Transforming Businesses

with Artificial Intelligence

© 2018 Cisco and/or its affiliates. All rights reserved. 1

Transforming Businesses with Artificial Intelligence

Executive summary
Not so long ago, technology that could learn and solve problems Cisco’s leadership position as one of the largest market
on its own was found only in science fiction. Today, devices shareholders in areas such as the network, security, cloud,
with these advanced capabilities are emerging all around analytics and collaboration, enables us to approach AI-ML
us, representing the latest wave of rapid progress. Artificial with a holistic perspective toward driving business outcomes.
intelligence (AI) is redefining our way of life, enabling machines Drawing on our organization’s wide visibility of data, Cisco is
to do what people once thought only humans could do. building AI-ML capabilities across its portfolio of products and
It is also revolutionizing the way we do business. solutions in networking, security, data center, cloud, analytics,
and collaboration.
Businesses need AI and ML so that they can:
In this paper, we will explore how AI will form the foundation
• Make their infrastructure intelligent to drive insights and
of this new world and show how Cisco’s products and solutions
better decisions
can help provide advanced intelligence across the value chain.
• Improve their security posture to secure every endpoint

• Enrich every customer experience to deliver more engaging,

personalized products and interaction

• Transform processes and business models to drive efficiency

and productivity

• Hire, retain, and empower talent to improve workforce

efficiency and engagement

of executives say that

of executives believe AI
83% is a strategic priority for
their businesses today.¹
75% AI will allow them to move
into new businesses
and ventures.¹

© 2018 Cisco and/or its affiliates. All rights reserved. 2

Contents
Executive summary.................................................................................................................................................................................. 2

What is artificial intelligence and machine learning?................................................................................................................................ 4

AI and ML is redefining businesses.......................................................................................................................................................... 5

What is motivating the emergence of AI and ML?.................................................................................................................................... 6

Why do you need AI and ML?.................................................................................................................................................................. 7

Make your infrastructure intelligent...................................................................................................................................................... 7

Improve your security posture............................................................................................................................................................. 8

Improve customer experience............................................................................................................................................................. 8

Transform processes and business models........................................................................................................................................ 9

Hire, retain, and empower talent......................................................................................................................................................... 9

Cisco drives AI and ML innovation.........................................................................................................................................................10

Reinvent the network.........................................................................................................................................................................11

Make security foundational................................................................................................................................................................12

Power a multi-cloud world................................................................................................................................................................13

Unlock the power of data..................................................................................................................................................................14

Create meaningful experiences.........................................................................................................................................................15

Start your transformation with AI............................................................................................................................................................16

© 2018 Cisco and/or its affiliates. All rights reserved. 3

Transforming Businesses with Artificial Intelligence

What is artificial intelligence

and machine learning?
We’re entering an exciting new era in technology that is These breakthroughs aren’t far off. They will be powered by
bringing transformative change to the way we live, work, and AI. It’s clear that AI is driving powerful transformations across a
play. Decades ago, the PC era brought computers and all their variety of industries. Machine learning (ML) is a subset of AI and
capabilities to a wide audience. Then we witnessed the rise of a central enabler of its capabilities.
the Internet, which brought more knowledge to people faster Artificial intelligence is still a new and amorphous field, but
than ever before. Next came the rise of mobile and cloud one widely agreed-on definition is “a system capable of
ecosystems, which is putting the Internet in the palm of people’s rationally solving complex problems or taking appropriate actions
hands, expanding the processing power of their devices, and to achieve its goals in whatever real-world circumstances it
scaling what they can store to formerly unimaginable levels. encounters.”² In short, it’s a computer that can solve problems
Now we are about to move to a new era, which we’re calling without direct assistance from a person.
the era of intelligence.
There are two essential kinds of problems AI can solve. The first
Imagine a world where every car is connected and involves scenarios where theoretical modeling can be applied
communicating with the cars and traffic signals around it to to approximate and predict behavior. The second focuses on
automatically optimize traffic flows using analytics of vehicle problems where diligent parametric observation provides enough
volumes and speeds. Or a city where sensors and guides can data to fit a mathematical formula. The first type of problem,
provide freedom of movement to the visually impaired. Consider known as knowledge engineering, involves coders and experts
the possibilities if every robot in a manufacturing facility were who team up to explicitly program human expertise into a
connected and providing data about product volumes for computer so it can act independently. The second scenario,
just-in-time ordering of raw materials, and metrics to enable machine learning, focuses on training algorithms—often called
proactive, preventive maintenance to eliminate downtime. learners—to discover their own problem-solving methods with
massive amounts of data.

