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How to Design a Foolproof IoT Cybersecurity Strategy – ReadWrite

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How to Design a Foolproof IoT Cybersecurity Strategy - ReadWrite


Technology has been advancing at a dizzying speed in the last decade. Here is how to design a foolproof IoT cybersecurity strategy.

One area that has been growing fast is the Internet of Things (IoT). IoT simply means a network of connected hardware devices that can communicate via an internet connection. The IoT network simplifies many processes and tasks by reducing human participation.

The Rise of IoT in Enterprise

While IoT has been a common concept in homes, enterprise use is only beginning to rise.  And with that comes the need for improved IoT cybersecurity.

McKinsey’s report shows that the adoption of IoT technology on an enterprise level has increased from 13% in 2014 to 25% in 2019. The same report forecasts that the number of connected devices is expected to shoot to 43 billion by 2023. That’s three times the number of connected devices there were connected in 2018.

It’s inevitable. IoT is becoming a prominent ingredient in enterprise operations. But there’s a caveat that comes with the rise of IoT — increased cybersecurity risks.

And that’s why you must design a foolproof IoT cybersecurity strategy.  

The Challenges of IoT Cybersecurity

IoT cybersecurity is a nightmare for most CISOs and CIOs. Unlike traditional IT cybersecurity, which is straightforward (more or less), securing an IoT environment is fraught with many challenges.

One of the biggest problems with IoT is that each device comes with its own software and firmware. In most cases, updating these is difficult. And as you know, software updates are a part of maintaining good cybersecurity hygiene. This poses a massive problem with IoT as every new line of code or functionality added could introduce new attack vectors. And conducting and monitoring updates at scale is next to impossible.

Another challenge is that most IoT devices don’t support third-party endpoint security solutions. One reason for this is regulations surrounding the devices (like FDA regulations for medical devices). As a result, enterprises end up focusing their security on the communication channels between devices and networks.

On an enterprise level, the number of connected devices is just too massive to keep track of. You can end up wasting valuable time and resources playing cat and mouse just to keep all your devices updated. That on its own can leave you open to attacks from other directions.

The Need for Enterprise Level IoT Cybersecurity Solutions

The need for innovation and efficiency are driving the growth of IoT adoption at an enterprise level. Business growth is virtually impossible today without keeping pace with current technology trends.

When it comes to cybersecurity, the more devices you have in your network, the more vulnerable you are. And because enterprises can deploy IoT devices and services at scale, they run a higher risk of being vulnerable to external threats.

That’s why, when adopting IoT in your business, you must be prepared to beef up your cybersecurity.

Because of the large number of devices in the network, IoT cybersecurity must be taken seriously. This is because a single infected device can infect and compromise the entire network. As a result, malicious agents can gain access to sensitive data or have control of your operations.  

4 Must-Haves for Foolproof IoT Cybersecurity

Because there are many entry points that malicious actors can take advantage of, IoT cybersecurity requires a multi-layered and scalable security solution. Here are some of the major components to consider as you build your IoT cybersecurity strategy.

  1. Block Attackers with Next-Generation Firewalls

A firewall is a network security device that monitors network traffic. It can permit or block data packets from accessing your devices based on a set of security rules and protocols. As the name suggests, its purpose is to establish a barrier between your internal network and external sources. Doing this prevents hackers and other cyber threats from gaining access to your network.

While there are many different types of firewalls, for your IoT cybersecurity strategy to be effective, you must employ next-generation firewalls (NGFW). Basic firewalls only look at packet headers, while NGFW includes deep packet inspection. This allows for the examination of the data within the packet itself. As a result, users can more effectively identify, categorize, or stop packets with malicious data.

Next-gen firewalls are a vital part of any IoT cybersecurity strategy as they can monitor traffic between multiple devices effectively. As a result, only verified traffic is allowed access to your network.

  1. Secure Data with Encryption

Another layer of security you need to consider for your IoT cybersecurity strategy is encryption.

