In this episode, John Donegan speaks with AI and innovation expert Alex Goryachev.
Alex is a global AI and innovation leader who has been recognized by Forbes as one of the top innovation experts in the world. Alex is also a Wall Street Journal bestselling author, and he’s driven transformative change at major global brands including Cisco, Dell, IBM, and Pfizer.
During this conversation, Alex discusses the impact of AI on organizations and society at large. He also suggests ways that companies can strategically innovate, while avoiding the creation of information silos. Interestingly, Alex finds shadow AI usage to be an effective indicator of innovation in the workplace; he even describes shadow AI as “a way to upend the corporate status quo.”
Alex is also a huge proponent of metrics. In his 2020 book Fearless Innovation, Alex writes, “Innovation can, and must be measured. In fact, if you can’t measure it, then it’s probably not innovation at all; it’s more likely ‘fake innovation.'” A provocative take, to be sure.
If you want to learn how to drive AI-fueled innovation within your organization, you’ll enjoy this conversation.
Agenda
-
- Discussing pragmatic innovation
- Using metrics effectively in the workplace
- The importance of chief innovation officers
- How comfort breeds complacency
- Shadow AI as an indicator of innovation in the workplace
- Making the case for exit interviews
- AI’s influence on society
- Using AI to challenge the status quo
- How AI is upending the educational system
- Potential AI regulation, parental controls, and advertising in LLMs
- Academia’s AI paradox
_______________________________________________________________________________________________
Transcript
JOHN DONEGAN, HOST
Hello and welcome back to the ManageEngine Insights podcast. I’m John Donegan, an enterprise analyst at ManageEngine, and I’ll be your host. Today we are joined by Alex Goryachev.
Alex is a global AI and innovation leader who has been recognized by Forbes as one of the top innovation experts in the world. Alex is also a Wall Street Journal bestselling author, and he has driven transformative change at major global brands, including Cisco, Dell, IBM and Pfizer.
Well, Alex, thank you again so much for doing this, coming on the ManageEngine Insights podcast. If you wouldn’t mind, just give us a brief history of your background.
ALEX GORYACHEV
Thank you so much. I think my background keeps evolving, right? But when I look at my past, I think I’ve been a part of every phase of the digital revolution, starting with Napster and the music industry, and moving on to e-commerce.
And I spent a number of years at Cisco, building and running their global innovation centers, including their first projects on AI. And then from there, I moved on to work with other organizations like Dell and Google and others, helping them be successful and innovate faster in the AI era.
DONEGAN
Awesome. I just finished your book, Fearless Innovation. Excellent. I believe it came out in January 2020. I guess my first question to you is, you know, what’s changed in the landscape since then, in the last five years or so?
GORYACHEV
Yeah. No, I appreciate this because I think, about five years ago, the companies were thinking about this whole concept called digital transformation. And the innovation was primarily coming in from the executive offices. And companies trying to establish a Chief Innovation Officer or basically facilitate growth. And when we think, right now, innovation is primarily about survival because everybody is innovating everywhere, at all the levels over the enterprise. So we are in this innovation world. And I think, we gotta be fearless, and at the same time fearful of not innovating.
DONEGAN
So, you know, maybe to back up for a second, what is innovation? And what is, you have this term “pragmatic innovation.” Could you just explain that real quick?
GORYACHEV
I love that question, right? Because I don’t have a simple answer for this; however, I do have an answer for “pragmatic innovation.”
We all operate at work within the context of our workplace. And in that workplace, we have certain things, metrics. Let’s look at something. Let’s not even go into revenue or customer satisfaction. Let’s look at our time, the way that we spend time. So, I think for me, pragmatic innovation is where we can move the needle on certain things. For example, how do we do things faster? Or how do we do them better? Or how do we do them cheaper? So, I believe when we are successful in the workplace, we’re actually looking at our existing workflow and trying to improve it. Or reinvent it. But starting with something that exists and making it better.
DONEGAN
Right. Right. You have a great quote here. “Innovation can and must be measured. In fact, if you can’t measure it, then it’s probably not innovation at all. It’s more likely fake innovation.”And I’ve heard you describe it elsewhere as “innovation theater.” So what is “fake innovation” or “innovation theater”?
GORYACHEV
Well, you know, that’s where we go—we see a lot of innovation theater with AI, for example. When we look at a lot of organizations, they talk about AI. But they talk about it. It’s in the press release. It’s in the earnings call. It’s plastered all over their advertising.
