By Steven Overly

With help from Derek Robertson

A soda fountain featuring PepsiCo beverages. | AP Photo/Wilfredo Lee

Critics and champions of artificial intelligence often debate its impact in the future tense. It will steal jobs. It will discover medical breakthroughs. But in many workplaces, the AI impact is already here. In a McKinsey survey released last month, 25 percent of executives reported personally using AI at work and 40 percent said their companies were increasing AI investments.

PepsiCo offers one example of the AI-powered future actually happening today — reshaping all manner of work, including the making of the humble Cheetos. The company’s chief strategy and transformation officer, Athina Kanioura, said in an interview on the POLITICO Tech podcast that she’s infusing AI at all levels of the operation.

“What we want is our employees to be more efficient, not to be eliminated,” Kanioura said. “We don't believe in dislocation; we believe in augmentation.”

At PepsiCo, financial planners now use AI to predict future costs and earnings, while truck drivers use it to optimize delivery routes and monitor vehicle maintenance, Kanioura said. And more recently, it’s been exploring generative AI models as well.

Kanioura said her company has managed to introduce AI without the rampant human layoffs that some AI critics fear. Instead, she said the company needs to hire fewer workers to keep pace with its growth.

Kanioura has embarked on a plan to digitize much of 58-year-old PepsiCo’s operations since joining the company in 2020 after 15 years at consulting firm Accenture. Half of her projects involve some degree of artificial intelligence, she said, describing AI as “pervasive in every practical technology application that we have in the company.”

Researchers lean on AI to select ingredients, like corn and cheese, and develop new snacks that match consumers’ taste. Engineers use the tech to enforce quality control and safety standards, speeding up a process that once involved stacks of manuals. And the marketing team taps AI to tailor products to shoppers’ favorite sports teams or personal memories, “because we want PepsiCo to be an experience company beyond just a snacks and beverages company,” Kanioura said. That may sound like corporate speak, but she said consumers today demand it.

“They want personalization. They want different experiences. They want engagement. They want a company that understands their needs real time, very, very fast,” Kanioura said. “You cannot be doing that in an analog way. You can only do that in a digital, real-time, AI-powered way.”

The business Kanioura describes sounds more like social media than soda making, and that’s kind of the point. Internet giants like Meta, Google and TikTok have amassed tremendous size and scale by pumping data into highly tuned algorithms and spitting out ads that resonate with consumers. AI-powered tools can be used to replicate that approach by analyzing larger and more varied types of data — like the crunch of a Cheeto — in increasingly sophisticated ways.

Kanioura said she is trying to bring data and algorithms into the workplace while preventing harms that the tech can cause. Kanioura said PepsiCo avoids micro-targeting individual people out of concern that the AI could perpetuate bias or exclude certain customers. Similarly, the company uses AI to automate parts of the hiring process, like determining compensation, but not to identify job candidates due to concerns about discrimination.

Like other U.S. companies, PepsiCo is operating in a fairly open playing field. Washington, D.C., has not passed significant AI legislation — a feat that seems even more remote with the ouster of House Speaker Kevin McCarthy. State efforts are scattershot.

Kanioura said the company has crafted safety and ethics guidelines to manage the technology’s risks — and its meeting with lawmakers in Washington to try to shape similar policies. But even with those considerations, the company only plans to ramp up.

“I do believe the companies that embrace technology [but] use it responsibly will be the companies that will stay and succeed in the future,” Kanioura said. “And the companies that stay on the sidelines will be left behind.”

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The writers’ strike is finally over, and the agreement between the Writers’ Guild of America and Hollywood contains some strictures specifically dealing with AI.

The summary posted by the WGA lists a series of agreed-upon AI rules, including:

• AI-generated material can’t be used to undermine or split a writer’s credit, or to adapt literary material
• Companies can’t force writers to use AI tools
• Companies have to disclose whether material given to writers is AI-generated

The WGA also “reserves the right to assert that exploitation of writers’ material to train AI is prohibited by MBA or other law,” keeping at least one avenue for protest open in what’s shaping up to be a drawn-out and murky legal battle over the training of AI models. — Derek Robertson

A man in Spain ponders the orb. | AP Photo/Emilio Morenatti

If you guessed that a worldwide finance app that uses biometrics to establish identity would attract some regulatory scrutiny, come and collect your prize.

Lawmakers in Kenya published a report that concludes Sam Altman’s Worldcoin project constitutes an “act of espionage,” as reported in this morning’s POLITICO Morning Cybersecurity. The project, which purports to create a “more human internet with global proof of personhood,” launched in 20 countries but has been whittled down to 12 as investigators across the world look into potential violations of privacy.

And yet… Morning Cybersecurity reports the company has already mined biometric data from more than 2.3 million users globally, taking advantage of minimal regulation and raising concerns about transparency around what they’ll actually do with that data. Worldcoin did not respond to their request for comment. — Derek Robertson

• The Messenger will use AI software to “evaluate the transparency of content.”
• Meta’s new AI tools for making stickers can generate some, uh, inappropriate content.
• Check out America’s EV battery manufacturing one year post-IRA. Key word? Tsunami.
• OpenAI’s “opt-out” tools for artists might not be very effective.
• SoftBank’s Masayoshi Son is a big believer in artificial general intelligence. 

Stay in touch with the whole team: Ben Schreckinger ([email protected]); Derek Robertson ([email protected]); Mohar Chatterjee ([email protected]); Steve Heuser ([email protected]); Nate Robson ([email protected]) and Daniella Cheslow ([email protected]).

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