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Welcome to the AI Chat Podcast. I'm your host,

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Jaden Schaefer. Every day I cover cutting -edge

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AI news and talk with the leaders behind it,

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breaking down what it means for your life and

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business. I host two other podcasts. One is called

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AI Hustle. It's about growing and scaling your

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business with AI tools. And one is called AI

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Applied, about using AI in your career. Every

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once in a while, I play an excerpt of one of

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those podcasts on this show to give you an idea

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of what it's like. I'm going to play an excerpt

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from today's episode of AI Applied. We're talking

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about Microsoft's $2 .5 billion AI bet. I hope

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you like it. And if you enjoy this episode, go

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check out the AI Applied podcast anywhere that

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you get your podcasts. It's AI Applied. Microsoft

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has just committed $2 .5 billion and 6 ,000 employees

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to a new AI implementation unit. Now, this is

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not new. They're not the only ones that have

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done this. They're following what OpenAI and

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Anthropic both have made partnerships with different

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organizations, Accenture and Deloitte, if I'm

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remembering correctly. And I mean, there's a

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bunch of players that have been doing this, a

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bunch of private equity firms that have been

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kind of getting in on this and kind of investing

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money into these sort of AI implementation units.

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Connor has a spicy take on this that I was reading

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on LinkedIn. And I was like, Connor, we got to

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talk about what you've been saying because this

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post has been blowing up. And I think it's making

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some people mad, but I see a lot of truth to

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this. So, and basically his take is that maybe

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what Microsoft is doing is not the right way

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to do this, which is, you know, shocker, especially

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when this is $2 .5 billion that are about to

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be spent on this. So Connor, I'd love for you

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to maybe explain a little bit about what these

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implementation units are. hoping to achieve what

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you think they will achieve what you think people

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should do and if this is all a giant two billion

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dollar mistake total billion dollar mistake everybody

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yeah i love the hot take here man this is so

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by the way i did have people from microsoft like

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you know writing to me and being like it's not

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really 2 .5 it's sort of like that's kind of

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like reallocated but The message is the same.

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And even people inside Microsoft are like, yeah,

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you know, the headline, don't really love the

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headline. But essentially, like, you know, the

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headline is essentially, let me grab it. It's

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from the information originally. If you don't

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know the information, but it's expensive to subscribe

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to, but it's worth it. Microsoft commits $2 .5

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billion to new applied AI consulting effort and

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then says the new unit comes as large companies.

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And this is important. The new unit comes as

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large companies have groused that it can be tricky

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to configure AI software to their own needs and

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generate meaningful returns. Jayden, I'll tell

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you why I am up in arms about this. So it reminds

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me, so we were working with the big, so AI Mindset

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like works with big companies to sort of like

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transform from a behavioral standpoint, right?

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Organizations to really transform AI adoption.

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And I remember working with this huge like oil

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and gas or energy, energy company, sorry. And

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we were kind of talking about all this and doing

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this big senior leadership workshop, which we

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do. They're like, you know, three and a half

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hours long or something like that. And at the

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end, these folks were talking about when they

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did like their SAP enterprise transformation

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thing. And they're like, yeah. And remember how

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we had to keep on tweaking it because people

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just weren't really satisfied with it and all

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that kind of stuff. And I kind of paused the

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conversation. I didn't really want to get involved

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because it was a conversation kind of among them.

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But I was like, can I just point something out?

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Has this happened before? And they're like, yeah,

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it happens all the time. I'm like, this is what

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we think about all the time. Every time you sort

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of like have a new system, Jaden, a digital transformation

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takes place. Hey, we're now going to use Salesforce.

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What happens? I promise you, everybody complains

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because people like the old system. So what do

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they do? They blame the system instead of how

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they work. And so when Microsoft sees this, and

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I'm telling you, this is what happens. It's not

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just Microsoft. I mean, it's every big LAI lab.