© 2018 Cisco and/or its affiliates. All rights reserved. 4

Transforming Businesses with Artificial Intelligence

AI and ML is redefining businesses

Companies in every vertical are employing AI and ML to unleash “There’s nothing for us that could be more strategic to the
a variety of benefits. Let’s take a closer look at how AI and ML company than to really drive better efficiencies and a better
is transforming businesses. end-to-end operation in our supply chain,” said Jim Fortner,
P&G’s vice president for information technology and services.
Digital production assistants build cars of tomorrow
Automobile manufacturer BMW is harnessing the potential of Maximizing supply chain efficiency is a powerful benefit not only
AI in innovative automation and flexible assistance systems in for P&G, but manufacturers in all industries. The market for smart
production. At its factory in Leipzig, Germany, lightweight robots manufacturing tools is expected to hit $250 billion by the end of
work directly on the production line together with the human 2018, according to research company TrendForce.
workforce. Their versatility, modest space requirements, and Hedge funds redefine trading
high level of safety grant people access to areas that used to
Financial services players have access to rich sources of
be off limits to everyone except robots.³
data. To make the most of it, today’s data-centric hedge
BMW is also applying AI to support the driverless cars of the funds increasingly rely on AI to support innovative new trading
future. It has stated that its aim is for its vehicles to achieve full engine models. For example, Hong Kong’s Aidyia identifies and
“level 5” autonomy by 2021. Level 5 autonomy tops the scale executes trades entirely on its own, drawing on multiple forms of
defined by the U.S. Department of Transportation. It indicates AI, including one inspired by genetic evolution and another based
that a vehicle will be capable of driving with no human input on probabilistic logic.
or supervision and operate at least as effectively as a human
Each day, after analyzing everything from market prices and
driver—in any conditions and on any road.⁴
volumes to macroeconomic data and corporate accounting
Intelligent production management systems boost uptime documents, these AI engines make their own market predictions
Procter & Gamble, which operates 130 plants worldwide, has and then “vote” on the best course of action.6
had success integrating AI and other smart factory technologies
into its manufacturing operations. The tools have helped the
company cut unplanned downtime by 10 to 20 percent.5

© 2018 Cisco and/or its affiliates. All rights reserved. 5

Transforming Businesses with Artificial Intelligence

What is motivating the emergence of AI and ML?

AI and ML have rapidly progressed over the past few years. According to Forbes, 2017 marked a period of meteoric rise of this
technology.7 ML in particular is playing a prominent role in digital transformation for several reasons, such as the falling cost of data
storage. Commodity hardware, the spread of open-source technology such as Hadoop, and the growth of the cloud are making it
very cheap to store data, resulting in the rise of big data. Much of this data provides excellent training material for learners and is
being packaged for easy use in resources such as ImageNet and data.gov.

In the past, training an ML system was often too computationally expensive. Fortunately, improved CPUs, GPUs, and cloud computing
have massively reduced the price of compute power. Mathematical advances have also made training neural networks easier and
more effective.

A public-private ecosystem including universities, companies, and government has also encouraged rapid progress in the field.
The combination of these trends has created a prime environment for the growth of machine learning.

© 2018 Cisco and/or its affiliates. All rights reserved. 6

Transforming Businesses with Artificial Intelligence

Why do you need AI and ML?

Data is the lifeblood of business. It helps drive insights and better
decisions; improve processes; and offer a deeper understanding
of customers, partners, and business. AI and ML enables us to
of executives say AI

84%
learn from data, identify patterns, and make smarter decisions
that augment human capabilities. This capability empowers
will enable them to
organizations with new ways to grow revenue, attract and retain obtain or sustain a
customers, and become more operationally efficient. AI and ML competitive advantage.8
can help automate tasks and accelerate untapped insight
in previously unexplored areas.

