WorkLab
·S9 E3
EY's Dan Diasio: AI is driving the biggest revolution in management ever
Episode Transcript
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People that will
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join companies next year
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will be managers on day one.
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They will just be
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managing a workforce
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that is an
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agentic-based workforce,
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one that is
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extremely powerful
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and sometimes clumsy.
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Welcome to WorkLab
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the podcast for Microsoft.
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I’m Molly Wood.
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On this show, we explore
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the future of work and the power of AI
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to amplify human potential
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and transform organizations.
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And today's guest is at the forefront
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of this new world of business.
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Dan Diasio is Global Consulting
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AI leader at EY.
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We'll be talking about moving from
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pilot projects to real world impact,
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reskilling for the AI era,
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and what leadership looks like
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when humans and AI agents team up.
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EY is in the inaugural class
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of the Digital Data Design
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Institute at Harvard
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Frontier Firm AI Initiative,
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hosted by Harvard Business School
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in collaboration with Microsoft.
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The initiative will research
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human-AI collaboration,
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upskill global C-suite leadership,
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and deliver new insights and tools
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to help reinvent organizations
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as Frontier Firms.
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Dan, welcome to WorkLab.
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I'm excited to join you, Molly.
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You've been in this business a long time.
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Tell me what you have seen
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and how you've ended up
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in the moment we're in right now.
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EY is a large,
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complex organization.
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We have 400,000 people.
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There is 100 years’
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worth of history
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and had a heritage in the businesses
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we operate in.
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It was only a couple of months into
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after ChatGPT had
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kind of arrived on the scene,
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and we realized this was very different
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from the AI of the past.
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I would say AI of the past
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was really focused as a discipline,
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like there was a team of data scientists
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and machine learning engineers
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that were really responsible
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for taking data and turning that
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into insights and
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translating that into actions.
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It was a part of our organization.
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What we realized pretty quickly
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is that AI was going to impact
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every single corner
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across every part of our business,
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and we needed to really rethink
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what our organization was going to be.
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So we created a part of our business.
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We called it EY.ai,
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which was the symbol for us internally
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that we need to move from the old
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business EY.com to EY.ai,
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and that meant a real rescale
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and rethink of everything
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that we do across the organization
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and how we enable our people.
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I'd say it's been very fundamental,
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but we really started with a purpose
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and an intent to be able to drive
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AI systemically across the business,
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as opposed to just turn it on in a way.
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It feels like you saw something
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really important coming
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because to be candid about the
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elephant in the room, I would say that
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people feel that the advent of LLMs
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and the way that people are using AI now
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could pose a threat to the consulting
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business that we have always known.
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I'm putting this gently,
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but it sounds like EY
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saw that almost immediately
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and moved to adapt.
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Yeah, I mean, I think there's been a lot
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written about the
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demise of the knowledge worker
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in the space of AI.
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That as cost of knowledge
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goes to zero, what happens
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to all of these knowledge workers?
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And, you know, over time,
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I didn't have this impression immediately.
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Like there was a bit of shock
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and awe that happened in the beginning.
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But over time,
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I've come to appreciate and believe
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that the knowledge worker
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is just totally underrated in this moment.
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Let's talk about your career at EY
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because you’ve been there
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a long time,
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you’ve been in this business
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a long time.
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So, Molly, this is a
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really fascinating time.
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I would say, right now
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I spend most of my time
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working on trying to help
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EY become a Frontier Firm.
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And that really means that I focus on
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four things every day.
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You know, so first
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I'm really working with our teams
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that are supporting our clients
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and trying to move from this idea
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of ideation and experimentation
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into enterprise scale with our AI agendas.
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The second is, if you make a list
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of all the industries that are going
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to be impacted by AI
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professional services near the top of that list.
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So we are actively working to
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look at everything we do
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to deliver value for our clients
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and start to infuse AI to become
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much more AI powered.
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The third is
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we have a historical dedication
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to a business model
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that is focused on effort, and
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we are looking to break that with AI.
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So there's a lot around
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commercial model innovation.
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And then fourth, the very essence of
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EY is all about our people.
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So we are working on building
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training programs, tooling and enablement
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to really empower the workforce.
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I spend most of my time these days
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really trying to figure out how we kind of
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create a new professional services firm
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that is based much more on AI
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and disrupting the old one.
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There are so many things to unpack there.
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Let's start with just the EY part of it,
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just the internal transformation.
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Because, of course, that's incredibly
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valuable when it comes to helping clients.
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But I would imagine presents
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its own set of challenges
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given the size and
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history of a firm like EY.
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So, Molly, if I can tell you a story?
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Say more, absolutely.
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So shortly after ChatGPT
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came onto the scene, we realized
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that our clients were being bombarded
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by PowerPoints explaining what AI was.
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And you can't learn that much about
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how these things work from a PowerPoint.
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So we created something inside our
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organization that we called a master class.
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We would show up with laptops
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in our clients,
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often in their boardroom
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or with their management committee.
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And we had some
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simple tools and a script.
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Often that script was to be able to use
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AI to build a new snack product
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in a lot of ways, so
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it was kind of simple,
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It was guided, it was scripted,
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but it got their hands on the keyboards.
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And it was fascinating,
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like just to watch this magic happen
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where CEOs were working in teams
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with their management committee,
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building new products,
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creating new marketing plans,
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creating jingles
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that they could use to advertise it,
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and then pitching it
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back to their committees.
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So it was really, really powerful.
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But then we took a step back.
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We've done this hundreds of times now,
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and I've looked at the results
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of all the images of the products
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that people have built over time,
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and it's all the same looking stuff.
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So it's all the same sort of packaging.
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It's all the same ingredients,
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the same recipes,
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the same marketing plans.
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Like if this stuff were to come true,
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we would have a global shortage
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of matcha
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and monk fruit everywhere.
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But it's a lot of the same.
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So what that kind of really translates
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to us is AI makes it very easy to produce
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something good, but it kind of
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commoditizes the output.
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And in a lot of ways it raises the floor,
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but it doesn't raise the ceiling.
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So what does it take
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to actually raise the ceiling?
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And what we say at EY is that it's
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AI and something.
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You have to bring context to be able
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to really unlock its potential.
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We often refer to these things
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as the big four.
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So you need to have creativity.
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You need to have critical thinking,
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systems thinking, and deep domain
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expertise to be able to really get
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what's possible into the system, to work
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together with the system, to be able
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to create the right and best output.
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And in a lot of ways, that's essentially
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what consultants are very good at.
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So we see that the role of the consultant
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is going to shift from one that does
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a lot of work and produces content
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to one that is much more of a creator,
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and using agents
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to be able to do a lot of that work.
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I mean, as you describe it,
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it sounds like what you're saying is
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we're going to have our consultants
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go back to being great, right?
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Like not that they weren't great
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to start with, but that there is an
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up-leveling that is required
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to not only stay ahead but be the best.
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And I think they have, you know, often
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we find that consultants
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have contexts that exists
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outside the organization
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in which they're supporting’s four walls,
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and that is extremely valuable
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to be able to get the most out of AI.
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So, I do think it is a big change
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to move from the old consulting model
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to the new consulting model,
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but I don't think that work goes away.
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It changes,
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and I think it becomes more important.
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Let's talk about your clients now.
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How often are you now
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telling this story to them?
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I think this is, you know,
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we are going through a period right now
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where there's too much focus
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on productivity
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and there's not as much focus
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as needed on growth.
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And this is very much
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part of the growth agenda,
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how we start to move
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from thinking about what we do today
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and how we can use technology
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to automate it,
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to how we can start
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to empower people to start
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to create the businesses of the future.
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00:08:09,614 --> 00:08:11,449
So, it is probably a daily
284
00:08:11,449 --> 00:08:12,408
part of that talk tracks
285
00:08:12,408 --> 00:08:13,451
that I have with clients.
286
00:08:13,451 --> 00:08:15,411
Is it like a matcha granola bar?
287
00:08:15,411 --> 00:08:16,412
Like, what are we talking here?
288
00:08:16,412 --> 00:08:18,206
There's like some monk fruit in it,
289
00:08:18,206 --> 00:08:19,248
some matcha,
290
00:08:19,248 --> 00:08:20,666
You know, often some
291
00:08:20,666 --> 00:08:22,668
some like natural chocolate.
