Western Washington University  ·  MIS 432  ·  Free

AI in Business:
Real Companies. Real AI.
Real Decisions.

A free, case-based digital textbook that teaches machine learning and AI through real companies and hands-on AI labs.

Every chapter is a real business case. Every lab puts you inside the AI that made it work.

7
Chapters
7
Labs
40+
AI Concepts
Free
Always

About the Digital Textbook

Most AI textbooks teach theory first and hope the business applications follow. This one does the opposite. Every chapter starts with a real company facing a real problem — and uses that story to teach the machine learning concepts that made their solution possible.

You will not just learn what a recommendation system is. You will understand why Spotify built one, how it works, what went wrong, and what the business consequences were. Then you will build a version of it yourself.

No prior programming experience is required. Each lab uses Claude to help you write and understand code step by step.

📖
Case-first learning Every ML concept is introduced through a real company story
🔬
Build it yourself Each chapter has a lab where you recreate the system in Python
🤖
AI-assisted coding Use Claude as a tutor and coding partner throughout every lab
Three parts. One big idea.

Every chapter follows the same structure so you always know what to expect.

1

The Business Case

Read about a real company solving a real problem with AI. Learn the ML concepts as they come up in the story.

2

The Concepts

Key ML and AI vocabulary is introduced inline — right when you need it, not in a separate glossary.

3

The Lab

Build a simplified version of the system in Python using Claude and Google Colab. Publish it on GitHub.

The AI Factory Model

Data
Collect & structure
Model
Learn patterns
Prediction
Generate output
Decision
Take action
Value
Business outcome
↩ Loop
Back to data

Every company in this textbook follows the same underlying pattern. Learning to see it is the core skill of the course.

Start Reading

This textbook is for business students who want to understand how AI actually works in practice — not just in theory. You do not need a coding background. Each chapter tells the story of a real company, teaches the AI concepts that made their strategy possible, and then walks you through building a version of it yourself.

Each chapter includes a business case, key ML concepts, and a hands-on lab.

Chapter 1 · Healthcare AI

Knowledge Graphs & AI Prediction:
How EveryCure Finds Hidden Treatments

EveryCure · Drug repurposing · Knowledge graphs · The AI Factory

ML Concepts

  • Knowledge graphs
  • The AI Factory model
  • Supervised learning
  • Graph-based prediction
  • Human-in-the-loop AI

Business Topics

  • Drug repurposing
  • AI in healthcare
  • Data as infrastructure
  • Scaling research with AI

In the Lab

  • Build a knowledge graph in Python
  • Score drug-disease matches
  • Publish results on GitHub Pages
Chapter 2 · Experimentation & Testing

A/B Testing & Experimentation:
How Netflix Decides What You See

Netflix · A/B testing · Experimentation · The prediction-decision gap

ML Concepts

  • A/B testing
  • Randomization & causal inference
  • Statistical significance
  • Explore vs. exploit
  • Prediction-decision gap

Business Topics

  • Data-driven decision making
  • Automation vs. augmentation
  • Content discovery
  • Narrow AI in practice

In the Lab

  • Simulate a Netflix-style A/B test
  • Calculate click-through rates
  • Run a statistical significance test
  • Publish case study on GitHub
Chapter 3 · Recommendation Systems

Recommendation Systems & Personalization:
How Spotify Learns What You Love

Spotify · Collaborative filtering · Embeddings · AI governance

ML Concepts

  • Recommendation engines
  • Collaborative filtering
  • Embeddings & two-tower models
  • Training-serving skew
  • AI governance & monitoring

Business Topics

  • Personalization as strategy
  • Data moats
  • Silent AI failures
  • Compounding competitive advantage

In the Lab

  • Build a recommendation system
  • Implement collaborative filtering
  • Generate a Wrapped-style summary
  • Recreate the training-serving gap
Chapter 4 · Uber Is AI

Uber Is AI:
What Happens When the Algorithm Is the Business

Uber · Forecasting · Prediction-decision gap · Responsible AI · Algorithmic accountability

AI Concepts

  • AI as operational infrastructure
  • Forecasting & time series
  • Black-box vs. interpretable models
  • Backtesting & prediction intervals
  • Distribution shift
  • Agentic AI

Business Topics

  • AI as the engine, not the feature
  • Algorithmic accountability
  • Responsible AI & governance
  • Build vs. buy decisions
  • AI prototyping
  • From cost center to revenue

In the Lab

  • Build a demand forecasting model
  • Detect trend & seasonality in data
  • Backtest model performance
  • Visualize prediction intervals
Chapter 5 · Deep Learning · Autonomous Vehicles

How Machines Learn to See:
Deep Learning & the Waymo Driver

Waymo · Computer vision · Neural networks · Simulation & synthetic data

AI Concepts

  • Neural networks & deep learning
  • Convolutional neural networks (CNNs)
  • Reinforcement learning
  • The long-tail problem
  • Simulation & synthetic data
  • World models & foundation models

Business Topics

  • When AI is the product, not the feature
  • Deep learning as competitive advantage
  • Safety-critical AI deployment
  • Liability & accountability
  • Waymo in the Wild — real failures

In the Lab

  • Analyze World Model scenarios
  • Run a real image classifier
  • Find failure cases on edge scenarios
  • Analyze driving motion data
  • Write a simulation design brief
Chapter 6 · Two-Sided Marketplaces

Dynamic Pricing & Marketplace AI:
How Airbnb Matches Guests, Hosts, and the Right Price

Airbnb · Marketplace matching · Dynamic pricing · Hybrid ML · Generative AI in production

AI Concepts

  • Two-sided marketplaces & matching
  • Cold-start problem
  • Behavioral sequences as tokens
  • Embeddings & multi-task learning
  • Dynamic pricing & lead time
  • Hybrid ML + structural models
  • Generative vs. predictive AI

Business Topics

  • Matching both sides of a marketplace
  • Exploratory vs. transactional users
  • Whose margin is the algorithm optimizing?
  • Automation vs. augmentation (hosts)
  • GenAI in established businesses
  • Labor substitution vs. augmentation

In the Lab

  • Build a demand-based pricing model
  • Fit a lead time distribution
  • Cluster listings into demand aggregations
  • Compare pure ML vs. hybrid approaches
Chapter 7 · Agentic AI · Healthcare

From Paper Charts to AI Agents:
How Epic Is Reinventing American Healthcare

Epic · Agentic AI · Ambient documentation · Human-in-the-loop · Future of medicine

AI Concepts

  • Agentic AI & autonomous action
  • Ambient AI & DAX Copilot
  • Human-in-the-loop vs. on-the-loop
  • Prompt engineering in production
  • AI prototyping
  • Multi-step agent pipelines

Business Topics

  • When AI stops answering and starts acting
  • Healthcare AI governance & liability
  • Physician burnout & the documentation crisis
  • Art, Penny & the pre-visit assistant
  • Automation vs. augmentation in medicine

In the Lab

  • Map Epic's agents to the agentic AI framework
  • Build a Penny-style insurance appeal agent
  • Compare chatbot vs. agentic approach
  • Design a human-in-the-loop governance framework