendations and discuss purchase options with the consumer. Stock management and site layout technologies will also be improved with AI.


AI can analyze factory IoT data as it streams from connected equipment to forecast expected load and demand using recurrent networks, a specific type of deep learning network used with sequence data.   


Artificial Intelligence enhances the speed, precision and effectiveness of human efforts. In financial institutions, AI techniques can be used to identify which transactions are likely to be fraudulent, adopt fast and accurate credit scoring, as well as automate manually intense data management tasks.

Working together with AI infographic

Working together with AI

Artificial intelligence is not here to replace us. It augments our abilities and makes us better at what we do. Because AI algorithms learn differently than humans, they look at things differently. They can see relationships and patterns that escape us. This human, AI partnership offers many opportunities. It can:

  • Bring analytics to industries and domains where it’s currently underutilized.
  • Improve the performance of existing analytic technologies, like computer vision and time series analysis.
  • Break down economic barriers, including language and translation barriers.
  • Augment existing abilities and make us better at what we do.
  • Give us better vision, better understanding, better memory and much more.  

What are the challenges of using artificial intelligence?

Artificial intelligence is going to change every industry, but we have to understand its limits.

The principle limitation of AI is that it learns from the data. There is no other way in which knowledge can be incorporated. That means any inaccuracies in the data will be reflected in the results. And any additional layers of prediction or analysis have to be added separately.

Today’s AI systems are trained to do a clearly defined task. The system that plays poker cannot play solitaire or chess. The system that detects fraud cannot drive a car or give you legal advice. In fact, an AI system that detects health care fraud cannot accurately detect tax fraud or warranty claims fraud.

In other words, these systems are very, very specialized. They are focused on a single task and are far from behaving like humans.

Likewise, self-learning systems are not autonomous systems. The imagined AI technologies that you see in movies and TV are still science fiction. But computers that can probe complex data to learn and perfect specific tasks are becoming quite common.

SAS® Visual Data Mining and Machine Learning screenshot on monitor

SAS® Visual Data Mining and Machine Learning

AI is simplified when you can prepare data for analysis, develop models with modern machine-learning algorithms and integrate text analytics all in one product. Plus, you can code projects that combine SAS with other languages, including Python, R, Java or Lua.

How Artificial Intelligence Works

AI works by combining large amounts of data with fast, iterative processing and intelligent algorithms, allowing the software to learn automatically from patterns or features in the data. AI is a broad field of study that includes many theories, methods and technologies, as well as the following major subfields:

  • Machine learning automates analytical model building. It uses methods from neural networks, statistics, operations research and physics to find hidden insights in data without explicitly being programmed for where to look or what to conclude.
  • Cognitive computing is a subfield of AI that strives for a natural, human-like interaction with machines. Using AI and cognitive computing, the ultimate goal is for a machine to simulate human processes through the ability to interpret images and speech – and then speak coherently in response.  
  • Computer vision relies on pattern recognition and deep learning to recognize what’s in a picture or video. When machines can process, analyze and understand images, they can capture images or videos in real time and interpret their surroundings.
  • Natural language processing (NLP) is the ability of computers to analyze, understand and generate human language, including speech. The next stage of NLP is natural language interaction, which allows humans to communicate with computers using normal, everyday language to perform tasks.

Additionally, several technologies enable and support AI:

  • Graphical processing units are key to AI because they provide the heavy compute power that’s required for iterative processing. Training neural networks requires big data plus compute power.
  • The Internet of Things generates massive amounts of data from connected devices, most of it unanalyzed. Automating models with AI will allow us to use more of it.
  • Advanced algorithms are being developed and combined in new ways to analyze more data faster and at multiple levels. This intelligent processing is key to identifying and predicting rare events, understanding complex systems and optimizing unique scenarios.
  • APIs, or application programming interfaces, are portable packages of code that make it possible to add AI functionality to existing products and software packages. They can add image recognition capabilities to home security systems and Q&A capabilities that describe data, create captions and headlines, or call out interesting patterns and insights in data.


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