292
00:08:22,668 --> 00:08:24,295
I mean, the same packaging.
293
00:08:24,295 --> 00:08:25,922
It's very crusty looking,
294
00:08:25,922 --> 00:08:27,507
you know, deep greens and browns.
295
00:08:27,507 --> 00:08:28,966
Very environmentally friendly.
296
00:08:28,966 --> 00:08:30,051
Of course, yeah.
297
00:08:30,343 --> 00:08:31,761
I mean, I kind of want to try it.
298
00:08:32,637 --> 00:08:33,638
But we're off topic.
299
00:08:33,638 --> 00:08:36,974
As you start to socialize the adoption
300
00:08:37,600 --> 00:08:38,601
of this technology
301
00:08:38,601 --> 00:08:40,478
with this really important realization,
302
00:08:40,478 --> 00:08:41,854
right, that your human skills matter,
303
00:08:41,854 --> 00:08:42,980
that your context matters,
304
00:08:42,980 --> 00:08:45,107
that your internal data
305
00:08:45,107 --> 00:08:46,275
and the context that brings
306
00:08:46,275 --> 00:08:47,610
you as a business matter,
307
00:08:47,610 --> 00:08:48,903
what kind of specifics
308
00:08:48,903 --> 00:08:50,988
are you starting to talk to people
309
00:08:50,988 --> 00:08:52,156
about when it comes to adoption?
310
00:08:52,156 --> 00:08:54,242
Like, are we building a playbook at last?
311
00:08:54,242 --> 00:08:56,118
Yes, I think we have the beginnings
312
00:08:56,118 --> 00:08:57,787
of a playbook that's been really effective
313
00:08:57,787 --> 00:08:58,663
for many of the clients
314
00:08:58,663 --> 00:08:59,664
that we've been supporting.
315
00:08:59,664 --> 00:09:00,831
The last couple of years
316
00:09:00,831 --> 00:09:02,583
have been an investment in technology.
317
00:09:02,583 --> 00:09:03,709
You're building tools,
318
00:09:03,709 --> 00:09:05,127
and when you use those tools
319
00:09:05,127 --> 00:09:06,170
and you expect to get value
320
00:09:06,170 --> 00:09:07,672
out of those tools, what do you do?
321
00:09:07,672 --> 00:09:08,798
You say, does the tool do
322
00:09:08,798 --> 00:09:10,174
what my person did before?
323
00:09:10,174 --> 00:09:10,967
And then you get into
324
00:09:10,967 --> 00:09:12,134
this productivity loop.
325
00:09:12,134 --> 00:09:14,554
And unfortunately productivity has a limit.
326
00:09:14,554 --> 00:09:15,972
Like there's only so much value
327
00:09:15,972 --> 00:09:17,390
you can create with productivity.
328
00:09:17,390 --> 00:09:20,268
Growth has no limit associated with it.
329
00:09:20,268 --> 00:09:23,563
So, we see that in order to be successful,
330
00:09:23,563 --> 00:09:24,939
you know, you referred to a playbook
331
00:09:24,939 --> 00:09:25,731
earlier, Molly,
332
00:09:25,731 --> 00:09:26,941
in order to be successful,
333
00:09:26,941 --> 00:09:28,526
it takes three things.
334
00:09:28,526 --> 00:09:29,986
It takes the mindset,
335
00:09:29,986 --> 00:09:32,154
the skill set, and the tool set.
336
00:09:32,154 --> 00:09:32,738
And right now,
337
00:09:32,738 --> 00:09:33,739
most of the investments
338
00:09:33,739 --> 00:09:35,741
have gone towards the tool set.
339
00:09:35,741 --> 00:09:38,286
There's not as much in the mindset
340
00:09:38,286 --> 00:09:40,037
and the skill set.
341
00:09:40,037 --> 00:09:41,706
So, what we see is
342
00:09:41,706 --> 00:09:43,624
enterprise transformation
343
00:09:43,624 --> 00:09:45,376
actually begins with the intent
344
00:09:45,376 --> 00:09:47,128
of how we start to frame the problem,
345
00:09:47,128 --> 00:09:49,922
how we start to look after the objectives
346
00:09:49,922 --> 00:09:51,424
of what we're trying to get out of AI.
347
00:09:51,424 --> 00:09:52,717
Are we just using it to do
348
00:09:52,717 --> 00:09:53,676
what we do today?
349
00:09:53,676 --> 00:09:55,344
Or are we going to reinvent
350
00:09:55,344 --> 00:09:57,179
the entire new way of working?
351
00:09:57,179 --> 00:09:58,472
And that shift is something
352
00:09:58,472 --> 00:10:00,099
that I think we're starting to see over
353
00:10:00,099 --> 00:10:01,350
the last couple of months
354
00:10:01,350 --> 00:10:04,353
of moving away from use cases towards
355
00:10:04,353 --> 00:10:05,896
more of a reinvention agenda.
356
00:10:05,896 --> 00:10:08,649
And so how is the concept
357
00:10:08,649 --> 00:10:10,526
and the introduction of agentic tools
358
00:10:10,526 --> 00:10:12,278
and agentic AI
359
00:10:12,278 --> 00:10:13,571
starting to change this conversation
360
00:10:13,571 --> 00:10:15,072
even more, because it feels to me like
361
00:10:15,072 --> 00:10:16,407
that’s a bit of a gateway drug
362
00:10:16,407 --> 00:10:17,617
to really thinking
363
00:10:17,617 --> 00:10:19,744
about transformation in a different way.
364
00:10:19,744 --> 00:10:20,870
Not just productivity,
365
00:10:20,870 --> 00:10:23,122
but new types of employees.
366
00:10:23,122 --> 00:10:23,664
Yeah.
367
00:10:23,664 --> 00:10:25,833
So, new types of employees.
368
00:10:25,833 --> 00:10:28,669
It’s such an interesting concept.
369
00:10:28,669 --> 00:10:31,380
Like, I think next year will be the first year
370
00:10:31,380 --> 00:10:33,382
that when you work at a company,
371
00:10:33,382 --> 00:10:34,717
you will be a manager,
372
00:10:34,717 --> 00:10:36,052
and you will not just have
373
00:10:36,052 --> 00:10:36,844
a human workforce
374
00:10:36,844 --> 00:10:38,095
in which you're managing.
375
00:10:38,095 --> 00:10:39,430
And, agents
376
00:10:39,430 --> 00:10:40,973
are going to be really responsible
377
00:10:40,973 --> 00:10:42,683
for driving a lot of the
378
00:10:42,683 --> 00:10:43,976
what we call at EY
379
00:10:43,976 --> 00:10:46,270
the toil that nobody wants to do
380
00:10:46,270 --> 00:10:47,229
and to start to drive
381
00:10:47,229 --> 00:10:49,065
a lot of that execution path.
382
00:10:49,065 --> 00:10:52,109
But agents are still subject to the same
383
00:10:52,109 --> 00:10:53,861
statistical sameness
384
00:10:53,861 --> 00:10:54,779
if you use them
385
00:10:54,779 --> 00:10:56,280
to do your critical thinking.
386
00:10:56,280 --> 00:10:58,616
So the real sequence of work
387
00:10:58,616 --> 00:11:01,702
should be human, agent, and then human.
388
00:11:01,702 --> 00:11:03,537
And so for that reason,
389
00:11:03,537 --> 00:11:05,665
I don't really see it changing
390
00:11:05,665 --> 00:11:08,751
the need to really focus on the mindset
391
00:11:08,751 --> 00:11:09,794
and the skill set,
392
00:11:09,794 --> 00:11:11,170
because what companies are going to be
393
00:11:11,170 --> 00:11:13,589
after is driving differentiation
394
00:11:13,589 --> 00:11:15,007
from their competitors
395
00:11:15,007 --> 00:11:17,426
and being able to create new markets.
396
00:11:17,426 --> 00:11:19,345
And, the AI is going to create
397
00:11:19,345 --> 00:11:20,680
the same predictable output
398
00:11:20,680 --> 00:11:22,390
for you as it would for somebody else
399
00:11:22,390 --> 00:11:24,725
if you're not using that context with it.
