Episode Transcript
[00:00:00] Okay guys, I want to give you a relatively short podcast today about the HR technology conference in Vegas and then talk to you about some new things we're doing and what's coming up next for the rest of the year. So as I discussed in my keynote there, everything is changing at the same time. Politics, the economy, the labor market, the culture of work, the nature of work, AI, every form of technology, everything is changing at the same time. So we're basically dealing with a business climate where there's no question that the AI agenda is number one in most companies. But that's not the only one. Because if you're in the media industry, you're dealing with the political issues. If you're in the energy industry, you're shifting away from electric vehicles towards oil and gas again. If you're in the semiconductor industry, you're dealing with the new emergence of different chips. If you're in the retail or hospitality industry, you're dealing with people not wanting to spend as much money because prices are too high.
[00:01:03] We're dealing with industry convergence, companies that had brand food brands converging or going out of business. Because the food industry is changing. I mean everything is changing at the same time. And the labor market has stopped growing and the job market has stopped growing. So everything's getting tightened up with more productivity from AI. And then as I mentioned at the keynote, the AI platform companies, the top ones, Meta, Microsoft, Amazon, OpenAI, Google have spent almost a trillion dollars. It's in the 800 to 900 billion on infrastructure this year alone, which is more than 2 1/2% of the United States GDP just on capital investment to prepare for the technologies that we're going to be using. And the HR technology conference was about as crowded as I've ever seen it. There are more vendors in HR than I have seen in a long time. Now a lot of the mid market, mid sized ones are getting acquired by the bigger ones. And you saw a bunch of those acquisitions this week. But everybody is shifting their technology towards agents and AI technology. Now in the middle of all of this, of course, you guys in HR or we are going to have to redesign the way we work. You know, the average HR function has benchmarked itself for many years at about a 1 to 100 ratio of HR professionals to employees. I am pretty sure I talked to nicolemero at IBM about this and I talked to Kathleen Hogan at Microsoft about this. We're probably going to go to 150 to 1, 201 in that ballpark because of the automation that's now potential in employee services, in recruiting, in all these different aspects of talent management. And some of the employee relations issues that we have in in HR surveys are being done by AI. We're able to crowdsource and do an AI intelligence on recognition data. Pay equity is being done by AI. Performance reviews are being summarized by AI. Companies are integrating their talent acquisition from handcrafted processes to what we call precision powered processes. We have research report on that. And then for those of you who are HR professionals yourselves, you now have access to Galileo and all of all the intelligence of all of the research that's ever been done in the labor market to do and turn you into a super worker as a consultant or an advisor, recruiter, L and D professional or more. And as I talked about last week, the L and D profession is also going to be transformed relatively quickly by dynamic content generation systems that are going to almost obviate the need for instructional design. Not quite, but pretty doggone close. So anyway, I talked about all of this this week and in the middle of that we have this question about what to do with the organization and the workforce. Now in about 30 days we're going to launch our research on the super manager. The super worker concept, as I explained, is relatively easy to understand. And it's the idea that regardless of what AI tools you use, those of us that are in white collar work, and this has already to a large degree happened in frontline work, are going to have automation that are going to give us two, three, four times the productivity that we did in the past, access to more data, access to better decision making nudges, recommendations and training and education tools at our fingertips that we can talk to, that we can ask questions. They're going to be embedded in our glasses, they're going to be embedded in our phones, they're going to be embedded in our cloth computers. And so each individual one of us as workers are going to become superworkers, as we've talked about. And that improves productivity and engagement for each of us. Of course, it also means that we're going to have to skill ourselves on these tools, really learn how to use them. But what's going to happen to managers? Well, there's a lot of narratives about flattening organizations and getting rid of middle managers. And that's, you know, kind of always a initiative that's going on in companies because, you know, we don't like to have a lot of overhead. And if the manager's not doing work on their own, in a sense they're a form of overhead. But what we're basically discovering is that there's a very new role for management and leadership too. Managers and leaders have to encourage and facilitate experimentation and new technology adoption and skills development and innovation amongst their teams so the team doesn't feel disengaged or scared or frightened by the AI around them. So I'll tell you more about that in about a month when we launch it. But there's a lot of interesting new ideas on what does it mean to be a manager, what does it mean to be a super manager versus a traditional manager, and how the management level can facilitate this AI transformation that's going on in all of our companies. There were a lot of vendor announcements. I'm not going to bother with you with them on this podcast, but I do want to make another comment. And that is that the thing that is becoming the clearest of all to me as we talk about agents and, you know, whatever definition you have of an agent is the change in the user experience. I mean, not only is AI an intelligent learning, data driven system that is in some sense non deterministic, it learns over time and doesn't always behave the same because the data within it keeps changing. But maybe the biggest change that we're all sort of starting to recognize is, is the user experience, the ability to literally talk to, chat with, inquire and express your curiosity to these systems and let them respond to you, to give you the solutions or the information or the support that you need. That paradigm of moving away from point and click and menus and tabs and Google queries to English language or whatever your natural language is, interactions is massive. Is massive. There was a very interesting report that came out from OpenAI this week that discussed the patterns of activity for the 800 plus million people that use ChatGPT. And I'll link to it. And what it basically shows is that 40 to 42% of the people and the inquiries going through ChatGPT have to do with learning, asking questions, seeking information, finding things, searching for things that they may have used Google or some other form for in the past. Now, of the remaining information, the remaining activity, it's things like generating content, generating code, generating images and things like that, which are actually much smaller than you might have imagined. So what these inquiry systems, these agents really do is they allow your mind to, to create and inquire and express the curiosity that you have about your job, about your work, about your role, about your skills, about your manager, about your situation at work, to improve your sense of Knowledge, your sense of confidence and of course your productivity. And of course that completely disrupts the idea of training because we don't need training. If I can just ask the system any question I want and it's going to answer it for me and it'll give me a tutor or a coach.