Together, AI and ML enable you to:

Make your infrastructure intelligent

In this increasingly connected world, data is more important than ever, and more organizations are looking to unlock its full value
using contextual awareness of apps, users, threats, and location. They need predictive and prescriptive insights to respond to market
changes faster. They are seeking more adaptive processes and technologies to understand their customers and business processes
better. These priorities all require an intelligent infrastructure.

One of the main values of artificial intelligence is its ability to unlock in-depth insights and intelligence from your organization and your
business processes. When you gather data from the people, processes, and things that reside on your network and analyze that data
by looking at patterns, you can better identify emerging customer needs, uncover trends, and innovate faster than your competitors.
The more data you can collect and analyze, the more opportunities will open up for you.

By 2020, insights-driven
businesses will steal

$1.2T
per annum from their
less-informed peers9

© 2018 Cisco and/or its affiliates. All rights reserved. 7

Transforming Businesses with Artificial Intelligence

Improve your security posture

Security is a fundamental part of every digital business transformation strategy. The threat landscape is changing fast, as the growth
in connected devices creates exponentially more targets, and attacks become more sophisticated. As the IoT continues to mature,
your potential exposure to threats is growing as well.

Organizations are already beginning to use AI to bolster security and offer more protection against sophisticated hackers. AI helps
by automating complex processes for detecting attacks and reacting to breaches. These applications are becoming more and more
sophisticated as AI is deployed for security.

$3.62M
average global cost of
data breach in 201710

Improve customer experience

In a world of always-on digital services at your fingertips, customers have much higher expectations of the organizations they do
business with. While product and cost leadership strategies have been used to great effect in the past to outsmart competition,
the quicker pace of innovation and outsourcing have made them easy to duplicate. Capturing the customer’s unwavering loyalty
by providing a delightful experience has become the primary factor in winning and retaining business, and maintaining credible,
sustained differentiation.

Chatbots answer customer’s questions and directs them to the right area using AI. AI has also improved natural language interfaces
and made it easy for the customer to speak to an Interactive Voice Response (IVR) system. Every customer is different, and AI helps
firms understand their distinct needs and preferences, and provide a personalized experience.

8 out of 10
businesses have already
implemented or are
planning to adopt AI
as a customer service
solution by 202011

© 2018 Cisco and/or its affiliates. All rights reserved. 8

Transforming Businesses with Artificial Intelligence

Transform processes and business models

As more and more devices get connected, companies have the potential to access and collect data from every extremity of their
value chains. This creates the potential for new ways of doing business and the ability to disruptively transform existing processes
and business models. The result is faster time-to-market, leaner operations, and greater agility to respond to market changes.

Machine vision is one of the applications of AI. Devising cameras many times more sensitive than the human eye is impressive,
but it’s actually the easy part of this technology. What AI adds is the increasingly useful ability to make sense of the images. AI is
also increasingly important in predictive maintenance for equipment, with sensors tracking operating conditions and performance
of factory tooling, learning to predict breakdowns and malfunctions, and taking or recommending preemptive actions.

By 2035, AI
technologies
are projected to
increase business
productivity by
40%
up to12

Hire, retain, and empower talent

Today’s workforce is multi-generational, with each group having unique motivations, values, and workstyles. Workers want to be more
engaged, empowered, and inspired at work. They tend to be more emotionally invested and focused on creating value every day.
And they’re looking for companies that provide the tools and culture to allow them to be more productive and responsive.

AI can help HR to hire and retain talent, make processes more efficient, and provide better employee experience. It can predict
and shape HR performance. AI can also create interactive tests and assessments to match test takers’ personal learning styles and
engagement levels. It can also make information delivery to the employee extremely customizable.

of recruiters believe

95% AI can greatly enhance

talent acquisition
and retention13

© 2018 Cisco and/or its affiliates. All rights reserved. 9

Transforming Businesses with Artificial Intelligence

Cisco drives AI and ML innovation

Cisco’s leadership position by virtue of being one of the largest market share holders in B2B areas such as the network, security,
cloud, analytics and collaboration, enables us to approach AI-ML in a holistic perspective toward driving business outcomes.
Drawing on this wide visibility of data, Cisco is helping customers reinvent their network, make security foundational, power a
multi-cloud world, unlock the power of data and create meaningful experiences by harnessing the power of AI and ML.

