Friday, February 28, 2025
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Hi, it’s Chad. Every Friday, I serve as your AI guide to help you navigate a rapidly evolving landscape, discern signals from noise and transform cutting-edge insights into practical leadership wisdom. Here’s what you need to know:
1. Paper Trail: AI Research Decoded
The Rise of Generative AI in Business Decision Making
Recent research reveals how a new class of AI models is transforming business decision-making processes with implications for middle market organizations across industries. Key takeaways include:
- Generative models serve three distinct business functions (controller, modeler, optimizer), offering unprecedented flexibility for middle market organizations to address diverse decision challenges
- Recent technological advances have significantly reduced computational requirements, making these powerful tools accessible to organizations without massive IT resources
- Strategic implementation focusing on specific business outcomes will deliver the greatest value, particularly in areas characterized by complexity, uncertainty, or limited historical data
Read our full analysis of each of these research papers at AI for the C Suite
2. Sound Waves: Podcast Highlights
Our newest episode featuring Papi Menon from Outshift by Cisco drops this Monday, March 3, 2025. Listen in as Papi and I discuss Cisco’s vision for “The Internet of Agents” and be sure to Subscribe for free today on your listening platform of choice to ensure you never miss a beat.
New episodes release every two weeks.
3. AI Buzz: Fresh Bytes
Here are a few interesting articles that caught my eye this week.
- Anthropic adds advanced reasoning to latest model
- The Augmented Intelligence Era: Unlocking Unlimited Potential for the Future of Legal Work with Eudia
- Nvidia helps launch AI platform for teaching American Sign Language
- AI-designed chips are so weird that ‘humans cannot really understand them’
- Microsoft prepares for OpenAI’s GPT-5 model
4. Algorithmic Musings. The Economy of the Made: AI, Declining Population, and the Future of Growth
Author’s note: This essay is less about AI in the “here and now” and more about the “near and now.” That said, the ideas and problems identified here are ones that leaders must ponder as part of their strategic planning. It’s not good enough to dismiss this by saying “Too far in the future” or “Not my problem.” Because the future is arriving with increasing speed and if you plan on remaining in the workforce until 2035 or later, then the future is now and it is your problem.
One of the questions vexing me for the past several years is what the rise of increasingly capable AI and the pending decrease in worldwide population means for societies and economies. A recent essay from a co-founder of Wired Magazine offers some thoughts on this and explores the idea of our economy transitioning from “those who are born to those who are made.”
It’s an intriguing idea that goes directly to the heart of the fact that capitalism depends upon growth. Growth, more specifically economic growth, has historically depended upon an increasing population. As worldwide population peaks and begins to decline, the traditional formula no longer holds true. Consequently, a new paradigm must emerge.
AI is a revolutionary general purpose technology just like the steam engine and electricity. And in much the same way that those technologies powered a massive shift from an agrarian to an industrial economy, AI will also power a massive economic and societal shift. Yet what happens when you add in the overlay of a decreasing population? That’s when things become even less clear. Enter the idea of the economy of the made.
The Demographic Reality
The evidence is increasingly clear – global fertility rates are declining precipitously, with no country having successfully reversed this trend once below replacement level. Unlike previous periods in human history, this isn’t a temporary fluctuation but appears to be a one-way trajectory. Within decades, we will experience something unprecedented in a millennium: a sustained global population decline.
This demographic shift fundamentally challenges our economic assumptions. For centuries, economic growth has been intertwined with population growth – more consumers, more workers, more innovation. Our economic institutions, from pension systems to real estate markets, assume continuously expanding markets and workforces.
The AI Revolution at a Critical Moment
The development of increasingly sophisticated AI arrives at precisely this demographic inflection point. This timing may be more than coincidental – it may represent an evolutionary adaptation of human civilization. As biological reproduction becomes less prioritized in developed societies, perhaps our collective ingenuity has innately turned toward creating artificial entities capable of performing economic functions.
These technologies won’t merely augment human capabilities; they may fundamentally restructure our economic foundation. AI systems and robots could potentially serve as both producers and consumers in an economy, generating new forms of value and enabling growth despite human population decline.
Beyond Traditional Economic Models
However, the “handoff” thesis isn’t the only possible path forward. We could instead reimagine economic growth itself, focusing on qualitative improvements rather than quantitative expansion. A circular economy emphasizing resource efficiency and reuse could thrive with a smaller population. Knowledge work and intellectual property could generate increasing value with fewer resource inputs.
Financial and policy innovations will be crucial – consider the idea of wealth redistribution mechanisms to new definitions of productivity and value. These alternative approaches challenge conventional economic thinking but present viable paths toward prosperity without population growth.
It is not unprecedented to imagine an entirely different economy. Consider this: Self-employed farmers constituted 80% of the workforce in 1820 yet only 20% of the workforce by 1900. This change wrought massive changes upon every aspect of life in the United States from governance and regulation to health care, and individual expectations. And, while the timeline for our pending economic transition is likely more compressed, the core idea remains the same: big change is coming.
The Human Element
Perhaps most profound is the question of human purpose in this evolving landscape. If AI systems increasingly handle productive tasks, what becomes the role of humans? The Wired co-founder suggests we might focus on creative endeavors, exploration, relationships – activities where “inefficiency reigns” but meaning abounds.
This vision requires rethinking not just economic structures but cultural values. Success would be measured not by productivity but by creative contribution, not by consumption but by connection. Our education systems would need to prioritize uniquely human capabilities rather than routine skills easily replicated by machines.
Navigating the Transition
The transition period will be precarious. Population decline will likely begin before AI systems are fully capable of replacing human economic functions. Managing aging populations with shrinking workforces will strain social systems. Inequality could worsen if the benefits of automation are concentrated.
Yet this transition also offers unprecedented opportunities to reshape our economic foundations. We could design systems that distribute prosperity more equitably, prioritize environmental sustainability, and value individual and collective human flourishing over mere production.
Final Thoughts
We stand at a profound inflection point in human history – facing both demographic decline and technological revolution. The path we choose will determine whether these twin forces lead to stagnation or a reimagined prosperity.
The economy of the made – whether through AI-powered economic participants or through fundamentally redesigned economic systems – represents our attempt to sustain human progress beyond the constraints of biological reproduction. It challenges us to reconsider what economy means, what growth truly is, and ultimately, what human civilization aims to become.
The question isn’t simply whether machines can replace human economic functions, but whether we can envision economic systems that serve human flourishing regardless of population size. The answer will define the next era of human civilization.
5. Elevate Your Leadership with AI for the C Suite
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As we navigate this unprecedented fusion of human and machine intelligence, remember: the best leaders aren’t just adapting to change – they’re actively shaping it. Until next week, keep pushing boundaries.
Chad