AI’s Revolutionary Moment—PegaWorld iNspire Keynote 2023

Pega CEO Alan Trefler talks about the significance of generative AI, the emergence of the ‘autonomous enterprise’ and how the vendor sees itself as positioned to lead a revolution.

(Pega CEO Alan Trefler delivering keynote at PegaWorld iNspire 2023. Photo by author.)

Sometimes chance is evolutionary and steady, but at other times it is revolutionary, disruptive and threatening to both vendors and the enterprises they serve, noted Alan Trefler, CEO of Pegasystems (Pega; Cambridge, Mass.) in his keynote at the company’s user group meeting PegaWorld iNspire in Las Vegas on June idea of creating a structure to organize the processes, the rules all the elements, the interfaces, the technology in a way that brought order to it, that allowed things to be shared but also compartmentalize certain parts so that you could have common rules and processes across the organization but specialization where that made sense.

Alan Trefler, CEO, Pega.

Trefler emphasized the sudden prominence of generative AI (GenAI) in the technology discussion. He spoke of GenAI’s relevance within the broader topic of AI, spoke about how AI was giving way to what the vendor calls the “autonomous enterprise,” and how Pega sees itself as uniquely positioned to lead a kind of AI revolution.

Trefler greeted the audience by noting that the event was the first user group meeting since the pandemic struck, and that this year marked the 39th anniversary of the first deployment of Pega’s technology. One of the vendor’s two customers of that vintage, Citibank, presented at the conference.

‘Mind-Blowing’ Technological Change

Technology has changed “mind-blowingly” recently, leading to a tipping point, Trefler said. “It’s clear to us that we are at a revolutionary moment,” he elaborated. “We’re at a moment when the emergence of AI in new ways is complementing our traditional views of AI and providing both enormous opportunities and enormous risks—and we’re doubling down on AI.”

Facebook took ten months to hit a million users, and Instagram hit that mark in only 11 weeks, Trefler observed. By contrast, ChatGPT took five days. “There’s no question that it’s coming and it’s sweeping over our business,” he said. “It’s going to influence not just bits of technology, but how people think about their businesses in very profound and fundamental ways.”

Businesses and their supplies will need to embrace that change and collectively adopt a new way of operating, Trefler continued. He then alluded to the vendor’s long-standing motto—“Build for Change.” He introduced the concept of the “layer cake approach,” by which Pega built its technology offering within a structure to organize processes, business rules and other functional components. This approach differs from that of other vendors with roughly similar offerings, and it will have important implications for AI-driven workflow automation and decision-making, he insisted.

Trefler noted that many of the foundational concepts of AI have existed for decades, citing the study of neural networks during his university days. While a computer science student, he was recruited to help develop “expert systems,” as they were then called, that could enable a computer to play chess at a certain level of competence. “It was a different way of thinking about problems,” he said. “The whole way of thinking about this topic has changed massively, but at that time it really impacted my way of thinking and set a path for the journey that Pega has been on.”

From Chess to Business Processes

The insights from that time led to thinking about how to train computers to do other automated activities that captured business processes and rules, Trefler elaborated. Another foundational insight for the evolution of Pega as a vendor was the creation of a “common canvas” where both business and IT professionals could exert influence in changing how a business worked.

Trefler described a hyper-agile distributed architecture that features a layer cake to capture business logic to ensure the delivery of a coherent experience to all customers. Another vital addition for working in the age of AI was what Trefler called “center-out” engines. These, he said, have “brains” and case management capabilities to record the history of processes, transactions and other activities.

Pega CEO Alan Trefler explaining the “Layer Cake” concept. Photo by author. (Click to enlarge.)

“The vision is that this should be part of a connective tissue—a part of a fabric, a microservices architecture, as it were—with a collection of engines running perhaps in multiple regions to be able to handle local data requirements, but all running off of a common set of layer cake definitions,” Trefler explained.

Trefler spoke about the company’s Low Code Innovation Factory capability as a place to create processes that fit within the larger logic of the layer cake which will leverage AI to accelerate processes.

Self-Optimizing Enterprise

“The best thing about this is you can have an enterprise that becomes self-optimizing, where every piece of it can be evaluating how it’s working, looking at standards, mining what’s going on with the processes and we call this continually optimizing enterprise driven by the layer cake, driven by the center-out engines we call that the autonomous enterprise,” he said. “It is going to change the game.”

Trefler said the layer cake concept was the secret to mastering GenAI, as it gave logical shape to the adaptation of the technology to processes. “Other approaches are going down the path of saying, ‘oh I’m going to use all these wonderful prompts to generate code and the code and stick it together somehow,” he added. “Candidly if you’ve got a small apps or systems that aren’t very sophisticated this may be fine. However,  the problem is your logic is buried in this code—and more code and more code—which inevitably means more bugs. And the reality is more disconnected apps.”

“That’s where the Pega approach is radically different,” Trefler continued. “Yes, we’re using GenAI…but we’re using it to augment the layer cake; we’re using it not to generate the code but to generate the rules, the business logic, the AI principles into the cake—into that structure. So, you’ve got a place where you can you can look at it, reflect on what it’s doing, and actually show an auditor what you’re running without showing them a bunch of prompts.”

Positioned to Lead a Revolution

As the business world enters a very threatening moment for many organizations, Pega sees “pure empowerment,” Trefler asserted. “We’re doubling down on bringing our development environment the power of generative AI…and the power to make AI-driven development natural.”

“I think we have the chance to radically improve how people run their businesses,” Trefler continued. “And that this is truly a moment of genesis, truly a revolution. Empowered with our history, our knowledge, the awesome customers that we get to deal with, we are I believe terrifically positioned to lead this revolution.”

The Age of the Autonomous Enterprise is Coming—Pega Research 

Consumer Attitudes Mixed on AI in Customer Service—Pega Research


Anthony R. O’Donnell // Anthony O'Donnell is Executive Editor of Insurance Innovation Reporter. For nearly two decades, he has been an observer and commentator on the use of information technology in the insurance industry, following industry trends and writing about the use of IT across all sectors of the insurance industry. He can be reached at or (503) 936-2803.

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