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It's Google. It's Anthropic. It's OpenAI. It's

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all of these labs. And I'm telling you, this

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is what happened. They put out a pilot of like,

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you know, 5 ,000 to a 50 ,000 person company.

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And what they say is everybody's going to use

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this and then it's going to catch like wildfire.

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And then we're going to sell our licenses to

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the other 50 ,000. What happens? A fraction of

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those people use it. It's just truth. Right.

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And the whole point is that. They are now getting

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feedback because they're like, well, what's happening?

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Why aren't people using? They're like, oh, I

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don't know. I just don't like the features or

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something. And they complain about the thing,

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which Jaden, I'm going to sound like a broken

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record here. But like, it's like complaining

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about the treadmill. It's like, you know what?

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I don't know. It's just sort of like it's downstairs

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or like I have to do laundry or like the features.

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I don't know. The problem is not the treadmill.

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The problem is you. Right. And why? Because we're

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just we don't like change. We don't like new

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systems, all that kind of stuff. And everybody

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who's sitting there listening to the sound of

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my voice and being like. That's not true. AI

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is great. It's just people have to be more curious

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and they have to just find their use cases. And

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I'm like, you've tried that, right? Has anybody

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responded to that? In the same way, has anybody

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responded when you've shouted eat less and exercise

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to them? It doesn't work that way. So when Microsoft

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is putting all of this effort. And I understand

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that there's nuances to this. It's not exactly

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like they took a pot of $2 .5 billion and 6 ,000

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people aren't putting into this. But what they're

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doing here, and I love Microsoft. I really do.

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I'm actually, you know, one of these people that

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I'm like a huge Microsoft fan. But I keep telling

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them like, you're the adult in the room here.

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Like you own enterprise. Why focus on it like

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this where you're like, yeah, let's come in and

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help you like tweak the systems and work on the

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features. That's not the problem. The problem

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is that what they actually need the McKinsey's

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for and the BCGs and everybody else's is how

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to get people to sort of like transform how they

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work. But even that doesn't work. Jayden, I promise

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I'm going to shut up after this. But even that

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doesn't work because the consulting model doesn't

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work. Why is that? Because. When the big consulting

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firms, the Microsoft, I'm sorry, the McKinsey's,

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the BCG's, the Bain's, the Deloitte's, EY's,

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et cetera. When they go in, what they are great

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at is they are great at looking at a system of

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like, hey, you guys do sales this way. Well,

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we know that from doing sales in a million other

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companies, the best way is to do this way. So

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do it like that. Or you do operations this way.

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The best way is to actually do it like this.

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So change what you do. That's fine. That's great.

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That's called consulting. But coaching is very

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different. You can't just say to people, hey,

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be nicer to each other. Or hey, think differently.

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Or hey, be more collaborative. That doesn't come

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from best practices from other organizations.

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You have to get people to change their habits

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and behaviors and everything else. Which is why,

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sorry, now I've brought it all the way back,

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Jaden. Microsoft is trying to solve the easy

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problem. And corporations are trying to solve

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the easy problem of like, oh, well, let's just

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tweak the system. When the problem is not the

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treadmill. The problem is. You just don't want

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to get on that treadmill. That's where I wish

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Microsoft would put $2 .5 billion on helping

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people to rethink how they work and rethink processes.

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I just think it's a big miss. A hundred percent.

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I mean, if you're going into an organization

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and you're like, hey, everyone, you've got to

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try the new Microsoft Copilot. We're signing

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it up on everyone's computers. These are all

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the 10 things we recommend doing. We're going

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to go on all hands every morning and share our

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favorite Microsoft Copilot like tip. I mean,

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that's not how they're implementing this in reality,

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but like, let's think about it, right? Or we

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get the engineers in there and we're looking

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at the workflows and we're trying to like get

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the Microsoft work, you know, work copilot or

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tools like embedded into the workflows and everything.

