Productive. Profitable. People Not Included? AI Displacement. Org Redesign. Universal Basic Income.

Productive. Profitable. People Not Included?

Companies are getting more productive and profitable — while quietly employing fewer people. This week we unpack the growing gap between AI productivity, disappearing jobs, and the uncomfortable question: if the work changes, what replaces the paycheck?

Companies are getting more productive. Profits are rising.
So why does it feel like workers are disappearing from the equation?

This week on Your Work Friends, Francesca and Mel break down two signals shaping the future of work.

First: hiring is slowing while AI takes on more tasks and even entire workflows. If jobs don’t keep pace with productivity, a bigger question emerges: how do people make money? That’s why ideas like Universal Basic Income are suddenly moving from academic theory into mainstream conversation.

Then we look at a new Harvard Business Review article on why AI transformations are stalling. The problem isn’t the technology — it’s that companies aren’t redesigning the work around it. Tools are being deployed everywhere, but the structure of jobs and organizations hasn’t caught up.

In this episode we explore:

• why productivity is rising while employment stalls
• the growing conversation around UBI and post-work income
• why AI adoption isn’t the same as AI transformation
• the organizational redesign most companies are avoiding

Because the real question isn’t just what AI can do.

It’s what happens to work — and paychecks — if it does.

#FutureOfWork
#AIAtWork
#WorkplaceTransformation
#Automation
#Leadership
#UniversalBasicIncome
#EconomicSignals

Disclaimer: This podcast is for informational purposes only and should not be considered professional advice. We are not responsible for any losses, damages, or liabilities that may arise from the use of this podcast. The views expressed in this podcast may not be those of the host or the management.

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Transcript

Speaker 0:00

this is not a conversation that can wait.

Speaker 2 0:01

Agreed. 100%.

Speaker 0:03

And I also feel like being like yippy io ca a as our AI policy is not exactly helping,

Speaker 2 0:09

Can that get on the books

Speaker 0:24

Welcome to your work friends. I'm Francesca Rani.

Speaker 2 0:27

And I'm Mel Platt.

Speaker 0:28

And we're breaking down the now and next of work. We're back with new week, new headlines. Mel, what are you talking about today?

Speaker 2 0:35

Heck yeah. We are this week Harvard, a business Review. They just dropped a new article this morning it is talking about how companies are not failing at AI because the technology is necessarily bad. It's because nobody wants to redesign the organization around it, which you and I talk about every freaking day.

Speaker 0:54

Yes. How about

Speaker 2 0:55

yourself?

Speaker 0:56

If AI takes over our jobs, how do you buy cheese? How do you actually make a living? The key question that keeps coming up with a lot of the head lines this week is if this economy keeps growing, which it is, but our jobs don't keep up, what happens to income? And I wanna talk about some of the options that are being put on the table.

Speaker 2 1:17

Let's do it.

Speaker 1:18

Let's do it. Alright, we talk to futurists all the time and there's always these themes that come up around, oh, it's gonna be great because you'll do this higher level thinking, and it's this new age of enlightenment and we're all gonna be farmers with cupcake shops, which sounds all super delightful until you start getting down in the details of, wait, how do I actually. Buy stuff, get stuff. Do I actually own stuff? And no one can really answer that.

Speaker 2 1:51

No.

Speaker 1:52

It really came to light, especially as we're looking at the latest job numbers and after I went down a massive rabbit hole about Kim Kardashian's bunker around, what happens when. Jobs don't keep up. This is the thing. We've traditionally gotten income from a job. And if jobs go away, especially in a mass scale, how do people get money? I

Speaker 2 2:17

don't know. I just wanna get paid in seashells.

Speaker 2:22

Kidding. Have four clams,

Speaker 3 2:23

two muscles.

Speaker 2 2:24

My dream of being the Little Mermaid, no, sorry.

Speaker 3 2:28

Look at this. Sp

Speaker 2:29

Yeah, it's yeah, it's,

Speaker 2 2:30

I'll take a spork.

Speaker 2:31

Yeah. A spork. Yeah. Yeah. This came to light this week, given four key trends in the news. We have headline one, which is like our long-term unemployment is starting to rise, even though our overall unemployment is around 4.4%, and obviously they reconcile the JAB numbers, the actual unemployment rate continues to go up, but by most signals, it's still relatively okay. However, talk to most people who are looking for a job? What do they say?

Speaker 2 2:59

Can't find one.