A study by ZScaler shows that over 91.5% of enterprise transactions occur over plain text channels. That means only 8.5% of transactions are encrypted. This is worrisome as this means hackers have a huge opportunity to access enterprise systems and wreak havoc. For example, they could launch a distributed denial of service (DDoS) attack that could cripple your business.

One way you can prevent malicious actors from gaining access to your network is to secure your data with encryption. This must be both for your software and hardware. But more importantly, you must use encrypted VPN solutions to ensure the safe transmission of data between your devices.

  1. Identity and Access Management

Initially designed for users, identity and access management (IAM) security solutions were designed for users. IAM ensures that only authorized people have access to systems and information they need to do their job. It also ensures that only authorized users have access to critical data.

But with the proliferation of IoT, IAM (which is sound management) is becoming another layer of security that can be applied to devices.

Just like human beings, digital devices have identities. And IAM tools have evolved to the point of being able to manage hundreds of thousands of devices and their users. With products like A3 from AeroHive, for example, IAM can identify each device in your network and grants them specific access controls.

When it comes to enterprise IoT, managing all your connected devices’ digital identity is critical to safeguarding your network infrastructure. More important is to ensure that each device only has the required access levels to your data. 

  1. Network Segmentation

Network access control (NAC) has been a critical part of cybersecurity since the birth of networks. And to this day, it remains an integral part of most cybersecurity strategies – especially IoT cybersecurity. 

The good thing about traditional network endpoints is that they usually run endpoint protection services. However, with IoT, this is not the case. And that’s where network segmentation comes in.

Using NGFWs to segment your IoT network from the rest of your network is advisable as it keeps potential threats confined within a controlled environment. For example, if an attacker manages to gain access to a device in your segmented IoT network, the threat is confined to that part of your network alone.   

Putting It All Together – Designing an IoT Cybersecurity Strategy

Now that you’ve seen your best options for IoT cybersecurity let’s quickly dive into designing your strategy. However, note that this is not a guide set in stone as every business’s cybersecurity needs are never the same. 

That being said, here are a few guidelines to help you design your enterprise IoT cybersecurity strategy: 

Determine what You Need to Protect

With your security protocols and guidelines in place, the next step to foolproof  IoT cybersecurity is to determine what you need to protect. This involves conducting an audit on:

Your Processes 

Understanding the most critical processes in your organization is essential as it enables you to know where to focus your efforts. Most cyberattacks target processes that can cripple your business, so be sure to have a clear picture of these.  Know what they  are — know how to protect.

Your Devices 

From data storage devices to devices that facilitate your processes, you must know every device in your network and where it fits in your operations. Remember, you’re only as secure as your most vulnerable device. And because all your data is stored and transmitted by your devices, you must invest more effort and time in ensuring your security is foolproof here.

Your Personnel

One aspect of cybersecurity many organizations overlook is their staff. You must ensure that your employees are up-to-date with the latest cybersecurity protocols and safety measures. Failure to do this could make your employees unknowingly compromise your security. For example, one employee could give another a password just to speed up an aspect of your process. While this may seem as harmless as playing a game during work hours — this is a severe breach of security protocol.

Having a clear view of how your devices and their users are connected is crucial to understanding your network’s most vulnerable points. As a result, you can plan on which security solutions you can implement at each point.

Consider Compliance

Sure, compliance is not really a security issue, but they do go hand in hand. That’s why as you plan your IoT cybersecurity strategy, you must do so with compliance in mind.

Incompliance is a serious issue that must be addressed as you map out your cybersecurity plan. Failure to comply could lead to you being slapped with hefty fines.

So what exactly does compliance mean in cybersecurity?

Cybersecurity compliance involves meeting various controls enacted by a regulatory authority, law, or industry group. These controls are put in place to protect the confidentiality, integrity, and availability of data that your business works with. Compliance requirements are different for each industry or sector, and that’s why you must always be careful to know your industry’s specificities.

To ensure that you’re compliant, always have a compliance program that runs in conjunction with your cybersecurity strategy.

