Celebrate Humans, Not AI, Deloitte’s Chief Futurist Says

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With the new year, there’s often a renewed focus on budgeting and priorities. Should your company go big into generative AI? Does hardware need to be upgraded? Is it time to take another look at your system’s UX, both for internal and external users? Are there cybersecurity threats that need to be addressed?

Underlying many of these priorities is a need to unite, organize and be able to easily use your data. Some companies use customer data platforms—commonly abbreviated as CDPs—to more easily integrate different kinds of data. While CDPs can be expensive to implement, a survey by CDP provider Tealium found that 90% of the companies that had them were satisfied with their investment. Companies are using the CDP’s data capabilities to retain and acquire customers, for privacy and regulatory compliance, to get to personalization at scale, and for loyalty campaigns. Nearly eight in 10 said they recognized a return on their investment within 12 months.

CDPs help companies have actionable real-time data on the back end, and can provide a personalized consumer experience on the front end. And all of this can help prepare a company to start working with AI. According to Tealium’s study, 80% of companies using CDPs were already recognizing business value from AI, compared to 51% of companies without them.

“While many companies are currently laying the groundwork for unified customer profiles and streamlined data management, the future lies in harnessing deeper customer insights, AI-powered personalization, and real-time decision-making,” Anish Krishnan, an analyst at Quadrant Knowledge Solutions, said in the report. “Businesses that master data unification, activation, and orchestration along this curve will stand to achieve unparalleled customer loyalty and market differentiation.”

It’s important to think about the big picture. AI applications are only as good as the data that goes into them, and it makes more sense to invest in data before taking the system further.

While organizing data seems like a simple thing to do to get your enterprise tech house in order to begin 2024, many things to be done at the beginning of the year actually are pretty simple. For the last 15 years, Deloitte has published an annual Tech Trends report, balancing hype with trending moves for CIOs in terms of tech management. I talked with Deloitte Chief Futurist Mike Bechtel about the report and its recommendations, which are also a lot about simplification.

HUMAN CAPITAL

Amazon and Google both began the year with hundreds of layoffs. At Google, the job cuts came more in areas that work directly with their technology. There were no exact counts at press time, but Google’s cuts included several hundred employees who work on the company’s core engineering team, the hardware division that makes Pixel and Fitbit devices and the team working on Google Assistant. In an email, a Google spokesperson told the layoffs were organizational changes the company was making “to become more efficient and work better, and to align their resources to their biggest product priorities.” These priorities, the company told Semafor, include doing more to integrate new AI technologies—including its generative chatbot Bard—into its products.

Amazon, which operates in tech, e-commerce, streaming and entertainment, is mainly cutting employees from its entertainment divisions. Most notably, video game live streaming service Twitch is laying off around 500 people, which is 35% of its staff, following many years of unprofitability.

While this is not a positive way for tech companies to begin a new year, it’s not without precedent. Last year, both companies slashed many more employees as they rang in 2023: 12,000 at Google and 18,000 at Amazon.

TECHNOLOGY + INNOVATION

The Consumer Electronics Show in Las Vegas is in full swing this week, and a new—and expected—introduction from Nvidia is helping to boost its stock to new highs. The company’s new graphics cards are its fastest and most powerful yet, and are designed to make computers more able to quickly utilize AI functions. But what’s pushed Nvidia over the top is its pricing for these new cards. The top line new model, the RX 4070 Super, will retail for $599—just $50 more than the original version of this card. The lower prices are somewhat of a surprise for Nvidia, considering CEO and founder Jensen Huang declared Moore’s law dead—a theory that speaks to computing power getting less expensive as technology becomes more advanced—in 2022. But aggressive pricing definitely will help Nvidia continue to outperform not only other tech companies, but most of the stock market, too.

Apple’s long-awaited Vision Pro headset will be available in the U.S. on Feb. 2, with pre-orders starting Jan. 19. The headset, which CEO Tim Cook has called “the most advanced consumer electronics device ever created,” allows users to be immersed in a virtual world and use augmented reality apps to overlay the physical world. The headset will cost $3,499 and is Apple’s first new product line since the Apple Watch’s debut in 2015.

