Episode Transcript
Speaker 1 00:00:09 Hello everyone. Today I have four topics I'd like to discuss. The first is some updates on generative AI and some really exciting things I've seen this week, including an announcement that's going to come out on Tuesday that I think is gonna kind of blow your mind. Then I want to talk about Howard Schultz and Starbucks and the fascinating senate hearings that took place about unionization at Starbucks and the implications. Third, I want to talk to you about some work that came out in the Pew Research report on the state of work in the United States, some really important things to think about. And fourth, I wanna talk about pay equity, why it's so important and some legal ramifications in the EU that were also passed this week. So first of all, on generative ai. I have to say at the beginning that I'm really just flabbergasted with the letter that came out from about 1500 engineers and other people, including Elon Musk, about why we should delay the implementation of AI for six months.
Speaker 1 00:01:09 It's a ridiculous letter. I don't understand it. Delaying for six months doesn't do anything. These models have been in development for decades. They have to be trained. They will constantly be trained with new data, new information, and the models are not going to stop. They've been developed over many, many years and they do amazing things and they can be used for nefarious purposes, but we have to work against that. And every piece of technology that's ever been invented, including the personal computer itself, the mobile phone, the internet, the web, the cloud has nefarious applications. We have to work against that. The technology vendors who build these things have to create explainability and anti-bias rules and they have to test them and they have to train them. We have to have legal regulations that create ramifications for bad use, which we do have by the way.
Speaker 1 00:02:01 And we have to build AI tools that monitor the AI so that we can understand why it's doing what it's doing. There's no way we're gonna stop this. And the histrionics that I read in that article are just absurd. I was gonna write a whole piece on this and I decided not to get involved in it. I don't know why everybody's afraid of this. The other thing that amazed me about it is the Washington Post did a survey, a poll, and found that only 9% of Americans think AI will be positive for society, which is just nuts because we're already using it. Every time you use your credit card, there's an AI machine behind it, making sure you're not committing fraud. In fact, somebody told me the other day that the noise canceling headphones are neural networks. We have neural networks in our computers already helping us do auto complete on Microsoft applications.
Speaker 1 00:02:50 It's just ridiculous. So as a scientist myself, I just don't get it. So if you wanna have a debate on this, we get 'em a debate on it. On the positive side of this, I've had just dozens of conversations with companies that they're doing things that are doing that are really, really creative and there will be just thousands of positive applications here. The issue of will it eliminate jobs came up again, this happened in 2016 when the University of Oxford put out the study that said that 47% of jobs were going to be automated. I'm tired of reading those things, to be honest, cuz they don't really tell you anything. Of course things will be automated. That's the way progress works. Do you want a job collecting the toll at the toll booth when a machine can do it? Nobody wants that job. The things that get automated are things that free people to do higher level work.
Speaker 1 00:03:42 And because of the progress of business and the way our economy works, whenever we have automation that takes over a quote unquote job or role or task or series of tasks that somebody does at work, we as business people add value on top of that. When salesforce.com was created, we didn't reduce the number of salespeople at all. We gave salespeople better tools. When Microsoft Office came out, we gave authors and writers better tools to edit their documents. The same thing's gonna happen here. Now, that just means that everybody who does white collar work is going to have to learn how these generative AI systems work. We're gonna have to, you know, look at them like Microsoft Excel as an aid, an assistant, a co-pilot, and we will do our jobs better. So these inflammatory articles, including the piece that came out from Goldman Sachs, has said that 7% of the jobs in the United States will be eliminated are just bogus.
Speaker 1 00:04:43 I mean, I'm sorry, I'm not upset. I just, I've seen this before. For some reason, people like to do PhD thesis on analyzing every task of every job in the O net database and what percentage of them will be automated. I don't know why they bother, because that's progress. That's the way the world has worked since the industrial age, since the age of fire and stone and throwing sticks, <laugh>. So I'm not worried about AI at all. I admit that there will be a lot of bad things that will happen. There will be more cybersecurity issues. People will take over various systems with these tools. There will be a lot of bad stuff that will happen. But that's been going on already. We've had all of these hospitals being ransomware. I think the AI will mostly be used and I mean 90 to 95 to 98% for very, very, very positive things.