400
00:11:24,725 --> 00:11:26,977
So how does that progression
401
00:11:26,977 --> 00:11:27,812
that you've described
402
00:11:27,812 --> 00:11:31,857
help companies become Frontier Firms?
403
00:11:31,857 --> 00:11:33,359
You know, transition away
404
00:11:33,359 --> 00:11:35,027
from the way they used to do things?
405
00:11:35,027 --> 00:11:35,486
Yeah.
406
00:11:35,486 --> 00:11:37,613
When it starts with the strategy of
407
00:11:37,613 --> 00:11:39,990
what is it that we want to do
408
00:11:39,990 --> 00:11:42,660
and how do we intend to create value?
409
00:11:42,660 --> 00:11:43,828
What we often say to
410
00:11:43,828 --> 00:11:45,538
our clients is create
411
00:11:45,538 --> 00:11:46,414
a point of view
412
00:11:46,414 --> 00:11:47,456
that you would be comfortable
413
00:11:47,456 --> 00:11:48,958
taking to your investors
414
00:11:48,958 --> 00:11:50,751
on what your strategy would be.
415
00:11:50,751 --> 00:11:52,378
Like, the value that you're creating with
416
00:11:52,378 --> 00:11:54,714
AI is not in your portfolio of things
417
00:11:54,714 --> 00:11:55,798
that you're doing.
418
00:11:55,798 --> 00:11:57,341
I mean, it's good and it's valuable.
419
00:11:57,341 --> 00:11:58,884
It's kind of like going to the gym
420
00:11:58,884 --> 00:12:00,261
if you're trying to run the
421
00:12:00,261 --> 00:12:01,470
the New York Marathon,
422
00:12:01,470 --> 00:12:03,597
like gym work and practice runs,
423
00:12:03,597 --> 00:12:04,181
they're helpful,
424
00:12:04,181 --> 00:12:05,516
but they're not the marathon.
425
00:12:05,516 --> 00:12:08,185
And instead, start to think about
426
00:12:08,185 --> 00:12:09,603
what the main objective is
427
00:12:09,603 --> 00:12:11,021
and where value is going to be created.
428
00:12:11,021 --> 00:12:12,606
And that often manifests itself
429
00:12:12,606 --> 00:12:15,609
in 2 to 3 pages of like just plain text.
430
00:12:15,776 --> 00:12:16,819
When you have that,
431
00:12:16,819 --> 00:12:17,361
that helps
432
00:12:17,361 --> 00:12:19,071
you set the mindset, skill set,
433
00:12:19,071 --> 00:12:20,906
and the tool set objective
434
00:12:20,906 --> 00:12:22,491
because you shift from an approach
435
00:12:22,491 --> 00:12:24,660
of just implementing AI everywhere,
436
00:12:24,660 --> 00:12:25,745
to start to think
437
00:12:25,745 --> 00:12:27,246
my marketing function,
438
00:12:27,246 --> 00:12:28,748
I'm going to completely reinvent
439
00:12:28,748 --> 00:12:30,124
my marketing function.
440
00:12:30,124 --> 00:12:31,125
I'm going to target
441
00:12:31,125 --> 00:12:33,335
not just people, but I'm going to target
442
00:12:33,335 --> 00:12:35,755
being able to market to people’s agents
443
00:12:35,755 --> 00:12:36,338
that are going to buy
444
00:12:36,338 --> 00:12:38,007
the products on their behalf.
445
00:12:38,007 --> 00:12:39,967
And you start to get into
446
00:12:39,967 --> 00:12:41,135
just a different territory
447
00:12:41,135 --> 00:12:42,178
in a different space than where the
448
00:12:42,178 --> 00:12:43,679
narrative has been placed in time.
449
00:12:43,679 --> 00:12:44,555
It's so interesting
450
00:12:44,555 --> 00:12:45,806
as you're describing this,
451
00:12:45,806 --> 00:12:47,349
because it sounds like
452
00:12:47,349 --> 00:12:48,309
that's how you should always
453
00:12:48,309 --> 00:12:49,602
be thinking about business.
454
00:12:50,728 --> 00:12:52,062
But I understand that
455
00:12:52,062 --> 00:12:54,190
when a tool like this comes along,
456
00:12:54,190 --> 00:12:55,065
people can have one of
457
00:12:55,065 --> 00:12:55,941
two responses, right?
458
00:12:55,941 --> 00:12:56,650
One is just like,
459
00:12:56,650 --> 00:12:57,985
we got to put it on everything.
460
00:12:57,985 --> 00:12:59,862
We got to smear some of this
461
00:12:59,862 --> 00:13:01,447
peanut butter and jelly on across
462
00:13:01,447 --> 00:13:02,490
everything that we're doing.
463
00:13:02,490 --> 00:13:04,658
Or we might tiptoe
464
00:13:04,658 --> 00:13:05,826
in with a couple of pilots
465
00:13:05,826 --> 00:13:06,368
and then kind of
466
00:13:06,368 --> 00:13:08,078
wait for other firms to figure it out
467
00:13:08,078 --> 00:13:10,206
and then come in all the way.
468
00:13:10,206 --> 00:13:12,750
And I really hear you describing a third
469
00:13:12,750 --> 00:13:13,834
and better way.
470
00:13:13,834 --> 00:13:16,378
I think the practical reality is
471
00:13:16,378 --> 00:13:17,296
the first two
472
00:13:17,296 --> 00:13:18,964
is what we've seen over the course
473
00:13:18,964 --> 00:13:20,174
of the last three years.
474
00:13:20,174 --> 00:13:21,258
And that's partly
475
00:13:21,258 --> 00:13:23,427
because this is an extremely
476
00:13:23,427 --> 00:13:24,595
powerful technology
477
00:13:24,595 --> 00:13:25,971
that we are still learning
478
00:13:25,971 --> 00:13:26,847
all the right
479
00:13:26,847 --> 00:13:27,890
controls to be able
480
00:13:27,890 --> 00:13:29,433
to put this at scale
481
00:13:29,433 --> 00:13:31,185
inside of organizations.
482
00:13:31,185 --> 00:13:32,853
We at EY have something we call,
483
00:13:32,853 --> 00:13:34,647
we refer to as the blueprint.
484
00:13:34,647 --> 00:13:35,981
So when you shift away
485
00:13:35,981 --> 00:13:37,650
and you think about a function that runs
486
00:13:37,650 --> 00:13:38,692
AI natively
487
00:13:38,692 --> 00:13:39,735
as if you've built it
488
00:13:39,735 --> 00:13:41,987
for the era in which we're in today,
489
00:13:41,987 --> 00:13:44,114
then that's not just a process
490
00:13:44,114 --> 00:13:45,241
that's AI powered.
491
00:13:45,241 --> 00:13:46,659
You have multiple layers,
492
00:13:46,659 --> 00:13:48,828
you have connectivity into the sources
493
00:13:48,828 --> 00:13:50,538
that you engage with today, because
494
00:13:50,538 --> 00:13:52,289
you know, it becomes a big question.
495
00:13:52,289 --> 00:13:53,916
Do you want to change and rip out
496
00:13:53,916 --> 00:13:55,417
everything that you've invested
497
00:13:55,417 --> 00:13:57,211
in from a technology perspective?
498
00:13:57,211 --> 00:13:58,921
But then you have an AI native platform,
499
00:13:58,921 --> 00:14:00,172
you have an intelligence layer,
500
00:14:00,172 --> 00:14:01,549
you have a control layer.
501
00:14:01,549 --> 00:14:03,759
The control layer is actually responsible
502
00:14:03,759 --> 00:14:06,095
for maintaining how much autonomy
503
00:14:06,095 --> 00:14:07,680
do you give these agents?
504
00:14:07,680 --> 00:14:09,139
And, like, simple things like
505
00:14:09,139 --> 00:14:10,391
where do you put the agents?
506
00:14:10,391 --> 00:14:12,434
Do you put the agents in the HR master,
507
00:14:12,434 --> 00:14:13,561
or do you put them in
508
00:14:13,561 --> 00:14:15,062
some other registration?