[00:08:36] We may not need portals anymore because we don't have to click and point and search through all the portals to find out the new policy for overtime or the vacation policy or whatever it may be.
[00:08:48] And all of the user experiences that have been designed over the last 25 years to point and click and find the transactions in our systems can be replaced by this conversational front end. Now, conversational front ends have been around a lot longer than AI because they used to use natural language processing.
[00:09:07] But now the system speaks to you in your language, it responds to you, it remembers who you are, it knows your name, it knows what kinds of questions you've asked in the past, it knows your experience, it knows your job level, it knows your job title, it probably knows your skills because it understands the kinds of questions you've been asking in the past. And even though I don't like personifying AI, it's there for you. So when I look at the new stuff that we're doing with Microsoft, the way people are using Galileo in different applications, the way ADP Assist works, you know, the reason that workdays going up and scrambling to buy these AI companies, the work that SAP is doing with Joule, the work that ServiceNow has been doing with its agents and with ServiceNowAssist, this is a discontinuous break from the architected user experience that we have on our either mobile phones or computers to literally conversations. And the implications of this are much, much bigger than you realized. The amount of traffic going to ChatGPT, the amount of traffic going to Galileo alone is three or four orders of magnitude higher than any website that's ever been built. I mean, in our particular case, we know how much, you know, querying and downloading and stuff people do on our old websites. It's hundreds of times to thousands of more interactive for them to use an AI like Galileo than it is for them to download and read something. That's going to affect publishing, that's going to affect your employee experience, that's going to affect learning, that's going to affect support, that's going to affect recruiting, that's going to affect succession management, the way we do performance management. I mean everything.
[00:10:56] And you know, when I was walking around looking at all of the different vendors and all of the data providers. And there's, you know, there's a massive number of data providers now that can, you know, show you exactly what the skills should be for a certain job and where you should locate that job and how much you should pay somebody in great detail. A lot of that, by the way, is in Galileo.
[00:11:16] You don't have to learn how to use that system through some, you know, point and click panel interface. You can literally talk to it. And so we've unleashed power of technology and data to individuals, to humans, to workers, to employees in a form that was never, ever possible before. And that's why that report from ChatGPT, from OpenAI is so interesting. What those 800 million people are doing now, of course, for those of you that are vendors or software companies, you're building systems that are going to deliver functionality that you may not have predicted. People are going to use them to do things that you may not have designed them to do. So they're going to be much more flexible and, you know, value drivers than maybe you've seen in the past. And that was kind of what shocked me as I looked around and sort of summarized the 80, 90, 100 vendors that I talked to this week. Okay, so lots of stuff there.
[00:12:17] I'll probably write this up in an article. One more thing. Today we announced the Open web search feature of Galileo. So we've basically done in Galileo is we've now provided all of the corpus you, you need of information about HR and recruiting and leadership and learning and technology and vendors, and complete access to the functionality of ChatGPT. You can use Claude, you can use OpenAI models. I don't think Gemini's in there yet, but it's coming and all of that is in one place. So Galileo is now, in a sense, a complete replacement for ChatGPT and the world's number one provider of HR advice and management and leadership advice in a conversational format. So that was a really exciting announcement for us. We did a big demo and workshop on Galileo at the conference and it was packed. So it was very interesting there. We'll be doing it again at the Unleashed conference in Europe.
[00:13:19] And then, you know, I'm going to be gone for a couple weeks in Asia. I'll tell you more about what's going on over there. And the tech market is healthy, healthy, healthy. Lots of great stuff's being developed, lots of vendors are being acquired. The incumbents are buying everybody in their site of view to try to move themselves into this new world. And for those of you that are trying to automate and implement and, you know, upgrade all of your HR technology. You got to go look at this stuff now. You've got to check it out. You've got to ask for references. You've got to talk to the vendors, get to know them. There are just dozens and dozens of amazing new tools hitting the market. Okay, that's it for now. Have a great weekend, and I'll talk to you guys next week.