But are they actually using this technology? Who is using this technology? And how? Right? So, when I see it, and I mean this respectfully to different teams, but when I see a lot of innovation that’s in the marketing, in the propaganda, or in the marketing material, and in the PR material, that’s wonderful. Right? It’s great. But sometimes I see a disconnect between the way that the work is actually being done, and employees using the latest and greatest tools, and they’re not.
So, there’s this promise to the shareholders for the marketplace, but there’s not necessarily reality on the ground. So for me, real innovation is when you look at any given employee in the organization, and that employee is empowered to make a change and to reinvent their work, to make it faster and better, and more pleasant and enjoyable.
DONEGAN
Right, right. And you do stress the need for metrics. You know, and you talk about the difference between “soft metrics” and “hard metrics.” And I guess between “activity metrics” and “impact metrics.” And you stress the importance of this without, you know, quantifying what’s happening. It’s kind of hard to be doing innovation. So, I read it as like fake innovation was, you know, maybe pretending you’re doing something that you’re not or, you know, not quantifying it, but maybe you could elaborate or clarify.
GORYACHEV
I think we’re very much on the same page, right? And I don’t want to confuse innovation with creativity. Right? So there’s a lot of creative processes. There’s a lot of things that are going on in us as humans that we can’t measure, nor should we, right? Which is the world of feelings and thoughts, and so many things that make this humanity beautiful.
And when we are in the workplace, I think it’s important that we measure it—not to make sure that everybody is so productive and efficient, and they don’t have any space to breathe. But just so that we are directionally moving in the right perspective. For example, hackathons are very popular. So, I often see organizations that are getting everybody in the room, and they’re saying, “Give us your ideas.” And then the employees get excited. They provide a lot of ideas. And then the organization publishes a report and says, “We’ve done these amazing things. We’ve collected 375 ideas.” Well, what have you actually done with them? Do your employees have a way of connecting, of actually implementing those ideas?
And outside of that beautiful, you know, executive room in a corner office where the hackathon takes place, can they go and innovate on a daily basis and actually come up with an idea and implement? And if the company invests money into this type of activity, I think that’s that’s real innovation. And if we only do hackathons and we don’t follow up, that’s theater. What do you think?
DONEGAN
No, no, no, I think it’s true. And I think we’re seeing it in the AI space a lot, like a lot of companies are just, you know, using basic automation and calling it, you know, agentic AI or, basically exaggerating the prowess of their new technologies for PR and marketing. Across the board, we’re seeing some of that.
You also say in the book, 63% of companies are hiring CIOs, not Chief Information Officers, but Chief Innovation Officers. In fact, I’m not even sure there’s an acronym for that yet, right? But the Chief Innovation Officers, 63% seems like a lot. Has this number gone up since then? Or gone down? Or? Care to comment, I guess.
GORYACHEV
Yeah. I feel like the companies are actually starting to pay a lot of attention in this manner. So, more companies are hiring Chief Innovation Officers because when the book was written, innovation was primarily about, “Can we look at the new business model?” or “Where can growth come from?”
Right now, innovation is about survival because AI is developing faster, faster, faster and faster. And the work workflows are being reinvented. So, if you’re not innovating your competition is undercutting your time or margin and also many other things. So right now it’s absolutely important to innovate. And I feel a centralized effort is necessary for some time. So I view this as a temporary transitional role. And every company that wants to stay successful needs to have one. I feel very strongly about that.
DONEGAN
Okay, interesting. Tim Cook has said, “As soon as a company has a Chief Innovation Officer, you know that company has a problem.” Pretty provocative statement.
GORYACHEV
Yes. I think it is a brilliant quote because every company has a problem.
DONEGAN
Fair, fair, fair.
GORYACHEV
Every company has a problem right now. And I’ll tell you this, I believe every single successful company has a problem because they’re successful. They know everything; everything is working, until it’s not. Right? So, I think that comfort, it really breeds complacency. And I was actually thinking about this yesterday, so when we think about what really killed the big companies in the past is not the future. It’s really their loyalty to their legacy, right? Because they’re afraid to change.
So, I don’t believe every successful company by nature has a problem. As much as the older we get us adults, we might become more mature and wiser. But we develop, there’s issues that are happening with our mind and the body. We become stiff, and our mind is not as plastic and it is the same with a large company.
And somebody needs to go and poke that system from within. And that I feel, is the function of the Chief Innovation Officer—by connecting the workstream and helping that company stay nimble.
DONEGAN
I couldn’t agree more. Speaking of digital disruption in companies, and not seeing the writing on the wall, you were working at Napster when the MPAA was suing them, right?