509
00:14:15,062 --> 00:14:16,605
And what access do they have
510
00:14:16,605 --> 00:14:17,731
to be able to run your business?
511
00:14:17,731 --> 00:14:18,858
And then you start to layer
512
00:14:18,858 --> 00:14:20,109
in the process,
513
00:14:20,109 --> 00:14:22,069
what the new jobs are of the future,
514
00:14:22,069 --> 00:14:23,988
and where and how you create value.
515
00:14:23,988 --> 00:14:25,990
And when you stack that up together,
516
00:14:25,990 --> 00:14:27,408
that is the playbook
517
00:14:27,408 --> 00:14:28,826
for how you become
518
00:14:28,826 --> 00:14:31,412
a much more Frontier-focused business
519
00:14:31,412 --> 00:14:32,913
in the area that you want to,
520
00:14:32,913 --> 00:14:34,832
that you want to start to compete in.
521
00:14:34,832 --> 00:14:37,251
Over time, doing that in different places
522
00:14:37,251 --> 00:14:38,085
allows you to work
523
00:14:38,085 --> 00:14:39,628
towards becoming the Frontier Firm.
524
00:14:39,628 --> 00:14:40,671
When you talk to your clients
525
00:14:40,671 --> 00:14:41,714
about their competition,
526
00:14:41,714 --> 00:14:44,258
is it firms that are moving faster
527
00:14:44,258 --> 00:14:45,634
to become Frontier Firms,
528
00:14:45,634 --> 00:14:47,595
or is it AI-first companies
529
00:14:47,595 --> 00:14:48,846
that are coming up behind them?
530
00:14:48,846 --> 00:14:51,849
I would say that that all, of course
531
00:14:51,849 --> 00:14:53,517
Molly, that depends on the industries
532
00:14:53,517 --> 00:14:54,518
in which we're focused on.
533
00:14:54,518 --> 00:14:57,271
But most of my clients
534
00:14:57,271 --> 00:14:59,106
are really concerned
535
00:14:59,106 --> 00:15:00,399
about the competitors
536
00:15:00,399 --> 00:15:02,693
and the disruptors that they do not see
537
00:15:02,693 --> 00:15:04,528
and they are not competing with today.
538
00:15:04,528 --> 00:15:05,821
It's the AI natives.
539
00:15:05,821 --> 00:15:07,281
I mean, there are many companies
540
00:15:07,281 --> 00:15:09,825
that are 40 or 50 people companies
541
00:15:09,825 --> 00:15:12,286
that have multibillion dollar valuations,
542
00:15:12,286 --> 00:15:13,412
and they are starting to be
543
00:15:13,412 --> 00:15:14,788
a very disruptive force
544
00:15:14,788 --> 00:15:16,582
for established businesses.
545
00:15:16,582 --> 00:15:17,666
And you don't see them.
546
00:15:17,666 --> 00:15:18,876
And then all of a sudden
547
00:15:18,876 --> 00:15:20,794
they are $1 billion company
548
00:15:20,794 --> 00:15:21,837
and starting to really eat
549
00:15:21,837 --> 00:15:23,380
into your business model.
550
00:15:23,380 --> 00:15:25,174
I would say that's driving a majority
551
00:15:25,174 --> 00:15:26,717
of the strategic
552
00:15:26,717 --> 00:15:28,469
imperative inside these organizations.
553
00:15:28,469 --> 00:15:28,844
Yeah.
554
00:15:28,844 --> 00:15:30,137
That's always been
555
00:15:30,137 --> 00:15:31,388
a hard thing to keep up with.
556
00:15:31,388 --> 00:15:32,932
You're kind of trying to imagine
557
00:15:32,932 --> 00:15:34,642
the anatomy of your disruptor
558
00:15:34,642 --> 00:15:37,686
as if it's this, like, shadow box of a person,
559
00:15:37,686 --> 00:15:39,396
or a company.
560
00:15:39,396 --> 00:15:41,273
And it is really challenging.
561
00:15:41,273 --> 00:15:43,233
But what I have seen,
562
00:15:43,233 --> 00:15:44,777
I would say over the last six months
563
00:15:44,777 --> 00:15:46,195
that is quite different now,
564
00:15:46,195 --> 00:15:47,696
is that in the beginning,
565
00:15:47,696 --> 00:15:49,281
everybody at the executive
566
00:15:49,281 --> 00:15:51,075
team needed to know about AI.
567
00:15:51,075 --> 00:15:52,368
So the education sessions,
568
00:15:52,368 --> 00:15:53,786
I referred to those master classes,
569
00:15:53,786 --> 00:15:55,788
those were supported by the executives,
570
00:15:55,788 --> 00:15:57,206
in many cases by the boards.
571
00:15:57,206 --> 00:15:59,333
Then slowly, it became a technology thing,
572
00:15:59,333 --> 00:16:00,209
where it became
573
00:16:00,209 --> 00:16:01,710
the responsibility of the CIO
574
00:16:01,710 --> 00:16:02,795
or the CTO to be able
575
00:16:02,795 --> 00:16:04,922
to scale out the technology.
576
00:16:04,922 --> 00:16:05,589
As we start
577
00:16:05,589 --> 00:16:07,675
to get more into mindset, skill set,
578
00:16:07,675 --> 00:16:10,886
being really needed investment
579
00:16:10,886 --> 00:16:12,680
buckets to balance out,
580
00:16:12,680 --> 00:16:14,890
you know, the true transformative power.
581
00:16:14,890 --> 00:16:15,891
It seems to be something
582
00:16:15,891 --> 00:16:18,143
that is going back up to the CEO
583
00:16:18,143 --> 00:16:20,813
and the executive leaders in the company
584
00:16:20,813 --> 00:16:22,189
to start to set the vision
585
00:16:22,189 --> 00:16:23,357
and the strategy.
586
00:16:23,357 --> 00:16:25,317
So, that natural progression, you know,
587
00:16:25,317 --> 00:16:26,944
we tend to overestimate things
588
00:16:26,944 --> 00:16:27,569
in the short term
589
00:16:27,569 --> 00:16:29,029
and underestimate them in the long term.
590
00:16:29,029 --> 00:16:29,905
Like perhaps
591
00:16:29,905 --> 00:16:30,572
that is what
592
00:16:30,572 --> 00:16:32,116
we should have predicted over time.
593
00:16:32,116 --> 00:16:33,784
But we do feel there's an inflection
594
00:16:33,784 --> 00:16:34,535
point happening
595
00:16:34,535 --> 00:16:36,286
where companies are starting to revisit
596
00:16:36,286 --> 00:16:37,621
the way they're thinking about AI
597
00:16:37,621 --> 00:16:38,789
in their organizations.
598
00:16:38,789 --> 00:16:39,832
Interesting.
599
00:16:39,832 --> 00:16:41,250
Before we move off of that,
600
00:16:41,250 --> 00:16:42,334
what are some of the benefits
601
00:16:42,334 --> 00:16:44,420
that a legacy firm
602
00:16:44,420 --> 00:16:46,088
can bring to this conversation?
603
00:16:46,088 --> 00:16:46,922
Like, you know,
604
00:16:46,922 --> 00:16:48,340
we should not assume
605
00:16:48,340 --> 00:16:50,801
that every company will be disrupted
606
00:16:50,801 --> 00:16:53,220
by a brand new AI native company.
607
00:16:53,220 --> 00:16:55,806
Are there things that are built-in benefits
608
00:16:55,806 --> 00:16:56,557
for a company
609
00:16:56,557 --> 00:16:57,683
that's been around for a long time?
610
00:16:57,683 --> 00:16:58,559
Maybe their data set,
611
00:16:58,559 --> 00:17:00,686
maybe, you know, their context?
612
00:17:00,686 --> 00:17:01,061
Yeah.
613
00:17:01,061 --> 00:17:03,147
I mean, I think really what it comes down
614
00:17:03,147 --> 00:17:06,567
to is their scale in a lot of ways.
