Luminoso uses AI to help skilled workers in Japan pass down techniques to the next generation; How technology can solve social problems

Luminoso Technologies, based in Massachusetts, USA, provides natural-language technology to make all of this possible.
The company has the technology to automatically convert text data to valuable business information. The client who receives the data will gain useful insights.
We interviewed David Smith, the Representative Director of Luminoso Japan, the company’s Japanese subsidiary, regarding how the company managed to establish its own unique strategy in Japan.

INDEX

・AI helps skilled workers pass down their techniques to the next generation
・Focused on products, not technology
・The company managed to create its own unique strategy in Japan thanks to its flexible spirit and strong but loosely held convictions
・Key points

David Smith
David Smith is an investor/operator/entrepreneur with over 10 years of experience across various industries (internet services, media, finance) in Japan. He arrived in Japan to begin his career immediately after earning a master’s degree from the University of Arizona. After a stint at a major U.S. investment bank, he joined GREE and engaged in investment/M&A operations. Then, he joined Digital Garage, where he handled venture-capital operations and launched a social media start-up. This is how he accumulated his diverse experience. Recently, David has established the Japanese unit of Luminoso Technologies, a portfolio company of Accord Ventures, expanding his skills related to Enterprise SaaS sales and management.

AI helps skilled workers pass down their techniques to the next generation

Luminoso Technologies originated in 1999 within the MIT Media Lab. It was a project started by engineers to teach languages to personal computers. Luminoso Technologies was spun out of this project in 2010.
During that time, 15 languages were taught to computers. As for Japanese, Luminoso cooperates with Japanese corporations and universities to improve precision and accuracy.
Many of Luminoso’s overseas clients are pharmaceutical and game companies. In Japan, however, Luminoso also attracts the interest of many manufacturers. This is rare in the U.S. or Europe.

SmithOne of the trends relates to the handing down of work techniques. Many companies have a vast amount of intelligence left by skilled workers in the past in the form of textual information. In reality, however, once they leave their workplace because of retirement or other reasons, such textual information can no longer be utilized effectively.

These companies, therefore, use Luminoso’s natural-language technology. A vast amount of text data are fed into a computer. It has long been considered that it was difficult to hand down skilled workers’ techniques because such techniques were unique to particular individuals. This is precisely why this technology’s potentiality is highly regarded among Japanese companies.

SmithLuminoso understands unique words used only within a certain company. If you provide an engine that can read and perform fuzzy searches, young engineers who encounter a certain problem, for example, could just enter that particular phenomenon and obtain search results that could point to the cause of the problem fairly easily. There will be an increased likelihood that documents from the past could lead to a solution.

SmithWe are not just talking about the Japanese language. The computer understands the Japanese society and its common knowledge.

Luminoso’s system understands the common knowledge of companies and individual words, just as it understands the common knowledge of society. A vast amount of past technical information that has been left dormant can be utilized in this way.
Luminoso creates such a solution specifically for each company by jointly considering the problem that must be resolved. The important point is that AI does not analyze everything.

Smith It is humans that will perform actual analysis. There are speculations in the media that AI will solve everything. However, our approach, which is more realistic, is different. Humans will perform actual analysis. AI will not completely replace humans. It would be best if humans and AI think together. Humans still have a role.

Luminoso’s clients include many global companies and many of the representative companies in Japan. The company finished procuring $20 million in capital by 2018. Thus, “Series B,” a round of investment to finance the company’s business expansion, has already been completed. A full-scale market expansion is now about to begin.

Focused on products, not technology

Smith believes that it is important to focus on products. This can be explained by his background.
Smith, who joined Luminoso Japan in 2017, began his career in Tokyo at an investment bank. He subsequently worked on finance-related projects at GREE, and handled start-up investments at Digital Garage. Furthermore, he launched a business in Japan. He is familiar with start-up companies in part because he has an experience as an investor.

SmithOne thing you should never do is become too preoccupied with what you can do with the technology you have. What should be prioritized is what technology can do as a “use case.” It would be better to learn about the problems of customers and create an end-to-end product. For example, if you have natural-language processing technology, this is precisely where you should use it.

You might dwell on how great your technology is. However, it is not something that customers are concerned about.

SmithYou must show your customers what is in it for them. As long as it works for the customers, they will certainly know how great it is. You must focus on products, not technology.

As an investor, he has also been investing in companies that held such policies.

The company managed to create its own unique strategy in Japan thanks to its flexible spirit and strong but loosely held convictions

Finally, Smith again provided the following analysis regarding how the company succeeded in creating its own unique strategy in Japan.

SmithI believe that what is important for a start-up company is flexibility. In Zen, there is a word nyunanshin (a flexible spirit). This is exactly what I am talking about.

Nyunanshin is a word used in Zen Buddhism. It means that one should strive to perceive and receive objects in a flexible manner.

Instead of considering how to apply technology, one must first consider clients. When one visits clients to learn about their problems, one must first be in a state of mind where there are no preconceived ideas.

SmithThis is because we tend to think in terms of the technology we have. However, what is important is to just listen to what they have to say. This is where nyunanshin comes into play.

Even so, it would be problematic if one just listens and refuses to think on one’s own.

Smith The expression I use here is to “hold strong convictions loosely.”

It would be better to have strong convictions. However, when one acquires new information by listening to clients, one should update those convictions.

SmithCreate a conviction based on new information. Then, go listen to your clients again. It may sound contradictory to say that you should hold your convictions loosely. However, life is full of contradictions. (Laughs)

The company was able to create its own unique strategy in Japan precisely because it flexibly adapted to various technologies and targets.

Even as technology evolves, a clue to solving a problem is found in conversation with other people. The company has connected natural-language technology with the handing down of techniques. This may be the result of the flexible spirit and the loose convictions that Smith and Luminoso have as they connect the dots, learn customers’ wants and concerns, and keep updating themselves.