© 2018 Cisco and/or its affiliates. All rights reserved. 10

Transforming Businesses with Artificial Intelligence

Reinvent the network

Cisco is reinventing networking with the network intuitive. Cisco employs ML to analyze huge amounts of network data, from
telemetry to traffic patterns, and understand anomalies as well as optimal network configurations. Ultimately, Cisco will enable
an intent-based, self-driving, self-healing network. The network will redirect traffic on its own and heal itself from internal shocks,
such as device malfunctions, and external shocks, such as cyberattacks.

Digital Network Architecture (Cisco DNA™) Center

Cisco DNA Center is a centralized management application. It includes ML software that observes the configuration, telemetry,
and traffic patterns of WAN deployments and recommends optimization and security measures based on them. Cisco DNA Center
simplifies network management, uses automation to lower OpEx, uses assurance and analytics to improve network performance,
and enhances security to reduce risk. It lets organizations predict performance through ML to correlate user, device, and
application data for contextual business and operational insights.

Encrypted Traffic Analytics

Cisco Encrypted Traffic Analytics is a form of advanced threat analytics designed to detect and analyze encrypted traffic and
threats without using decryption. It is a new technology that uses data available from Cisco’s latest networking gear and advanced
analytics, including machine learning. It is a network-based security solution that monitors encrypted traffic flows on the network.
By modeling the pattern of encrypted communication, it identifies activity indicative of ransomware attacks, advanced persistent
threats, malware infections, illicit crypto-mining, and other threats.

Application Centric Infrastructure (ACI)

Cisco ACI, the industry leading software defined networking (SDN) solution enables application agility and data center automation.
Customers can build multi-cloud networks with a consistent policy model. With ACI Anywhere, customers have the flexibility to
move applications seamlessly without compromising high availability and creating a single fault domain environment.

© 2018 Cisco and/or its affiliates. All rights reserved. 11

Transforming Businesses with Artificial Intelligence

Make security foundational

To help safeguard organizations in a constantly changing threat landscape, Cisco is using AI and ML to support comprehensive,
automated, coordinated responses between various security components.

Cisco Umbrella™
To secure the business running on the network and multi-cloud environment, Cisco utilizes machine learning to automatically
identify and contain threats. Cisco Umbrella is our cloud security platform for the network. Our unparalleled machine intelligence
enables us to uncover malicious domains, IPs, and URLs before they’re even used in attacks. Then, we use the power of fleet
learning to convert the discovery of a malicious agent on one network to blacklist it on all Cisco Umbrella customers.

Talos™
Talos is the Cisco threat intelligence organization, an elite group of security experts devoted to providing superior protection
for our customers, products, and services. Its detection research provides vulnerability and malware analysis that helps
enhance all Cisco security products. Threat intelligence correlates and tracks threats, enabling Cisco to turn attribution
information into actionable threat intelligence, to protect our customers quickly and effectively.

Cloudlock®
Cisco Cloudlock is the cloud-native cloud access security broker (CASB) that helps accelerate use of the cloud.
Cisco Cloudlock secures cloud users, data, and apps, combating account compromises, data breaches, and cloud app
ecosystem risks, while facilitating compliance through a simple, open, and automated API-driven approach. Cloudlock employs
advanced ML to detect anomalies in IT environments across SaaS, PaaS, IPaaS, and IDaaS by adaptively learning user behavior.

Cognitive Threat Analytics

Cognitive Threat Analytics is a cloud-based product that uses machine learning and statistical modeling of networks.
It creates a baseline of the traffic in your network and identifies anomalies. The product also analyzes user and device behavior,
and web traffic, to discover command-and-control communications, data exfiltration, and potentially unwanted applications
operating in your infrastructure.