615
00:17:07,067 --> 00:17:08,777
You know, organizations
616
00:17:08,777 --> 00:17:10,154
I've seen, you know, compete
617
00:17:10,154 --> 00:17:12,197
against some of these AI native startups,
618
00:17:12,197 --> 00:17:13,449
the AI native startups
619
00:17:13,449 --> 00:17:14,950
don't like the messiness,
620
00:17:14,950 --> 00:17:16,702
which is a corporate reality.
621
00:17:16,702 --> 00:17:17,911
Many of these companies
622
00:17:17,911 --> 00:17:19,413
have learned in B2B
623
00:17:19,413 --> 00:17:20,873
constructs, have learned to be able
624
00:17:20,873 --> 00:17:22,791
to sell to an enterprise,
625
00:17:22,791 --> 00:17:24,376
to be able to take technology
626
00:17:24,376 --> 00:17:26,712
to a complex organization.
627
00:17:26,712 --> 00:17:28,547
I’d say that the data flywheel
628
00:17:28,547 --> 00:17:30,049
inside of organizations
629
00:17:30,049 --> 00:17:31,967
is critically important,
630
00:17:31,967 --> 00:17:34,470
because that organizational nuance
631
00:17:34,470 --> 00:17:37,139
and context is what drives differentiation
632
00:17:37,139 --> 00:17:39,391
from just using a general-purpose model.
633
00:17:39,391 --> 00:17:40,809
And then I'd say also it's
634
00:17:40,809 --> 00:17:42,561
the customer reach and contracts.
635
00:17:42,561 --> 00:17:43,395
You know, often
636
00:17:43,395 --> 00:17:44,605
these are incredible
637
00:17:44,605 --> 00:17:46,398
endowments inside of organizations
638
00:17:46,398 --> 00:17:48,650
that really are
639
00:17:48,650 --> 00:17:51,236
the points that allow them to be able
640
00:17:51,236 --> 00:17:52,905
to kind of move into a new market.
641
00:17:52,905 --> 00:17:54,490
Like, there are many
642
00:17:54,490 --> 00:17:56,784
multi-conglomerate technology companies
643
00:17:56,784 --> 00:17:58,118
and some of them find that
644
00:17:58,118 --> 00:18:01,246
their most valuable asset in the AI space
645
00:18:01,538 --> 00:18:03,916
are the game consoles that they have,
646
00:18:03,916 --> 00:18:07,419
and the following of consumers
647
00:18:07,753 --> 00:18:09,004
engaging in gaming
648
00:18:09,004 --> 00:18:10,380
on their game consoles,
649
00:18:10,380 --> 00:18:11,632
because that implicitly
650
00:18:11,632 --> 00:18:12,758
has this community
651
00:18:12,758 --> 00:18:14,760
that can become the flywheel
652
00:18:14,760 --> 00:18:16,637
in which you introduce AI innovation.
653
00:18:16,637 --> 00:18:18,138
Let's talk about employees,
654
00:18:18,138 --> 00:18:19,014
because so far
655
00:18:19,014 --> 00:18:20,557
we've talked about leaders,
656
00:18:20,557 --> 00:18:23,060
and this is a leadership challenge,
657
00:18:23,060 --> 00:18:24,144
bringing employees along.
658
00:18:24,144 --> 00:18:26,688
EY has launched an initiative to upskill
659
00:18:26,688 --> 00:18:30,150
tens of thousands of professionals in AI.
660
00:18:30,150 --> 00:18:31,485
Talk about how important this is
661
00:18:31,485 --> 00:18:33,946
and how you get it done in organizations.
662
00:18:33,946 --> 00:18:36,240
Yeah, this is something that is
663
00:18:36,240 --> 00:18:37,866
as we are a people-based business
664
00:18:37,866 --> 00:18:40,160
and we will be a people-based business,
665
00:18:40,160 --> 00:18:41,120
this is something
666
00:18:41,120 --> 00:18:42,955
that is of critical importance
667
00:18:42,955 --> 00:18:44,790
to us in our organization.
668
00:18:44,790 --> 00:18:48,043
I'll speak for our consulting organization.
669
00:18:48,043 --> 00:18:50,879
Last year, we built a full curriculum
670
00:18:50,879 --> 00:18:53,382
for all of our employees at EY
671
00:18:53,382 --> 00:18:55,342
to get introduced,
672
00:18:55,342 --> 00:18:56,552
to get the foundations,
673
00:18:56,552 --> 00:18:57,803
but then to start to teach
674
00:18:57,803 --> 00:19:00,806
AI to them in the context of their jobs.
675
00:19:00,973 --> 00:19:03,559
And I referred to using AI
676
00:19:03,559 --> 00:19:05,394
to move into a creator-based economy
677
00:19:05,394 --> 00:19:07,646
and to be able to do what's
678
00:19:07,646 --> 00:19:09,648
what's not possible in AI itself.
679
00:19:09,648 --> 00:19:11,859
We call that the “power of the and.”
680
00:19:11,859 --> 00:19:14,444
So, we’re working on teaching our people
681
00:19:14,444 --> 00:19:16,363
how to find their “and.”
682
00:19:16,363 --> 00:19:18,198
How to take their deep
683
00:19:18,198 --> 00:19:20,117
domain expertise and turn that
684
00:19:20,117 --> 00:19:22,327
into a strategic differentiator
685
00:19:22,327 --> 00:19:24,163
in the way that they engage with AI
686
00:19:24,163 --> 00:19:25,664
to create unique content.
687
00:19:25,664 --> 00:19:26,874
So we rolled out this out
688
00:19:26,874 --> 00:19:27,541
to all of our people,
689
00:19:27,666 --> 00:19:29,376
and we feel really good about it
690
00:19:29,376 --> 00:19:32,254
because we've seen our employee
691
00:19:32,254 --> 00:19:33,922
engagement scores go up
692
00:19:33,922 --> 00:19:35,174
as a result of that.
693
00:19:35,174 --> 00:19:37,217
We feel that people feel more in
694
00:19:37,217 --> 00:19:38,051
the driver's seat
695
00:19:38,051 --> 00:19:40,095
of how they can start to shape AI,
696
00:19:40,095 --> 00:19:42,181
as opposed to have I happen to them.
697
00:19:42,181 --> 00:19:43,682
So it's been an investment
698
00:19:43,682 --> 00:19:44,892
that we will continue to make
699
00:19:44,892 --> 00:19:45,726
and all of our people
700
00:19:45,726 --> 00:19:47,394
across the organization every year.
701
00:19:47,394 --> 00:19:48,770
This is such a great point
702
00:19:48,770 --> 00:19:49,396
that you're bringing up,
703
00:19:49,396 --> 00:19:52,316
because there can be a lot of built-in
704
00:19:52,649 --> 00:19:55,277
resistance or skepticism or concern.
705
00:19:55,277 --> 00:19:56,403
You know,
706
00:19:56,403 --> 00:19:57,237
we would be lying
707
00:19:57,237 --> 00:19:58,488
if we said that didn't exist
708
00:19:58,488 --> 00:19:59,656
within organizations.
709
00:19:59,656 --> 00:20:02,034
And it really is a leadership challenge
710
00:20:02,034 --> 00:20:05,579
to champion this, to do it in partnership
711
00:20:05,579 --> 00:20:06,788
with your employees.
712
00:20:06,788 --> 00:20:08,415
Yeah, we run this poll
713
00:20:08,415 --> 00:20:09,833
asking employees
714
00:20:09,833 --> 00:20:11,585
how engaged they are, and how much
715
00:20:11,585 --> 00:20:14,588
they're getting what they need from AI.
716
00:20:14,588 --> 00:20:16,673
Recently, about 85% of them
717
00:20:16,673 --> 00:20:17,841
said they were really excited
718
00:20:17,841 --> 00:20:20,260
for agentic AI, but 86% of them
719
00:20:20,260 --> 00:20:22,012
said they had to learn it on their own.
720
00:20:22,012 --> 00:20:22,846
Most of their learning
721
00:20:22,846 --> 00:20:23,847
was happening on their own.
722
00:20:23,847 --> 00:20:25,557
This is not EY specific.
723
00:20:25,557 --> 00:20:28,227
This is broadly across workers.