Speaker 3:00

Can't find one. Yeah. Can't. On top of that, we are seeing continued layoff announcements, block last week just laid off 4,000 other 7,000 people due completely to ai. We're seeing and have been seeing over the last few years companies quietly reducing their workforce. By about this two to 3% per year. And that's through things like hiring freezes. Yes. AI and automation. And also they're just not backfilling any kind of roles that they had in layoffs. And it's this Parmesan slice of their workforce that they're doing two to 3% at a time, the other thing that's happening is we are starting to see some productivity increases, and AI is allowing companies to produce more with fewer workers. At least that's the going narrative, we have shaved our workforce. We're more productive than ever. We're more profitable than ever. That's a very common headline right now. Whether or not that's actually AI or just squeezing blood from a rock, of the humans that are still there, is yet to be debated. But we are showing, increased productivity, increased profitability with fewer humans. And the last thing that has started coming to head, at least in the last few weeks is this conversation about universal basic income.

Speaker 2 4:14

Yeah.

Speaker 4:15

Now, some of you might be wondering what the hell is that? I'm going to go through it. But it's this idea of giving people money or a basic income when jobs don't exist. And a few years ago, this was something that was really relegated to academics that were studying economic policy now, last week, for example, you saw Andrew Yang on Moonshot talking about it. You're seeing Joe Rogan talk about it. Elon Musk talk about it's. Coming into the ether as part of the narrative, and one of the main reasons why I want to talk about it, because this link between work and income. It's starting to loosen.

Speaker 2 4:53

It is. I always pause when I hear Joe Rogan or I'm like, what are the benefits for them? But

Speaker 5:01

super fair. Yeah. Why I think it's very interesting to watch what they're saying is because that means it's mainstream.

Speaker 2 5:07

Yeah. A hundred percent. A hundred percent

Speaker 5:08

right. Which also means to me that they believe this is coming.

Speaker 2 5:13

I think it's coming too.

Speaker 5:15

I think it's absolutely coming. Yeah. I think it's absolutely coming. I agree.

Speaker 2 5:17

Yeah.

Speaker 5:18

We've had these narratives for a long time around AI is going to create more jobs than it will displace.

Speaker 2 5:25

Right?

Speaker 5:27

Right now we're not really seeing a lot of evidence of that. And my biggest concern is that a lot of people point to historical scenarios the internet, the industrial age, all these ages that we've gone through. The difference here is that those were not technologies that completely reproduced human cognitive ability.

Speaker 2 5:48

Yeah, this is extremely different. And even a year ago, you and I'd like to think we are optimistic realists over here, but even we thought okay, your role might get augmented, or your role might get redesigned potentially. But it wasn't going to be this level of layoffs not at this speed.

Speaker 6:07

No.

Speaker 2 6:07

Anyway. So this is different.

Speaker 6:10

Yeah, the two forcing factors for me that make me very nervous, one to your very good point. The speed. This is not something that's gonna happen over the next 10 years or the next 20 years. This is something that's probably gonna happen within the next two to three. LLMs largely didn't come on the docket

Speaker 2 6:27

2022 it dropped. We started. Are you and I were texting, look at this.

Speaker 6:33

Yeah, that's cool.

Speaker 2 6:34

This is cool. Let's try it out. Let's test and learn. And then really picking up the speed,

Speaker 6:40

very much picking up

Speaker 2 6:41

exponentially the last year.

Speaker 6:42

And you're probably seeing some of this inside your organizations, right? If you're managing teams in an organization, you might be feeling like the shape of the work or the number of the people needed to do it is changing. Your organization might be asking you to keep the amount of headcount that you have and figure out how to use AI to replace any of the labor that has gone away or that you need. That's a very common thing we're hearing right now. And there's three forces that are really driving this pattern. One is obviously the technology. AI can automate so many tasks within knowledge work, right? And there's a thought too that if AI can. Automate or AI can do the cognitive labor or even the labor that a human can do. The value of that labor goes down to whatever the cost of the machine is, which will always be cheaper than a human

Speaker 2 7:30

right.

Speaker 7:30

There's that. The second is companies are incented to operate with more productivity, and they're incented to honestly keep on shaving that two to 3% headcount each year because it makes them more profitable. They're incent in the stock market. They're incent by their board. Payroll, we know is one of the most expensive costs of an organization. So if you're a big organization that can meet a hundred million dollars a year,

Speaker 2 7:55

yeah.

Speaker 7:55

Not chump change.

Speaker 2 7:57

It isn't. That's a lot.

Speaker 7:59

The third is what we just talked about is this economic structure, historically, productivity gains have created new jobs. But again, that transition took decades. A lot of times, if we're being honest, this is not right, and it creates what economists call job-like growth, where productivity rises, profits rise, but employment stall, does that sound familiar?

Speaker 2 8:23

It does, yes.

Speaker 8:25

Yes. Like we talked about before, we're moving from this phase of adoption. We're throwing Claude, we're throwing copilot at our employees and figuring out if they figure out a cool way to use it to really acceleration, like we're putting it from test and learn to put it through workflows. Your agent can do something that an actual FTE headcount could potentially do. When you're moving from that phase one early adoption to that phase two acceleration. This is the moment where labor disruption historically has happened, this is where we start seeing, oh, the jobs that we used to have. Don't need to be there anymore. We're moving on to historically now the new jobs. The problem is who's doing those new jobs? AI is gonna do those new jobs. Correct.