While similar headsets are already on the market from competitors including Meta and Microsoft, Apple’s reputation for quality—and early reviews from testers who say this headset delivers on the possibilities of the virtual world—may be what brings the virtual reality metaverse to the forefront. After all, Apple’s got a decent track record here. It revolutionized personal computing with its Macintosh, changed the way people thought about digital music with its iPod, revolutionized smartphones with the iPhone and helped create a new computer category with the iPad.

ARTIFICIAL INTELLIGENCE

OpenAI’s GPT Store is finally open for business. This online marketplace is where users of the generative AI chatbot platform can sell their custom-built creations—like a bot designed for Book recommendations, or one created as a code-teaching tutor. A revenue program will roll out this quarter to allow GPT creators to earn money based on engagement with their custom bots. The initiative was announced in November at OpenAI’s first in-person DevDay conference, which was right before the company’s leadership shakeup that ousted and reinstated CEO Sam Altman. It was initially planned to launch last year, but Bloomberg reported the company told GPT creators in an email in late November the release date was pushed to early 2024 as “a few unexpected things have been keeping us busy!”

SOCIAL MEDIA

Elon Musk has teased that X, formerly known as Twitter, would become an “everything app.” The company announced that it will get another new functionality this year: A peer-to-peer payment portal. The company has not said when this will go live or how it will work, but TechCrunch reported in December that X Payments has registered to do business in at least 32 states and has acquired a money transmitter license needed to process payments in at least 10.

While Musk has experience in this realm—he was a cofounder of the online payment app now known as PayPal—it’s not clear if the ability to make payments on X will do much for the business sector. X has almost always been a social app, though businesses and government entities have used it as a communications tool. Since Musk bought the company in 2022, the platform’s dismantling of content moderation and user verification—as well what many have said is sanctioned amplification of extreme hard-right content—has driven businesses away. A report released this week by eSafety, Australia’s online safety commissioner, quantified how deep the cuts in that area were: 80% of engineers dedicated to trust and safety, and a third of non-engineering employees in that area lost their jobs. An automated response from X’s press email to ’ questions about the report read, “Busy now, please check back later.”

BITS + BYTES

Deloitte Chief Futurist Mike Bechtel On What’s Next In Information Management

For the last 15 years, Deloitte has issued its Tech Trends report, advising both those working with technology and those interested in the future about the new technologies and trends that are emerging. After a quarter century of parsing these trends, Deloitte Chief Futurist Mike Bechtel described himself as a “geek turning geezer” that sees an ever-changing “blizzard of buzzwords.” However, he said, the core principles in each category—or the things that help clients save or make money—are nearly constant. I talked with him about this year’s trends and what it means to CIOs. This conversation has been edited for brevity and continuity.

Where does generative AI fit in the panorama of what executives should be looking at for business developments in the upcoming year?

Bechtel: Generative AI is what’s new and next, in the centermost category. …It’s all about the data layer, or about information and insights and decision making. From a geek perspective, as a technologist, we see generative AI as merely a very useful evolution of a series of information-and-insights-driven advancements that we’ve been tracking since 1956. What started as arithmetic in the first computers gave way to rows and columns in relational databases, that gave way to descriptive analytics, and then predictive analytics, data science, Big Data. Then, most recently, AI: traditional AI and now, gen, or creative AI.

With the nerd hat on, it’s like, this is simply what’s next in information management. But I think the reason it’s such a big, spectacular story as regards the business side is that for the first time, executives and creative professionals are seeing the rising tide of automation beginning to affect them. We’ve had mechanical muscles for a couple generations, and we’ve had mechanized spreadsheets for 10 years, but all of a sudden, you’re saying, ‘Wait a minute. Computer-generated thinkpieces? What’s going on?’

There’s a lot in the report about larger systemic change in organizations’ technology: Upgrading legacy systems to run on better code, holistically assessing the health of your tech ecosystem, giving developers a better work environment. Where are most companies in terms of looking at these issues in a more holistic way?

Bechtel: There’s this tendency to look at the hyperscalers or Big Tech out of the Bay Area and presume that’s the state of technology in business. But in truth, if you’re a middle American mid-market commercial insurance company, that stuff is the future, right. You’re running on legacy systems that you’re trying to drag to the present, let alone leapfrog into tomorrow. What we’ve seen are a couple things. For companies that are just catching up to that future, the first thing they’re starting to recognize is that there’s a people side to that modernization. Our [report] chapter on this idea, “From DevOps to DevEx,” really speaks to this idea. Ten years ago, in our Tech Trends, we said every company will be a technology company. At the time, that felt reasonably provocative.