724
00:20:28,227 --> 00:20:30,979
So, in order to really engage with people,
725
00:20:30,979 --> 00:20:32,231
you need to have a strategy
726
00:20:32,231 --> 00:20:34,191
with clear intent, which is,
727
00:20:34,191 --> 00:20:36,026
I think, more of a growth strategy
728
00:20:36,026 --> 00:20:37,778
than a productivity strategy.
729
00:20:37,778 --> 00:20:39,529
You need to have the right investments
730
00:20:39,529 --> 00:20:42,282
in helping people develop those skills
731
00:20:42,282 --> 00:20:43,617
and give them the opportunity
732
00:20:43,617 --> 00:20:45,202
and the tooling to be able to
733
00:20:45,202 --> 00:20:47,037
to build that muscle.
734
00:20:47,037 --> 00:20:48,830
And then I think, you have to address
735
00:20:48,830 --> 00:20:50,666
the fact that this is going to be
736
00:20:50,666 --> 00:20:53,627
an ever-going cycle of change.
737
00:20:53,627 --> 00:20:55,462
And, like, change agility
738
00:20:55,462 --> 00:20:57,631
and investing in building out
739
00:20:57,631 --> 00:20:59,800
that muscle is critically important
740
00:20:59,800 --> 00:21:01,426
and something that, you know, I'd say
741
00:21:01,426 --> 00:21:03,136
we're still tackling inside of EY.
742
00:21:03,136 --> 00:21:04,221
How do you communicate that
743
00:21:04,221 --> 00:21:05,555
to leaders at other companies?
744
00:21:05,555 --> 00:21:07,557
That “You may bring them along” to
745
00:21:07,557 --> 00:21:08,850
“You need to start with your strategy
746
00:21:08,850 --> 00:21:09,977
and your desired outcomes
747
00:21:09,977 --> 00:21:12,271
and really go deep on the functions
748
00:21:12,271 --> 00:21:13,605
that you want to change,
749
00:21:13,605 --> 00:21:15,607
but don't leave your employees behind.”
750
00:21:15,607 --> 00:21:17,359
Yeah, I mean, this is the story
751
00:21:17,359 --> 00:21:20,237
of 2025 right now with AI.
752
00:21:20,237 --> 00:21:23,740
It's how do we create more as opposed to,
753
00:21:23,740 --> 00:21:25,909
you know, try to use AI to do the same,
754
00:21:25,909 --> 00:21:26,994
but with less?
755
00:21:26,994 --> 00:21:28,954
What we often do inside of EY
756
00:21:28,954 --> 00:21:30,455
is we believe that, you know,
757
00:21:30,455 --> 00:21:31,957
we can talk all we want
758
00:21:31,957 --> 00:21:33,875
about what a company should do,
759
00:21:33,875 --> 00:21:35,127
but we need to be able to walk
760
00:21:35,127 --> 00:21:36,378
the talk as well.
761
00:21:36,378 --> 00:21:37,713
And we've invested in something
762
00:21:37,713 --> 00:21:39,965
we call our Client Zero Program,
763
00:21:39,965 --> 00:21:42,050
which is where we are doing this
764
00:21:42,050 --> 00:21:43,260
to ourselves first
765
00:21:43,260 --> 00:21:45,137
and then showing our clients
766
00:21:45,137 --> 00:21:47,389
what's worked and what hasn't worked.
767
00:21:47,389 --> 00:21:48,724
And that has been
768
00:21:48,724 --> 00:21:49,975
a really effective tool
769
00:21:49,975 --> 00:21:51,768
of being able to really drive that.
770
00:21:51,768 --> 00:21:52,936
I think the second is
771
00:21:52,936 --> 00:21:54,896
when you can come in with a blueprint,
772
00:21:54,896 --> 00:21:56,064
these, these blueprints
773
00:21:56,064 --> 00:21:57,357
I was referring to say,
774
00:21:57,357 --> 00:21:59,276
this is how you can create value
775
00:21:59,276 --> 00:22:00,986
in an AI native way,
776
00:22:00,986 --> 00:22:02,487
then you automatically shift
777
00:22:02,487 --> 00:22:03,447
to the growth agenda
778
00:22:03,447 --> 00:22:04,614
as opposed to just focusing
779
00:22:04,614 --> 00:22:06,033
on the productivity agenda.
780
00:22:06,033 --> 00:22:07,617
What can you tell us about what has
781
00:22:07,617 --> 00:22:08,910
worked and what hasn't worked?
782
00:22:08,910 --> 00:22:11,204
Okay, so, inside of EY?
783
00:22:11,204 --> 00:22:12,247
Yeah.
784
00:22:12,247 --> 00:22:13,749
So, I'd say at EY
785
00:22:13,749 --> 00:22:14,666
We won't tell anybody.
786
00:22:14,666 --> 00:22:15,625
Don't tell anyone.
787
00:22:15,625 --> 00:22:16,001
No.
788
00:22:16,001 --> 00:22:17,085
Please. This is off the record.
789
00:22:17,085 --> 00:22:17,794
Just between us.
790
00:22:17,794 --> 00:22:18,754
Yes. Okay.
791
00:22:18,754 --> 00:22:20,422
So, in that case,
792
00:22:20,422 --> 00:22:22,174
I think we've done a really good job
793
00:22:22,174 --> 00:22:23,633
with our leadership buy-in
794
00:22:23,633 --> 00:22:24,885
and engagement.
795
00:22:24,885 --> 00:22:26,094
You know, our leaders,
796
00:22:26,094 --> 00:22:28,138
our CEO is very active
797
00:22:28,138 --> 00:22:30,932
in driving and shaping our AI agenda.
798
00:22:30,932 --> 00:22:33,685
Her direct report is responsible
799
00:22:33,685 --> 00:22:35,812
for leading all of the programs
800
00:22:35,812 --> 00:22:36,480
that we're doing
801
00:22:36,480 --> 00:22:38,315
all across our service lines.
802
00:22:38,315 --> 00:22:39,608
And we've cascaded
803
00:22:39,608 --> 00:22:41,276
that down into priorities
804
00:22:41,276 --> 00:22:43,362
for every geography around the world.
805
00:22:43,362 --> 00:22:45,822
So I think leadership buy-in
806
00:22:45,822 --> 00:22:47,616
the investments that we're making
807
00:22:47,616 --> 00:22:50,202
in people, in process, in technology.
808
00:22:50,202 --> 00:22:51,912
Like last year, we've invested over
809
00:22:51,912 --> 00:22:53,246
a billion dollars of capital
810
00:22:53,246 --> 00:22:54,998
into getting ourselves ready
811
00:22:54,998 --> 00:22:56,958
to become that Frontier Firm.
812
00:22:58,168 --> 00:23:00,712
The challenging part that you asked for,
813
00:23:00,712 --> 00:23:02,756
I'd say, you know, and this is
814
00:23:02,756 --> 00:23:04,674
this is not unique to EY,
815
00:23:04,674 --> 00:23:06,760
but this is a massive
816
00:23:06,760 --> 00:23:09,763
and fundamental change of the business.
817
00:23:09,971 --> 00:23:12,516
For us, we are a business model
818
00:23:12,516 --> 00:23:14,601
that has been built on the billable hour,
819
00:23:14,601 --> 00:23:17,396
where people monetize their efforts.
820
00:23:17,396 --> 00:23:18,522
The harder the problem,
821
00:23:18,522 --> 00:23:19,898
the harder you have to work,
822
00:23:19,898 --> 00:23:20,899
the more you get paid
823
00:23:20,899 --> 00:23:22,526
for that particular problem.
824
00:23:22,526 --> 00:23:25,445
And we are going to, through AI,
825
00:23:25,445 --> 00:23:27,322
start to break that business model,
826
00:23:27,322 --> 00:23:29,366
but it fundamentally changes
827
00:23:29,366 --> 00:23:30,992
how we price our services
828
00:23:30,992 --> 00:23:32,702
and how we value our services.
829
00:23:32,702 --> 00:23:33,745
And it's not just us
830
00:23:33,745 --> 00:23:34,871
that needs to change,
831
00:23:34,871 --> 00:23:36,957
it's also the clients that are going to buy
832
00:23:36,957 --> 00:23:38,291
our services in the future
833
00:23:38,291 --> 00:23:39,084
need to be along with
834
00:23:39,084 --> 00:23:40,544
with us for that journey.