Know and Anticipate Your Threats

To ensure that you design a robust IoT cybersecurity strategy, you need to know and understand the security risks you face. To do this, start by evaluating your business by asking questions like:

  • What is your product?
  • Who are your customers?

While these may seem like simple questions, the answers will help you answer two fundamental questions:

This will help you narrow down the types of attacks that will most likely be targeted at your business.

You can also determine the kind of threats you’re most likely to face by studying your competitors. Take note of their risk profiles or the most common breaches in your industry.

Knowing the threats you’re likely to face will help you understand the kind of security measures you must put in place. After all, knowing your enemy is half the battle won (so they say).

Once you’ve determined all these factors, the next step is the most critical – selecting your cybersecurity framework. 

Select an Appropriate Cybersecurity Framework

Now that we’ve laid the groundwork, it’s time to get practical by selecting and implementing your preferred cybersecurity framework. In essence, a cybersecurity framework is a set of policies and procedures recommended by leading cybersecurity organizations. These frameworks enhance cybersecurity strategies in enterprise environments. A cybersecurity framework must be documented for both knowledge and implementation procedures.

Different industries have different cybersecurity frameworks designed and developed to reduce the risk and impact of your network’s vulnerabilities.

While cybersecurity frameworks are never the same, they all must address five critical functions of cybersecurity.

  1. Identify. Your framework must help you identify the existing cyber touchpoints within your business environment.
  2. Protect. This function addresses how you take care of access control, data security, and other proactive tasks to ensure your network is secure.
  3. Detect: Here, your framework addresses how you will identify any potential breaches. This is usually done by monitoring logs and intrusion detection procedures at network and device level.
  4. Respond. How do you respond when a breach is detected? You must have a procedure for understanding the breach and fixing the vulnerability.
  5. Recover. This stage of your framework deals with creating a recovery plan, designing a disaster recovery system, and backup plans.

With a cybersecurity framework covering these five areas, your enterprise IoT cybersecurity strategy will be robust enough to handle (almost) anything. 

As I said, there are myriad different types of cybersecurity frameworks you can adopt. However, most of them fit in one of three categories, according to cybersecurity expert Frank Kim. Let’s take a cursory look at them, so you have a better understanding of frameworks and how they fit in your cybersecurity strategy:

Control frameworks are the foundation of your cybersecurity. They help you:

  • Identify a baseline set of controls
  • Assess the state of technical capabilities (and inefficiencies)
  • Prioritize the implementation of controls 
  • Develop an initial roadmap your security team should follow

Examples of control frameworks include NIST 800-53 and CIS Controls (CSC).

Program frameworks are designed to help you develop a proactive cybersecurity strategy that enables you to identify, detect, and respond to threats. This is achieved by helping you:

  • Assess the state of your security program
  • Build a more comprehensive security program
  • Measure your program’s maturity and compare it to industry benchmarks
  • Simplify communications between your security team and business leaders

Examples of program frameworks include ISO 27001 and NIST CSF, among others.

The risk framework allows you to prioritize security activities and ensure that the security team manages your cybersecurity program well. You can use this framework to:

  • Define key processes and steps for assessing and managing risk
  • Properly structure your risk management program
  • Identify, measure, and quantify risks 

Examples of risk frameworks include ISO 27005 and FAIR.

For an exhaustive list of examples of the different types of cybersecurity frameworks you can implement in your business, check out this article.

It’s Time to Take IoT Cybersecurity Seriously

The rapid digital transformation that has been brought about by COVID-19 and the fast adoption of remote work has led to many organizations’ cybersecurity being stretched to its limits. Throw in IoT into the mix, and cybersecurity has become a nightmare for most organizations.

But this shouldn’t be the case for your business.

The key to winning cyber wars is to be proactive and anticipate cyberattacks before they happen. And this is when a cybersecurity strategy comes to play. 