Cisco Stealthwatch®
Stealthwatch applies intelligence across the network, data center, and cloud. It uses machine learning to discover advanced
threats and malicious communications. The machine learning engine processes massive amounts of data in near real time to
discover critical incidents with high confidence, and can suggest clear courses of actions to remediate quickly. Stealthwatch
employs multiple layers of processing, where a combination of techniques from artificial intelligence, machine learning, and
mathematical statistics helps the network to self-learn its normal activity so it can identify malicious activity.

Cisco Advanced Malware Protection (AMP)

Cisco AMP is built on unmatched collective security intelligence. This intelligence is collected from Cisco Security Intelligence
Operations and the Sourcefire Vulnerability Research team, then pushed from the cloud to the AMP client so that the user
always has the latest threat intelligence. Its ML engine applies heuristic approaches to detecting malicious software.
The solution identifies broad classes of threats based on generic characteristics rather than pinpointing a single threat.

© 2018 Cisco and/or its affiliates. All rights reserved. 12

Transforming Businesses with Artificial Intelligence

Power a multi-cloud world

With the help of machine learning, Cisco is learning and analyzing network traffic patterns by collecting data from various sites.
It is offering recommendations to deliver a single user experience across clouds, including one policy and one instance of security.

Cisco Intersight™
Intersight™ enables transparency and management in all of an organization’s data centers from a central source. It combines
the simplicity of SaaS with actionable intelligence. The Intersight recommendation engine provides actionable intelligence for IT
operations management. Insights are driven by analytics and machine learning that enable a new level of systems management.
Intersight is a new advancement in ITOM tools. Its ML capabilities also offer proactive guidance to secure and optimize the data
center and identify possible points of failure so they can be corrected before issues occur.

Cisco UCS and HyperFlex Servers

Cisco UCS helps change the way IT organizations do business. It combines industry-standard, x86-architecture servers with
networking and storage access into a single unified system. UCS brings increased productivity, reduced total cost of ownership,
and scalability into your data center. Cisco HyperFlex enables multi-cloud IT with an adaptive platform that powers any application
anywhere with the simplicity of hyper-converged infrastructure. We have UCS and HyperFlex systems that support AI-ML
workloads that are very data intensive.

© 2018 Cisco and/or its affiliates. All rights reserved. 13

Transforming Businesses with Artificial Intelligence

Unlock the power of data

Cisco is focused on delivering insight and recommendations at the network layer, the data center layer, and the application layer to
optimize for latency, reliability, power, and operating expense. Our next goal is full auto tuning that will make sure of fast movement
of data across the network, using the fewest possible resources.

DNA Analytics and Assurance

DNA Analytics and Assurance provides contextual insights across users, devices and applications. It assures network
performance by using advanced correlation and ML algorithms to analyze data, identify outliers and provides recommendation,
driven by 30 years of Cisco domain expertise and constantly evolving best practices, on identified issues.

Tetration Analytics™
Cisco Tetration is designed to address security and operational challenges for a multi-cloud data center. It uses machine-
learning, behavior analysis, and algorithmic approaches to offer a holistic workload-protection strategy and network-performance
insights. This approach allows customers to gain application insights, auto generate whitelist policy and enforce a consistent
policy to enable zero-trust model. The platform also tracks process-behavior deviations, identify software vulnerabilities in a
multi-cloud infrastructure allowing you to reduce attack surface and identify indicators of compromise much faster.

Network Assurance Engine

Network Assurance Engine (NAE) transforms operations in data center networks to a fundamentally more proactive model.
Built on Cisco’s patented network verification technology, it is the most comprehensive assurance engine that mathematically
verifies the entire network for correctness, giving operators confidence that their network is always operating consistent
with intent.

AppDynamics
AppDynamics monitors applications and discovers and baselines end-to-end business transactions so IT teams can instantly
identify and remediate performance bottlenecks that could affect the business. It uses machine learning to deliver contextual
insights about application and business health, predicts performance deviations, and alerts before impact.

Kinetic
Cisco Kinetic platform helps to extract, compute, and move data from your connected things to various applications.
The data produced by all your things is a high-value asset that can change the trajectory of your business—if you can make full
use of it. But that can be challenging when you’re working with disparate things and a variety of applications that may live in edge
or fog nodes, your data center, private clouds and/or public clouds. Cisco Kinetic makes it easy to connect distributed devices
(“things”) to the network—then extract, normalize, and securely move data from those devices to distributed applications.

