Episode Transcript
[00:00:00] Good morning everybody. Today I want to give you an update on Galileo and I want to talk about the economic effects we're seeing from AI. And then I want to give you some high level overview of the project that started in November called the AI HR Blueprint and what it is about and how you can get involved. And then I want to talk about Irresistible. Really quick.
[00:00:25] So an update on Galileo.
[00:00:27] Galileo was launched in May two and a half years ago. It now has more than 1,000 companies using it. We're really excited about the progress.
[00:00:40] Next month we're going to be launching a major new release.
[00:00:43] And this week we introduced a version of Galileo called Galileo for Consultants.
[00:00:51] This is a version of Galileo that includes all of the information and intelligence and tools and data that we've had so far, plus a special library of all of our consulting tools that we use with clients for change management strategy, maturity model assessments and individual and company development planning. So if you are a individual consultant, you work for a consulting firm, you are a leadership development consulting consultant and L and D consultant. Galileo from Consultants is for you.
[00:01:30] In addition to all of our consulting tools, we're having monthly webinars for consultants where we're going to talk about consulting activities and consulting best practices. You're going to get access to our consulting training with Bill Pelster featured as the main instructor. And you are licensed to use the Galileo data with your clients. Technically speaking, those of you who use Galileo for internal are not licensed to share information from Galileo with external parties. I'm really excited about this because I really think the world is becoming much more independent in our jobs and our roles. And a lot of you inside of large companies and small companies or as individuals or perhaps people who retired from HR are operating as consultants. And Galileo Consultants is your lifeline, your education tool, your professional development tool and your toolkit for doing work that will make your life will actually really differentiate you as a professional.
[00:02:36] And there's going to be a badging program that you can use to certify yourself and lots of other things coming. So check that out. In March we're going to announce the Mars release of Galileo and it's got a ton of new stuff in it.
[00:02:49] It's going to be really exciting. Just wait till you see it. Okay, that's number one. Number two, the economy.
[00:02:56] So yesterday, the most earth shattering thing that I've seen as a business person in most of my career, and there have been many, many things that I've seen was the announcement of Nvidia's financial results posted a 73% growth in revenue quarter over quarter and $120 billion of profit in the last year. I wrote an article on Substack about this, but basically Nvidia is on track to become bigger than Google.
[00:03:31] Profits are, I wouldn't say obscene is the word, but they're extraordinarily high.
[00:03:38] And if you look at the hundreds of billions of dollars being spent on the data center industry, in other words, the infrastructure behind AI, Nvidia is capturing a significant percentage of the compute part of that build out. Now there's nothing wrong with this. This is what happens when you're a really successful company and you get yourself into the right place at the right time and you sort of stay ahead of your competition and you're really creative and innovative and good at what you do.
[00:04:09] However, what it indicates is, is the maybe distorted is the word nature of the financial market around AI.
[00:04:18] Most of the AI companies, including software companies, are not really making much of a profit here. In fact, very few are because there's such a huge cost of infrastructure and capital to build or buy the compute resources. You know, several friends who work in the compute sales industry at Google for example, and they do hundred million deals regularly with software companies signing up for 100, 200, $300 million multi year commitments to Google Cloud just to fuel the software companies that they're building, their revenues are not necessarily commensurate with those expenses, but they need that compute.
[00:05:04] So a lot of that money goes to companies like Nvidia.
[00:05:09] Nvidia's number one competitor AMD is a tiny fraction of their size.
[00:05:13] So this is an indication of a market that's very significantly changing the economy of the world, the United States and the economy of our businesses. Now if you translate that to our world in hr, you can look at what happened to the stock of Workday, SAP, Salesforce and a lot of the packaged enterprise software companies this week and that is that they all dropped significantly. I don't know if they recover a little bit.
[00:05:43] And the reason for that is, and I put a, put together a video on this and I'll link to it in the notes is the financial community is convinced that Claude Code and all of the variety of coding tools coming out of Anthropic and others are going to create agents that will replace these core systems. Now I'm going to talk about that next, but you know, the situation for us is we're going to have to make some financial sense of how we allocate our resources around AI because the AI costs that the vendors or the providers are incurring is going to be passed to us as corporations.
[00:06:23] I would say up until now a lot of this stuff has been somewhat free and subsidized by the investment community.
[00:06:31] That's not going to work anymore because the stock market is starting to figure out where all this money is going and ask some very difficult questions.
