Phil Simon: Nine Tectonic Shifts, Steer into the Skid | Turn the Lens with Jeff Frick Ep25

Cold Open

All right, so then I will count us down and we will go in 3, 2, 1.

Jeff Frick

Hey, welcome back everybody. Jeff Frick here coming to you for another episode of ‘Turn the Lens’ from the Home Studio. We're excited about this next episode. Funny, I think I don't do a lot of book reviews, but I actually, when I look at my record. I actually do a couple book reviews now and then, and this is one that's very topical, very timely, and we’re excited to get into the deets. So joining us all the way from the Phoenix area, he's Phil Simon, the author of 14 different business books, best selling business books. But today we're talking about the newest book and it's called "The Nine. Nine Tectonic Forces Reshaping the Workforce." Phil, great to see you.

Phil Simon

Jeff, thanks for having me. I'm looking forward to our chat.

Jeff Frick

Absolutely. So first off, before we get into it. 14 books, I mean, you are prolific in this area. And it's pretty interesting. You’ve done like the whole gamut of different types of books from Dummies books, which I think, you know, all dummies like me think we could all write a dummy book. And I'm happy to see that they're still popular even speed producing them. I heard in one of your other interviews to get some of the stuff out for Zoom and kind of the post-COVID topical-ness. Tell us a little bit about how you got to be a full-time author.

Phil Simon

Well, I joke, Jeff, that if I didn't write my first book back in 2008, I would have needed to see a shrink. I spent most of the aughts and a little bit of the tens. Is that a thing? What do they call it? Whatever came after the aughts. Helping companies implement different enterprise resource planning (ERP) systems. And almost without exception, it was just Groundhog Day problem after problem. Go to a different client in a different industry or a different part of the country, and you're basically swapping out one Yahoo or one set of data issues or technology issues for another. So they say, write what you know, my first book did nothing for about five months, and in July of 2009, I received a popular Slashdot review. Next thing you know, I was number #91 on Amazon. Somewhere sandwiched in between, your boy Malcolm Gladwell and Stephen King and J.K. Rowling was this guy Phil Simon. And then I just started banging out about a book a year, and I've tried to spread myself out a little bit and not just write the same book over and over again. I just get bored easily, and some have been about strategy books like ‘The Age of the Platform: How Amazon, Apple, Facebook and Google have Redefined business. But the last really six books have been about technology and the future of work. And the most recent one that we'll discuss today, ‘The Nine.’ Like most authors, I'm sure say it's the, it's their best yet, so hopefully we can get into it. But yeah, I just don't sleep. I have a lot of opinions, type very fast, and really enjoy the creative process. So that leads to a lot of books.

Jeff Frick

That's great. And also, you know, we'll get into ‘The Nine’ and we’ll kind of be going up and down because I think these are tectonic shifts that not only impact work, which was the specific objective of the book. But these are big societal things as well. They impact, you know, a lot of the things in terms of the way we live, the way we entertain ourselves, the way we engage with friends and family and everything else. So I'm excited for it. So let me just read the Nine just to get that out of the way. So employee empowerment, physical dispersion, systemic inflation, automation, generative AI, blockchain, immersive technologies, I'm running out of fingers, unhealthy analytics, which is really interesting, especially in the context of some of your other books. And then fractions. I mean, I've got pages and pages of notes. I don't know where I want to begin. I think let's just start with employee empowerment because I think that's a big one, especially in the not too distant past. We had kind of the Labor Day ‘Return to Office 4.0’ as our mutual friend Brian Elliott would call it that didn't really work out so much, and the piece that you talk about a little bit, but I think that's kind of over the top of the whole thing is the systemic changes in the demographic makeup, especially in some of the more developed countries. You see it, kind of an advanced version of it in Japan or even seeing some things in China that's kind of a result of the single child policies of 20 years ago. So at the end of the day, ultimately Labor decides, right? Ultimately it's who can afford to walk away from the job more, the employee or the employer? And I think, you know, we're really seeing this shift because nobody can fill all their positions, and there's just not enough people to get the job done.

Phil Simon

100%. I think the most recent stats from the Department of Labor last month, or it's, I think we’re at 3.6% unemployment rate. And if you think about issues that we won't have time to address today, and certainly I couldn’t put in the book around immigration, around college debt, around the cost of raising a child in this country around just some of the social factors, two-income families. The birth rate in many industrialized countries, including the U.S., has been dropping for a long time. You can't just snap your fingers and create people the same way you could go to Amazon Web Services or Google Cloud and create more compute power. So I do think that that's a long term systemic thing and it's more of a pendulum. It's not like we have arrived at a period of permanent employee empowerment any more so than inflation is permanent. But I put on my Swami hat as I was writing the book and said, what happens for the next five years and beyond? And I just don't see Jeff. And I'm sure you'd agree how after three plus years of work stoppages, working from home, remote work, hybrid work, we all of a sudden snap our fingers and everyone's back through Monday to Friday, 9 to 5, dealing with crazy commutes. We needed employees, blue collar, white collar to get through the pandemic. And certainly the technology was a big part of that. And if, as I'm fond of saying, if COVID had been a snow day a couple of weeks, maybe even a couple of months, okay, fine. Back to reality. But we have, and Brian (Elliott) has actually been on my podcast a couple times as well. And I read his book, (How the Future Works: Leading Flexible Teams To Do The Best Work of Their Lives) has mentioned this, we were largely successful. In fact, when he worked at the Future Forum, which is part of Slack, which is now part of Salesforce as you know, Stewart Butterfield was fond of saying, the co-founder, he’s no longer there, but if we could meet in person but the technology wasn't there, we would not have done nearly as well as not being able to meet in person and having Slack, Microsoft Teams, Zoom all of these new tools that have been evolving over the years. So yeah, we very much need employees and we'll see how generative AI changes that because that is certainly a countervailing force. But I don't necessarily think that it's a substitute, and many people say that in the future. Let's just say you're a lawyer, you won't be replaced by machines, you will be replaced by people who use machines. Right? Right.

