Episode Transcript
Speaker 1 00:00:05 All right, today I'm gonna talk about AI for most of the podcast because there is a mania going on about this topic and it really is a mania and you gotta watch out for it. So the theme is gonna be chat cheap PT versus Google, Bard versus you, because we've gotta talk about these two giant companies and what they're doing, the implications on, on the business community in hr, and then the implications on you as a professional or a worker or an employee. So first of all, what happened this week, which most of you probably read about is such an Adela, the CEO of Microsoft, made a huge announcement, probably overplaying the story that Bing was going to include. Chat from open ai, the chat G P T as was Microsoft Edge, therefore revolutionizing and disrupting search, which is a multi-billion dollar industry. And the best I can see, Bing has 5% market share or something like that, pretty small.
Speaker 1 00:01:04 And he made a big point with the financial analysts that every percent of market share in search is worth something like 2 billion to Microsoft. Now, implicit in that, of course, is the idea that the chatbot connected to search is going to sell more advertising, which leads to all sorts of other things I want to mention. Anyway, it was a big deal for Microsoft. I'm a big fan of Microsoft. They're a great company. It's unfortunate that they have to partner with open AI to do this because open AI is not a very big company, but good for them. Google, on the other hand, is also doing some pretty cool stuff. This product called Bard, which did not get launched really very well, is actually very cool. I have played with it. I got access to it, and it is as good as chat G p T better in some respects, from my opinion, just from my playing around and just has not been launched yet.
Speaker 1 00:01:56 So stay tuned for that. Google also invested in philanthropic, which is a spinoff from Open ai. So my guess honestly is that Google has much more resources to throw at this than Microsoft, cuz Microsoft has a couple hundred engineers in ai, which is more or less a startup. Google has thousands of people working on ai. If you've ever used Google Photos, you know how sophisticated Google's AI already is in implementation in real world applications. So I have to believe that over time Google's gonna be perfectly fine and the search market is not gonna go to Bing. Now, maybe a little bit of it will, but I have a hard time imagining that we're gonna all point our browsers towards Bing. The other strange thing about Bing is I do think a lot of their revenue comes from unsolicited advertisement, which you see when you go over there, sports scores and Yahoo stuff and all sorts of weird stuff that has nothing to do with what you're trying to do anyway.
Speaker 1 00:02:53 This is a very big deal for the tech industry and the tech punditry. So I wanted to make a comment on that. Now, what does this mean for you in business, in hr, in consulting, or as a technology provider? First of all, I remain a hundred percent enthusiastic about this technology. The applications are enormous. It is basically English language parsing and interpretation through pattern matching, and it works pretty well. It speaks English extremely well. Now, what it actually says is not necessarily very good, but it says it in a very persuasive way, which is great, but dangerous as I'll talk about it in a minute, but really great. So it implies many, many applications. And let me just talk about some of the applications in hr, writing, job descriptions, handling candidate inquiries, searching for information inside your company if you're an employee, asking technical questions inside of your company, looking for articles that relate to your company to determine PR or market branding or employment branding, creating training programs, creating training outlines, creating training assessments, creating training quizzes, assessing the content in a training program to determine what's missing, creating technical documentation, creating technical q and a leadership development, coaching, management development, onboarding, employee transition, employee q and as, benefits administration and benefits, questions, on and on and on.
Speaker 1 00:04:25 All of the service and advisory related things that we do in hr, many of them are dependent upon document databases and compliance data that we have written down, and we as humans in incorporate that into our minds. And then we solve other people's problems by explaining it to them. This is exactly what this technology does. It's really, really good at that. And I've talked to quite a few vendors already that are working on this and there's gonna be some amazing things coming out. Two points on the vendor market. First of all, if you're a vendor, you have to be looking at this because it's going to change the user and employee experience of everything you do. I'm not saying that we're all gonna be chatting with our computers all day because that's not exactly productive either, but if you look at how you use your phone and how you use Alexa and how you use other voice enabled systems in your personal life, there's no reason why can't, we can't do that at work.
Speaker 1 00:05:21 So obviously this will affect your your product, but beyond that, many of the things you do manually today, whether that be marketing, copywriting, developing documentation, will be aided by this. Our editor here has already been playing around with it and found it was very helpful in producing content that was better laid out in some of our beautiful studies. I mean, this has only been a week, and he's already found all sorts of cool things to do with it. So the second big topic I want to talk about a little bit to give you some sensitivity is the business around this. I don't believe from my experience in tech that this is a winner take all market, not at all. Lambda, and a lot of the code that Google has created, by the way, Google really is the source of most of this technology has a lot of open source elements.