[00:06:40] For example, Anil Bashuri was talking about the financials of Workday in their earnings call this week and he's very bullish on this and I'm actually fairly bullish on Workday too for a lot of reasons. But essentially one of the things he said is we're not going to let AI vendors plug into Workday for free anymore. We're going to start charging them, which, you know, just means that the money that we spent on HR software is going to probably go up and that will somewhat be justified for by increased productivity and increased leverage of the technology relative to labor. But we're going to be talking about some expensive stuff here and I wouldn't be surprised if even the OpenAI types of subscriptions and Gemini eventually become usage based based on the high cost of these systems.
[00:07:32] So, and the second thing I wanted to note about Nvidia, if you read the article that I wrote about it, is this is not a company that got lucky. This is a company that's a very well run, human capital centric company that's been around a long time. And there's an example of Microsoft and IBM and intel, many other tech companies that have flourished over the years. And what you find in a tech company in particular, which is the most maybe competitive industry on the planet, it's about as competitive as retail.
[00:08:03] The human capital, training culture, recruiting, pay, talent density strategies of these companies are essential to their growth. Anyway, take a look at that article and you'll see the impact of that massive Nvidia growth on our situations in HR and also on just as a role model for a leadership well run company. Okay, so that's a little bit about that stuff, which leads me to number three, which is our world of HR infrastructure.
[00:08:38] Now I feel like I'm spending a lot of my time on this, not a hundred %, but maybe 50, 60%.
[00:08:44] We decided back in November, December into January, that what we were going to do for all of you is not only talk to vendors and share with you all the innovations and best practices and technologies that are out there, but to show you a roadmap of where AI and HR is going.
[00:09:05] And in order to do that, we worked Together with Galileo's help, to map out 140 or so HR agents that are possible.
[00:09:18] Now, let me talk about the word agent for a minute. The word agent sort of appeared a year or two ago.
[00:09:24] And the idea of an agent is an agent has agency, it can do things. And originally we didn't really know how to build an agent. We weren't sure exactly what it was. It was kind of a concept. But now you can literally build an agent with no technical experience at all in Galileo. We have clients now building agents within Galileo that do different things in hr. We're going to talk about that a lot at our conference. But you know, for example, I'm experimenting with an agent for our business that's off the shelf.
[00:09:58] And we can take the documentation and education we have about Galileo and we can build a support agent that can sit alongside Galileo or for you as a prospect who's trying to figure out what to do. And you can just ask it questions. And it's exceptionally easy to use and it requires zero technical input whatsoever.
[00:10:22] So you are going to be able to build agents very easily, technologically.
[00:10:27] What's going to be hard and actually take effort is understanding the use cases, the workflows, the edge cases, and the data that this agent needs.
[00:10:40] So let's suppose you're building an agent for onboarding and you think, okay, let's just stick all our company policies in there and just let people use it.
[00:10:50] Well, there's the version of the policy in France, there's a version of the policy for executives, there's a version of the policy for this role, There's a versions of the policy for that city for part time, for full time. All of these HR agents need the embedded business knowledge about your company.
[00:11:11] So building an agent is really a human thing that requires human knowledge. And the quality of an agent from vendor A versus vendor B has very little to do with their technology, but more their understanding of the domain and their data and the data that they can provide to you and how high a quality and useful it is in your industry. So the agent market or the agent building space that we're all in is going to leverage your expertise as a business person, as an HR person, as an experienced, tenured professional in your company.
[00:11:51] It isn't about the technology.
[00:11:53] Now, the technology vendors, including Workday, SAP, Oracle, all of them are building agent frameworks. Workday calls it the agent system of record, SAP calls it Joule, and ServiceNow calls it the agent control tower. To register these agents and allow them to interoperate in your company.
[00:12:18] For example, in the case of an onboarding agent, which we actually see as a super agent because it's so complex, it needs sub agents within. It is needs to be deployed across different people in different ways and some where somehow you have to teach the agent what to do by job role, by location, by city, by tenure, by level, et cetera. Well, that code really doesn't belong in the agent. That code should come from the core systems you already have. So these agent frameworks or systems of record or control towers or whatever you call them are going to be there to help you deploy these agents, manage them, monitor them, see who's using them, and eventually probably look at the data that they're using and the health and safety of that agent. In our case, since Galileo is used by approximately, almost 1100 companies now, we don't really control or look at what people are asking, but we have a lot of information about the utility of the agent in these different organizations. And we can see if there happens to be a company that's doing some amazing things that we want to talk to inside of your organization, you're going to want the same situation.
[00:13:33] And that leads back to my second point, that the financial model of the agent management system Companies like the ERPs and HCMs and others will compete with the financial model of the agent providers themselves. I don't really agree with Aneel that companies are going to pay a tax to connect into workday, but you know, if they decide to create it that way, so be it. We'll see what happens.