Speaker 2 9:16

Right.

Speaker 9:16

We're seeing it at a 4.4% unemployment number. Was doing some scenario modeling. Even if we conservatively shaved two to 3% of our employee base every single year, which by the way, is very conservative that's a very modest cut. I know it impacts a lot of people, but it's a modest cut. If organizations continue down this trajectory, we are most likely gonna be at a seven to 8% unemployment rate within the next 12 to 18 months. When you get to that level, that's the signal where most of the people that you know are either looking for a job or waiting to get laid off. That's where people start defaulting on credit card loans. That's when they start taking down all of their savings. We're already starting to see a lot of those signals. You and I talked about that.

Speaker 2 10:08

Yeah.

Speaker 10:08

People doing their 4 0 1 ks, right?

Speaker 2 10:10

Yeah. This weekend I was in my little doom scroll on threads with, I learned about how sharks are older than trees, and then I saw seven plus different. Threads of people who cashed in their 4 0 1 Ks because they were looking for work for the last year and a half, and haven't been able to find it or just. You know what YOLO is, what's happening in the world.

Speaker 10:35

You can't blame people. You gotta do what you gotta do. You

Speaker 2 10:37

gotta do what's right for you.

Speaker 10:39

Yeah. Even if you're doing it for YOLO purposes, God bless. Do what you need to do,

Speaker 2 10:43

real life, man.

Speaker 10:44

Yeah. No shit. Honestly I, it makes sense to me. Makes sense.

Speaker 2 10:47

Yeah,

Speaker 10:48

but that 78% is where like societally, it is not a good feel at all. And that's where the political pressure about how do we support economically our people because they are not making the money they need in order to buy goods, buy houses, buy cars, sustain

Speaker 2 11:07

We talk about this all the time at the organization level. If you have a business problem, you have a, the people problem at the root of it. On a mass scale. What that looks like is if your communities. Are destitute and in this position, guess what? Your industries aren't gonna survive around it. So this is bad for everybody.

Speaker 11:29

It really is. The reality situation is people need income,

Speaker 2 11:33

right?

Speaker 11:33

They need money to not only have necessities, but if you think about it as being livable wage, livable income. Let alone high income, but livable, which means that they're not in chronic stress because they're wondering where their next dollar is going to come from. That's livable. We need to rethink how people get income if their income is not coming from a job.

Speaker 4 11:57

Yeah,

Speaker 11:57

and there are many ideas out there. Again, this has primarily been in academia and in some pub policy circles, but you're starting to hear more conversations like we talked about in more mainstream media like Joe Rogan fucking talking about universal income. Yeah. That is a mainstream topic now. So let's go through a few of them that are on the docket, because you're gonna hear about these more. You're gonna start to see more signals around these, most likely in the next year. Number one, universal basic income, sometimes called UBI. This is the idea that every adult receives a guaranteed income. Keywords there. Every in adult meaning like per adult, not per family. Not per household. And adult, not child. So if you're a family of four, two adults, two kids, whatever. There you go. Not the kids. You most commonly discussed version of this has been like a thousand dollars a month. Andrew Yang was just on a moonshot with Peter Dimas. Yeah. Basically saying he thinks it should be$25,000 a year. That might be necessary for the future. So$25,000 per year per adult. That's like the highest I've heard about universal basic income. What do you think about that number? You want us to 1120$5,000 a year, Mel? No.

Speaker 2 13:10

You can't survive on$25,000 a year. That is below the poverty line.

Speaker 13:16

Yes. But it is an idea that is being touted out there. Universal basic income. You'll hear a lot of people talk about this. I would say this is probably the most. Common that you'll hear U-B-I-U-B-I. You'll hear that right? But the highest rate I've seen is$25,000 where people have modeled it out. Listen, it's not chump change. I'd love to get 25,000 a year just for funds, but

Speaker 2 13:39

great

Speaker 13:40

to live on. Okay? Yeah. Negative income tax number two. So instead of a flat payment to everyone, the government guarantees a minimum income through the tax system. So if you earn below a certain level, the government will like top you up to come up to a livable wage,

Speaker 2 13:57

who's determining what that is?

Speaker 13:59

This is the point, right? Yeah. Okay. Great. We're, our country could be doing that right now. Yeah. In some aspects we do, but.

Speaker 2 14:06

Yeah,

Speaker 14:06

it's not there yet. The other one, and these are the ones that I'm more drawn to, which is the AI or sovereign dividends. In this model, the economic gains from automation are taxed or captured and distributed to citizens as dividends. Similar to how Alaska pays residents an oil dividend each year. So the oil. Companies are paying Alaskan residents a dividend, they are getting a cut of the profit of that company. Make Guo.