When Metallica and Doctor Dre, and whoever else, you know, they were disrupting the the old guard, as far as, you know, the Tower Records of the world. Now, that’s a great example. And then also Blockbuster, which we can get into. Yeah, let’s talk about Blockbuster, I guess. In your opinion, what events led to Blockbuster’s downfall? I also read Alan Payne’s book. He was a franchisee of a bunch of stores, I think, in Alaska and maybe in the Rio Valley here in Texas. He’s an Austin guy, but he has his own thoughts. I’m just wondering what you think led to Blockbuster’s downfall?
GORYACHEV
Well, first of all, thank you for mentioning that book. I’d love to read it.
DONEGAN
Oh, it’s a good one.
GORYACHEV
In my opinion, it was just a very successful company. Everything worked for them. It was an American tradition apparently. People were showing up at this place; it was called “the mall.” Where is it now? Right? And people were doing certain things in a certain way, and the numbers were going up until they weren’t.
Right? And again, it’s this whole methodology of, “Everything is successful. Why bother?” And I think that’s what ultimately led to the downfall. And when we look at some other industries, it’s the same thing. It’s like, well look at taxis. Well, it’s a monopoly. It’s a monopoly. It’s a regulated space. And there’s this Uber thing. Who’s going to believe in that?
When I grew up, my parents told me two things: One is, “Never meet people over the internet.” Right? And that’s the first thing. And the second one is, “Never get into strangers’ cars” So that’s like gospel. And now look at the entire country, the entire world. That gets in Lyft, that gets in Uber. And now God forbid, into some driverless cars.
DONEGAN
Right, sure.
GORYACHEV
So, everything changes overnight. And I feel like Blockbuster really believed in its own success. And another thing is, I was reading that they really did not want to disrupt their relationships with studios because of the way that things are distributed. But it’s ironic because when we look at four of the biggest studios right now, they’re tech companies.
DONEGAN
Yeah, totally.
GORYACHEV
In a way. Yeah.
DONEGAN
Yeah. No, a lot has changed. I mean, ironically, back in 2000, what’s his name? John Antioco, I believe was the CEO. And Netflix came to him and offered Blockbuster an M&A deal for like $50 million, but obviously hindsight is 2020.
GORYACHEV
It is. Absolutely. At Napster, we never really thought about streaming. We thought that people would burn their music to CDs, or they would record it on their music player. But the whole concept of, “We’ll have this super fast internet, and we’ll have plenty of cloud storage; we won’t have to store anything. We’re not limited by the speed, or the storage in our devices.”
DONEGAN
Right.
GORYACHEV
I mean, I’m sure it crossed people’s minds. It didn’t cross mine. It wasn’t a part of the business model.
DONEGAN
Right, right, right.
GORYACHEV
And things evolved completely. Now we have this whole AI music thing. So, who knows where that is going.
DONEGAN
Where do you see things going? You know, what’s the next iteration? What’s the next thing we haven’t thought of? As far as, it can be, in any industry, what predictions do you have, I guess?
GORYACHEV
Well, you know, I really think we are going to enter a bubble of entrepreneurship. Right now, if we look at the mortality rate of the fortune 500 companies, roughly 52% of them from year 2000 are gone.
And I think that number is going to increase significantly because what we have with artificial intelligence is the ability for anybody, anywhere in the world to go and innovate and spin off businesses and create ideas, and basically pilot their ideas very, very fast.
So when I look at entrepreneurship, I think it’s going to grow exponentially. When I think about the organizational change and the level of the organizational change, it’s going to, I don’t want to say disintegrate the organizational chart, but it’s going to change it significantly, because in the past, innovation was, “People have ideas, but they have to go to another department or another team or I.T and raise a business case and do all those things.”
DONEGAN
Right.
GORYACHEV
Now, people can go and use this technology.
DONEGAN
Yeah, that’s true.
GORYACHEV
With AI. And they can go and do things without budget, without permission. I was reading up, actually I wrote in Forbes about this this morning, and it got published. You have a phenomenal study on shadow AI.
DONEGAN
Yeah. Oh, yes.
GORYACHEV
It really shows where the work is being done. And I really feel that’s what’s going to inform a lot of this. So when you were asking, “What’s going to change?” I think like, look, look at the shadow AI.