Speaker 1 00:06:09 So there are dozens of startups being funded, very high valuations already. And so the mania has already started. You know what happens when there's a mania, money gets thrown all over the place. By the way, I just noticed every.ai domain is getting snatched up. And if you go to GoDaddy and try to buy a.ai domain, it's 10 to a hundred times more expensive than it was a month ago. So they're taking advantage of it too. Vidia, c3, ai, which is sort of a funky company. Any company that has a vision or a strategy to build AI tools just tripled or quadrupled their valuation. So we're going back to another little mania like we just had on crypto because nobody really understands the implications of this. From my perspective, being a little bit older, the web was like this, mobile was like this. Search was like this chatbot AI is gonna be like this.
Speaker 1 00:07:04 There's gonna be this huge flurry of excitement and lots of people pontificating about how it's gonna, you know, dominate our lives, et cetera. And then it's gonna settle down and we'll figure out that it is just a business, it is just a market, and there are all sorts of things to layer on top of it. Now, the third thing I wanna talk about, I don't remember if this is two or three, is what does this mean for you as an employee, as a manager, as an HR person? And one of the podcasts I was listening today was from a publishing company. And the woman who runs it was all freaked out about all their screenwriters and editors worried about listicles being created, AI news being created by ai, et cetera. Here's the big picture on automation in general. During the last hundred years, we automated away a lot of jobs in manufacturing.
Speaker 1 00:07:53 So robots and machines and electric motors created essentially AI that replaced the human muscle. So if your job is to screw in a bolt or to do other repetitive work, that job doesn't even exist. That has been automated. But the manufacturing industry is still short people, there's a huge number of manufacturing jobs that are not filled. Look at the semiconductor industry. They can't find people to man these plants because what happened was those jobs became better jobs. They became higher paid jobs, they became safer jobs, they became mentally more interesting jobs, and the people that were screwing in bolts or doing other heavy lifting went back and did other things and they learned how to do other things. So the size of the manufacturing economy got a little bit smaller by number of people, but a lot of the jobs that went away were not very he or safe in the first place.
Speaker 1 00:08:46 Okay, that's manufacturing. Second industry segment that's been get been automated for years is services. I mean service, not services. So customer service, you now go to an airport and you check in on a kiosk, you do your customer service online for retailers, you do most of your travel planning online. You don't have to get on the phone with the travel agent. Travel agent used to be a human being. You had to spend hours and hours on the phone with them for everything you apply for jobs online. All of these things that used to be human service jobs have been automated. Have we run out of jobs for service people? No. It's the fastest growing part of the economy because now the service jobs are better jobs now they're comprehension and empathy and complex problem solving and data-driven service jobs. I was just on the phone yesterday with an investment bank about a bunch of stock options on something, and there's no way I could have done this myself.
Speaker 1 00:09:43 The website was impossible to use and the guy spent 45 minutes on the phone with me. So that's what happened there. Now, this third era that we're in now with ai, which everybody claims is going to obsolete, white collar jobs, exactly the same thing is gonna happen. This is an augmentation technology that's going to make your job better. If your job, by the way is writing listicles from the newspaper of the 10 new things in the world of work, and you're trying to sell ads about that, I'm sorry, you're not gonna be in business that isn't a very high value effort anyway. So unfortunately you're just gonna have to find something else to do. But the way humans and businesses evolve is business is all about adding value in new and different and creative ways. So as this AI stuff becomes understood, and people will understand it very fast, we're gonna build things around it and we're gonna stop doing repetitive work looking things up in the dictionary or coming up with a new way to describe something.
Speaker 1 00:10:39 You know, I, I'm a writer and I do a lot of writing and I've spent a lot of time reading and writing. That's mostly what I do. And I've looked at both of the chatbots and they're pretty good writers, but they're kind of boring writers. They're not very interesting to read. And you can kind of tell that it was written by a machine if you're a good writer. Well, my uniqueness as a writer, my voice is mine. I'm gonna keep it and I'll bet it's fine, even though these chatbots are probably gonna plagiarize a lot of stuff once they get out there. So don't freak out about this. Think about this as the next great automation or augmentation tool for you to use to make your job better. Now, implicit in that statement is the hope that Google and Microsoft and the other vendors that are getting into this create open systems so that we can use these tools easily with the data and the content that we have.
Speaker 1 00:11:31 I think the enterprise search, enterprise analysis, enterprise interpretation of these systems is a much bigger business than the consumer applications. I mean, Bing and Google are chasing after this giant search advertising market, which is uh, a very strange market, by the way. I'll talk about that in a minute. But think about the size of the market for corporations to use this technology inside of their companies. That is a big market too. And hopefully one of them goes after that because that's certainly where I sit and where I know a lot of you sit. The next topic I wanna talk about briefly is the implications of this on your general consumer world. Now, if you study Google in the search engine business and go back in time to when it started, the reason Google makes 80 or 90% of its profit on search is not because people paid a search, it's because of the advertising.