Jeff Frick

And it's a popular theme that we hear over and over and I think is really valid, which is, you know, COVID, the accelerant to a bunch of things that were kind of underway that, just kind of ripped the Band-Aid off and forced the change that maybe would have happened over a period of time. I think you had Kate Lister on. I had her on as well. And I’m like, you know, you workplace professionals have been pounding the drum on this topic of flexibility and how it impacts employee happiness and engagement. Darren Murph is the greatest proponent of that, which results in better outputs. But, you know, the thing was moving at a snail's pace until suddenly COVID showed that it actually can be done. And just for clarity, you know, most know, 60% of the jobs, I think according to Eric Blum, (Brain freeze, Stanford’s Nick Bloom) can't be done remotely. So we're talking about a subset here, you know, generically. But, you know, it showed that it can be done and then it showed that, you know, the digital tools are pretty effective ways to get stuff done.

Phil Simon:

Oh, absolutely. And one of my favorite stats around the pandemic accelerating things is that in I want to say March of 2020, 18% of all commerce in the U.S. was electronic, Amazon, Walmart, dot com, whatever. A month later was 28%. And I think it was Vladimir Lenin who famously said, I'm probably the only person to quote a former Soviet leader on your podcast, but sometimes, I always screw this up. Weeks happened in decades, sometimes decades happen in weeks. And I think that's very much a case of it. I think McKinsey or one of the management think tanks said that we saw ten years of, and I hate the term ‘digital transformation,’ effectively happened in the span of three or four months. All the things that in theory, and I think (Nick) Bloom has written and spoken about this as well, that couldn't be done all of a sudden we figured out a way, right.  So I just don't see how that goes away. And I saw a stat on LinkedIn a couple of months ago that all things being equal and maybe they never are, people are willing to accept something like on average 8% less for the ability to occasionally work from home. So that's a big deal. I mean, as you know, we're not just talking about being able to save a few bucks on gas or tolls. We're talking about getting back. The average pre-pandemic American commute was 37 minutes. So if you get that back...Just twice a week, that's 168 minutes. Right, that's over two and a half hours that you could listen to music or go for walks or read, spend time with your family, do yoga, whatever you like to do. So there's been this qualitative shift, and I think that companies will find it'll be a sticky one. And if you look at getting to fractions for a moment when people say, ‘Oh, we need everyone back in the office’ or when it's time for them to renew their corporate leases, actions express priorities, to paraphrase Gandhi. So JPMorgan CEO Jamie Dimon famously was banging the drum for full return to the office for years. But in Manhattan, I believe that when he renewed Chase's real estate, he opted for something like 40% less. Don't quote me on that square footage, so there is a huge financial incentive for firms, not just in terms of office space, Jeff, but as you know, in terms of the talent pool. And I’d also argue that it's becoming table stakes. And you see this in the data. I took a very data-driven approach to this book, as I have with the last really bunch of books, but it was something like on LinkedIn, fifty (50%), five zero percent. I'm sorry, 15% of the job openings are remote, but those openings receive fifty (50%), five oh, percent of the applicants. So employees are very much speaking their minds here and voting with their feet.

Jeff Frick

Yeah. It’s interesting, so that takes us kind of into number two, which you talk about is physical dispersion, and we'll just kind of mix around and jump around. But the remote work and what is your line? The war over where work gets done is over. Get over it. And what’s wired right. We've seen offshoring. We've seen outsourcing. I had an older uncle that used to be a Southwest rep. He worked out of his bedroom 20 years ago booking Southwest flights. You know, they put in an ISDN line into his house, and he never had to go to work to actually work the phone. So we've seen it. It's just kind of it wasn't this acceptance. And I think what it really brings up is an interesting thing looking down the road. And again, when I asked Nick (Bloom) straight up, because it's a hard question, how it's going to drive the change in pay for skills versus pay for geo (location-based pay). And he had a really great example. He's running an executive business thing at Stanford and some employee moved from the high-rent district to this low-rent district. And somebody else found out about it and was pissed because they were getting paid for living in an expensive place. They didn't live in an expensive place. So, you know, it will take time. But it's interesting, slowly evening out. There was another guy who talked about hiring a super brilliant engineer in like Belarus. You know, the day before he hired the guy in Belarus, the market for this talent was defined by the area in which he was potentially employable, which was small. The day after he gets a job working for this guy, suddenly now the market for his services is now expanded. And so the available money and pay rates changed almost instantaneously.

Phil Simon

It's fascinating to me, Jeff, I remember back when I was in grad school a million years ago...Took a course in labor economics, and we covered compensating wage differentials, which is a fancy way of saying for the listeners that if you work in a certain area, let's say Manhattan, it's more expensive, and as a result, you may make more if you're a programmer, say, than if you live in Iowa. Another factor, and it's not just location, might be danger. So a police officer or a firefighter or a coal miner could die on the job. That's probably not going to happen if you're a programmer, although if you write some bad code, maybe your boss will be ticked off, and that's a different discussion, but. Yeah, we've seen with COVID certain companies effectively eschewing economic orthodoxy. Zillow is a great example. They want to say two years ago announced on their website and they changed their corporate policies. Their Chief People Officer had written a LinkedIn post about it, about how they were introducing what they called location-independent pay. So it doesn't matter if you live on the moon or Timbuktu or Manhattan. We value the job at X, and that is an enormous change. And in fact, in some cases, it might be worth it for an employee who has to work a couple of days a week on-site or a couple of days a month to get on a plane to drive 200 miles. And you're still coming out ahead because you're not paying five grand a month for an apartment in Manhattan. And yet that commute 2 hours every day sucked five days a week. So maybe you put up with it. But what if you only have to put up with it one day a week? So that is it. When I wrote this book, Jeff, I was amazed at the level of interplay between and among the different forces. I mean, there are so many ways these things can collide. I didn't want to put in a nine by nine chart because I thought that might be a little too cliche and forced, but. Yeah, to me, Dispersion and Employee Empowerment are the first two because they're very much they're inextricably linked. And it was a little tough to separate the two, but you could argue that they're all fruit from the same tree.