Speaker 1 00:05:37 And if any of you are computer scientists and you wanna talk about this, I'm happy to talk about it. But I talk to a lot of engineers working on this stuff and none of the people I talk to are worried at all. They're just really excited about the potential here. So I'm kind of thinking this is a lot of clickbait from the media industry. But anyway, that was a big day, big week relative to that. And then this morning I got up and I read this piece that says that there's a 5% chance that by the year 2070, the entire population of the world will be wiped out by ai. I mean, come on. So we're gonna march ahead, at least I am and we're gonna figure out how to use this stuff and I'm really glad Microsoft and Google are doing that. Google did, by the way, Cinar.
Speaker 1 00:06:18 Pacha did a nice, very high level interview in the New York Times this week and physically said, which I believe to be true that Bard is a small language model. It's not a large language model, so it is going to get a lot better. He put it basically along the lines of we've got a Honda Civic competing with a bunch of Ferrari. He says, wait till we put the Ferrari out there. So I don't think Google's out of this race at all. And as I've said before, I use Google Photos for example, which is a miraculous application of AI if you've never tried it. So I think Google's gonna unlock some pretty cool stuff probably fairly soon. Okay, so I'm gonna be putting out an article on Tuesday about a vendor that I'm really excited about that has developed something very innovative, very useful and very powerful using G P T in the recruiting space.
Speaker 1 00:07:10 On the issue of Starbucks, you really should watch Senate hearings with Howard Schultz and Bernie Sanders literally yelling at each other in Congress. The situation is as follows, in the early days of Starbucks, Starbucks essentially pioneered the idea of taking care of hourly workers, pioneered healthcare benefits, flexible hours, educational benefits, tuition reimbursement, d e i management, development management training. Starbucks is a very important company and a very valuable company to millions of people that have worked there similar to what McDonald's wants. When I was a kid, when I was a kid, I worked at McDonald's for three or four years. I learned so much about work and people and customers and tension to detail and just the ethic of a job. It was the most valuable thing I think that happened to me in my career to be honest. McDonald's was just a great employer.
Speaker 1 00:08:12 It didn't pay a ton of money. I made a dollar 65 an hour, but, but it was really good. Starbucks did that too. But as the economy grew and Starbucks grew and the number of high priced things that people wanted grew and Starbucks became more complex and added cold drinks and hot drinks and food and breakfast and on and on on, they pretty much broke the backs of their staff with too many things to do. And the information that I have, which comes from some of our meetings with Starbucks and as well as some information that was published in the Wall Street Journal, is that on the current Starbucks experience, there are roughly 170,000 permutations of drink that you can order there. So the three to four to five people working behind the counter are being asked to do, do a lot of things that are complicated and time consuming, and they're being measured by speed and efficiency.
Speaker 1 00:09:03 And the quality of work went down, the quality of the labor experience went down for the employees. People are burned out there. So just like everybody else, by the way, their employee experience declined, especially during the pandemic when a lot of people came into Starbucks wearing masks and upset about how their generalized are doing. So they tried to get help. Howard Schultz had, you know, left the company or really moved to the board and they weren't being taken care of. And so they started this union movement and the union movement has been pretty successful. A lot of the stores are now unionized. So if you listen to the hearing, what you're going to hear is Howard Schultz, who I admire tremendously fighting in a sense with the senators for the ownership of the relationship with his employees. And what he's worried about is that the union is going to get in the middle of Starbucks relationship with their staff because he believes that's a sacrosanct part of their company, which I admire because that is what my book is all about.
Speaker 1 00:10:01 That's what HR is all about, is having a really valuable relationship with your employees and taking care of them and not getting somebody in the middle of that who you may not be able to influence. Nevertheless, there are laws that prohibit senior executives or anybody else in the company from getting in the middle of labor negotiations and labor meetings and apparently Starbucks did that. So they're probably in trouble legally. But the story is really not the legal issue to me. The story is if you're passionate about your employees, you better take care of them because they're important and they have autonomy and power also. And in this case, some very forward thinking, activist oriented employees decided they were gonna do their own thing and got this all started. And I think that cat's out of the bag for Starbucks and I think they're gonna have to live with it.