Speaker 2 14:30

Yeah, exactly.

Speaker 14:32

To your very good question, who determines the cut? Who determines the raises? Raise, does everybody get the same cut? Begs a question about capitalism.

Speaker 2 14:42

Because you're assuming that these companies are gonna be on board

Speaker 14:46

here's what blows my mind about this whole discussion. We are gonna have to completely take down our old system of how we think about how

Speaker 2 14:59

we operate.

Speaker 15:00

Societies operate

Speaker 2 15:02

100%. It feels like a giant game of Jenga. And he just pulled out the middle piece

Speaker 15:08

that was seven. It's a little, it's a little

Speaker 2 15:10

don't come over, you're just waving back and forth. Right now, someone blew on it the right way, but that is what it feels like. Like we're about to have a big crumbling of a Jenga game.

Speaker 15:23

We could. It also makes this conversation really important because what can sustain that is people, even if the source of income changes, they're still whole. Right. So you know the, you have UBI, you have this negative income tax, the AI or sovereign dividends. There's a fourth major model that's been touted to, which is universal basic assets. So instead of cash payments, citizens receive ownership and national investment funds. So essentially building wealth collectively so people earn returns from the capital, similar to the dividends, just more of an ownership aspect of it. Again, begs the same questions. Find it fascinating in this though, that you have as little as$1,000 per month per person touted, which by the way, didn't go to math school,$12,000 a year. Said, I know you're not gonna have job, you

Speaker 2 16:16

don't have a medical problem. During that time,

Speaker 16:18

a thousand percent. So as little as 12,000.

Speaker 2 16:21

Yeah.

Speaker 16:21

All the way up to I mean not that Joe Rogan's the arbiter of this, but he's talking about, man, wouldn't it be great if everybody received the equivalent to$200,000 per year per person.

Speaker 2 16:35

I do agree with that.

Speaker 16:38

It. They are wildly different futures.

Speaker 2 16:42

Wildly different. But also what is it gonna get you at this point? Because who is paying taxes? On those things where, what happens to federal income tax when a big majority of your population can't work and contribute to those things. There's just a lot that needs to be discussed, and that doesn't even get into some of the bullshit. If you've ever had to rely on government assistance for anything in your life.

Speaker 4 17:09

Yeah.

Speaker 2 17:09

Does it create. The in-crowd and the outc crowd of certain benefits, does there become tears of this shit? And then does that also create policing on how you use. Your universal basic income, which happens today, by the way, for anyone who uses SNAP benefits and they've got like people judging what's in their shopping cart.

Speaker 4 17:31

Yeah.

Speaker 2 17:31

So I'm so curious, like we haven't even tackled that for the programs we have today. Imagine this, who gets a thousand hundred K? Who gets 20 5K? Yeah.

Speaker 3 17:42

Yeah.

Speaker 2 17:43

And then what do you do for work? Is it now feudalism? Where we're assigned jobs and meaningful work goes away because you no longer have the skills to do the jobs that exist, so you get assigned to something. In order to receive this basic income, like what does that look like? So now you potentially don't have a choice as a person. And I know I'm getting my big tinfoil hat on here. But that's where my mind goes in these directions thinking about it.

Speaker 18:10

I think those are really important questions. I am secretly hoping it's like the Jimmy Buffett Margaritaville and we all just get to be like, we're tired. Yeah. I'm like, we stand away.

Speaker 2 18:21

I just wanna do some watercolors. And yes,

Speaker 18:25

you'll see me driving around a girl be beep this is the thing that blows my mind, right? There's so many questions.

Speaker 2 18:34

Oh yeah.

Speaker 18:34

So much of this hinders on really robust, thoughtful, intentional policy. Yeah. And yet the people having these discussions are not federal policy makers. They're business people and AI futurists and academics. And

Speaker 2 18:50

to be fair, I just wanna point something out.

Speaker 18:53

Sure.

Speaker 2 18:55

You know that meme where everyone's pointing the finger at somebody else, like it's their, I

Speaker 18:58

agree. We've had

Speaker 2 18:59

this problem.

Speaker 19:00

I agree.

Speaker 2 19:02

All these companies are like, it's the government's problem, and the government's it's the company's problem. It's both your problem and you gotta get on the same team to figure it

Speaker 19:11

out. I agree. I agree. I am seeing more. People that are typically in the private sector, having these conversations but it takes everybody, and this is not a conversation that can wait.

Speaker 2 19:23

Agreed. 100%.

Speaker 19:26

And I also feel like being like yippy io ca a as our AI policy is not exactly helping,

Speaker 2 19:31

that's not helping. No.