As you adopt IoT in your business’s infrastructure and processes, make sure to design and implement a robust security strategy. This will help mitigate the risk of you falling prey to malicious agents who thrive on taking advantage of vulnerabilities in an enterprise’s IT infrastructure.

So, it’s time to take your IoT cybersecurity seriously.

Neal Taparia

Entrepreneur & Investor

Neal Taparia is the co-founder of Imagine Easy Solutions, a portfolio of online educational services that reached over 30 million students yearly. Neal sold the business to Chegg (NYSE: CHGG), where he stayed there as an executive for three years. He’s now pursuing a new initiative, Solitaired, which ties classical games with memory and attention training.

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4 Ways Tech Can Bring a Federal Infrastructure Bill to Life – ReadWrite

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Deanna Ritchie


The stimulus bill approved by the House of Representatives in late February was the first of two major budget initiatives President Biden is seeking in the opening months of his administration. The second bill, expected soon, will address the president’s longer-range objective of creating jobs by, among other things, overhauling the nation’s infrastructure.

It’s a fact that people on both ends of the political spectrum can agree on: The nation’s infrastructure is in immediate need of an update. The most recent Infrastructure Report Card from the American Society of Civil Engineers gave U.S. infrastructure a D+ rating.

As the new administration and Congress begin the process of updating the country’s crumbling roads, dams, and electrical grids, one unsettling fact looms large: no one knows exactly how the federal government will be able to solve such a large problem. Improving the country’s infrastructure will require extraordinary levels of investment and public- and private-sector cooperation.

Bassem Hamdy, CEO ofBriq, the leading financial management platform for the construction industry, looks forward to this massive undertaking but warns of potential pitfalls. “The lack of infrastructure development in many areas may be attributed to the bottlenecks existing in construction,” he says. Easing these bottlenecks is going to require tech assistance. This article will discuss how technology can help overcome the industry’s challenges and bring a federal infrastructure bill to life.

1. Digitization

The construction industry has been notorious for relying on manual and paper-based workflows for decades. That paperwork can lead to scores of errors and delays that push projects further back from their intended completion. By digitizing all information, using paper as a backup only, information can be easily shared and accessed at all times.

Hamdy acknowledges the impact technology has already had on the construction industry, noting that “Over the last 10 years, a whole host of software providers emerged, turning paper-based workflows into digital workflows, and in the process, moved general contractors specifically to the cloud.” Moving documentation from paper to the cloud has greatly impacted project efficiency in just a few short years.

While cloud storage and instant messaging have become more widespread in the industry, other forms of technology are pushing the construction world even further into the future. One example is digital contract signing, which makes it possible for documents to be verified and signed digitally, eliminating or reducing the need for paper in most situations.

2. Automation

A federal infrastructure bill might not take into account the labor gap in the construction industry. “While the construction industry accounts for over 10 million jobs in the U.S., there is a significant labor shortage to execute the projects that currently exist,” says Hamdy. “Many of the subcontractors are typically responsible for providing labor but consistently struggle to meet labor requirements, which means that projects often fall into delay and cannot meet schedule requirements.”

Certainly, opening up new jobs is a good thing, but only if skilled applicants can fill them. One way to work around the construction industry’s labor problem is through automation. This could take the form of modular construction (think factory-produced or 3D-printed facades) or the digitization of planning, design, and management processes. Even bricklaying or road paving could be automated.

When automation lightens the workload, it frees up the construction industry’s scarce human workers to perform the tasks only they can do. One further upside: the savings that result from implementing automation could improve the industry’s often razor-thin profit margins.

3. Reduced Overhead and Improved Financial Planning

Even though the construction business is very profitable in certain areas, contractors inevitably face risks inherent to large-scale projects. Robust financial planning capabilities enable them to assume such risks and take the necessary precautions to ensure projects are successful.

Financial technology (fintech) allows contractors to more easily develop budgets and track expenses without an extensive finance background. Predictive modeling and analytics enable more accurate forecasting of cost to completion, while streamlined workflows reduce overhead costs. Both functions will help contractors keep projects within their designated budgets.