A friend of mine called me just. I’m sorry that this is becoming a long answer, but he said, “Alex, I’m having an interview for the infosec cybersecurity role. And one of the questions they told me to prepare for is how to combat shadow AI.” And I said, “That’s not an infosec question.” Right? Because shadowy AI is an indicator of innovation in the organization—because that means that people want to get the work done; they’re looking at some other ways of doing things.
DONEGAN
True.
GORYACHEV
That is a great metric for innovation. So, if I were to ask this question for any organization and say, “Hey, where’s the future for you?” or “How is the work being changed?” My advice for them would be to look at your shadow area and how your employees are really using AI. And what for? And that would give you some indication of where your organization is going.
DONEGAN
Right. It kind of speaks to what you were saying in the book too. How, you know, people don’t operate, or they shouldn’t operate in silos, right? And why exit interviews are so important, and why you need to reach out to everyone in the organization to see how the organization as a whole can move forward. I guess to that end, I’ll ask you, “How can companies proactively avoid the creation of these silos that, you know, inevitably form, or at least in my experience?” Or we can focus on “Why are exit interviews so important?”
GORYACHEV
Well, I think there’s two things. Maybe we start with the exit interviews. It’s so funny how much we invest in bringing in an employee and interviewing them, and going in circles asking all those questions without telling them anything about what the real work is. What the culture is. Who is toxic on the team. What the problems are. You know, when did the layoffs happen? There’s so much institutional knowledge that actually needs to be disclosed. But all we do is ask all those questions without telling much.
But when a person leaves, we don’t ask him any questions, or we often don’t. Because I think that a lot of organizations, they don’t want to face the inconvenient truth. Learning the things that they need to take action. And I feel their lack of the exit interviews is because exit interviews would need to be documented. That information would need to be aggregated. Somebody would need to go and act on it, and make a change.”But why bother? We’re so successful.” Or “Well, the people are leaving left and right and we’re going downhill, who cares.” Right? But I’m really cynical about this. I think that’s why the organizations don’t really do these interviews, because it really creates accountability.
DONEGAN
Yeah.
GORYACHEV
So, getting to your other question, the only way that we can break silos is by transparency. Because silos are very, because what are silos? Silos are a lack of a view and connectivity into the processes and the work that is being done in other teams.
And I think this is where the AI has the biggest promise, because in order for AI to work well, it needs to have a common data foundation. And in order for people to use it well, they need to have institutional knowledge. So, I think AI is going to bring in a lot of visibility.
It will break silos by challenging middle management because middle management is usually the—and I think middle managers are wonderful. And they’re the ones that are innovating and keeping a lot of companies afloat. And they’re the gatekeepers. They hold a lot of information, they hold a lot of knowledge, and they don’t necessarily share. Or they’re the ones that are measuring what needs to be shared.
And I think with AI, and if institutional knowledge goes to AI, it’s all in the wide open. Anybody, a CEO has an answer. Without needing to ask 17 direct managers. Right? And an employee has an answer without needing to question the manager. So, I think that’s what’s ultimately, it’s a big promise to fight bureaucracy.
And silos and bureaucracy and a lack of exit interviews have something in common. And yeah, I think I said enough about that.
DONEGAN
No, no, no. That’s great. In the book, you compare innovation teams to hostage negotiators. This jumped out at me. Do you remember doing this?
GORYACHEV
No. I’m starting to think like, “What was I thinking?”
DONEGAN
You know, I wish I had the book in front of me. You know, I’m not exactly sure. I was hoping you could explain it more because it was a very incendiary, and interesting, observation.
GORYACHEV
You know, it’s interesting, I’m making a note to myself, “What was that about?”
But I really, what I would want to compare them to now is the orchestrators. Because at the end of the day, and I’m glad you’re bringing this up, because the innovation team is not that special team in the corner office. With kombucha on tap and beanbags or whatever that is that comes up with the next big ideas.
The innovation team is the one that actually builds trust with others and helps them facilitate and get their ideas done. So, what I want to say is that the innovation team is a facilitator.
DONEGAN
Okay.
GORYACHEV
They are not the people coming up with the best ideas. They’ll never have the best ideas. I mean, no. It’s the employees and people—the frontline workers—that are doing it. People across everywhere in the organization.
Ask the middle managers, “If you were to have more budget or less pressure, what would you do?” And then help them implement their ideas, and make them pragmatic and tie them to metrics.
I think I think that’s what it is. And as I was talking, I’ve asked one of my favorite AI tools—he has a copy of the book. So I said, “What did I mean by that just now?”
DONEGAN
Just now you did?
GORYACHEV
Just now I did. I said, “I compared the innovation team to hostage negotiators in Fearless Innovation. What was that about?” That was my prompt.