Speaker 19:34

It's

Speaker 2 19:35

Can that get on the books like you're

Speaker 19:38

Yeah, it's, yeah. That's the thing. We're seeing this coming down the pike. It is not to scare anyone, this could end up being a really beautiful thing. We could all be the Jimmy Buffett Margaritaville. It could be completely dystopian, or it could be what probably is gonna happen, which is some shit show kind of stuff that we got during COVID, right? Like it's gonna be wonky and it's not gonna be perfect. And being able to be prepared for what might happen. The key, right? So some signals to look out for, one, if you run a business, I think the misread here is that this is just a hiring slowdown. It's not,

Speaker 4 20:13

no,

Speaker 20:13

it's not you. Their tell here is if your organization's productivity continues to rise, but your head count is less or flat, that should probably tell you that your business is obviously operating in the less, if you will. And then I think the thing that. I would ask yourself is what your workforce looks like if productivity increases 20%.

Speaker 4 20:37

Yeah.

Speaker 20:37

If you lead a team, the misread here is that your job is about protecting headcount because most likely your organization's gonna force you to use the cheapest labor possible, which will be increasingly become more and more ai. If your AI tools are changing workflows. I'm not talking about spot tasks, I'm talking about their doing. Whole workflows they're doing whole aspects of a project that should let you know that AI is taking over more of the human labor. And the move here if you wanna keep your headcount. How do you make sure that your people are doing higher level work? You gotta stay one step ahead of the ai. All you need to do is not be the last person, between the bear or whatever the fuck that thing is. You know what I'm talking about?

Speaker 2 21:18

Yeah. Mean AI bear? Yeah. You have to, you can't just set it and forget it. So for, I think it's gonna honestly show some asses for leaders who aren't paying attention to that. Stuff with their team because if you're not checking with your team regularly or making them part of the conversation, we talked about this in our 2030 predictions. Frontline workers know what's up and what's happening if you're a leader and you have a leadership team underneath you, who then is also interacting with people. You need to be having at least a quarterly touchpoint to talk through, like what's shifting and what does that mean for us? What's next then? Yep. And to your good point, how are we elevating our work? What else could we be doing now that this frees up space for it? If you don't have a clear answer for that, how can you go to bat for your team?

Speaker 22:03

Thousand percent. Yeah. And listen, if you're an employee the misread, do not believe that stability comes from a single job. No. It does not. It does not. You will know that this is getting worse when more and more people in your circle are looking for a job when more and more of them have been unemployed for six months or more. And the move right now that we've been talking about a lot is building multiple income streams and skill pathways. What else?

Speaker 2 22:31

Making sure your brand is not related to your job. Yeah. Or your job title. Listen, in the US and you and I talk about this all the time, we start, we started a research project on it a few years ago actually.

Speaker 22:45

Yep.

Speaker 2 22:46

Talking about self-worth and your self-worth tied to our jobs and in, in our US culture. It's the first thing everyone asks you. What do you do? Instead of who you are, which is really sad by the way. I try to change that. People are gonna have to start breaking up with their relationship and their identity and how it's tied to their work.

Speaker 23:09

Yeah. Because

Speaker 2 23:10

that's not your only value on this earth. That's gonna be a big mental shift for a lot of people.

Speaker 23:18

Big shift. Listen, the bottom line, the relationship between work and income is starting to change. Literally mentally and emotionally, the opportunity here, it's massive prosperity through technology it's the Jimmy Buffett retirement that's the opportunity. The risk here is that prosperity doesn't reach enough people. What can you do now? Pay attention to the signals, because this might not be about new jobs, it might just be about new ways of earning income.

Speaker 2 23:46

Yeah.

Speaker 23:47

Yeah.

Speaker 2 23:48

All right. Now we'll see what happens. This is fresh off the press dropped this morning. It's called the Last Mile Problem Slowing AI Transformation came out of HBR today from KA Ani. A professor at Harvard Business School. The chair of the D three Institute at Harvard and on the board of CloudFlare, so he knows a little bit. About a little bit of something, little bit in this space. Just a smidge. So here are the three headlines that came out of this article you should pay attention to. Headline one. Most large scale companies have hundreds of AI pilots running, and almost none of it is showing up on the balance sheet.

Speaker 24:28

It's great.

Speaker 2 24:28

Interesting.

Speaker 24:30

Literally off 4,000 more people Keep going.

Speaker 2 24:32

And say it's because of ai headline two. Over 99% of employees at one global payment network are actively using AI tools, yet their finance team couldn't find the return. That was just an example coming out of the article headline three. The consequences of this productivity gains are real. At the individual level, but they just disappear back into meetings and email because nobody redesigned the role around them. Francesca, I read this and I was like, yes, we talk about this every day.

Speaker 25:04

Yeah.

Speaker 2 25:04

That's the work we do.

Speaker 25:06

Yes. Yes. I think this is the thing that it's a little age old, but especially right now with ai, because AI is really creeping into cognitive labor if you don't. Redesign the people capabilities is like how do they do what you need them to do? And if you don't redesign the structures that enable them to do that really well, and then if you don't incent them to do those behaviors, they ain't gonna do it.

