Chapter 23 - The CEO's Mandate

“A computer would deserve to be called intelligent if it could deceive a human into believing that it was human.” – Alan Turing

I am very pleased with how my new book has come along. You will find a lot of historical context to make the changes meaningful, and I am answering and challenging many of the issues, even with the number of jobs that could be lost and how they will be replaced. I have gone much deeper than others have written about AI and provided real-world prescriptions and advice. The book is in five parts.

The Markets - Economy and Consumers

Happy days are here again? Maybe it depends on whether you are looking at the immediate consumer world or thinking of the next one in the near future. The market has returned to where it was two weeks ago. There are certainly a lot of expectations with Donald Trump taking office again in the US and an anticipated change in government in Canada. But there is a difference between political hype and feasible economic policies.

I will not predict the market, although I believe this is still an AI-driven stock market betting that every consumer and business will be connected to some form of AI platform. I am betting that it will be unstoppable as soon as consumers grab onto this. Think greater convenience moving from search to ask...powerful.

Personal Log: Who is looking out for you (the workers)?

I analyze everything with validated data and take nothing I am told for granted. I am just wired that way. So I get it: people are fed up with the economy and all the misery it brings us. But we humans are not fools, at least not all of us. I turn off anyone who spins tales of wanting things better for society, and all we need is a change...yeah, yeah, yeah! These people use our emotions and twist data to fit their story and get us into their circle of hate or crafting dissension. It is twisted. That's why, on November 23, I posted an unbiased view of federal debt by country as a percentage of GDP. I was shocked to see that Canada was one of the lowest. Now, we have increased our debt, no question, but we are not the US, and we are more like Germany. But when these doomsayers want us to believe that our productivity or ability to make money is eroding, they are right, but not on why it is happening. Canada is a great nation, but we cannot attract investment and new companies because we are a nation of oligopolies. In this environment, a small group of companies control the lion's share of the market, making it difficult for any new startups or foreign investment to happen. But here's the problem for workers. These companies will undergo massive changes because of AI (all of them!). At some point, they will be under pressure from investors to become more profitable due to their investments and productivity improvements with AI. Where do workers go from there? There will be new roles; how are you preparing for them? So, to all these people who use data to spin a story, ask whose agenda they are really speaking for. It isn't ours. Here is the link to my LinkedIn Post

Leadership: Chapter 23- The CEO's Mandate

Many executives will face massive change and reorganization of the companies they lead or own over the next two years. Their mandate is one of continuous reinvention and innovation. We will need more than saying we are going to be bold. The bold part isn't new; successful leaders and organizations have been doing this for years. The challenge is keeping an organization competitively intelligent with AI. Investors and boards will place a great deal of scrutiny on organizations and leaders on their ability to reinvent and innovate continuously. I can't emphasize enough for you how relentless the marketplace will become. That will drive a higher level of speed to market and significant improvements in their talent base. Human workers will still matter, but let's not kid ourselves. The workplace will change; if it doesn't, it will fail, not because of the people but because leadership chose not to embrace AI. The CEO's first mandate is the speed with which they can define their vision of AI and what they want it to do, and begin with their internal audit of the organization from systems, data, talent, and building out the infrastructure. If you thought missing out on e-commerce and digital marketing was painful for organizations, you haven't seen anything yet. Imagine you are a lender; why would you lend money to a company that doesn't want to evolve? If you want to be bold moving to an AI-First or Hybrid-AI company will be the boldest move, without it competitors will win in identifying consumer insights, developing and launching insights. Why am I so confident about this? I've worked for and led successful businesses that are either already at this stage or are embarking on it.

Retailing: Another Black Friday, with AI?

It's here again...but it started a few weeks ago. Christmas trees were up in September in some retailers. It didn't help Target in the US. Where I continue to see growth is off-price retailers and discount stores. Retailing is a tough industry, and it is being primed for another major shift with AI, a shift not all retailers will be able to play in. Will AI be playing a role this holiday season? For some time, we have become so accustomed to it that we are unaware. Every recommendation or reminder you get on your screen or email that's AI, it has been tracking our every move. Retailers, especially independent and mid-sized ones, must ensure they get the right advice. If your contact can't explain the difference between AI, Machine Learning, and Reinforcement Learning, you must seek help elsewhere. Retailers will capture 25-45% of their annual revenue in this period. For the most part, it will be normal. However, next year's retailing will be an AI-driven marketplace. That's what I wrote in an article for Retail Insider scheduled for December publication.

Retailing in Canada: It's not the same as in the US.

US and other foreign retailers have struggled with Canada for the most part. Let's start here: what is Luxury in Canada? For that matter, what is retailing in Canada? Even Nordstrom's failed, and they weren't Luxury. Premium and specialty retailers are high-end for Canadians, it's not to say that no Canadians buy luxury but it is very much an elite income or a very special gift and often for some once in a lifetime. Besides language and cultural differences between provinces, incomes and the cost of living, even before the pandemic and inflation, have always dictated how and where Canadians spend their money. Retailers like lululemon Aritzia and Zara do well in Canada because they are deemed fashionable, not luxury. Affordability is key to any retailer that wants to make a go of it in Canada. Yet, as mentioned above, off-price and discount retailers do well in Canada for obvious reasons. If any retailer wants to enter Canada, they need to be able to open just a couple of stores and get their four P's right. Costco and Ikea have done it because they've paid their dues by understanding Canadians. You would be surprised at how some subtleties, such as advertising, can make a difference when it isn't US or European copy and is created for Canadians.

Thank you for reading this week's issue of The Business Brief.