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That's not how you drive the big change. The

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big change comes from individual people getting

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a spark and realizing, oh my gosh, look how capable

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this is. Look how much time I can buy back for

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myself personally to work on the parts of my

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job that I like doing, automate the repetitive

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mundane parts. As soon as someone gets that spark,

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you don't need to spend $2 .5 billion to convince

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them to use it. They're obsessed with it. I mean,

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most of you guys listening to this podcast are

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in that. ballpark, right? Like you see, you see

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something incredible that it can do. And you

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want to go all in and figure out all of the ways.

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And even myself who covers AI all day, every

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single day, there's so many ways that I discover

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every day. I'm like, Oh my gosh, I never even

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thought of that. That's so cool. I want to try

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it out. Right? Like This is what drives the adoption

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is people being genuinely excited because they

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catch that spark and you have to ignite that

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spark for people. And you're not going to do

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it by just going and telling everyone to go download

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Copilot onto your computer and make sure to go

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ask it, you know, what time the Yankees are playing

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at XYZ, some simple little thing, right? Like

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you really got to get them to actually get a

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spark with it. So that's one thing. And the other

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thing that I think for me is just. I mean, it's

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just so much money that could be spent in so

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many other places. I know you said Microsoft

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was like, oh, it's not really $2 .5 billion.

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I mean, it's just kind of the way the presser

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goes out or whatever. But I just think that there's

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a lot of ways. In your opinion, Connor, from

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a lot of the consulting that you've done with

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organizations, what's the best way for people

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to help others in the organization catch that

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spark? Yeah, I love that you call it the spark.

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So the thing that we figured out, I think, in

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this whole thing is the reason why we don't teach

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use cases. and we teach process instead, is that

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use case is just encouragement. Come on, guys,

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find your use cases. Again, it's sort of like,

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come on, guys, don't you want to feel better?

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Like, get out there and run. Like, that doesn't

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work. You have to put processes in place. So

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for some people, you know, we do it through this

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whole behavioral thing, which actually drives

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a lot of spark because people are like, oh, I

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didn't think of it like that. It's actually like

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this and not like that. So that gets a lot of

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people kind of like with that spark. But we can't

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get everybody. We just can't. So then the people

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that we don't get, we have to put a process in

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place, right? So let me attack those two sides,

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right? So first of all, Gene, I totally agree

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on the spark. The only thing that drives AI adoption,

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first of all, it has to be driven at the individual

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level. Unless you're talking about AI in a product,

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right? Like Gene's AI box, right? Your product

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keeps getting better and better and better because

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of AI, right? I mean, and that's awesome. But

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for individuals at a company, when you're trying

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to drive value, It has to happen at the individual

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level because you're paying people to drive value

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for your company. You don't have like some people

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and some robots. It's all people. So what do

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you do in that case? You want to have everybody

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have their spark. And the problem with the spark

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is that it often happens outside the scope of

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work. Anybody listening probably has had that

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spark, as you said, right? I want to know like

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how many of you. have found that spark in a personal

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thing versus a work thing because i find it's

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often in personal right you're like oh my gosh

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i spilled you know coffee on this and i don't

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and all of a sudden chat gbt gets you have a

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bind you're like oh my gosh like it doesn't usually

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come because somebody discovered how to write

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an email faster that who's that who's that like

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being like the genie has come out of the bottle

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right no it's like yeah it's not exciting it

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doesn't get you sort of like wanting to stay

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up all night like just working with ai it doesn't

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get those things so then how do you drive that

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if you if if people just aren't finding that

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spark, right? So again, in our training, we get

00:10:21.919 --> 00:10:23.360
a lot of people, but we don't get everybody.