Speaker 2 25:29

They're not gonna do it because people. Be people.

Speaker 25:32

People be people. People be people. Oh, that's a good hat. That's a good people

Speaker 2 25:37

be people. That's what it's Alright, so take it all together. It points to one signal. AI transformation is stalling because of the technology. It's stalling because organizations aren't willing to redesign themselves around it. And you and I see it all the time.

Speaker 4 25:52

Yep.

Speaker 2 25:53

We see it all of the time. If you're a CEO, this means your board is gonna keep asking for ROI on tools you've already bought, and you're not gonna have a clean answer until you make a structural decision. What we just talked about, if you're leading a team, this means your headcount and role design decisions are already behind also what we just talked about. And if you're an employee, this means sure you save some time, you're getting back from ai, it's probably going straight into low value work, unless someone above you. Explicitly says otherwise that it has real value. And we're seeing headlines, right about the big KPI of AI success is adoptability, but that isn't the case. It's what return is it actually bringing to an organization? So that's a red flag, right? If finance teams are really struggling to see that. So the pattern, what's driving this pattern is the way that organizations have positioned AI from the very start. When you're leading with cost reduction, you get cost reduction. You also get middle managers on the defense in a C-suite that's narrowed its own ambitions before the work even starts. The authors of this called it the efficiency trap. They warn that a relentless focus on efficiency risks, hollowing out the human capabilities, judgment and storytelling. That's the differentiating high value work. That's not what AI has. What leaders are getting wrong here is that they're celebrating those adoption numbers like I just talked about as that proxy for transformation. One organization in this article cited over 99% co-pilot usage as success, and the CFO still couldn't find that return. Adoption isn't the transformation. What employees are misreading here is that they think job security is the biggest threat. AI in itself the biggest threat here is working for an organization that's refusing to address this redesign issue. Yeah. What's your read on this?

Speaker 3 27:48

I'm not surprised.

Speaker 27:49

Every time we have a new technology it's this shiny ball it, and. It's gonna solve all your problems, and it never does because if organizations haven't done the work to get incredibly clear on this is who we are, what we do, and how we do it. These are the ways in which we do that via human or AI, or I don't care, a chainsaw, whatever it is.

Speaker 3 28:18

Yeah.

Speaker 28:19

You're gonna just have a lot of slop basically. I think adoption's an interesting number. I appreciate the fact that people wanna take things down a funnel, we look at adoption and then we look at productivity. But ultimately, if that's not going towards a gain around new product offerings, new service, customer retention, whatever, they have to go down the funnel. And in order to get down that funnel, you need to be really clear around what great looks like and enable your people to do that. A lot of the reasons why people don't do this is because it's hard. It's a lot easier to say, oh, let's get an AI training in here for two days and let's leave it up to teams to figure out what to do. And then Hail Mary, hopefully something's gonna happen where we start to see something out of it, as opposed to being in the driver's seat of your own strategy and your own org

Speaker 2 29:14

you and I know this, we have from our learning backgrounds, you have to get people in there actually using it and like calling out the efficiencies versus that's a great starting point, but how is the work getting redesigned?'cause it starts to fall apart on the PE again, people, v people, and it starts to fall apart at the people level. There are emotions around change that aren't being addressed there are real barriers do you think this is good, bad, or was always inevitable from your perspective?

Speaker 29:46

It's inevitable in the sense that there's some great examples of organizations that are incredibly savvy in the way they design work. Before AI even came on and there's a lot of organizations that weren't. Then you pull AI into it. And it just multiplies the problem so inevitable that way. Bad in the sense that it multiplies the problem. And on top of that, all of your employees are sitting in an environment where the job market is kaka.

Speaker 2 30:16

Yeah.

Speaker 30:16

Even if you haven't talked about layoffs, even if you haven't laid off a single person, they're living in the world. And wondering, am I next?

Speaker 2 30:26

Yeah. Their friends have been laid off. Their family members, their spouses potentially. You can't ignore that factor either.

Speaker 30:35

In my mind is that it's a massive opportunity.

Speaker 2 30:38

It is, yeah. It's, it is, it's a huge opportunity for people to really get it right. The org design problem was always going to be one, mainly because the tech is moving faster than people are. Management in particular, like how they're gonna do this, how are they gonna shift and restructure and do things? They give a really great example around, this team that was able to pull together proposals that needed to go through, like general counsel review, and so they created efficiencies on their team. The problem is the whole workflow hasn't, so the, there's all these little bottlenecks happening within organizations because then it's sat. For two weeks with their general counsel office waiting for review.

Speaker 4 31:21

Yeah.