Jeff Frick

Yeah, well, all these things are super interspersed, which makes it interesting. But I want to shift gears a little bit because I think one of the trends and I don't know where I'd put it, probably under your unhealthy analytics that COVID exposed was just really bad management practices. And I think one of the bigger things that kind of dovetails to what we were talking about is that kind of managing inputs versus managing outputs, and managing inputs is management by walking around. It's management by seeing if people are showing up, do they have Excel on their computer when you walk by, or are they shopping on Amazon versus measuring outputs? And I had a great interview with Marten Mickos years ago who was at MySQL years ago. He's now at HackerOne and he talked about, you know, when you work at home, you're only, you know, your only evidence of your work is what you do. It's the output. So it's, you know, I think a lot of the pushback was because the middle managers actually weren't getting the support from the senior managers. They kind of have a clear definition of what the objectives were. And then taking the time to make sure that the individual people knew how their contributions, you know, impacted kind of the greater mission.  And I think, you know, they need the training, they need the help. Their bosses didn't have to manage this way. But I think it really exposed, a lot of bad management. And to your 'bad analytics' think, you know, people are measuring the wrong thing. You were in HR. That once a year HR, you know, sit down review is the stupidest thing in the history of time.

Phil Simon

Yeah, there's a lot to unpack there. But Rani Molla of Vox wrote a piece a couple of months ago, came out after the book did. And it's titled something to the effect of Managers are obsessed with productivity, but they can't define it. (Your boss is obsessed with productivity without knowing what it means) I feel that's very true, because there is very much a power struggle with this LinkedIn, I'm sorry SHRM - Society for Human Resources Management about a year and a half into COVID, ran a survey, and it was something like 72% of managers wanted everyone back in the office. And I'd argue that a big part of that is that they can see employees work, which absolutely gets into trust and what are we doing here? One of my favorite pieces of the new book references Goodhart’s Law and effectively that the minute that you say that you're measuring something. It ceases to become an effective measure. The classic example would be going back to the Soviet Union. Nails. If you say we really need people to produce a lot of nails, All right, fine. You get lots of these little tiny nails that if you were hit with a hammer, would just break. No, no, we don't do that. We need big nails. All right, fine. We'll create nails the size of a home, which, of course, aren't very practical, but who's going to hammer them? So to quote, Mark Twain. 'There are lies, damn lies, and statistics.' And I'm not anti-data, as I make the point in the book. I've written a bunch of books about analytics and big data and data visualization, but it isn't hard to gauge. I'm sorry to manipulate the ratings or the gauges. So when Howard Schultz says we've got the badge data to prove who comes into the office, Fine, I'm in the office. Does that mean that I'm productive? In fact, you can make the argument that people might be so ticked about having to come into the office just to be on Zoom calls because the manager doesn't trust them or to code or whatever that they're going to be less productive and in fact even a little angry. And in fact, just the time commuting to and from work, yes, you can take out your phone or laptop or iPad or whatever and be somewhat productive. But yeah, it's not as simple. And hybrid work, as Brian Elliott pointed out, is harder because of proximity bias. It is easy for me to see Jeff and go, 'Oh, Jeff must be doing a great job' because he's in the office five days a week. In reality, that's not true. You may not see Ryan and he's only coming in once a month, but he's really hauling ass. So it's very difficult to solve this problem. But the way I look at it and I make this point at the end of the book, these forces are here. They're not going anywhere. So you got a bunch of options. But I don't see how ignoring them or trying to make work great again and go all Elon Musk is really a viable strategy for most managers.

Jeff Frick

Yeah, well, it's interesting. There's the whole chapter on unhealthy analytics. I also grabbed the, you know, ‘How to Lie with Statistics’ was written by Darrell Huff in 1954. : I had to look it up, it's about how you take the data, how you manipulate the data and what is the story that you're trying to tell and the narrative that you're trying to tell.  And unfortunately, a lot of people will find the data, find the statistics, present the data that's supporting their point of view.

Phil Simon

Or Ronald Coase famously said, ‘If you torture the data long enough, it will confess.’ I love that quote because I can absolutely tweak it. And I'm pretty good with data visualization tools and analytics. But it's not difficult to tell the story that people aren't productive at home if that's what your goal would be because you would ignore all the outliers and treat your numbers. So, you know, it's very when I hear the ROI statistics, I just roll my eyes because, come on, what are the odds you could say if we let people work from home and they were 27.2% more productive? I mean, come on, take that with some salt, but I'm not anti-data. I just think that it's important to look at our numbers and make sure that they make sense.

Jeff Frick

And I think we have a real problem to your Goodhart’s Law. I didn't know the name of the law. I kind of knew I knew the law. I didn't know the name. My favorite example is the NFL combine. A little bit more recent. They spend all this time timing how fast people are on the 40 (yard dash) and yet that's not what you're hiring them to do. You're hiring them to play football. So, you know, you take somebody like we've got right here in San Francisco. Brock Purdy, played four years as a starter.