835
00:23:40,544 --> 00:23:43,380
So that kind of change management,
836
00:23:43,380 --> 00:23:45,715
change agility and breaking down
837
00:23:45,715 --> 00:23:48,718
the muscle memory of, you know,
838
00:23:48,718 --> 00:23:51,179
being in a business for decades
839
00:23:51,179 --> 00:23:53,223
under a consistent business model
840
00:23:53,223 --> 00:23:54,808
is something that I would say
841
00:23:54,808 --> 00:23:56,017
is the biggest challenge
842
00:23:56,017 --> 00:23:57,310
that we are facing,
843
00:23:57,310 --> 00:23:58,895
but it's something that is critical
844
00:23:58,895 --> 00:24:01,273
for our long-term thriving with AI.
845
00:24:01,273 --> 00:24:03,775
For leaders who want to start
846
00:24:04,151 --> 00:24:06,319
or maybe accelerate their organization’s
847
00:24:06,319 --> 00:24:07,696
AI transformation,
848
00:24:07,696 --> 00:24:09,823
what are some concrete places
849
00:24:09,823 --> 00:24:10,991
that they can begin?
850
00:24:10,991 --> 00:24:12,284
Like, where do you start?
851
00:24:12,284 --> 00:24:13,452
Yeah, look at where
852
00:24:13,452 --> 00:24:15,036
the company creates value
853
00:24:15,036 --> 00:24:16,872
inside the organization today.
854
00:24:16,872 --> 00:24:19,082
I would say it's a value-based story.
855
00:24:19,082 --> 00:24:20,709
It needs to be about growth.
856
00:24:20,709 --> 00:24:21,877
Start in those areas.
857
00:24:21,877 --> 00:24:22,669
So for many
858
00:24:22,669 --> 00:24:24,254
consumer product-based companies
859
00:24:24,254 --> 00:24:26,047
that'll be, what products do you build
860
00:24:26,047 --> 00:24:27,841
and make inside your organization?
861
00:24:27,841 --> 00:24:29,050
And that'll put you down a path
862
00:24:29,050 --> 00:24:30,719
of looking at AI to do product
863
00:24:30,719 --> 00:24:32,471
innovation and R&D,
864
00:24:32,471 --> 00:24:34,014
and to be able to help the sales
865
00:24:34,014 --> 00:24:35,098
and marketing function
866
00:24:35,098 --> 00:24:36,766
or the supply chain function.
867
00:24:36,766 --> 00:24:38,810
If you're in a banking function,
868
00:24:38,810 --> 00:24:39,811
it becomes
869
00:24:39,811 --> 00:24:40,979
a little bit of a different story.
870
00:24:40,979 --> 00:24:43,023
Oil and gas is a different story.
871
00:24:43,023 --> 00:24:44,232
So I'd say it's
872
00:24:44,232 --> 00:24:45,817
a very sector specific story of
873
00:24:45,817 --> 00:24:47,652
think about where you create value.
874
00:24:47,652 --> 00:24:48,695
I know you're going to say that
875
00:24:48,695 --> 00:24:50,739
I'm giving you like an easy answer
876
00:24:50,739 --> 00:24:52,032
and I'm not getting specific enough.
877
00:24:52,032 --> 00:24:52,866
Well, I have an idea
878
00:24:52,866 --> 00:24:53,992
about how we can drill down.
879
00:24:53,992 --> 00:24:55,368
I wonder, is there a temptation
880
00:24:55,368 --> 00:24:56,995
for companies to start
881
00:24:56,995 --> 00:24:58,079
with an underperforming
882
00:24:58,079 --> 00:24:58,914
part of the business,
883
00:24:58,914 --> 00:25:00,999
because that might feel a little bit safer?
884
00:25:00,999 --> 00:25:02,834
Like, are you sort of saying, listen,
885
00:25:02,834 --> 00:25:03,668
go up the gut,
886
00:25:03,668 --> 00:25:05,045
take the thing that you already do
887
00:25:05,045 --> 00:25:06,129
the best and try to figure out
888
00:25:06,129 --> 00:25:07,088
how you can make it better?
889
00:25:07,088 --> 00:25:09,257
Yeah, that that is a great way to say it.
890
00:25:10,258 --> 00:25:11,635
In a lot of ways,
891
00:25:11,635 --> 00:25:13,595
what we see is organizations
892
00:25:13,595 --> 00:25:15,138
wanting to test it out
893
00:25:15,138 --> 00:25:17,557
by experimenting in their back office.
894
00:25:17,557 --> 00:25:18,517
And then when you do that,
895
00:25:18,517 --> 00:25:19,267
you get into this
896
00:25:19,267 --> 00:25:20,685
like cost out productivity.
897
00:25:20,685 --> 00:25:23,688
AI is going to show returns on its P&L
898
00:25:23,897 --> 00:25:26,233
by driving down costs.
899
00:25:26,900 --> 00:25:27,943
I think, you know,
900
00:25:27,943 --> 00:25:29,528
the strategic companies that we see,
901
00:25:29,528 --> 00:25:30,278
they are taking on
902
00:25:30,278 --> 00:25:31,821
challenging business questions
903
00:25:31,821 --> 00:25:33,365
that are existential to their
904
00:25:33,365 --> 00:25:34,824
business strategy,
905
00:25:34,824 --> 00:25:36,201
And they're using that to start
906
00:25:36,201 --> 00:25:37,619
to power their business.
907
00:25:37,619 --> 00:25:40,747
And I think getting to a 2 or 3 page
908
00:25:40,747 --> 00:25:42,624
reinvention of a function
909
00:25:42,624 --> 00:25:45,252
agenda is an easy and tangible way—
910
00:25:45,252 --> 00:25:46,378
well, I shouldn't say easy.
911
00:25:46,378 --> 00:25:47,045
I was going to say.
912
00:25:47,045 --> 00:25:48,964
Sounds like an easy thing to do,
913
00:25:48,964 --> 00:25:51,258
but it is an objective
914
00:25:51,258 --> 00:25:52,968
target that you can set
915
00:25:52,968 --> 00:25:54,970
that allows you to start to push
916
00:25:54,970 --> 00:25:56,888
and move that mindset shift
917
00:25:56,888 --> 00:25:58,181
in the organization,
918
00:25:58,181 --> 00:26:01,268
that this is not about just doing AI, but
919
00:26:01,268 --> 00:26:04,271
it's about changing how we work with AI.
920
00:26:04,604 --> 00:26:06,481
And then if you are an employee,
921
00:26:06,481 --> 00:26:08,567
for employees who want to thrive in
922
00:26:08,567 --> 00:26:09,985
an AI-first workplace,
923
00:26:10,986 --> 00:26:11,903
even if they have been
924
00:26:11,903 --> 00:26:13,822
mandated to upskill.
925
00:26:13,989 --> 00:26:16,074
What are some of the things
926
00:26:16,074 --> 00:26:17,742
that they should focus on right now?
927
00:26:17,742 --> 00:26:19,536
This is probably
928
00:26:19,536 --> 00:26:23,748
the biggest revolution of management
929
00:26:23,957 --> 00:26:27,043
that has ever happened in our society.
930
00:26:27,043 --> 00:26:29,170
And these are really big, bold words.
931
00:26:29,170 --> 00:26:32,507
But, the corporate ladder used to be
932
00:26:32,507 --> 00:26:34,134
that you took a job
933
00:26:34,134 --> 00:26:36,386
and you worked hard by building
934
00:26:36,386 --> 00:26:37,762
credibility and experience.
935
00:26:37,762 --> 00:26:38,888
And ultimately
936
00:26:38,888 --> 00:26:40,181
if you did that really well,
937
00:26:40,181 --> 00:26:41,474
you became a manager.
938
00:26:41,474 --> 00:26:44,102
And then you managed and oversaw people.
939
00:26:44,102 --> 00:26:45,854
And today, the corporate ladder
940
00:26:45,854 --> 00:26:48,440
is being completely kicked over.
941
00:26:48,440 --> 00:26:50,525
People that will join companies
942
00:26:50,525 --> 00:26:53,528
next year will be managers on day one.