Some examples of fintech in action can be found at Harper Construction and Wescor, two companies that have seen massive savings by working with Briq. The technology has added the power of automation as well as additional tools necessary to improve financial analysis and workflows.

4. Data Analytics for Current Projects

Data provides insights for calculated decisions on how to proceed with discrete projects and the day-to-day running of their businesses. “The most important thing a contractor can use technology for is in the management of their cash flow,” observes Hamdy. Data can inform everything from the most cost-effective material choices to the most productive hours for employee scheduling.

Data analytics also helps contractors think bigger picture. “Contractors will embrace intelligent financial forecasting, data analytics, and predictive modeling to better anticipate risk,” Hamdy predicts. And as important as it is to anticipate and brace for potential risks, data analytics can also act like a compass pointing toward new opportunities. Pinpointing growth zones before they explode allows construction companies to tap infrastructural gold mines before the space gets too crowded.

The best of tech is yet to come, but what is available today in the construction sector can bring a federal infrastructure bill to life. In fact, it would likely be impossible to carry out such ambitious plans without leveraging technology in these four ways.

Deanna Ritchie

Managing Editor at ReadWrite

Deanna is the Managing Editor at ReadWrite. Previously she worked as the Editor in Chief for Startup Grind and has over 20+ years of experience in content development.

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Is 2021 the Year of Digital Transformation? – ReadWrite

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Frank Landman


While all large and successful organizations have already gone through significant digital transformation, 2021 may be the year that small and medium-sized businesses dive in headfirst. Are you ready to join the fold by embracing the next iteration of the business world?

What is Digital Transformation?

Digital transformation has been called a lot of things over the years. And while some would argue that it’s nothing more than a buzzword, those who are involved with it know that it’s more than conceptual. When executed with vision and precision, it can revolutionize a business from the inside out.

In the simplest form, digital transformation can be described as the process of leveraging the correct blend of digital technologies to modify existing business processes and/or create new ones. The objective of digital transformation is to enhance the customer experience and establish simpler, more cost-effective systems that streamline every aspect of value creation.

As industry thought leaders often say, digital transformation begins and ends with the customer. When businesses recognize and follow through on this idea, they can expect to yield an array of benefits, including:

  • Greater efficiency. Think about the bottlenecks in your business – the things that slow down processes, frustrate employees, and prevent you from reaching your full potential. In many cases, technology is involved. And if we dig a layer deeper, we’ll find that these technologies are outdated and/or being improperly leveraged. The beauty of digital transformation is that it allows you to fight through these bottlenecks and speed up your business through greater efficiency and output.
  • Better decision-making. It’s not enough to have data. You need to know what to do with that data. Digital transformation ensures you’re collecting and interpreting data correctly, which allows you to improve decision-making and guide your company in a better direction.
  • Enhanced customer satisfaction. Research from Gartner shows that more than 81 percent of companies are competing primarily on customer experience. And as we said on the front end of this piece, digital transformation is ultimately about the customer. By enhancing customer satisfaction, businesses can cultivate loyalty and squash the competition.
  • Increased profitability. An impressive 56 percent of CEOs say digital improvements have helped them increase revenue in the past. And as we move forward into a world where digital transformation becomes even more integral to the health and well-being of organizations, we’ll see this number grow even more.
  • Superior company culture. While customers may be the focal point, digital transformation has a positive impact on employees as well. Over time, this emphasis on digital transformation fosters a superior company culture that reduces turnover by elevating retention.

Identifying and understanding these benefits provides some context as to the value that digital transformation provides. The only question is, are you doing what it takes to yield these advantages?

6 Strategies for Seamless Digital Transformation

Digital transformation doesn’t happen overnight. It takes months and years of proper planning and careful execution. However, you can begin experiencing positive results almost immediately. Here are a few tips to help you do just that:

1. Gain Top-Down Buy-In

There is no digital transformation without comprehensive buy-in from all organizational stakeholders. And more specifically, you must begin the process with buy-in from the C-suite.