Speaker 1 00:10:51 And my point is that you don't have a lot of forgiveness in your employee base if you treat people poorly. Not only is it a performance issue and a retention issue and employment brand issue, but it's hard to get your employment brand back. And so when I wrote my book and I studied so many companies on this, I realized that being irresistible is a never ending quest. You have to constantly listen to your employees and you have to constantly think about what you can do to make life better for them so that it will be better for your customers and your business partners because they are the ones that are delivering it. They are the ones that are building and selling and designing and supporting everything that you do in your company. And I think the Starbucks story is worth thinking about and reading about.
Speaker 1 00:11:35 We are doing some work with them and we'll see if we can get some of them to come to our conference. And leads me to think about Boeing for example, who's a wonderful company who takes really good care of their people and they're going back to their basics too. Even GE I think lost their way a little bit in this dimension. So it's a constant reminder, which leads me to number three, which was this Pew research study that came out how, how Americans view their jobs. So there was a very large survey that came out from Pew this week, 6,000 people or so. And it was really kind of disappointing. What they found was that of these various roles that people, white collar, blue collar nurses, doctors, engineers, scientists, everybody, only about 51% of people really love their jobs, which to me is a sad statement.
Speaker 1 00:12:27 I mean there will always be a percentage of people that are in what I call survival jobs. They're doing the job because they just need the money and they don't have time to look for something better. And I think that should probably be 20% of the workforce. It certainly shouldn't be 49%. And what the peer research also finds is something that I wanna point out that was also in the 2023 Edelman Trust barometer, which I also really encourage you to read, it's not very hard to read, is that the number one thing, the most positive aspect of work of employment, of career is relationship with coworkers, coworkers, peers, teammates are the most important driver of satisfaction and happiness at work. And actually when you look at the PEW research, they are also the most trusted people in employed citizens' lives. People trust their coworkers far more than they trust the C E O.
Speaker 1 00:13:28 They trust the C E O far more than they trust their political leaders and they trust the media even less. And by the way, I think this is one of the reason people are worried about AI, is they really don't trust people in charge. And they're worried that whoever's in charge of ai, by the way, there is nobody in charge of ai, but I think people believe there is some, you know, sort of gigantic entity creating all this stuff. They don't trust them. And so we have to build trust. And the fact that coworkers relationships are so important reminds me of everything we do in hr. Everything that you do, hiring, staffing, pay, pay, equity, diversity training, career development impacts the relationships between people and the way people feel about their jobs. Uh, many times I've talked about my conversation with Edgar Shine that the most important cultural value at work is people helping each other.
Speaker 1 00:14:22 Well, when you do that, you really improve people's lives at work. Because the other thing that the research showed at the Pew research, which is something that I firmly believe, is that about 40% of people leave and I think this number is actually understated that their entire personal identity revolves around their job or their career. Now I would suggest that it's actually higher than that. Ideally everybody who works for a living and even if you don't work, even if, if you take care of kids or you're a teacher and you're working part-time or doing volunteer work, I believe our identities in life are largely formed around the values and the work we do for others, whether that be our company, our boss, our customers, our families, our communities. And that is a career. So if we can create a company or experience where people trust each other and help each other and feel a family-like experience, and I know there's a lot of debates about whether companies are families or not, then we can make work better for people and we won't end up in the situation of Howard Schultz or high turnover or anything else.
Speaker 1 00:15:31 Turnover is still a massive issue. We had a long debate about it on Friday at the big reset. Most companies are still struggling with turnover and it's still a very tight labor market. And so this is a c e O level issue. So that's the issue that I would point out in the Pew research study. The other thing in the peer research study that's really important to think about is it older people like my age are pretty happy with their careers for a lot of reasons. One is that we've been around a lot and we've kind of, we're kind of used to things not always going right, but young people are not as happy and and young people, as I talked about on the webcast I did this week have very long careers ahead. They're going to live into their hundreds and so they have time to check out, quietly quit and come back later.