…Well, here we are. It feels pretty passé to say that today, but here’s the knock-on effect of that. Just about every sizable company now employs a whole lot of techies. And techies are wired differently. They’re incented differently. Raises are interesting, but not sufficient to stick around. Promotions are sometimes feared because they’re seen as a threat to have to put down the toolbox and pick up the briefcase. On the people side, one of the things we’re seeing in our clients is this recognition that career paths, cultural norms, red tape reduction, there’s a whole set of CHRO and people initiatives that need to be put in place to recognize that techies tick differently.

…On the tech side itself, we have a chapter in this year’s Deloitte Tech Trends we call “From Tech Debt to Tech Wellness.” …What we found in our discussions with our clients this year around the globe, was that when they talk about tech debt, you see the body language change. They kind of clam up as if they’re talking about going to the dentist. It’s this thing they think about once a year because they know they have to, but they really don’t like it. It’s a bad time, and so they minimize time spent, and they don’t check on it for another year. Until gasp, something happens, and suddenly it’s an emergency statement of work to spend big on a monolithic systems modernization. It kind of goes from ‘out of sight, out of mind’ to disaster.

What we’re seeing is some of our more pioneering clients are saying, ‘You know, if we reframe this as daily preventative health, in the same way that a smartwatch encourages you to get up and stand every hour. If legacy application monitoring and maintenance and renewal were part of the daily cadence, in the same way that daily health is part of avoiding the doc, then fewer of your yellows go into the red, and you realize net savings and a better time.’

Generally speaking, neither of those have anything to do with AR headsets, generative AI. It’s just saying, ‘Listen, crusty old systems can be managed more effectively,’ and smart clients are figuring out how. Crusty old workplace orthodoxies don’t cut it for next-gen workers. Let’s in all cases bring those futures that are passé in the Valley into the rest of the market.

If you were to point out something that you would want executives to really take notice of in the report, what would it be?

Bechtel: In an age of creative machines, humans matter more, not less. I’ll give you an example here that blew my mind, and we make reference to it in this year’s report introduction. I was surrounded by literal captains of industry. …I was showing an image diffusion model to them, and I said, ‘Gang this thing can paint anything. Literally anything you’ve ever imagined. What do you want to see?’

This sort of arms-crossed, skeptical, CFO-energy gentleman, he says, ‘Paint me a sunset.’ The system gives him a traditionally attractive sunset. But he just looked at it. He goes, ‘It’s just a sunset.’ In my internal dialogue, and I think those around the circle were like, ‘Respectfully, sir, you ask a boring question, you get a boring picture.’

His chief of staff is this young woman leader. She comes to the back of the circle, and she goes, ‘OK, I want to see pretzels versus potato chips in a fight. Pretzels get squirt guns, potato chips get nunchucks. The whole thing’s on Mars.” And everybody looks at her like, ‘Stage one, you’re nuts. Stage two, that’s awesome.’ And then stage three, the picture renders and there’s literal applause.

…I’m thinking, don’t celebrate the machine. Celebrate that woman. Because to me, the downside risk [is] garbage-in, garbage-squared. …To me, it’s genius-in and genius-squared. That’s why we say this is a force multiplier for human ambition.

The big thing I’d like people to take away from our report is: Give these tools to your highest performers. They’re going to be exponentially higher performing still. And I think that’s the big takeaway: This ain’t robots coming for jobs. This is tools used mindfully, changing the world for the better, faster.

FACTS + COMMENTS

In earnings guidance released this week, Samsung Electronics reported a steep decline in operating profit due to weak demand for its products.

35%: Estimated drop in Q4 operating profit, compared to a year prior

2.35%: Decline in Samsung’s stock following the guidance’s release on Tuesday

Sales will expand ‘in line with growing demand for generative AI’: Samsung predicted in its third quarter earnings report

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QUIZ

The first texts using T-Mobile’s network via SpaceX’s Starlink satellites were posted on X by Elon Musk. Which one of these wasn’t a part of the conversation?

A. New phone who dis?

B. Where r u?

C. Hellow

D. Dinner wen?

Check if you got it right here.