Research from McKinsey & Company finds that companies who engage the chief digital officer (CDO) at the beginning of the process are 1.6 times more likely to report successful digital transformation on the back end.

Achieving buy-in requires you to be knowledgeable and articulate in your messaging, but it shouldn’t be difficult. If you do a decent job explaining the benefits of digital transformation, the C-suite will have every reason to support the strategy.

The bigger challenge, per se, is that you’ll have to reaffirm the buy-in continually. In most C-suites, approval is not a one-and-done idea. You’ll need to show momentum and progress through objective data. Be prepared to document the results every step of the way.

2. Assign a Point Person

Don’t be fooled into thinking you can roll out an entire digital transformation strategy with a hodgepodge team of people who already have their hands in a dozen other duties and responsibilities. If you want to be successful with your approach, you should find someone who can lead the way. This may look like hiring a new person for the job or reassigning someone. Whatever the case, be sure to practice discernment.

There are a few key characteristics to look for, including a comprehensive understanding of the digital marketplace, as well as a personality that’s conducive to building rapport and moving others to action.

“For business leaders driving digital transformation, they must be able to lead change and communicate a vision to superiors, peers, direct reports, and users,” mentions Box, a leader in the digital transformation space. “They must understand the impact of a new business model. At the same time, They have to be adept at working with IT managers — explaining the big picture and negotiating specific requirements from IT.”

This person won’t be in charge of executing every element of the strategy, but they will be the ones championing the cause. Everything flows from this person, so get it right!

3. Establish Clear Vision

Your “point person” will be in charge of helping to clarify and communicate the vision for your digital transformation strategy. It’s more important that your vision is comprehensive than catchy. It should be a holistic yet specific idea that considers every aspect of the organization. This includes:

  • Branding
  • Marketing
  • Sales
  • Tech stack
  • Performance
  • HR
  • Budget and operational costs
  • Expected Outcomes
  • Stakeholder impact
  • Etc.

Your vision essentially amounts to a digital roadmap for the future. It explains where you’re going and which aspects of your organization the strategy will touch. (Which should end up being every department, element, and asset.)

4. Evaluate Current Gaps

Take a look at your current technology stack/processes and contrast this with where you want to be in six months, a year, or three years from now. Consider where there are opportunities to pivot and improve, as well as where you’re coming up short. These are your gaps.

Technological and process-based gaps are where the opportunities for significant digital transformation exist. It’s not just about replacing legacy systems and doing away with obsolete processes that no longer produce the results you need. You need to rethink your approach to certain areas of your strategy – like marketing and sales – and imagine what these areas could look like in a perfect world.

As always, think about these gaps through the eyes of the ideal customer. Every digital initiative should support the customer in specific ways. If an “improvement” happens at the customer’s expense, it’s not true digital transformation. It should start by enhancing the customer experience, then (and only then) should you consider the internal impact.

5. Set the Appropriate KPIs

Every organization goes into a digital transformation strategy with the hope that it’ll work out, but there’s a difference in hoping and knowing what’s actually happening. The best way to evaluate the success of your strategy is to set objective measurements ahead of time. Well-developed key performance indicators (KPIs) with pre-defined benchmarks give you something to measure against.

Setting KPIs begins with figuring out what you want to measure and then building from there. If, for example, you’re trying to measure the success of a new application that you’re introducing to your user base, good KPIs would include: daily active users, ratio of repeat to new users, conversion rates, abandon rates, and average time spent on the app.

Is the goal to evaluate customer experience based on a new onboarding process or customer loyalty program? Metrics like customer satisfaction (CSAT), customer effort score (CES), customer loyalty index (CLI), and sentiment analytics are insightful.

User engagement is a fun one to track. You have options such as net promoter score (NPS), traffic sources, customer satisfaction index, bounce rate, and exit rate.