[00:14:00] Now this framework or this blueprint is we've now tested it with about 20 companies. I went through it for our Chro Council yesterday and not only is it educational for you in understanding what's going on, but it'll help you think through how to prioritize.
[00:14:18] Because the number one question that came up amongst the chros yesterday was where do we start with all this stuff? And what we're really getting at here is a fundamental issue of enterprise AI is that we're not in the business of providing individual productivity tools anymore. That's still happening. Of course, there's always going to be that, but we're really talking about automating workflows, automating business processes and eliminating things that we don't really want to do anymore.
[00:14:48] As IBM puts it, their AI strategy is essentially what they call it eliminate, simplify, automate, in that order. What can we eliminate, what can we simplify? And now what can we automate? We don't want to build a bunch of agents that do the same, you know, perhaps duplicative or silly jobs we have today. We don't want to build one agent for every job. We need to sort of take a step back and look at the agents as multi process automation tools and then build them in a way that they can replace multiple roles in multiple steps. For example, at ServiceNow they have a, they call it, I believe, a people analytics agent. But essentially what that agent does is it goes into the HCM data systems you have and answers questions for other agents, which by the way is something that happens all the time and it prevents or at least reduces the need for each agent to know how to get data from different systems because this particular agent knows how to do that. And that's a brilliant idea to me of a way to really make a lot of things in HR a lot easier. So this agent blueprint is, is a document. We have not published it and we're going through it with clients Kathy Enderis and Michael Antolini and our company are leading this and we're going to do workshops. So I would just ask you if you're interested in this, reach out to us or reach out to the person you work with in our company and we will bring you in to the next agent framework workshop we have and we can do it for your company to help you understand what's going on and prioritize your investments. And the vendor market fits right into this. Most of the vendors we talk to want to work with us on the blueprint too because it helps them understand the complexity of HR and how the different pieces fit together.
[00:16:35] Very exciting times. Okay, so that's my second sort of update for today. 3. Let me talk about Irresistible. So June 8th through 10th at USC, which is an absolutely spectacular place, we're having our 5th annual Research Professional Development Corporate HR Conference.
[00:16:56] This is a leadership conference, is designed for business and HR leaders. Probably at least 40 to 50 CHROs signed up already with their teams.
[00:17:07] We can only support around 450 people. It's modest, mid sized conference, very intimate, very hands on. We have workshops. We're going to be releasing new research showing you some incredible technology.
[00:17:21] And some of the folks coming are industry leaders in the airline industry and the hospitality industry and the technology industry and other places.
[00:17:31] And I really want to encourage you to come. If you go to irresistible2026.com, you will also see we've introduced our new awards program called the Pacesetters. If you have something you're doing, and I'm sure you do, everybody does that you're proud of and you would like industry recognition, click on that link and fill out the form and apply for a pacesetter award. Not only will we highlight what you're doing, but we will help you promote it into the market to help you get recognition, to help you hire people, to help you learn from others.
[00:18:06] So take a look at Irresistible. Generally, if I think back about the last week or so, in the middle of all of these things that are happening, things are going in the right direction.
[00:18:17] The economic market around AI starting to shake itself out.
[00:18:22] The solutions are becoming clearer over time. There's going to be a lot of shakeup in the vendor market yet to come, but we're very familiar with that. If you want to get your hands dirty on the whole space, we're all going to be at Unleash and we're going to be introducing and demonstrating and doing Galileo workshops there in Las Vegas in a couple of weeks.
[00:18:43] We're going to be at Transform, which is the week following, and at the Transform conference we're going to be announcing a fairly significant partnership we have in the agent world with Galileo. And then I will be at the HR Technology Conference in Europe in mid April and we will also be there to talk to you about the blueprint and what's going on with the big picture of AI. And at the bottom of all of this is a really exciting opportunity for each of you to educate yourself. And we're doing everything in our power to give you the tools to learn to deploy this technology in a safe, high quality, high value way with the Galileo and the rest of our offerings. And if you come to Irresistible, not only will you see all this laid out in front of you or we will also show it to you at unleash, but we'll also be introducing another education offering that I think you're going to find really exciting.
[00:19:42] Okay, that's it for this week. Stay tuned for another series of podcasts that are coming out starting next week on the Frontline Workforce in partnership with Workday Paradox. It will be a small series within this podcast so you don't need to subscribe to anything new and very excited to catch up with everybody at these conferences in the coming weeks. That's it for now.