Phil Simon

Mr. Irrelevant.

Jeff Frick

You got four years of tape and yet you're making your judgment based on how tall he is or how big his hands are or whatever. It's almost like to me, actually, I think there's a kind of an ugly underbelly. Is it just to drive gambling in Vegas or, you know, what is really the objective?  Is the objective to win a football game? Well, then why wouldn't you judge how well somebody plays a football game in as close a representation as you can see, which is replicating the behavior that you're hoping that they're going to be good at. And you see it over and over and over again?

Phil Simon

Yeah, it's fascinating to me, and I'm not a huge football fan. But what did the Niners give up two firsts and a third for Trey Lance? (actually 3 firsts and 1 third round NFL draft pick)

Jeff Frick

So here's a good question for you. Would you consider the draft a success or failure?

Phil Simon

Yes.

Jeff Frick

And do you measure it in its totality or do you measure it in the big strike and a miss, or do you measure it in the lucky grab at the back? Or was it really luck? So, I mean, there's all kinds of ways to slice and dice it.

Phil Simon

It just goes to show how difficult it is to gauge employee performance, and yeah, it could be JaMarcus Russell. It could be in the NBA Kwame Brown, I mean, there. Darko Miličić got drafted by the I think it was the Detroit Pistons. And we think was out of the league in four or five years. And then you've got players like (Nikola) Jokić who won the MVP two of the last three years and won the (NBA) title for the Denver Nuggets. I think he was the 45th or 47th person drafted. And if you look at the people. Draymond Green got drafted 35th and he plays for the Golden State Warriors and this is amazing to me. He can name that top the 30. The 34 people drafted ahead of him in order. So don't tell me that doesn't motivate him. And if we can't measure performance accurately in a draft or even in the real game in some instances because Draymond's stats aren't great, but I think he's a first ballot Hall of Famer with four championship rings. What does that say for your head of product or your head of customer experience or programming? So yeah, it's tough in sports, and I'd argue that sports lends itself to quantification in a more and a purer way maybe than a lot of white or blue collar jobs. I can remember in my days at Sony Electronics out of college, and there were folks who would game the system I was a call center rep, and some people would figure out ways to transfer calls and they were on the phone all day, but they really weren't taking that many calls. So, yeah, the analytics thing underlies everything because there are so many changes and we want to say, look to the data as if the data is this ultimate in objective representation of reality. But as you know, that it sometimes isn't the case.

Jeff Frick

Before you started writing, you were in HR (Human Resources). You were at bunch a couple different (firms), and you mentioned that you know, big companies and HR roles working on compensation plans and this, that and the other. And it seems like HR is finally making a little bit of a shift and not treating people like a piece of steel or a car that something is easy to measure, you know, kind of what you get and what you're going to get out. And I love this kind of concept we’re seeing more and more, which is, create the environment in which people can be successful. Because I think another big piece of this is, you called it out specifically or am I missed it is, you know, kind of the shortened duration of a big company's time on the Fortune 500 as a proxy for the rate of change. And I had a guy on from Accenture one time (Michael Biltz: Vision, Future, Change | Turn the Lens) and he's like you know, it used to be find something successful then efficiency the crap out of it so that you sold more and you made a lot of money. Now, with the dynamic world in which we live, it's more about flexibility than efficiency over some long period of time because that particular product may or may not be in demand tomorrow and the hottest thing that you're not even into you might need to get into tomorrow. And that's a direct result of innovation which is driven by risk taking. So it's a very different kind of set up in the way you treat people because they're people, they're messy and sloppy and not logical and emotional. There's a lot of stuff going on in people's lives.

Phil Simon

Yeah, again, a lot to unpack there. But I'd argue that HR really has an opportunity to step up to the plate. And I've been hearing for the last 25, 30 years that HR needs to be a strategic partner. Well, to the extent that getting back to our point about employee empowerment and fraction and dispersion, if people can work pretty much anywhere without uprooting their families, selling their homes, finding new schools for their children, why are we staying at a company? And a lot of times the data indicates that it's because of a relationship with the manager. But if the manager is a hard ass about having you in the office five days a week, it's only a matter of time before people will walk whether the Great Recession has ended or not. Yeah, we've seen so many changes taking place that I like to think I've written a good book, but in two years I might look back and go, "What the hell was I thinking?"

Jeff Frick

No, no, it's a lot of moving parts. I like it. Let's talk about number seven, which you talk about immersive technologies, VR and AR, and I want to expand it a little bit beyond just those to more kind of digital and the concept of what digital has enabled. So there's digital platforms, which you talk about some with Slack or whatever, you know, and kind of moving work to digital platforms, which then opens up the ability to do it from everywhere. I mean, people forget you had to go to the office because that's where the paper was, that's where the printer was, that's where your phone was, that's where the fax was. You know, there’s always the funny picture that people show of all the things on the desk that gets sucked up into the phone. That's really true. They all got sucked up to the phone. And as soon as I think really Salesforce is the one who deserves the credit to have an enterprise-based cloud application that's touching revenue and to have that on a trusted third-party cloud that now you're actually going to put your revenue in that to kind of open up the, "Oh my goodness" you know, I can really get access to this, but there's a whole another future coming. You talked about, you know, there's holograms and there's augmented reality and there's all these new ways, you know, to go to the extreme, whether it's the metaverse or virtual environments. But you know, something as simple as a heads-up display or, you know, some of these digital tools that people can use in the fields, whether they're doing technical service or technicians, there's so much opportunity in this whole digitization of work and many work processes.