00:10:23.620 --> 00:10:25.759
So the people we don't get, we have to have the

00:10:25.759 --> 00:10:28.600
people leaders in those organizations put processes

00:10:28.600 --> 00:10:30.740
in place, like meetings, things like that, where

00:10:30.740 --> 00:10:33.299
AI is integrated, and we have specific ways of

00:10:33.299 --> 00:10:35.679
doing this, but where AI, you can't get to the

00:10:35.679 --> 00:10:38.379
end of the day without going through AI in some

00:10:38.379 --> 00:10:41.240
way, because then it's sort of like forcing people.

00:10:41.299 --> 00:10:42.840
It's almost like, hey, listen, guys, to start

00:10:42.840 --> 00:10:44.600
the day at this company, we're all going to go

00:10:44.600 --> 00:10:47.539
out on a two -mile walk. whatever at some point

00:10:47.539 --> 00:10:48.679
you're gonna get more and more people who are

00:10:48.679 --> 00:10:50.139
like you know what i actually like i'm really

00:10:50.139 --> 00:10:52.039
glad i'm doing this you know what i mean like

00:10:52.039 --> 00:10:54.559
you force it in that kind of way a forcing mechanism

00:10:54.559 --> 00:10:57.240
because then they will find their spark through

00:10:57.240 --> 00:10:59.419
that but that's why we don't do use cases because

00:10:59.419 --> 00:11:01.240
use cases are just like come on everybody just

00:11:01.240 --> 00:11:02.879
find your thing and you're kind of encouraging

00:11:02.879 --> 00:11:05.580
x so we say moving from encouragement to expectation

00:11:05.580 --> 00:11:08.720
of use expectation of use is Listen, all our

00:11:08.720 --> 00:11:10.159
meetings are on the third floor and the elevator

00:11:10.159 --> 00:11:11.980
doesn't work anymore. That's how you get people

00:11:11.980 --> 00:11:13.639
healthier. Do you know what I mean? You're just

00:11:13.639 --> 00:11:15.659
saying people have to go through a process. So

00:11:15.659 --> 00:11:18.879
that's how we've had success on that. And I just

00:11:18.879 --> 00:11:22.480
wish, again, Microsoft, to my friends at Microsoft,

00:11:22.659 --> 00:11:26.100
you are the adult in the room here. You are able

00:11:26.100 --> 00:11:28.820
to do this. You own enterprise. I mean, obviously,

00:11:28.879 --> 00:11:32.600
so does IBM. So does Google. So does SAP. So

00:11:32.600 --> 00:11:35.059
does Salesforce. A lot of these places do. So

00:11:35.059 --> 00:11:37.330
I'm kind of speaking to them as well. But if

00:11:37.330 --> 00:11:39.570
you focus on how you get people to change their

00:11:39.570 --> 00:11:42.870
processes rather than the tool itself, then they're

00:11:42.870 --> 00:11:45.090
going to buy your product at scale, like because

00:11:45.090 --> 00:11:46.809
they'll have that spark. That's what gets me

00:11:46.809 --> 00:11:50.210
probably, as you can see, overly excited. But

00:11:50.210 --> 00:11:52.149
that's how we think about it. Yeah. And I mean,

00:11:52.149 --> 00:11:54.409
the last thing that I'll say is there also is

00:11:54.409 --> 00:11:57.070
an issue in a lot of organizations. um where

00:11:57.070 --> 00:11:59.929
i feel like the companies themselves are not

00:11:59.929 --> 00:12:01.610
doing enough and like you mentioned that forcing

00:12:01.610 --> 00:12:03.389
function is so important because i feel like

00:12:03.389 --> 00:12:04.889
the companies themselves are not doing enough

00:12:04.889 --> 00:12:07.289
to encourage or push people maybe they had early

00:12:07.289 --> 00:12:09.970
like bans on ai maybe they just never encouraged

00:12:09.970 --> 00:12:11.970
it maybe they never rewarded it and i mean there's

00:12:11.970 --> 00:12:14.230
all sorts of absolutely ridiculous reward systems

00:12:14.230 --> 00:12:16.110
like who's using the most tokens okay terrible

00:12:16.110 --> 00:12:18.690
ideas but but like genuinely getting people to

00:12:18.690 --> 00:12:20.590
leverage these tools because the things i'm seeing

00:12:20.590 --> 00:12:23.110
a couple different things number one a lot of

00:12:23.110 --> 00:12:25.210
the software companies I use and the scrappier,

00:12:25.230 --> 00:12:28.610
savvier startups, they are churning out new features