943
00:26:53,528 --> 00:26:55,572
They will just be managing a workforce
944
00:26:55,572 --> 00:26:57,699
that is an agentic-based workforce,
945
00:26:57,699 --> 00:26:59,242
one that is extremely powerful
946
00:26:59,242 --> 00:27:00,869
and sometimes clumsy.
947
00:27:00,869 --> 00:27:01,620
And they'll have to have
948
00:27:01,620 --> 00:27:02,787
the requisite skills
949
00:27:02,787 --> 00:27:04,748
to be able to do that
950
00:27:04,748 --> 00:27:06,625
technological management.
951
00:27:06,625 --> 00:27:08,960
So that's where I get into those four
952
00:27:08,960 --> 00:27:10,378
that I described earlier.
953
00:27:10,378 --> 00:27:12,088
I think that really requires
954
00:27:12,088 --> 00:27:13,506
that critical thinking,
955
00:27:13,506 --> 00:27:14,924
that creativity,
956
00:27:14,924 --> 00:27:16,384
that systems thinking
957
00:27:16,384 --> 00:27:18,094
and the domain expertise
958
00:27:18,094 --> 00:27:19,012
to make that happen.
959
00:27:19,012 --> 00:27:20,722
And I'll just add a fifth one in here
960
00:27:20,722 --> 00:27:22,349
because it feels right.
961
00:27:22,349 --> 00:27:26,394
But there's got to be a real structured
962
00:27:26,394 --> 00:27:28,313
and a real investment
963
00:27:28,313 --> 00:27:30,982
in developing the delegation skills.
964
00:27:30,982 --> 00:27:33,610
Because giving agents instructions
965
00:27:33,610 --> 00:27:35,320
to be able to go do the work,
966
00:27:35,320 --> 00:27:36,738
and then critically evaluating
967
00:27:36,738 --> 00:27:38,073
if that happened in the appropriate
968
00:27:38,073 --> 00:27:39,282
way is critical
969
00:27:39,282 --> 00:27:41,117
for how a worker can thrive
970
00:27:41,117 --> 00:27:42,911
by being able to accomplish much more
971
00:27:42,911 --> 00:27:43,953
than what they'd be without
972
00:27:43,953 --> 00:27:45,497
what was possible yesterday.
973
00:27:45,497 --> 00:27:47,374
This is just partly me
974
00:27:47,374 --> 00:27:48,208
and how I like to work,
975
00:27:48,208 --> 00:27:49,834
but this sounds like a workplace
976
00:27:49,834 --> 00:27:51,169
I would want to be a part of.
977
00:27:51,169 --> 00:27:52,003
As opposed to, like, I'm
978
00:27:52,003 --> 00:27:53,213
you know, I'm an entry level worker
979
00:27:53,213 --> 00:27:53,880
who's going to come in
980
00:27:53,880 --> 00:27:55,465
and do a bunch of rote skills
981
00:27:55,465 --> 00:27:57,008
and regurgitate things.
982
00:27:57,008 --> 00:27:58,927
To be able to come in and say,
983
00:27:58,927 --> 00:28:00,637
have creative thinking, right?
984
00:28:00,637 --> 00:28:03,181
Have critical thinking skills,
985
00:28:03,181 --> 00:28:06,184
set strategy for an agent.
986
00:28:06,434 --> 00:28:07,894
It seems like a good story.
987
00:28:07,894 --> 00:28:09,270
I think there's a lot of upside.
988
00:28:09,270 --> 00:28:11,439
I mean, really, at the end of the day,
989
00:28:11,439 --> 00:28:12,816
I think this technology
990
00:28:12,816 --> 00:28:15,777
will start to power a new economy
991
00:28:15,777 --> 00:28:17,028
just like the internet did.
992
00:28:17,028 --> 00:28:18,029
You know, at first
993
00:28:18,029 --> 00:28:19,739
when the internet first came along,
994
00:28:19,739 --> 00:28:21,116
we were really worried
995
00:28:21,116 --> 00:28:22,283
that it was going to replace
996
00:28:22,283 --> 00:28:23,576
all the mail carriers.
997
00:28:23,576 --> 00:28:24,786
And then it created
998
00:28:24,786 --> 00:28:26,788
trillion-dollar businesses.
999
00:28:26,788 --> 00:28:27,747
It's hard to know
1000
00:28:27,747 --> 00:28:29,165
exactly what those businesses
1001
00:28:29,165 --> 00:28:30,208
are going to be,
1002
00:28:30,208 --> 00:28:31,668
but I know those businesses
1003
00:28:31,668 --> 00:28:33,336
will be created by people
1004
00:28:33,336 --> 00:28:34,087
that have learned
1005
00:28:34,087 --> 00:28:36,548
how to scale their impact
1006
00:28:36,548 --> 00:28:39,342
and their creative thinking by using AI.
1007
00:28:39,342 --> 00:28:41,636
In any technological revolution,
1008
00:28:41,636 --> 00:28:43,263
there's always in the beginning,
1009
00:28:43,263 --> 00:28:45,515
first fear and then reinvention.
1010
00:28:45,515 --> 00:28:47,142
And I think we're just coming out of
1011
00:28:47,142 --> 00:28:48,476
that fear phase right now.
1012
00:28:48,476 --> 00:28:49,227
Dan Diasio,
1013
00:28:49,227 --> 00:28:50,770
thank you so much for the time today.
1014
00:28:50,770 --> 00:28:51,604
It's my pleasure.
1015
00:28:51,604 --> 00:28:52,522
Thank you.
1016
00:28:52,522 --> 00:28:54,190
For more conversations like this one,
1017
00:28:54,190 --> 00:28:54,983
follow the show
1018
00:28:54,983 --> 00:28:56,276
and find every episode
1019
00:28:56,276 --> 00:28:58,486
at Microsoft.com/worklab.
1020
00:28:58,486 --> 00:28:59,821
I'm your host, Molly Wood.
1021
00:28:59,821 --> 00:29:00,739
Thank you for listening.
1022
00:29:01,698 --> 00:29:03,199
If you've got a question or a comment,
1023
00:29:03,199 --> 00:29:04,117
drop us an email
1024
00:29:04,117 --> 00:29:06,244
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1025
00:29:06,244 --> 00:29:06,828
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1026
00:29:06,828 --> 00:29:07,579
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1027
00:29:07,579 --> 00:29:09,247
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1028
00:29:09,247 --> 00:29:10,582
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1029
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1030
00:29:11,166 --> 00:29:12,834
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1031
00:29:12,834 --> 00:29:14,294
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1032
00:29:14,294 --> 00:29:15,003
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1033
00:29:15,003 --> 00:29:16,838
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1034
00:29:16,838 --> 00:29:18,089
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1035
00:29:18,089 --> 00:29:19,674
You can find all of that
1036
00:29:19,674 --> 00:29:21,926
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1037
00:29:21,926 --> 00:29:23,094
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1038
00:29:23,094 --> 00:29:24,721
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1039
00:29:24,721 --> 00:29:26,055
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1040
00:29:26,055 --> 00:29:28,183
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1041
00:29:28,183 --> 00:29:30,143
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1042
00:29:30,143 --> 00:29:32,270
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1043
00:29:32,270 --> 00:29:33,104
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1044
00:29:33,104 --> 00:29:33,897
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1045
00:29:33,897 --> 00:29:34,856
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1046
00:29:34,856 --> 00:29:37,108
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1047
00:29:37,108 --> 00:29:38,276
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1048
00:29:38,276 --> 00:29:40,403
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1049
00:29:40,403 --> 00:29:41,070
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1050
00:29:41,070 --> 00:29:42,447
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1051
00:29:42,447 --> 00:29:44,908
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1052
00:29:44,908 --> 00:29:46,576
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1053
00:29:46,576 --> 00:29:47,577
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1054
00:29:47,577 --> 00:29:48,369
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1055
00:29:48,369 --> 00:29:49,454
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1056
00:29:49,454 --> 00:29:51,456
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1057
00:29:51,456 --> 00:29:52,707
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1058
00:29:52,707 --> 00:29:55,043
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