Phil Simon

Yeah, again, there's a lot in that. You think about VR and AR and immediately you think about gaming, and when I was putting the finishing touches on the book, I pretty much had confirmation I think it was Mark Gurman from Bloomberg Businessweek said Apple is finally launching the Vision Pro. And as a general rule, even though I think it's $3,500 and not a lot of people will be buying it, we all know it's going to get more powerful and less expensive. So I found two examples of companies that were actually using VR, AR, what I'll just call immersive technologies, Walmart and Accenture. And I like those examples, Jeff, because one is very much a blue-collar organization. I would imagine that the median Walmart employee makes minimum wage or close to it, give or take, and Accenture, I would imagine very few employees make minimum wage because it's the ultimate in white-collar work. And in both cases, the companies have made significant investments to bring immersive tech to the workplace, both in terms of training and on the basis of that, other things down the road. I just read recently not to get off the subject into generative AI, but Walmart is also investing a boatload of cash to create a standalone internal AI tool because they don't necessarily want employees putting data out into ChatGPT and then using that to train other models. Proprietary information. So yeah, I think, Starting to cross the chasm. And that doesn't mean that everything can be done in a metaverse or some sort of VR type environment. But I do think that, and I've been hearing about this, I think 'The Lawnmower Man' (Columbia Tri-Star 1992) came out when I was 15 years old with Jeff Fahey, and I read the Stephen King book. The movie right now looks incredibly cheesy because the tech is so old, but I've been hearing about VR for pretty much my entire adult life, and I think that it is finally arrived in earnest the same way that AI's been around for a long time. But basically things got real when you could go to ChatGPT as of November of last year and start creating your own Seinfeld scripts and poems and all sorts of other stuff.

Jeff Frick

I can’t believe, we’re however long we’re into this interview and you have yet to drop a Seinfeld clip. So I'm a little disappointed in myself that I have not that I have not triggered a Seinfeld quote.

Phil Simon

I'm contractually obligated to drop one Breaking Bad and one Seinfeld reference per interview.

Jeff Frick

Exactly. So let's dig into the generative AI. I think there's a couple of things that I think are maybe less talked about. One is kind of where it is today and where it's going to be tomorrow. And I think we always have to be really cognizant when we talk about technology and the law you didn't put in the book that's my favorite is Amara’s law, which I'm sure you've quoted, which is, you know, we underestimate or we overestimate the impact in the short term and we underestimate the impact in the long term. Often, I think, gets confused with Gartner's hype cycles, so even though I think there's some issues with it today and the accuracy still there has some room for improvement, etc., you can clearly see where it's going. And the other thing I forget, one of the OpenAI guys I saw in an interview talked about the horsepower increase over just the last like four years and it's like 50,000x, whatever the number is, I’m making up a number. It's big. It's a big, big number. And to me it's kind of like exponential curves in your face, like this big splash of, all these models are old models. They've had the models for a long time. They just didn't have the horsepower or the data sets (or Transformer architecture) to drive them to the level that they're getting the output now. And if you listen to Mira Murati, hopefully I'm not mispronouncing her name, the CTO there, you know, she does this interview with Reed Hastings (actually that was Reed Hoffman, oops) and she's like, we just keep feeding it more stuff. And it just keeps ingesting it. So to me, it's like a real kind of in-your-face moment for the accelerating curves of exponential growth of computing horsepower, which is kind of under the covers. But this is kind of in your face.

Phil Simon

Yeah, you probably saw that Reed Hastings received early access to Chat GPT-4, and I want to say five or six months ago, maybe not quite that long. He actually wrote a book and named Chat GPT-4 as a co-author. ('Impromptu' by Reid Hoffman and Chat GPT-4) And now Amazon has basically limited the number of books that people using its self-published tool can publish per day at three. That's crazy to me. I write about as fast as anybody I know, and if I really haul ass, I can get a book done in 4 to 5 months. The idea that I can do three in a day is obscene to me, and we both know that if they put that as a limit, there were probably people who were doing 300 a day, never mind whether they were accurate or good books or laid out properly. So there's a lot of noise there. But yeah, the OpenAI thing could be a very, very long book in and of itself. I think last time I checked there were 30 or 40,000 books on Generative AI on Amazon, and I'm sure most of them have dropped in the last year or so. But yeah, who knows what will happen? And it used to be QWERTY-based, but I think last week on GPT-4, didn't they announce a voice prompt so you can talk to it? And it’s also multi-modal. Yeah, now it's also multi-modal, which is a fancy way of saying it isn't just a text query, it can be a CSV file, it could be a JPEG, it could be a PDF, it could be code. What's wrong with my code? So yeah, where we're going, I don't know, but I thought it was important in that particular chapter to lay out some of the limitations, whether they're legal or based on veracity or transparency. I mean, if I hired you to do a job for me and you didn't do it right, I might say, Jeff, what happened here? Was I unclear, did you drop the ball? Let's have a discussion. There's accountability. You can't necessarily ask ChatGPT or Google Bard and Claude Anthropic, "Why did you do this?" Because in some cases they don't even know, because they're dealing with an insane amount of data. And when a lot of people think data going back to your earlier point, they think structured query language, SQL. Well, I am absolutely not an expert on the technical underpinnings of these large language models, but they are not using relational databases, they're using vector databases, and it's just not a mature technology yet.

Jeff Frick

Which gets into the whole thing about explainable AI and, you know, and being able to unpack these algorithms. Don’t know if you've seen the White House document on explainable AI (Blueprint for an AI Bill of Rights, The White House), you know, they're trying to get to the root of this. You know, can you unpack it to find out how it got to the answer? And as you know, that's virtually impossible, right?  Because the data and the models, not only are they giant and complicated, but they're changing all the time.