Speaker 1 00:16:11 So you have to really think about special care for younger workers development, career opportunities, growth, coaching, mentoring, forgiveness, flexibility, et cetera. And so I would encourage you to read that about links into the podcast. One of the conversations we had on Friday with the big reset was the folks in Walmart, Canada that are implementing their talent marketplace, which is a really massively interesting story and we're gonna try to get them to come to the conference and tell it. What they found at Walmart, which is a very good employer, really takes care of their people, is that the most stagnant part of their employee experience, the part that wasn't improving was careers. People wanna grow, they wanna find new things to do. And so their entire focus on this project they called Compass, which is the career marketplace at Walmart, is directly targeted toward helping people find new jobs, find new careers, and they wanna drive internal mobility at Walmart up to 60 to 70% of all mobility, all jobs, which I think is a really admirable goal.
Speaker 1 00:17:13 You know, most companies are about 10 or 15%. So this is a one of the things that will help drive some of the issues in the Pew survey. The fourth thing I wanna talk about is pay equity. And Kathy Andis, who a lot of you know has really pioneered this research on pay equity. It took almost a year to do the research. And what we found, if you read the infographic or get your hands on the actual study, is that only about five or 6% of companies really take pay equity seriously. Most people look at it as a project, oh, let's just figure out what, where we're off and then fix it and then move on. Pay systems are constantly under attack and I think a lot of the pay systems and companies are out of whack for historic reasons because of inflation, because of remote work, because of the pandemic and because of technological change, there's a whole bunch of small reasons why pay gets out of whack.
Speaker 1 00:18:04 You're looking for a really rarefied skill. So you pay somebody a ton of money to get them and all of a sudden you've created inequities. You hire somebody in a low cost of living state and they make a lot more money than other people in that state. And so you end up with inequities. You have people that think women are not as capable as leadership as men, so the women don't get promoted. So they have pay equities. African Americans are paid less because they may have different educational backgrounds and different work experiences and there's bias there anyway, there's about 15 or 20 reasons why pay equity problems exist. What our research finds, and Kathy's been talking to a lot of you about this, is that this is 13 times more predictive of employee experience problems as level of pay. So you have to look at it as in an ongoing investment systems infrastructure to constantly look at ways to keep your pay system fair and equitable and communicate what equitable means, why somebody is making more money.
Speaker 1 00:19:01 What are the values that we reward in this company? What are the goals? What will allow you to get paid more money in a very transparent way? I'm not saying pay numbers have to be transparent, but the process has to be transparent. And yesterday or this week, the EU voted and approved a pay equity law. I didn't really say when it goes into effect where every company that does business in the EU is going to have to prove that they don't have gender pay equity problems above 5%. And they're going to have to prove it or they will be fined. So this is not just a good idea anymore or an interesting new practice. This is going to become regulatory law in the eu and I think the United States will come around to it too. You've seen the pay transparency laws and job postings in a lot of states, so it'll become bigger.
Speaker 1 00:19:48 And the reason I'm really into it is that pay equity is part of systemic HR pay equity isn't about pay, it's about equity. And equity is about employee experience. And employee experience impacts everything. Leadership, recruiting, how we manage people, the performance management process, all these things are interconnected. So I'm gonna keep talking about systemic HR more. We're about to put together some models on this cause we've been doing some really interesting interviews on that. But anyway, take a look at our pay equity research, join our membership. We have a pay equity program in the Josh Bur Academy and very soon we're gonna be launching a really groundbreaking new program in the J jba on talent mobility and career mobility to deal with all of these issues you're facing on skills taxonomies and talent marketplaces and everything else. And it has lots of incredibly good stories and examples in there.
Speaker 1 00:20:42 And that is in the jba for JBA A members. You can join the JBA as an individual or part of your corporate membership as well. So lots of things to think about this week. I'm not giving up on ai, I don't think it's going to ruin the world. There's plenty of problems that we're dealing with around here, but that's life. We just have to take these things on one at a time and deal with them. Lot more coming this week. Watch the announcement on Tuesday and I look forward to hearing from you. Have a great week.
