Leveraging AI foundation models to boost your enterprise

Leveraging AI foundation models to boost your enterprise

KPMG Edge October 2023

Foundation models powered by AI are driving major breakthroughs for enterprises, including generating critical data-driven insights and streamlining everything from product innovation to content creation. Here’s what enterprises should know about AI foundational models, how they can be leveraged to put your enterprise ahead of the pack, and the relationship between Generative AI and foundational models.

What are AI foundational models?

AI foundational models are a crucial component of modern artificial intelligence (AI) and machine learning (ML) systems. These models serve as the backbone upon which more specialized and task-specific AI applications are built.

These models have revolutionized the field of natural language processing (NLP) and are instrumental in powering a wide range of AI applications, including chatbots, language translation, content generation, and sentiment analysis.

The concept of AI foundational models gained prominence with the development of deep learning techniques, particularly in the field of NLP. One of the seminal moments in the evolution of these models was the introduction of the transformer architecture. 

Transformers are neural network models that have demonstrated remarkable capabilities in processing sequential data, making them well-suited for NLP tasks. 

Composed of an encoder-decoder structure and relying heavily on self-attention mechanisms, transformer-based models are capable of independently weighing the importance of different elements in a sequence when making predictions.

The breakthrough in transformer-based models came with the introduction of models like GPT (Generative Pre-trained Transformer) and BERT (Bidirectional Encoder Representations from Transformers). 

Pre-trained on massive corpora of text data, these models learn to understand language by predicting the next word in a sentence or by filling in masked words within a given context. 


This pre-training process equips them with a broad knowledge of syntax, grammar, and semantic relationships, making them highly adaptable to a wide range of NLP tasks. They can generate human-like text and perform various language-related functions. 

Some key characteristics and features of AI foundational models include:


Transfer Learning

One of the primary advantages of these models is their ability to transfer knowledge learned during pre-training to specific tasks. Instead of training a model from scratch for each new task, developers can fine-tune these pre-trained models on smaller, task-specific datasets. This significantly reduces the computational resources and time required to develop AI applications.


Multilingual Capabilities

Many AI foundational models are designed to be multilingual, meaning they can understand and generate text in multiple languages. This makes them valuable for global applications such as language translation, sentiment analysis, and content recommendation.


Continuous Improvement

The AI community continuously works on improving these foundational models. Researchers develop larger, more powerful models, fine-tune them on increasingly diverse datasets, and optimize their performance. This iterative process leads to better AI capabilities over time.


Open-Source Frameworks

Many foundational models are open-source, allowing developers and researchers to access and utilize them freely. This democratizes AI development, enabling a broader community to contribute to and benefit from these models.

Foundational models in AI: An overview

Foundational models have found widespread use across multiple domains, including:


Natural Language Processing (NLP)

In NLP, models like GPT (Generative Pre-trained Transformer) and BERT (Bidirectional Encoder Representations from Transformers) have revolutionized tasks like text generation, sentiment analysis, machine translation, and question-answering. These models can understand context, semantics, and even nuances in human language.


Computer Vision

Similar concepts have been applied to computer vision. Models like Vision Transformers (ViT) and Convolutional Neural Networks (CNNs) have been pre-trained on large image datasets and fine-tuned for tasks like image classification, object detection, and facial recognition.


Recommendation Systems 

Foundational models play a role in building recommendation systems. By learning patterns from user behavior data, these models can provide personalized recommendations in various domains, such as e-commerce, content streaming, and social media.


It’s clear that AI foundational models are a critical advancement in the field of artificial intelligence, serving as versatile tools that underpin a wide range of NLP applications. Their ability to learn from vast amounts of data and transfer that knowledge to specific tasks has significantly accelerated the development of AI-powered solutions making them an integral part of the AI ecosystem.


As these models continue to evolve, they hold great promise for driving innovation and improving the capabilities of AI systems in the future. 

Currently, common business and enterprise uses for AI foundation models include:


These models enable the creation of chatbots that can hold natural and free-flowing conversations with users, improving customer service and user engagement.


Content Generation

They are used to generate high-quality, human-like text for tasks such as content creation, marketing, and storytelling.


Sentiment Analysis 

AI-based foundation models can analyze and understand the sentiment expressed in text, which is valuable for brand monitoring, customer feedback analysis, and market research.


Language Translation

They power online translation services, making it easier for people to communicate across language barriers.

Leveraging foundation models for decision making


Aside from practical, customer-facing purposes, enterprises can leverage foundation models for smarter decision-making, driven by the power of pre-trained AI models to enhance and streamline the decision-making process across various domains. These models provide a foundation of knowledge that can be fine-tuned and customized for specific decision-support tasks.