Phil Simon

Yeah, I read I think it was Mark Bergen's book on YouTube, 'Like, Comment and Subscribe'. And he was explaining the rise of YouTube and how there were times in which the algorithm would spit out... Things around hate speech or around election deniability. And so why is it doing this? They said, we don't know. We really have to look into it. New York Times had a piece four or five years ago about how YouTube was recommending increasing risqué videos of teenage girls to people. And there was outrage, justifiably so. I said, Well, who told the algorithm to do that? That was the wrong question.  The better question was, "Why didn’t someone tell it not to do that?" Because YouTube's business model is basically ad-based. I do subscribe to whatever it is, YouTube Plus, so I don't have the commercials for $20 bucks a month, but most people don't. So how do they keep you engaged? Well, they're going to serve ads. How do they serve ads or serve you more relevant content? Whether that content is objectionable to you isn't necessarily the primary concern. So, I mean, it's not nearly as sophisticated as some of the things that I've seen Bard and ChatGPT do. But make no mistake, an algorithm is absolutely AI because you're having a machine do something that a person would do. Go back 30 years if you and I were sitting at a concert, and let's say we're going to see U2, what other bands do you like? Well, you're asking me for a recommendation, right, versus having a machine. When you type in a query, say, "All right, let me think you'd like this." Or because you like U2, you might like Coldplay or Muse or something like that. So yeah, there's a lot to unpack with this stuff. And I wanted to put Generative AI in the context of these other forces, particularly with respect to blockchain, because when people can generate deepfakes like that and they're very difficult to predict, how do we prevent chaos from ensuing?

Jeff Frick

Deepfakes scare the death out of me and the law of unintended consequences.You know, we learned from 'The Social Dilemma' (Netflix), great movie, to kind of follow up on what you said. It just so happens that the best way to get more clicks is to send this stuff that's not necessarily good and doesn't necessarily make people feel better about themselves. And yet, you know, if you tweak the algorithm for a different output, you could tweak it, but you might not get... Right.

Phil Simon

But I would argue that there is a place for them. But where do you draw the line and going to find different adoption curves depending on the maturity of the workforce, the type of industry, legislation, different countries, cultures, so... This could have been a thousand-page book, but I try to distill it into something readable for the busy and intelligent reader who just wanted a high-level overview of these forces. Because I have read books about all of these things and... You know, you can really get into the weeds. But I think Pew said something like 43% of Americans don't read a single book in a year. So the odds that they're going to read ten books or whatever on one force, never mind nine, are pretty remote. So hopefully this is a decent summary to let people know where we are and, more important, where we're going.

Jeff Frick

Well, let's touch on one more kind of controversial one on that, which I think has to do a lot with, you know, kind of a chain of possession, if you will, to steal from the legal argument. And that's your number six on 'Blockchain' and trust and distributed ledger. And fortunately or unfortunately, you know, blockchain is intertwined with Bitcoin and cyber currencies. I was talking to someone who is a huge proponent of Web 3.0 and cyber currencies, and I'm like, well, how come they're getting stolen all the time for being so locked down and secure? How come I keep reading about, you know, getting stolen all the time? He’s like there are criminals, there are shysters, like there are in any business.  But it is a really interesting thing to think about, and especially like you as an author or anyone who's a creator in terms of ultimately defining, you know, where did this come from? And, you know, is there a chain of possession or command, and where is it really? Where does it really stop, or end, I mean, another great quote, since we're just ripping them all off, is, you know, good artists copy, great artists steal, you know, so where are the lines? And I think it's a really it's a really interesting, again, challenge. And you know I think it's the clouding because of the bitcoin is not helping the cause at all.

Speaker 1: Right, and many people mistakenly conflate Bitcoin with blockchain and Satoshi Nakamoto’s 2008 whitepaper actually does not mention the term blockchain. But he, or they, or she, we don't know who.

Jeff Frick

Which is ironic that person that wrote the paper on identity doesn't have an identity that we all know.

Phil Simon

That’s very Meta, Yes 100%.

Jeff Frick

And you opened your blockchain chapter with the story on Bitcoin which I also thought was another kind of twist on a twist.

Phil Simon

Yeah, it's easy to conflate the two, but, I... We could talk for hours about digital currencies. I actually just finished ghostwriting a book on that subject, but... Keeping it on blockchain for a minute... Solving the double spend problem is just one of its uses. So there has been digital currencies for a long time, but if I give you a physical dollar bill, I'll lose a bet to you.  You are now in possession of that. You can’t recreate it, at least legally, right? If you had a high-tech color photocopy or something. But let's leave that aside.  Blockchain you can use for many different things. In the book, I give the example of a company called DocHub. It's a competitor of DocuSign  So if you and I engage in an agreement and I send you a PDF, you can go into any number of tools like PDFpen or Adobe Reader. I'm sure you can find my signature online and create a signed document. Is it real? Is it legal? No, it is not. It's a forgery. So with DocHub you can actually see this ledger if you use the software. And it’ll say that Jeff received this email on October 13th at 10:49 a.m.. He opened it up using his PC at this IP address. He viewed the document. He inserted his signature, he sent it to me, etc., etc. That is an unalterable chain. That's a lot different than mocking up a PDF or creating a deepfake, so Will it solve all the problems associated with deepfakes? Absolutely not. But in a world of Generative AI, in a world of dispersed workforces, it can prove providence. You actually did write that code and I didn't have to install employee surveillance software in order to prove that, so there are all sorts of other ones in it. To me, with blockchain, it is insane to me that if I go to a new dentist or doctor that I have to fill out a form.  There should be a blockchain of every doctor's appointment, dental appointment, eye appointment, anything medical that I've ever done. and I should be able to basically check boxes and say, "Yes, Jeff, I will give ‘Dr. Jeff’ access to these things, but you don't need to know my annual income because how does that relate to whatever?" So there are all sorts of applications for blockchain that I think people don't understand because it's been conflated with crypto.