DONEGAN
Nice.
GORYACHEV
And the response that I got is, “It creates a path where everyone feels safe enough to take the next step.”
DONEGAN
Okay, I wish I remembered better. I mean, that’s a brilliant, irrefutable answer from the AI.
GORYACHEV
Or it could be a hallucination.
DONEGAN
Yeah, totally. Yeah, but I mean, it was pretty persuasive, so that’s pretty good. Let’s see, we covered—
GORYACHEV
I mean, these AI responses always sound persuasive. I mean, I still I’m still trying to come up with a super prompt that would just tell me, “No, I don’t know.”
DONEGAN
Yeah, right? Exactly.
GORYACHEV
But it always says, “What a brilliant question. Here’s the answer.”
DONEGAN
True. Well, it wants to keep us happy and engaged and, still using it. So I think it’s a—
GORYACHEV
Yeah, that’s my concern.
DONEGAN
Yeah. It’s purposeful, I’m sure. So just generally, where do you see, you know, the elephant in the room right now is that AI is this new, you know, it’s sort of it reminds me of the dotcom days. Right? That we’re seeing, like an AI bubble, if you will, in the market and in the marketplace. Where do you see AI taking society just in general, or are you optimistic or cautiously optimistic? And two part question, I guess, are we in the middle of a fifth industrial revolution? I guess we’re in the fourth now, right?
GORYACHEV
We are in the fourth according to the World Economic Forum. Who knows, they’re going to meet in January, and we’ll find out. You kind of raised three things. So, the first thing you said is where, from an industrial revolution perspective, I think we’re getting into this, the whole learning economy, which is “AI learns faster than us.” So how do we keep learning? And it’s not going to be about the job roles. It’s going to be primarily about the skills. So I do think that the organizations are going to be reinvented and redesigned. We’re seeing a lot of these new AI native companies, just showing up that are built around, and I think that’s one. The second big question is the compensation of creators, because a lot of IP has been created. Now AI is using it. So, who is profiting from this?
DONEGAN
Totally.
GORYACHEV
And how do we make sure that everybody has an opportunity to benefit. Right? So my concern with AI is it could really optimize a lot of things, and it could put a lot of people out of work. And I have no doubt it will create a lot of jobs. But my worry is the gap between our desire to make everything efficient and generate more profit (or what we call, a nice way of saying it, “shareholder value’)…is happening so fast that we’re putting people out of jobs without necessarily thinking, “Should we be doing that? Is this good for the organization and good for the society?”
And then, of course, there will be a new wave of innovation and creativity, but it’s going to take time. So how we manage this interim period, whether that’s our organization, or learning, our universities, schools, kids. That is the question where I don’t have the answers; I just think we need to start raising that question very vocally.
DONEGAN
True. Yeah, I mean, I think we’ve seen that just because we can create something doesn’t mean we should, right? Like you think of maybe the atom bomb or, I don’t know, maybe along the way we didn’t create things? Maybe there were safeguards put up, and there are certain things that we don’t talk about because they don’t exist. But, um—
GORYACHEV
Maybe let’s look at social media, right? Is social media wonderful? I don’t know, I mean, one of my resolutions this year was to use less social media because I feel it feels disruptive to my sleep. So there’s a lot of like—but was the promise of social media brilliant? Absolutely. We’ll also be more connected, and we’ll see common sense. Right? We’ll all come together.
Now we’re seeing that there is a correlation between polarized society, depression, people being more lonely. Who is responsible for that? I’m not pointing any fingers. I’m just saying that hopefully we’ll learn from that example. To think this through. Especially when children and the younger generation is involved.
DONEGAN
Yeah, 100%. Yeah, I could not agree more. And that’s a great example. Yeah. And I think part of it, you know, has to do with M&A, right? Like maybe if Facebook wasn’t able to acquire Instagram maybe we wouldn’t—It seems like when the power is in the hands of so few, the situation can get exacerbated.
GORYACHEV
I appreciate you saying this. You said it very well, right? My hope is that there will be more and more innovation. So there will be more and more creativity. That means that there will be more and more players.
DONEGAN
Yes.
GORYACHEV
The less players we have, the worse outcomes are for the society.
DONEGAN
I agree.
GORYACHEV
I mean, that’s the promise of the democracy, right? When you think about it, there are a lot of players, and they all take an active role in managing our society. It’s why we have boards and governance in the organization because of diverse points of view.
DONEGAN
Right. Sure, yeah.