Speaker 2 31:22

So it doesn't matter that this efficiency happened over here'cause it's not happening over here. There's a huge opportunity. What are we overreacting to

Speaker 31:31

you and I are cursed with. A few things, but one of them, just kidding. But one of them is that we see patterns which is great. It's great when you're talking about the future of work, it's great when you're trying to do strategy. It's not great when you sitting in corporate trying to move an organization along because you see problems that need to be fixed. What you believe today.

Speaker 2 32:00

Yeah.

Speaker 32:00

But those leaders. Don't see it yet necessarily and or don't believe it's the problem that really needs to be solved because they're dealing with frontline customer shit, they're dealing with the today, the now I have to make numbers. The only thing I think about with overreacting is I think some. Business leaders would think I'm not underreacting to this. I'm being diligent about seeing where this goes, and then I'll make a move because I need to worry about customer stuff.

Speaker 2 32:29

Yeah,

Speaker 32:30

I don't think we are, but I can see where organizations might think we are.

Speaker 2 32:34

Yeah, I could see that. Yeah, I could, I agree. I could see that too. What do you think we are underreacting to? Gonna go back to the self-worth thing that I commented on in your story because that identity to your job. And if you lead teams, you've seen this, you've seen this before.

Speaker 4 32:52

Yeah.

Speaker 2 32:53

When something comes off of someone's plate and their identity Is tied to that project, tied to that work tied to their innate value because it's what got them accolades.

Speaker 33:05

Yeah. Pretty

Speaker 2 33:07

It is. Not a good experience for them. For you it, it's really hard. That's a difficult transition.

Speaker 33:15

Yeah.

Speaker 2 33:15

And we're dealing with people and human emotions. So the people who hold that like tacit organization knowledge, and they have built maybe their whole status around being the person who knows something. This transformation is asking them to give all of that up. And if that's not being addressed, you're not gonna get the knowledge from those folks. And you're not gonna get the transformations that's needed because they're not feeling like they're part of that transformation. It's happening to them.

Speaker 4 33:50

Yeah.

Speaker 2 33:51

I think that's the biggest thing. In addition to all the structural stuff. Yeah, it's the people piece. And. Life. You and I talked about this a couple weeks back, how people are not okay just given all the life stuff.

Speaker 34:05

Probably the most simple things people can do, but would go a long way to alleviate. Some of that is for leadership to spend a few days, if not more, really thinking about what is their AI philosophy? What is their ethos towards it? I don't need you to have all the details. I need you to tell me what your intentions are with ai, I need you to give me a roadmap of what you're gonna try to figure out and by when. And take me on that journey as an employee, that doesn't take a ton of time or a ton of effort. It takes somebody who understands like Strat and narrative and internal brand and all this good jazz, but we have found that goes such a long way to alleviating some of that dissonance that your employees might be feeling about what's gonna happen to me. And by the way, their confidence in you as a leader, that you have a game plan

Speaker 2 35:05

and that they see themselves in that game plan. At a team level, have that quarterly check-in and make people feel included in the transformation at a bare minimum. It is shifting what they care about. And again, our culture is like identity too. Your work. It is deeply embedded in our DNA. I wanna see the quiet part out loud here. Most organizations have already spent the money, spent mega bucks on this stuff. The tools are deployed. The question now is whether leadership is willing to do the harder thing, which is redesigning the orgs around them, as we just talked about. And if that's true, then the real risk is that companies who move fast on redesign are actually gonna look. Like a completely different category to their competitor in the next 36 months because they have a different operating model and the one that pays attention to these things. So stop measuring AI success by adoption rates. Start measuring it by what's structurally changed and start paying attention to your people. What this means on a Monday morning. Although we're recording this on a Monday afternoon, here's what you need for the rest of your week. If you are running the business, you're a CEO. You're an executive. Here's a misread you might be having that your adoption numbers are strong, so you're in good shape. The tell that is not the case. If your finance team cannot tell you where the productivity return is landing in your headcount or your cycle time, your transformation has plateaued. So watch for the conversion there. The move, ask one question in the next leadership meeting where the, is the time savings from AI actually going, that's gonna tell you whether you have this last mile problem that we're talking about here. If you lead a team. Your misread might be that your team is using the tools and your job here is done. There's nothing else for you to do here. That is not the case. If you have not explicitly redesigned what your people do with the time that AI gives back, that time is being absorbed by low value work, more than likely. Watch for your people who are busier than ever, but can't say why. Because we read that article even a few weeks ago that talked about how this is actually creating double work for some people with all of the checking that they need to do. So one of the moves that you can make this week, pick one role on your team, write down what it would look like if you redesigned it from scratch with AI as a first class participant in their whole role. That is the gap that you can redesign for. So pay attention to that, work through that as a team. Go through it one by one. Think about all the roles on your team, and if you're an employee. The misread for you is if I just use ai, I'm totally safe, which is also not the case. No, at all. But I think a lot of people have been communicated with if you stay on top of it, that means you're safe. But that isn't the case. And by the way, it's never been the case through any transformation. It just hasn't, unfortunately. You gotta be like Madonna folks. Reinvent yourself. Here's the tell. Watch whether your organization is actually making these structural decisions about roles and budgets around ai or if they're just celebrating people who are using the tools. One of those organization actually has a plan in place. Your expertise is something that needs to be encoded, not just executed on. That's what you need to pay attention to. What are your capabilities? What are your superpowers? How do you talk about them and how does that evolve through this type of transformation? The people who stay essential are gonna be the ones who really pay attention to their own brand story here and what value that they bring. And the bottom line is again, organizations that move away from this, Pilot rich experience right now, and they move to the redesign in the next 18 months, that's gonna be their game changer. So this is a real opportunity.