Jeff Frick

I'm going to jump ahead to chapter ten. I'm going to give some of the suggestions that you give on what you can do about this. Number one, ignore reality Two, turn back the clock. That's always been a real successful strategy I hear the Luddites are taking recruiting people get partially pregnant into one of these things, which we know, that doesn't usually work out so well. Scale back or tap out, or number six, steer into the skid.  Well, clearly there's not a lot of steering into the skid in Phoenix, Arizona. So you must have grown up in some snowy climes at some point in time.

Phil Simon

I’m a Jersey Boy

Jeff Frick

There you go. You know, you don't really have a choice. You've got to lean in, especially if you're in a leadership position, and the other thing to me that I think is really illustrative of the difficulty of someone who's a little bit older, leaning into this digital phenomenon is online dating. And I saw this great, great study that prior to 1984, whenever the Internet kind of happened, you know, they listed all the ways that people meet their spouse online dating wasn't on the list. friends, church, work, bars, whatever. I think the original thing came out in 2019 or 2017, and it was like online dating was like 38% or whatever. I sent the guy a note. Please send me the update. It's now over 50%. Over 50% of married couples heterosexual, in the U.S.

Phil Simon

I heard it was higher than that. But okay, well, even if well, whatever.

Jeff Frick

But it's more than 50% of something that didn't exist when I was in, you know, the market looking for my better half, so It's not hard to understand why people don't get it when it's something that literally didn't exist. So to understand the intimacy of relationships, to understand the power of a digital communication and digital platform when it just didn't exist when you're going through certain parts of your career, it's not too. It's not hard to see why it's so hard to gronk for some of these people.

Phil Simon

Yeah, there are a lot of second-order effects that in hindsight might be obvious, but at the time, who knows? One of my favorite examples back in 2013 or so the iPhone and smartphones had been out for about six, seven years. And I spoke or I'm sorry, attended a conference in Vegas where I lived. And I had to write an article for either Wired or Huffington Post. And it was a conference, and I just didn't find it all that interesting. And finally, around 1 p.m., someone said something that had this light bulb go off, and the stat was something to the effect of in supermarkets, candy and gum sales were down something like 80%. Well why?

Well because when you and I grew up, if you were in line, you were just sitting there bored and you go, "What the hell? I'll buy a pack of Wrigley's or a Kit-Kat or whatever." Well, now when you're in line, you don't look at the sweets, you take out your phone and you're playing Scrabble or on the gram or whatever the kids are doing these days or TikTok. So yeah, there are a lot of these second-order effects and that's why I don't think you can pretend that these forces haven't arrived in earnest. In my opinion, the only question is what are you going to do about them? And if you are 58 years old and you've done well for yourself and you want to retire early, go for it. I'll be the first to admit that managing all these changes, even four or five of them, won't be easy. Never mind all nine. Trying to pretend, though, that they're just going to go away to me isn't a viable strategy. So yeah, I would argue that for most folks, the only option across the board is to steer into the skid and assume that these things are going to happen. How can you take advantage of them? Does that mean that you completely rewrite the rules of your business tomorrow? Probably not. But if your five-year plan involves a lot of stasis, I don't think your company is going to be around that much longer.

Jeff Frick

Well, we're getting to the end of our time. And I wanted to close on a little bit of a shift. And that's you as an author. And we talked about it a little bit at the beginning. But you've been in it. You've been in the author business for 20 plus years. You've written over 14 books. And I'm just curious to get your take. You mentioned earlier that, you know, people aren't reading as many books. You're writing about kind of trendy stuff and long-term stuff. They're business books. So and there's this whole element that we've talked offline before we turned on record about, you know, there's the writing, the words, and the research. And all the fun stuff about books. And then there's the business side of the business and the hustle side of the business. And now you've got to worry about, you know, somebody who's really good at ChatGPT prompts. You know, putting out four new books a day, three new books a day on Amazon. So I wonder if you could just reflect on, you know, what it's like to be an author. Because the other the good news is, you've got potentially access to reach out and touch anyone in the world, which maybe you couldn't. And also, I'm curious, your relationship with your audience and your fans and your readers and how that's evolved over time. I just had a post I put up yesterday with John Fortt from CNBC.: And I think that's a really interesting thing in his world, even though he works for this huge network broadcaster, you know, he created this kind of side Internet media so that he could go longer form and do stuff he was interested in. He could have a little bit more direct relationship with his audience and not be kind of bound by the traditional limitations that the media that he grew up in, you know, kind of bound him with.