GORYACHEV
And I’m hoping that we’ll we’ll have this diversity with AI as well.
DONEGAN
Yeah. And I think you bring up a good point about shadow AI too. It kind of forces some of the higher-ups to pay attention to, you know, some of the lower folks or, you know, you’re on-the-ground employees, to see how they’re actually doing their work—so you kind of see a democratization of information.
GORYACHEV
Well, I feel you’re up to something with the shadow AI because shadow AI is the biggest indicator. In fact, as I was telling my friend yesterday; I said, “Look, if you have shadow AI, it’s not a security problem. It means that your employees are innovating faster than the rest of the organization, which is a wonderful metric to have. That means that you have somebody who cares, and they’re looking for a faster way of getting their work done, for whatever reason.
DONEGAN
Right, right, right.
GORYACHEV
How do we bring them on board? And I’m not saying let’s go and proliferate shadow AI. I’m just saying, well, it’s a it’s a great indicator of innovation. And I feel that’s such a leading indicator of where innovation is happening. So people that are breaking rules are innovative. In every single company.
Whether that’s the music industry today. Or Spotify, or Uber, or Lyft. It began with breaking some rules, or challenging the status quo. So people that are using shadow AI, they’re just challenging the status quo.
DONEGAN
Right. No, that’s true. So, let’s go back to your Napster days, and your early days at EFF (Electronic Frontier Foundation). People must come to you, you know, with questions about “Where are we, where’s the music industry going? In film and media, what’s the next iteration of digital distribution? Where do we go from streaming, and how is that going to shake things up even more with AI?” Do you have any thoughts on this?
GORYACHEV
Yeah, I think it’s all going to be an immersive entertainment because when I think about AI, it’s a tremendous form of entertainment. Right now, people are using it for—I mean, a lot of people, as you know, are using it for therapy and companionship.
When we think, I’m not going to get into the therapy, but what but what’s really a companionship, right? Companionship is about emotions. It’s about feelings. It’s about belonging. A sense of being a part of a bigger story. Right? Because we don’t want to be isolated. The reason we go to social media is because we want to be a part of a bigger story. So, I do feel with AI we’re going to have a lot of immersive entertainment.
The entertainment that we create, that will be created by us. And everybody will become a digital creator. I am seeing a lot of creativity that’s going to come out of that. And I’m hoping that a lot of it can be monetized. For people like you and me or anybody in the world that can go and create their own miniseries.
DONEGAN
Sure, sure. Yeah, I’m a little fearful though, that that we won’t know what’s real and what’s not. You know, you’re seeing, you’re questioning, it’s the liar’s dividend and these deepfakes. And there’s massive implications from an IT security standpoint as far as, you know, social engineering and these things. So I worry about going online and not being sure, you know, what I’m seeing is real. And the implications for society at large based on that. But I don’t know.
GORYACHEV
Yeah, but to be honest, anytime I read a newspaper or I read a corporate press release, I have no idea what’s real or not.
DONEGAN
That’s fair.
GORYACHEV
So, I mean, to be honest, my concerns are like people that are scamming elderly or people taking advantage of others, right? So for me, it’s the societal manipulation, or taking advantage of others is what really concerns me. And you’re absolutely right. It’s very important to understand what’s real and what’s not, especially when other people are being impersonated in video or in audio.
DONEGAN
Yeah, yeah. totally. Right. So we do need guardrails, there’s no doubt.
GORYACHEV
Yeah, we definitely need guardrails. And I assume that there will be some regulation that’s that’s going to come down eventually.
DONEGAN
Steve Ballmer, back in 2001 when he was CEO of Microsoft, he called Linux a cancer, and he was demonizing it as communism. You mentioned this in your book. I think he subsequently has done a 180 on this thought process. What are your thoughts on, you know, open source as far as innovation and, you know, where we are today? And yeah, you can comment, just as a springboard.
GORYACHEV
Well, first of all, I was an early user of Linux. I really loved it. To be honest, I’m not sure why. Maybe because I could program. There was something very cool about it. Maybe because it was counterculture. Right? Having said that, to be honest, I haven’t followed open source for a while, so I can’t really comment on where it’s going. But the whole idea of who owns the code and who creates the code is now a big question, right? We can go, and AI can create a lot of code and a lot of IP. So who owns that IP? Who creates it?
But most importantly, what happens when everybody has access to it? Because the open source is about everybody contributing to something and having access to it. And in a way with AI, we’re all contributing to something, because we’re helping to train the AI systems. Who profits from it is a different question.