If it’s the reliability of IT systems that you’re interested in measuring, you may keep an eye on specific metrics like uptime, mean time to failure (MTTF), mean time to resolve (MTTR), and mean time before failure (MTBF).

Other large-scale KPIs that touch various aspects include employee performance, innovation, operational performance, and financial performance.

6. Beware of the Shine

It’s tempting to become mesmerized by the shine of new tech and innovation. And with so many different tools and applications being released on a regular basis, it’s difficult to differentiate between the ones that have the potential to be useful and the ones that are a waste of your energy and resources. Be diplomatic in your decision-making!

Where is Your Focus?

Every digital transformation strategy will have a unique flavor. And while it’ll look a bit different in execution and application, many of the same underlying principles are present across the board. For best results, study what others are doing and view their approaches through the lens of your customer and your business. Your roadmap lies somewhere inside these lines.

Frank Landman

Frank is a freelance journalist who has worked in various editorial capacities for over 10 years. He covers trends in technology as they relate to business.

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When Will Chatbots Become Better Than Humans? – ReadWrite

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Nate Nead


How often do you have full conversations with chatbots? It might happen more than you think. 

These days, millions of businesses are employing chatbots for sales, customer service, and dozens of other functions, giving people the fluidity and directness of conversation without requiring an actual human agent to step in

Some of the advantages of this move are obvious; if a chatbot can automatically answer basic customer questions, you don’t have to hire a person for the role. You may also see a faster response time, greater consistency, and no fatigue or frustration. 

But if your intuitions are in line with the average person’s, you’ll instinctively feel like chatbots aren’t quite at the human level yet. 

So is this intuition true? And if not, could chatbots ever become better than humans? When can they do it? 

What Constitutes “Better”? 

These are complicated questions. They’re hard to answer in part because the utility of chatbots is so diverse; you can use chatbots to field customer service questions, generate leads, or even provide direct services to paying clients in some cases. 

But these questions are also difficult because we need to acknowledge what we mean by “better.” What makes a chatbot better than a human? 

There are several dimensions in which a chatbot could hypothetically be better than a human being, and in some of those dimensions, chatbots are already objectively superior. 

Consider: 

  • Cost efficiency. In terms of overall cost efficiency, there’s no comparison. Chatbots are irrefutably more cost efficient than their human counterparts. You’ll need to pay people hourly, or pay them an annual salary, for them to execute conversational tasks for 8 hours a day – plus, you’ll need to pay to train them. While chatbots do carry upfront costs (especially if you’re building a chatbot from scratch), they easily pay for themselves since they function automatically, 24/7. 
  • Availability. The availability factor is another consideration. Human beings get tired. They get hungry. They get emotionally exhausted. But this isn’t so with chatbots. True, you can compensate for human limitations by keeping people on rotating shifts, but there’s no true substitute for the 24/7 coverage that chatbots can provide. 
  • Range of service. When it comes to range of service, human beings are real contenders. Modern chatbots can be trained to cover a wide range of topics and help customers with a wide range of issues – but it all needs to be programmed and it all needs to be predictable. Human beings are still much better at handling unexpected situations and improvising; the artificial intelligence (AI) that dictates chatbot behavior isn’t general enough to support this. 
  • Range of emotion. The emotionlessness of chatbots can be an advantage; they never become frustrated, offended, or impatient. However, many people want genuine compassion or empathy when they’re engaging with an agent – especially in certain applications. For now, human beings are better at expressing emotion and giving people a genuine, “human” experience. 
  • Training and preparation. We also need to consider the training and preparation required to get a human being or chatbot up to speed. To prepare a human for a role in customer service, sales, or a similar area, you’ll likely need to spend a few days, or even a few weeks training them. Programming a chatbot can take even longer, especially if you’re designing one from scratch; but with the chatbot, you’ll never have to worry about turnover or retraining new people. Additionally, you may have to train an entire team of human beings, but you’ll only have to train one chatbot. 
  • Communication skill. Communication skill is often at the heart of this debate. Are chatbots capable of understanding what their conversational partners are saying? Can they respond articulately and completely? The short answer is yes. As we’ll see, modern chatbots are incredibly semantically advanced. 
  • Consumer preference. Currently, consumers overwhelmingly prefer speaking to a human over a chatbot. While consumers do prefer self-service most of the time, most people don’t like the idea of trying to express their thoughts and concerns to a robot. For this reason, human beings are still better – and will likely keep this advantage for the foreseeable future. 
  • Secondary benefits. There are secondary benefits to both human beings and chatbots. For example, human beings can learn from their conversations with customers and provide qualitative feedback you can use to improve your business. But with chatbots, it’s very simple to gather data directly from conversations, and analyze those data to form objective conclusions about your business’s position. 