Phil Simon

Yeah, that sounds a little bit like Mark Stein. He used to work for The New York Times and ESPN about three years ago. He started a Substack (The Stein Line - https://marcstein.substack.com/) and he covers the National Basketball Association. And some months during trade season, as a big basketball fan, I'll spend. Whatever it is, $8 eight bucks a month to get his Substack, but he can take that with him if he moves from Substack to a competitor. And this is very much imbued in this ethos of Web3. You own it. It's less centralized, right? If you were to in some instances there's vendor lock-in. So if you're talking before about Salesforce, I guarantee you there's no magic button to hit and all of a sudden you go from Salesforce to HubSpot or Salesforce to Oracle or a different CRM. So yeah, with respect to writing books and building an audience, it's really challenging because there's just so much content out there. I remember in 2012 when I was putting the finishing touches on my book on Big Data, I was just amazed, there was a stat from, I don't know if it was Bill Schmarzo or the guy who wrote the big book on Big Data or something. But the stat was something like the average person today, and this is 2012-2013, is exposed to more information in a single day than someone in I think it was the 15th century was in his or her entire lifetime. That blows my mind.: So on one hand, there's this dichotomy. You can absolutely reach anyone. And I see my stats on my website, someone, you know, fifteen people from Belarus looked at me one day and checked out my stuff. It's amazing to me to reach that. But then I'm not special. Anybody can. So if there's a strategy, I try to put out good content as quickly as possible. Quick story. Back in 2010, I had an agent, and I was working on that book about platforms Amazon, Apple, Facebook, Google. My agent was able to procure an offer from a small publisher in Boston, and they said they love the idea. They want to do your book. My first question was great, when's the pub date? They said, I don't know. Probably 18 months. I said, deal breaker, can't do it. I'm not that smart. Other people are talking about Amazon, Apple, Facebook, and Google. And as far as I know, there isn't a book out there on them. And now there are hundreds of books about them. One of my favorites is "The Four" by Scott Galloway, Prof G. Excellent book. So my agent wasn't thrilled with me when I said no, and we had a falling out.

But I tend to have a bias toward action. If I'm not mistaken, at the front, on the front of my website, it reads, and I'm a big fan of quotes, as you already know, what I think is mine. The costs of inaction typically exceed the costs of action. So when people are looking for absolute certainty, to your point before about disruption and good luck with that. I mean, in hindsight, right, you might say, the iPhone, of course. Well, Steve Ballmer, right, famously said this thing is going to be a dud. No one is going to pay $800 for it. And I want to say that they've sold it's over, I think, a billion iPhones. You can make the argument that it's the most successful product ever. It's basically selling at the volume of a Toyota with the profit margins of a Lexus that typically is difficult to do.  So I tend to have a bias for action. And again, I could fall flat on my face. And in a year inflation could be 2% and employees are back to the office. Monday through Friday, 9 to 5, and blockchain is dead. And Generative AI was just this overhyped thing like 3D printers or 4K TVs. I don't think that's the case, but to quote Tin Cup the golf movie, "Greatness courts failure." So if you're not willing to fail as an author, you know, what are you doing? Is someone going to read a book that's just fine? When they could find the same content either on a blog post or through ChatGPT or a Substack or something like that. Or do you really want to challenge and provoke your readers?  My favorite movies, TV shows, musicians all push themselves. Nothing against an Iron Maiden or an AC/DC, but they tend to put out the same album over and over again. You know, my favorite bands like Rush and Marillion, Steven Wilson, are constantly switching things up. You know, Radiohead. I don't like a lot of their music, but I appreciate the fact that they weren't just producing the same album over and over again, so that actually hurts me, though. I think Jeff, from a branding point of view, because if I were David Allen ‘Getting Things Done’ and known as a productivity guru and all my books were about productivity, people would know what to expect from a Phil Simon book. Because I branched off into some different areas that might make me a little bit harder to pin down, but I guess I'm willing. The fleas come with the dog.

Jeff Frick

Well, the fact that you led with Rush just changed the whole attitude about you. So now, now I got to come down, we got to hang out, we got to listen to some together. And like you, I like to challenge the algorithm. I mean, all the algorithms say stick to one topic, stick to one topic, be, but you know, life is too interesting.There's way too much interesting stuff going on. And this is a very dynamic world and all that information is out there. If you're willing to go check it out and dig in.

Phil Simon

Yeah, I mean, Jeff - Do a little investment. I mean, how boring would that be to just have just one book, you know, for good things? I get it, right? If Jason Statham is the heavy and in every movie, he just kicks everyone's ass. I get it, right, and I'm not begrudging that. But my favorite actor, Bryan Cranston, after Malcolm in the Middle, played a meth kingpin in Breaking Bad, right? I saw him on Broadway playing Lyndon B. Johnson. He's willing to zig when other people zag. But there are also happy accidents. If I didn't write "The Nine" and just wrote more and more books about consulting projects, maybe we don't meet, so I guess that I try to steer into the skid myself. And it can be frustrating because you put out what you think is a very good book, and you're not selling as much, and it's a first-world problem. But I try to play the long game and I really do enjoy the process, and it leads to connections. It leads to passive income, foreign translations, potentially. These are all things that aren't necessarily guaranteed. So I understand that it's not the life for everyone, but I, I, you know, I, I just enjoy it too much. There's something to me magical about books. And if I think about how I've probably read 300 or 400 business books, they've really informed my thinking. I don't always disagree with the author, don't always agree with the author, but I don't mind that either. I'd rather someone challenges my thinking rather than my just leafing through a book. Oh yeah. I know that. I know that. I know that. You know, I don't. I don't mind it when someone throws me a curveball. So Yeah.

Jeff Frick

Great. Well, we'll leave it there, Phil. It's been really a treat to catch up. It's a great book because these are all super important topics and like you said, each one could easily, easily be, I don't know, 300 pages. And I don't, I don't write books. I don't know what the effort is to write a 300-page book, but these are all huge important topics. So I think you've actually done a pretty good job for people that need to know a little bit and not necessarily, you know, deciding which of the vectors they want to dig deeper into. But this will give you a good overview, and then you can figure out where you want to go down to the next level of granularity. So good job.

Phil Simon

Thanks, Jeff. Thank you for having me on. I enjoyed it.

Jeff Frick

All right, with that, we will wrap it up. So he's Phil, I'm Jeff. You're watching Turn the Lens with Jeff Frick. Thanks for watching. Thanks for listening on the podcast. See you next time. Take care.

Cold Close

Thank you for having me on. It'd be great to grab a beer with you. You and I could talk for hours about this stuff.

Love to connect sometime.

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