Speaker 39:04

Alright. I have a few WTF and FEI news. You wanna hear'em?

Speaker 2 39:07

I do. Yes I do.

Speaker 39:09

Okay. They're a little bit off the beaten path, but I thought they were funny

Speaker 2 39:11

okay.

Speaker 39:11

Let's go

Speaker 2 39:12

for it. Alright. This is the WTF News. A fan literally unplugged the future. This week's story comes from Germany, where a masked soccer fan apparently decided that he didn't like the technology, he just unplugged it. So here's the story. So during this I'm gonna get some of these names wrong, so I apologize. I do not sprees the Deutsche, but during a German second division match between press and Munster and Hertha, Berlin referee, Felix Bickle went to review a possible penalty on the pitch side, VR Monitor, where they're like looking at calls that they wanna challenge or not. The screen was dead because a masked supporter had gotten into the interior area and just unplugged it so he couldn't make the call. Fans also displayed a banner that basically translated to pool the plug on the VAR. The remote VAR official in colon had to make the call instead, and Hertha ended up winning two to one. So here we are in an elite professional. Sport with very expensive review tech.

Speaker 40:07

So listen we're not here to talk about. Sports necessarily as this signal, but it's like that our systems are still pretty fragile. Like we keep building more and more tech dependent environments, which I'm not knocking, but a shocking number of them are still like one really dumb human action away from complete chaos. It's pretty funny.

Speaker 2 40:26

It's pretty funny.

Speaker 40:27

I know for our Fuck Yeah. Story, which I'm really excited about because every once in a while Labor policy does something that feels like it belongs in this century, which is really great. Let's hear it for Mexico. So Mexico's Chamber of Deputies approved a bill that would gradually reduce the standard work week from 48 to 40 hours by 2030 with a reduction beginning in 2027. Routers reports, their reform would affect about 13.4 million workers if it clears the remaining state level approvals that are expected. So this matters because Mexico has some of the longest working hours in the OECD, it's not really a just a cosmetic move. It's one of those policy moves that may be signaling that human beings aren't just productivity livestock, which I'm here for.

Speaker 2 41:10

I am here for it too. I had no idea that it was at 48 hours.

Speaker 41:15

Yeah. Yeah. It's interesting, right? I think it's a kind of fascinating thing. We talk a lot about AI driving a lot of future of work, but it's also time, who gets it, who controls it? Whether governments, and companies finally admit to more hours, doesn't really necessarily equate to value.

Speaker 2 41:32

Listen. It was women, by the way, in the state of Connecticut who fought for the eight hour workday. And American Heart Associations shows that anything over 50 hours a week is actually detrimental to your health.

Speaker 3 41:47

Yeah.

Speaker 2 41:48

So when does that start to come into play in terms of legislation worldwide. It is actually bad for your health. And you don't even get good ideas. After 50 hours a week, everyone's maxed out. What other evidence do you need?

Speaker 42:01

Like my total Pollyanna utopia here is, what if we all just end up working like maybe two to three hours a day? We all have lives where it'd be like we at least have$200,000 a year type of living situations, and we just get to. Have a wonderful life. I know that's super Pollyanna in utopia, but I'm like, that'd be nice, right? No,

Speaker 2 42:24

it would

Speaker 42:24

be like everyday weekend,

Speaker 2 42:25

endless summer. It would be extreme nice, but I don't trust the powers that be to deliver on that offer. Sorry, I'm being so pessimistic right now, given the current state of the world, but yeah, I think that would be lovely. That's what we're here for. What was, who said this? Oh my God. I'm gonna totally butcher it, but what was it? It was like, we're here to just fart around, like

Speaker 42:50

yeah,

Speaker 2 42:51

make art, eat good food, and spend time with our loved ones. Beyond that. Why not? That is what life is for.

Speaker 42:59

It's like perpetual summer break. I'm here for it is that what being a trust fund kid would feel like, I don't know. Don't you wanna experience that?

Speaker 2 43:06

Yeah, that sounds magical.

Speaker 6 43:12

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