The Turing Test and Eugene Goostman 

For many consumers, the true test of whether a chatbot is better than a human being is whether it’s at least indistinguishable from a human. In other words, are its linguistic capabilities strong enough that they could be mistaken for an actual human? 

This is, essentially, the Turing test – a test of a machine’s ability to demonstrate intelligent behavior, devised by Alan Turing in 1950. A machine is said to “pass” the test if humans consistently struggle to distinguish between a real human and a sufficiently competent machine. 

Chatbots have been capable of passing the Turing test as early as 2001, when the chatbot known as Eugene Goostman was developed. The Goostman bot emulated a 13-year-old Ukrainian boy, and could carry out simplistic, yet linguistically diverse conversations. Participants were unable to distinguish the bot as being a machine, though there are some limitations to consider here – for example, 13-year-olds aren’t expected to carry out conversations as sophisticated as fully grown adults. 

That said, we’ve technically had chatbots that rival human conversational ability for 20 years. Is this enough to qualify them as “better” than human, given their other advantages? 

The State of AI-Based Chatbots

The most advanced chatbots of the modern era are robust and highly useful. Microsoft and Google have demonstrated technology capable of understanding human speech on par with human error rates. The latter has also demonstrated a chatbot that can literally make phone calls and make rudimentary small talk when carrying out basic tasks like setting appointments. 

Other chatbot platforms showcase their advanced nature with customizability; businesses and individual customers can use the chatbot platform to build the perfect chatbot for their needs, training it and testing it to hone it to perfection. 

Exploitability and Visible Weaknesses

There are also some major weaknesses in chatbots that we need to consider. For example, many chatbots have built-in bias from their developers, which prevent them from providing service equally to all your customers.

Other chatbots are programmed to learn from real people; they’re adaptive, and they evolve by studying the speech patterns of others. While this can be a source of major strength, it’s also exploitable. For example, Microsoft’s Tay chatbot functioned similarly when it was released in 2016, and antagonistic trolls were quick to “teach” it how to wield racist and sexually charged language. 

Finding a way to preserve advantages without opening exploitable loopholes is a challenge that humans don’t generally have to contend with. 

Can Humans Ever Be Replaced? 

It’s clear that chatbots are already better than humans in some regards, and they’re not far behind in others. If we hold this true, the big question becomes: can humans ever truly be replaced? 

Even if chatbots became so perfect that they were unquestionably better than human conversational counterparts (with no exploitable weaknesses), there would be a portion of the population who always prefers speaking with humans over bots. There’s no guarantee chatbots will ever get to this point, but it remains a realistic possibility. 

In short, chatbots are already better than we would have thought possible just 20 years ago. Another 20 years could make chatbots indistinguishable from humans even to the most perceptive conversationalists. But for now, it doesn’t look like humans will ever be completely out of the picture for conversational needs. 

Nate Nead

Nate Nead is the CEO & Managing Member of Nead, LLC, a consulting company that provides strategic advisory services across multiple disciplines including finance, marketing and software development. For over a decade Nate had provided strategic guidance on M&A, capital procurement, technology and marketing solutions for some of the most well-known online brands. He and his team advise Fortune 500 and SMB clients alike. The team is based in Seattle, Washington; El Paso, Texas and West Palm Beach, Florida.

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