DONEGAN
Right.
GORYACHEV
But we all get access to this. So again, it’s a big equalizer that’s going to make a lot of major players nervous. And I think the reaction that you’ve shared was a reaction of nervousness.
DONEGAN
Yep. Yeah totally. Yeah. No, there’s resistance. And you talk about it in your book, you say, “They tend to ignore it, then shame it, and regulate it.”
GORYACHEV
And then regulate it. That’s what we’re seeing with AI right now. Ignore it, shame it, regulate it.
DONEGAN
Right, right, right. I mean, we definitely have to figure out a way to compensate everyone for sure, ’cause right now we’re in the early days where, you know, they’re kind of stealing the IP and training it. And different countries have different approaches to regulation.
Actually, I guess that’s a question, “What do you think is the right course of action as far as regulating these foundation models?” Like, should there be some kind of profit sharing if they’re going to train (their models) based on a journalist like you; you know, you published this morning. If Anthropic were to use that, maybe you should get a cut of that.
GORYACHEV
I think there’s a couple of things. One is when we think about the deepfakes, right? I think that’s one area where we’re already seeing regulation, which is very important. The second one is what AI tells our children and why. So, and I know that AI is rolling out parental controls, but I think there will be some regulation—that is, that involves kids and protecting the younger generation. I think that’s very important. And sometimes it’s, as you know, often when protecting younger generations, we’re protecting them from themselves.
DONEGAN
Yes.
GORYACHEV
Right? So, I feel that is very important. And then the third thing is creating new economic models, where everybody, where creators can go and benefit from their work being done. And there’s many different—I don’t know if that’s regulation, or that’s something that’s going to emerge in the market—but right now, the fundamental model of the Internet is broken because in the fundamental model, we publish content and then we sell advertising on our site. Or if we sell services, somehow we get our money back from that investment. And right now we publish content, and it all gets into AI and we’re not necessarily being (compensated), and we don’t profit right from it. Or we don’t recoup our costs. So that is very important. Can this be regulated? Can the regulation be worse than what we have right now? Sometimes I’m fearful of a government being involved and coming up with some bright idea.
DONEGAN
Yeah.
GORYACHEV
Without actually understanding how the process works. So, I don’t have an answer for this, but I’m hoping that this will be worked out really soon.
DONEGAN
Yeah, totally. I don’t have an answer either. It’s fascinating because, at least in the US, folks on the right and folks on the left both want to, you know, upend Section 230 of the Communications Decency Act—but for totally different reasons, right? So, it remains to be seen what the right approach is, and what will happen in the States, and in the EU, and elsewhere.
GORYACHEV
Absolutely.
DONEGAN
Let’s see what else we got. What are you working on? Do you have a new book coming out or, you know, anything you want to plug? And then also, what’s the most important thing you want to get across?
GORYACHEV
I mean, what I’m working on primarily is I’m very— I feel that the biggest industry that’s being disrupted by AI is the learning and academia.
DONEGAN
Yeah.
GORYACHEV
So, I spend a lot of time working with educational institutions and understanding how people learn, because AI is really changing the nature of learning. Everybody has access to all the information. So the critical thinking, the way that we learn is, is becoming very important.
DONEGAN
Yeah.
GORYACHEV
The second thing is we are teaching. If I look at the people that are just entering college, it is going to be what? The class of 2030 or something like that? Are they going to have a jobs for which they’re being trained? If AI can pass a bar exam, or a medical licensing board exam, what kind of attorneys and doctors do we need? I’m not saying we don’t need them. I’m saying we need a very different kind of doctors and attorneys. So, knowing, and I mean this was love, that academia was always lagging; it comes up a brilliant idea. And then there’s a lot of implementation.
How do we reinvent our educational system? That’s what I really want to…this is what I call the “AI learning economy.” It’s like we have to really recreate this learning pathway. It’s one. And I do want to write a book about that, so for me that’s a big thing. And maybe the thing that I want to leave people with is there’s a lot of talk about this whole AI bubble.
DONEGAN
Okay, yeah.
GORYACHEV
You brought this up, and I want to separate the economic realities from the speculative investments. Do we have speculative investments right now in AI? And are there companies that are going to go bankrupt? Of course there will be. That’s the nature of economy. But a lot of people refer to an AI.com bubble burst—like the hypothesis was not valid. But however, the hypothesis was valid.
Napster didn’t survive, but neither did the music industry. It changed forever. And it not only changed the way the artists were paid, but it changed even the way the music is being created, because in the past, before digital music, we used to publish albums. Which was an end-to-end musical composition. Now we’re publishing singles. So, it changes the entire narrative. Right?