Speaker 1 00:12:26 And if you've ever tried to buy advertising or use advertising, what's going on is this giant bidding war for words, for phrases and a domain, which is called search engine optimization. Search engine optimization is a fancy technical word for something very simple and very important, which is tagging and arranging and organizing your website so that it's fast and Google can search it. And unfortunately, if you're in the consumer business, if you're in the retail business, if you have a website, you have to optimize it for Google, otherwise Google can't find it and you don't get good results and people can't find you. So there's this gigantic industry of consultants and experts who know how to do this, and they study the Google search algorithms and they study the Google documentation. And there's lots of courses on this and there's a downside to it, of course, which is that if you search for a recipe, or really if you search for health related information too, you get a lot of junk.
Speaker 1 00:13:23 And sometimes unethical solution providers and and vendors are very good at seo. And so some of the hacked up content that you find when you click on the first couple of links in a search are not necessarily very reliable. They might be or they might not be. You can't tell. You have to learn it. So what we've all become very good at is scanning the list of search results and looking for the Mayo Clinic or looking for the New York Times, or looking for the Wall Street Journal and skipping the junk that pops up because they paid a lot for advertising. That is the nature of the Google advertising business. I don't know if you like it or not, there's obviously some downsides to it, but that's the way it works. Well now apply chat to this. We have the same exact industry about to be created where everybody who has content or is selling something, which is basically every company and every business and every individual is going to have to optimize itself for Bard or chat G B T or whatever is out there.
Speaker 1 00:14:23 The books have not been written on how to do this. The courses have not been developed. It's not even clear what the process is, but the implications are big. If I ask Google for, for medical advice because I have a headache and 50 things come up and 20 of them are from drug companies and they're recommending their brand of aspirin or something, I, I can tell what that is. I'm pretty well trained on where the good information is gonna come from. However, if Google gives me a or or a Microsoft gives me a very carefully worded, extremely persuasive answer and includes links and documentation about something that is recommended by that very persuasive voice, I might not know that it got that information because a company paid Google or Microsoft to produce that. This is a massive problem. What is the revenue model for search engines when you're using a chatbot?
Speaker 1 00:15:18 I don't know how to scan a chatbot and figure out what's reliable. So there's a downside to this and I am crossing my fingers that these 300 people at Open AI and the many thousands of people at Google are thinking about it. Microsoft's gonna have to think about this and Google's enough to think about it now. That's why in some sense, the enterprise applications of this are easier because we know that they're reliable in the data inside of a company is reliable. Okay, last discussion point about the AI mania is the financial markets. So you know, I know a lot of investors and a lot of VCs and people that are investors essentially are in a very, very competitive market. They have a fund or a bunch of clients and they're trying to generate a return that's better than their competitors. So they chase trends like crazy.
Speaker 1 00:16:09 And if there's an AI trend or whatever it may be that somebody's tapped into and somebody else is investing it in it, they want all over it. So what's already happened in the last week, and then this is gonna be a weird thing to watch, is that all of these AI wanna be companies, many of whom probably will end up being successful and of course many more won't, are suddenly increasing in valuation. And I know a lot of AI companies, I mean Eightfold, the company we started working with seven or eight years ago on the Gwi is an AI company. Paradox is an AI company. Obviously Workday is, has has been working on AI in some sense, probably not to the degree of some of the others. Gloat actually has AI under the covers. So investors are gonna be searching around for these companies and they're going to be telling you as a consumer, as a buyer, as an HR person, which ones are the best.
Speaker 1 00:16:59 My suggestion on this is I wouldn't pay too much intention to investors yet. They're going to be chasing this in a frenzy before a lot of these things are proven. The real success here is the domain expertise and the focus of the solution providers, because AI is a massive topic and many of the nuances of how it works have to do with the domain. I talked about paradox in one of the podcasts I did earlier. Paradox by only focusing on recruiting, is built a very, very success chat Bott. I think a leadership development chat bot would be very different from a recruiting chat Bott. I think a technical support chat bot will be very different obviously from a training chat bot, et cetera, et cetera, et cetera. So you may find investors hawking something that they think is really cool that they're getting behind. But over time, this is gonna turn into a very solution centric market where the offerings will be uh, refined about the domain, the use case, the industry or the topic that they're really good at.
Speaker 1 00:18:03 And we will hopefully build one of these for you guys around our research too. We're kind of poking around on that at the moment. So that's about it. This has been 20 minutes. There was just so many things to talk about. I wanted to get this out there as a follow up. One more point, if you are a vendor and you are working on an AI implementation, please contact us because we are actually talking to lots and lots of vendors just to get a sense of what you're working on so we can explain it to the HR community and we will not obviously steal any of your ideas or tell anybody about something that you don't want other people to know. But if you're working on something that's interesting to you that you would like other people to know, please let us know and we'll be happy to help you communicate that. Thank you.
