Enterprise hits and misses - a week full of hallucinations, earnings, acquisitions and more

Brian Sommer Profile picture for user brianssommer March 4, 2024
Summary:
NVIDIA stock is on fire. Workday makes an acquisition. Surge pricing is not loved. Benioff gets quote of the week. It was a wild week indeed. Here are the hits, misses and whiffs of the last week of February.

loser-and-winner

Jon's under the weather this week, so I'm picking up the reins. In we go...

Lead story - Diminishing DEI - the big mistake that some tech firms are making and storing up talent problems for the future

Amidst all of the layoffs in the tech sector recently, Madeline noticed that DEI programs (Diversity, Equity & Inclusion) are getting hammered. She noted:

When it comes to DEI spending, 90% of firms plan to spend the same or more this year compared to 2023, while only six percent are going to decrease DEI outlay. Similarly, 91% of firms intend to hire the same or more staff as part of DEI-focused recruitment, while only five percent plan to decrease the number of DEI hires.  The report also reveals that 76% of IT employees consider DEI as important when considering a new job.

She’s absolutely right about this and the point about DEI being important to jobseekers is spot-on. DEI factors into a firm’s employment branding and it is more important than some of the firms in this piece realize. 

Madeline also noted this from a TEKsystems executive:

Internally, de-emphasizing DEI initiatives will signal that it was self-serving, virtue signaling or performative. This may lead to dis-satisfaction, which will lead to dis-engagement among employees, who value a diverse and inclusive workplace.

Madeline also touches on the politics/optics that accompany some discussions re: DEI. The politics are harmful and mean-spirited. One IT analyst I know makes even a discussion about the weather into some kind of ‘woke, virtue signaling’ conspiracy. The same TEKsystems executive noted:

Anti-DEI sentiment is altogether different. It is not the same as having to reduce staff. The anti-DEI sentiment we’re seeing unfortunately has to do solely with the racial, ethnic and gender aspects of DEI and none of the others, which are just as important.

Conversations about DEI can be uncomfortable but they’re necessary. 

diginomica picks - my top stories on diginomica this week

In an event that may complicate Sam Altman’s $7 trillion plan to corner the AI chip market, NVIDIA’s market cap just eclipsed $2 trillion. This 5,500 % rise since 2022 was buoyed by incredible earnings growth and the white-hot market for AI.

Many suggest this rapid growth may soon dwindle owing to increased AI chip competition from Intel, AMD, cloud vendors, and chip startups. Others have commented on the business fundamentals and market psychology behind this, including sky-high margins and insatiable demand leading to a secondary market. 

Okay, I’d like some of that stock, too!

  • And I pulled from numerous sources for another HR month in review. Return to Office is the editorial gift that just keeps on giving. HR month in review - February 2024. What’s missing in this HR world? Not enough empathetic leaders, little focus on employee experience, etc.

Vendor analysis, diginomica style. 

Best of the enterprise web

  • The vast majority of press regarding AI is either consumer-oriented or more limited to helping some process get completed. Not enough is being discussed about the role of AI in manufacturing. This McKinsey & Company piece notes that “machine intelligence technologies—AI that, rather than seeking to simulate human intelligence, empowers machines with the specialized intelligence needed to perform complex tasks in the cyber-physical world of production—are reaching unprecedented levels of maturity”.  The only question is how well would a machine handle an AI hallucination?
  • Apple Car: Apple's Now-Canceled Car Project: What We Know (macrumors.com) Oh, no, the vehicle I dreamed of is no more!!! And, I was hoping to get some of those new Michelin airless tires to go with it: How Michelin's Airless Tires Are Changing the Game (msn.com) . Seriously, this tire technology significantly reduces the number of tires discarded due to punctures, contributing to a smaller environmental footprint.”
  • Elon Musk sues OpenAI and CEO Sam Altman, claiming betrayal of its goal to benefit humanity (msn.com)In a lawsuit filed at San Francisco Superior Court, billionaire Musk said that when he bankrolled OpenAI's creation, he secured an agreement with Altman and Greg Brockman, the president, to keep the AI company as a nonprofit that would develop technology for the benefit of the public. 

“OpenAI, Inc. has been transformed into a closed-source de facto subsidiary of the largest technology company in the world: Microsoft,” the lawsuit filed Thursday says. “Under its new Board, it is not just developing but is actually refining an AGI to maximize profits for Microsoft, rather than for the benefit of humanity."”

  • Avast hit with $16.5 million fine for selling user data. This one really takes the cake. You would think that PC security software would protect its customers. Apparently, that’s not always the case: “In the complaint, the agency says Avast Limited, based in the United Kingdom and through its Czech subsidiary, claimed to block tracking cookies that collect data and prevent other trackers from following online activity only to then sell that data to third-parties, engaging in the behavior since at least 2014. Furthermore, the FTC says Avast told users it would only share information in “anonymous and aggregate form,” though this was not the case.”

Enterprise whiffs

Surging PR Problem – Wendy’s took a bruising last week and competitors cut it no slack either. CNN reported on the story but it was the marketing/PR aspect of this that caused a lot of brand damage: 

'Whoever called it surge pricing made the worst marketing mistake you can think of,' said Juan Castillo, assistant professor of economics at the University of Pennsylvania. 'Surge pricing sent the message to everybody that this is mostly about increasing prices. That created a very negative reaction from the public.'

What am I Looking At? – Everyone last week was pondering the ethnic diversity of generative AI tools. Even the Atlantic did a deep dive into the subject. Here’s a taste:

Is there a right way for Google’s generative AI to create fake images of Nazis? Apparently so, according to the company. Gemini, Google’s answer to ChatGPT, was shown last week to generate an absurd range of racially and gender-diverse German soldiers styled in Wehrmacht garb. It was, understandably, ridiculed for not generating any images of Nazis who were actually white. Prodded further, it seemed to actively resist generating images of white people altogether. The company ultimately apologized for “inaccuracies in some historical image generation depictions” and paused Gemini’s ability to generate images featuring people.

Or how about the day or so that gibberish was the order of the gen AI day? AFP reported:

ChatGPT was giving "peculiar" responses, generating non-existent words, incomplete sentences and general gobbledygook, developers using the tool said in a discussion forum on the OpenAI website.

'It gives me meaningless words followed by a bizarre list,' one developer lamented.

'It feels as if my GPT is haunted or something has been compromised, either on my end or at OpenAI's (end).'

I’m ‘haunted’ by the prospect of future gen AI bugs generating other kinds of problems for users and companies!  I think I’ll dress up as a gen AI tool for my Halloween costume (unless Jon’s already planning to do this)! 

Loading
A grey colored placeholder image