Did the first of all delivery companies, Like Webvan go out of business? Absolutely. They all blew up. But now we have DoorDash, and so many other things. So when we look at every single—I shouldn’t be this generalizing, I’ll be careful—when we look at the majority of things, they all turned out to work.
They did not necessarily work with the companies that started them because they probably were ahead of their time, or they were too speculative. Who knows what they were, right? But major players did not survive either.
DONEGAN
Yep, fair.
GORYACHEV
So, while the bubble might burst from an economic perspective, that doesn’t mean that the underlying premise of AI changing the world is not valid. I think it’s already changed the world. I’m seeing this with students everyday. It has changed the world. It has changed the world forever.
DONEGAN
Yeah.
GORYACHEV
Whether it’s for the good or for the worse is up to us. Because like you brought up, you said early days of music. Or digital music. Five years from today, or ten years, or twenty, we’ll be looking at what we’re going on right now as early days of AI.
DONEGAN
Yeah, probably.
GORYACHEV
I just hope all of us are going to make better choices and more informed choices. And the choices for everyone involved, not just the people in the government or not just the people in the corner offices, or not the people with the biggest pocketbook and the best lobbyists.
DONEGAN
Yeah, 100%. I fear that we will see the big players, you know, a consolidation of these media companies.
GORYACHEV
Yeah.
DONEGAN
But you see Google, right? Their basic business model and Facebook, you know, is ad revenue. But if they’re also building LLMs and trying to embrace AI, they’re kind of cannibalizing their legacy businesses in my mind. So you’re right that not everyone’s going to come out of this looking the same as they did—even the big successful players historically.
GORYACHEV
You’re bringing up something very important because, yes, are we going to see ads in AI?
DONEGAN
I don’t know.
GORYACHEV
But if we are, how are they going to be targeted when we know that the majority of people are using AI for therapy and companionship. We know AI is so persuasive. So, this is going to be very interesting. And people are sharing their hopes, fears, and secrets right now to AI. And they’re seeking companionship. They’re seeking emotional validation. So many other things. Are we going to serve them with an antidepressant ad? When they’re at their lowest? Right?
So, these are all big questions for which there are no answers right now. But I’m very curious, helping and working with people like you and your listeners in helping to shape that discussion—and helping us; I mean, we can never make a right choice, but we can make a better choice or a more informed choice.
DONEGAN
Yeah, yeah. And education is a big—well, I came out of academia myself, actually, for a short stint—I couldn’t imagine, you know, the shake up that must be going on there now, like you used to have TurnItIn, right? Where you would—
GORYACHEV
Right.
DONEGAN
—So it just changes. As far as upskilling, I guess, is that something you focus on? Or learning new skills to enter the workplace? You touched on it earlier.
GORYACHEV
Yeah, for me it’s really what are the jobs of the future? What are the jobs? I mean, the big questions that I’m trying to understand: Are four year degrees actually going to be around?
DONEGAN
Yeah, I don’t know.
GORYACHEV
Because the learning curve is—the learning cycles are much shorter. We talked about microlearning, as you know, for years. We talked about skills for years. But now it’s like are we going to be in college for four years? That’s one. And the second thing is, it’s an interesting thing because a lot of academia is on the warpath with AI, for obvious reasons.
DONEGAN
Sure, sure.
GORYACHEV
I’m not judging them.
DONEGAN
No. Yeah, yeah.
GORYACHEV
But we’re penalizing students for learning the skills for which the marketplace pays the most.
DONEGAN
Right. True. That’s a good point.
GORYACHEV
Right? And so these are just paradoxes. There’s no answer for that. They’re interesting paradoxes.
DONEGAN
Yeah. Well, if only we had a crystal ball. It’s a very interesting time to be alive. There’s no question. Well, you know we’re coming up on time if there’s any other thing. And I look forward to reading your next book for sure, whenever that comes out. Yeah, I don’t know, any final thoughts?
GORYACHEV
No, John. I’m really grateful. Just more paradoxes, right? Yeah, I’m really grateful for this conversation. I look forward to chatting with you again.
DONEGAN
Awesome. Well, thank you so much for coming on the Manage Insights podcast. We really appreciate it, Alex.
GORYACHEV
Thank you so much.
DONEGAN
Well, that brings us to the end of today’s podcast. Thank you very much to Alex, and a big thank you to everyone for listening. And please stay tuned for our next installment.