There are numerous benefits associated with utilizing foundation models for making decisions within an enterprise. 

Enterprises can leverage data-driven insights, which are extracted from large volumes of structured and unstructured data by the models. This data-driven approach ensures that decisions are based on a comprehensive analysis of relevant information.

Foundation models can provide enterprises with a meaningful boost to their automation and efficiency. These models can automate repetitive decision-making processes, saving time and resources. 

Routine decisions, such as approving loan applications or flagging fraudulent transactions, can be expedited with the help of AI, allowing human decision-makers to focus on more complex and strategic tasks.

AI models may provide greater objectivity and consistency, as they are designed to be free of human bias. They are not influenced by preconceived judgements, emotions, or fatigue. This neutral, data-based approach is particularly important in fields like healthcare and finance, where the consequences of biased or inconsistent decisions can be significant.

Scalability is another major benefit of using foundation models. Because they can be scaled up effortlessly to handle large volumes of data and decisions, they’re particularly helpful for applications in industries with rapidly changing environments, such as e-commerce, supply chain management, and cybersecurity.

Continuous Learning: These models can adapt to changing circumstances and evolving datasets. They can be periodically re-trained to incorporate new information and improve their decision-making capabilities over time.

However, there are serious challenges that enterprises should consider when leveraging foundation models as a central component for their business decisions.

Using AI for decision-making raises ethical considerations, especially when it comes to issues of fairness, accountability, and transparency. Models may inherit biases from their training data, leading to unfair or discriminatory outcomes.

The accuracy and reliability of decisions influenced by the models heavily depends on the quality of the training data. To put it simply: garbage in, garbage out. Ensuring high-quality, diverse, and representative data is crucial, or else enterprises may find themselves with incorrect or irrelevant recommendations.

Interpretability is also a key issue. Many foundation models, particularly deep learning models, are often considered "black boxes" because their decision-making processes are complex and not easily interpretable. This lack of transparency can be a challenge in highly regulated industries where decision-makers need to explain and justify their choices.

That’s not to mention very real concerns around security and privacy. Using foundation models for decision-making may involve processing sensitive information. Safeguarding the security and privacy of this data must be a top priority to protect individuals and organizations from data breaches and misuse.

Generative AI for enterprise: What you should know

Generative AI, a subset of artificial intelligence, has been making significant inroads into the enterprise sector, promising to revolutionize how businesses operate, innovate, and interact with their customers. 

Foundation models and Generative AI are closely connected, with generative AI often being built upon or utilizing foundation models as a core component.


As previously mentioned, foundation models such as GPT (Generative Pre-trained Transformer) and BERT (Bidirectional Encoder Representations from Transformers) serve as the starting point for numerous generative AI applications.


Many enterprises use Generative AI, which is powered by the language understanding and generation capabilities of foundation models, to develop applications that create believable, natural texts, assist in content generation, and perform various language-related tasks.


This connection between generative AI and foundation models underscores the importance of pre-trained models in advancing the capabilities of AI systems and their widespread adoption across diverse domains.

Common enterprise use cases for Generative AI

Because of Generative AI’s ability to create human-like text, including articles, marketing copy, and product descriptions, the technology is invaluable for content-heavy industries like publishing and e-commerce. These Generative AI solutions can be used to save time and resources, including manpower hours, while maintaining quality.


Generative AI is often used to boost customer engagement. Both chatbots and virtual assistants powered by Generative AI are becoming increasingly sophisticated. They can provide personalized customer support, answer queries, and even engage in natural, context-aware conversations. This enhances customer satisfaction and streamlines customer service operations.


Enterprises that prioritize product innovation may use Generative AI to create design prototypes, suggesting improvements, or even creating entirely new product concepts. It can accelerate the innovation process and help businesses stay competitive.


Personalization is a key driver of customer loyalty. Generative AI can analyze vast amounts of customer data to tailor marketing campaigns, product recommendations, and user experiences to individual preferences.

Embracing the future: Foundation models and Generative AI for your enterprise

Foundation models and Generative AI are undeniably reshaping the business landscape in profound ways. Enterprises that recognize the transformative potential of these technologies and embrace them are poised for success in the ever-evolving digital era. These AI advancements offer not just a competitive edge but a fundamental shift in how businesses operate, innovate, and engage with their customers.


Enterprises that do not embrace these technologies run the risk of being left behind in a rapidly changing business landscape, missing out on the numerous advantages they bring in terms of efficiency, customer engagement, and innovation. To remain competitive and relevant, businesses must recognize the pivotal role of foundation models and Generative AI in shaping the future of enterprise operations.


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