Brazil’s Busca.Legal – Systax set out to simplify that system in the 2017 Watson Build Challenge, with Busca.Legal Tax Classifier – TC, winning the top spot for Latin America at our Global Finals event in New York last November. I’d like to share a conversation with Paschoal Naddeo, co-founder of Busca.Legal, to provide some insight into his company’s solution and his experience taking part in the 2017 Watson Build Challenge.
Nice to chat with you again, Paschoal. What were your thoughts when your solution earned the top spot for the Latin America region?
Paschoal Naddeo: Our team was thrilled and honored to be selected as the Latin America Geography Champion. The energy at the event was fantastic, and it was clear that there was an incredible amount of talent in the room from around the world. Being selected as a finalist was incredible recognition for our hard work.
Creating a cognitive-based solution using Watson APIs requires innovative thinking. How did you come up with your solution concept?
We have innovation in our DNA. We’ve been pioneering in the tax legal space since 1999 when we launched a 100 percent web-based search tool for fiscal and legal information. Fast-forward almost 20 years, and we still find ourselves on the cutting edge of the legal space. We decided to put cognitive AI to work to complement, empower and facilitate the daily routine of tax professionals. Accounting/tax departments, accounting firms and foreign trade specialists all need to have the right tools to make sure the product tax classification is correct, because the financial consequences can be quite significant if a mistake is made.
Tell me more; I’m sure most of us avoid thinking about intricate tax work, so you definitely have great insight to share.
Taxes in Brazil are some of the most complicated in the world, and the Mercosur Common Nomenclature (NCM) adds to this complexity in a big way for companies conducting international trade. Companies need to keep their product registers correct and up to date in regard to the tax classification of these products using NCM. Furthermore, the NCM also makes the addition of new items to company registers incredibly time-consuming and a high-risk effort.
The challenge for clients is that the incorrect use of an NCM code may cause either the overpayment or the underpayment of taxes and contributions. And there’s a lot at stake if a company underpays—a minimum fine of 75 percent may be imposed by the tax authorities.
Our solution specifically targets the tax classifications around foreign trade for businesses, and the combination of IBM technology and other proprietary tools made it possible. The solution searches through a large collection of information, bringing together data from more than 26 different sources in order to enable Watson to combine the results and rank them in order of the most adequate NCM. We present the tool through a web interface for direct user interactions, as well as through an API for integration with third-party systems we intend to provide via IBM Cloud. As a result, we’re able to deliver the most appropriate probability-weighted NCM suggestions indicated by Watson for each situation.
Did you leverage your IBM relationships as you put your solution together? Or participate in workshops?
Yes, there was definitely collaboration with IBM technical mentors and cognitive specialists as well as trusted IBM Business Partners as part of our participation in the event. We also joined the live Design Thinking workshop—it was inspirational and enhanced our focus on innovation in our solution.
Today, customers are waiting for AI solutions, and the Watson brand has a great deal to do with making them a reality. Plus, there is no doubt about the power of the IBM brand to assist us in reaching our customers. By being an IBM Business Partner, we get to stay on the cutting edge and share knowledge with the most innovative ecosystem in the world.
What advice would you give to other Business Partners that might be debating whether to join the Watson Build program this year?
I wholeheartedly recommend that you join and attend. In addition to the obvious experience of developing an innovative solution, spending time with the worldwide leadership of IBM, the broader IBM Business Partner ecosystem, executives from other companies and other competing participants can be very inspirational. It’s key to focus on innovation and the use of AI, but always start by thinking about the benefits your solution will bring to the end user.
Thanks, Paschoal, for sharing your journey! For those of you who want to learn more about what Busca.Legal – Systax accomplished, here’s a great video of their 2017 Watson Build presentation.