00:12:28.610 --> 00:12:31.590
every two weeks because they just can. And it's

00:12:31.590 --> 00:12:32.889
like, it's actually blowing my mind. There's

00:12:32.889 --> 00:12:34.070
a bunch of companies I've followed for a long

00:12:34.070 --> 00:12:36.090
time and the rate that they're able to just put

00:12:36.090 --> 00:12:37.570
out these incredible features or rebuild their

00:12:37.570 --> 00:12:40.149
entire platform is so impressive to me. And I

00:12:40.149 --> 00:12:41.769
understand why, because I'm doing the same thing

00:12:41.769 --> 00:12:43.590
with all my software and platforms and tools,

00:12:43.690 --> 00:12:46.090
but I'm not seeing it from all companies. And

00:12:46.090 --> 00:12:47.889
the companies that I'm not seeing it from, for

00:12:47.889 --> 00:12:49.210
example, I mean, there's just so many people

00:12:49.210 --> 00:12:51.700
where... you realize that we are sort of in a

00:12:51.700 --> 00:12:53.159
bubble. There's some people that are really taking

00:12:53.159 --> 00:12:55.139
advantage and there's some that are just not.

00:12:55.299 --> 00:12:58.080
I was recently talking to someone and he's a

00:12:58.080 --> 00:13:01.500
developer at like a big gaming studio. And he's

00:13:01.500 --> 00:13:04.259
said, I'm like, I'm like, oh my gosh, like he's

00:13:04.259 --> 00:13:05.820
a front end developer. I'm like, you must just

00:13:05.820 --> 00:13:07.340
like, Clyde must be your best friend, right?

00:13:07.399 --> 00:13:09.330
It's like so awesome. Cause I'm doing this all

00:13:09.330 --> 00:13:10.909
day. Right. And he's like, ah, to be honest,

00:13:10.970 --> 00:13:12.929
like, I don't know if I've tried the Claude one

00:13:12.929 --> 00:13:15.610
yet. Like, I think I tried, we had like a GitHub

00:13:15.610 --> 00:13:17.389
one, but then it's, we don't have it anymore.

00:13:17.529 --> 00:13:19.509
And like, I've started using it a little bit

00:13:19.509 --> 00:13:21.769
lately, but anyways, it just blew my mind how

00:13:21.769 --> 00:13:24.490
much he didn't use it. And I'm like, if it's

00:13:24.490 --> 00:13:26.690
not a priority in your company, it's not a priority

00:13:26.690 --> 00:13:28.269
for your employees. And if it's not a priority

00:13:28.269 --> 00:13:30.169
for your employees, you're not shipping new updates

00:13:30.169 --> 00:13:32.629
every two weeks because you can, you're not 10

00:13:32.629 --> 00:13:35.830
X in your output because you like, you can with

00:13:35.830 --> 00:13:39.250
AI. And so. Yes, there's like business as usual.