© 2018 Cisco and/or its affiliates. All rights reserved. 14

Transforming Businesses with Artificial Intelligence

Create meaningful experiences

Cisco is using AI in our products as well as our internal operations to improve employee and customer experiences.
Our initiatives focus on making our collaboration products and solutions simple, automated, and intuitive.

MindMeld
At Cisco, we are calling our ML-enhanced collaboration experience Cognitive Collaboration. It features two primary components:
bots and computer vision. Cisco customer-facing bots are built on the MindMeld technology. MindMeld ML algorithms enable
complex, human-like natural language search and navigation. They support dynamic user flows and dialogues for conversational
UI, as well as voice assistants. These tools can be used for food ordering, music or video discovery, or even travel booking.
Cisco ML algorithms are also in the process of being integrated into Cisco video conferencing products.

Webex Endpoints
The Cisco vision for Webex Teams and Webex Boards includes a variety of AI and ML enhancements. For example, Cisco is
making the bot chat assistant more intelligent, so interactions can be automated and predicted. Cisco is also enhancing Webex
Teams with a customer care bot to predict and solve customer issues easily and quickly. Additional enhancements include AI
capabilities such as automatic detection of people in the room for intelligent camera framing, voice recognition to place calls
using voice commands, and face recognition to identify meeting attendees.

© 2018 Cisco and/or its affiliates. All rights reserved. 15

Transforming Businesses with Artificial Intelligence

Start your transformation with AI

As the new era of intelligence takes shape all around us, the To start your transformation and learn more about
possibilities are endless for organizations to apply AI and take how to harness the power of AI-ML visit:
their business processes to the next level. Cisco’s products and www.cisco.com/go/intelligence.
solutions can help you deploy advance intelligence across your
value chain to make your infrastructure intelligent, improve your
security posture, enrich your customer’s experience, transform
your processes and business models and hire, retain, and
empower talent.

1. MIT Sloan, “Reshaping Business with Artificial Intelligence,” https://sloanreview.mit.edu/projects/reshaping-business-with-artificial-intelligence/. 2. Executive Office of the President National Science and Technology Council Committee
on Technology, “Preparing for the Future of Artificial Intelligence,” October 2016, https://obamawhitehouse.archives.gov/sites/default/files/whitehouse_files/microsites/ostp/NSTC/preparing_for_the_future_of_ai.pdf; Pedro Domingos, “The
Master Algorithm: How the Quest for the Ultimate Learning Machine Will Remake Our World,” 2015. 3. https://roboticsandautomationnews.com/2017/03/04/bmw-shows-off-its-smart-factory-technologies-at-its-plants-worldwide/11696/.
4. https://www.forbes.com/sites/bernardmarr/2017/08/01/how-bmw-uses-artificial-intelligence-and-big-data-to-design-and-build-cars-of-tomorrow/#6eaa92f82b91. 5. http://www.businessinsider.com/sc/artificial-intelligence-
change-manufacturing. 6. https://www.wired.com/2016/01/the-rise-of-the-artificially-intelligent-hedge-fund/. 7.https://www.forbes.com/sites/janakirammsv/2017/12/28/3-key-machine-learning-trends-to-watch-out-for-in-
2018/#376f52971280. 8. MIT Sloan, “Reshaping Business with Artificial Intelligence,” https://sloanreview.mit.edu/projects/reshaping-business-with-artificial-intelligence/. 9. Forrester - https://www.forrester.com/report/Predictions+2017+
Artificial+Intelligence+Will+Drive+The+Insights+Revolution/-/E-RES133325 10. IBM 11. Oracle - https://www.oracle.com/webfolder/s/delivery_production/docs/FY16h1/doc35/CXResearchVirtualExperiences.pdf 12. Accenture https://www.
accenture.com/us-en/insight-artificial-intelligence-future-growth 13. https://ideal.com/how-recruiters-feel-about-ai/

© 2018 Cisco and/or its affiliates. All rights reserved. 16