00:13:39.289 --> 00:13:41.250
And some companies are like in these industries

00:13:41.250 --> 00:13:42.909
where you're kind of entrenched. You kind of

00:13:42.909 --> 00:13:44.929
have a good thing going and business as usual

00:13:44.929 --> 00:13:47.070
works pretty good. But I mean, if you really

00:13:47.070 --> 00:13:49.049
want to stay competitive, you have to make this

00:13:49.049 --> 00:13:50.610
a priority. I know I'm speaking to the choir

00:13:50.610 --> 00:13:52.509
here, but it blows my mind because it probably

00:13:52.509 --> 00:13:54.070
happens at least once a week where I talk to

00:13:54.070 --> 00:13:58.409
someone and they're like not using AI. This is

00:13:58.409 --> 00:14:00.649
the bubble we live in. It's the bubble we live

00:14:00.649 --> 00:14:02.889
in. Just to close that out, like just remember,

00:14:02.909 --> 00:14:05.200
guys, like. Two things. First of all, we live

00:14:05.200 --> 00:14:07.039
in a bubble. Anybody listening to this show lives

00:14:07.039 --> 00:14:09.059
in the bubble. A lot of people are not using

00:14:09.059 --> 00:14:12.059
AI. I'm not getting emotional. I'm just going

00:14:12.059 --> 00:14:13.659
to take a sip of water. Connor is incredibly

00:14:13.659 --> 00:14:15.940
emotional about this point, and people just aren't

00:14:15.940 --> 00:14:18.879
using AI enough. I was watching England -Mexico

00:14:18.879 --> 00:14:20.919
the other night, and Harry Kane lost his voice.

00:14:21.000 --> 00:14:22.879
I'm like, how embarrassing is that? And he had

00:14:22.879 --> 00:14:24.059
a much bigger audience, so I think I'm okay.

00:14:25.120 --> 00:14:27.139
Jayden, the thing is like this has to start with

00:14:27.139 --> 00:14:29.059
leadership. It has to sort of like start with

00:14:29.059 --> 00:14:30.759
leadership and work its way down just as you're

00:14:30.759 --> 00:14:32.980
saying. There's literally no way for a company

00:14:32.980 --> 00:14:34.639
to sort of like hold people accountable unless

00:14:34.639 --> 00:14:37.059
leadership is holding people accountable. That's

00:14:37.059 --> 00:14:39.480
where that has to start. But again, we have to

00:14:39.480 --> 00:14:41.840
understand that like just telling people to use

00:14:41.840 --> 00:14:44.419
it is just never going to work. Guys, before

00:14:44.419 --> 00:14:46.279
I lose my voice again, like again, if anybody

00:14:46.279 --> 00:14:49.019
saw Mexico, England, they know the Harry Kane

00:14:49.019 --> 00:14:50.679
interview was glorious. He lost his voice. He

00:14:50.679 --> 00:14:52.480
sounded like Kermit the Frog. Luckily, I think

00:14:52.480 --> 00:14:55.419
I've rescued myself. But here is the thing, guys.

00:14:55.460 --> 00:14:57.539
If you are sort of like trying to push yourself

00:14:57.539 --> 00:14:59.019
and trying to sort of like see how you can use

00:14:59.019 --> 00:15:01.620
this better, I cannot recommend more highly Jaden's

00:15:01.620 --> 00:15:05.159
AI Box .ai. This is my absolute favorite thing

00:15:05.159 --> 00:15:07.139
to use because when I'm bouncing between Claw,

00:15:07.159 --> 00:15:09.299
Gemini, OpenAI, those are my kind of like big

00:15:09.299 --> 00:15:12.759
three. This allows you to do that for less than

00:15:12.759 --> 00:15:14.980
$10 a month. It's absolutely unbelievable. Use

00:15:14.980 --> 00:15:16.799
all these models, help, you know, compare things.

00:15:17.039 --> 00:15:18.600
This is what I'm doing and spending hundreds

00:15:18.600 --> 00:15:21.279
of dollars a month. Check this out if you haven't

00:15:21.279 --> 00:15:23.460
already. It is unbelievably worth it. You won't

00:15:23.460 --> 00:15:26.279
regret it. And don't forget to leave a rating

00:15:26.279 --> 00:15:28.919
and review. We are so grateful for these conversations

00:15:28.919 --> 00:15:30.980
with you all, and we will see you in the next

00:15:30.980 --> 00:15:31.240
episode.
