An AI Thesis
What will be the impact of AI on the creative industries and how can we meet this moment?
"FEARLESS CREATIVE LEADERSHIP" PODCAST - TRANSCRIPT
Episode 264: An AI Thesis
Here’s a question. What will be the impact of AI on the creative industries, and how can we meet this moment?
This is the final episode of my series of interviews over the last few weeks leading up to and through the Cannes Lions Festival of Creativity.
It offers a map for the future based on those conversations, and observations of the speed of change. If you haven’t seen it, look up the Volvo ad that was just published on social media. It took one person, 24 hours to create.
This ad could not have been made in May, when I started this series of interviews.
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Creativity and innovation are oxygen for the world's best businesses. Increase the flow and they soar. Limit the supply and they wither and ultimately die.
That has been true for longer than anyone reading this has been alive.
What is also true is that until now, that creativity, that ability to come up with original ideas that solve problems has been limited to human beings.
With the arrival and advances in AI, will that still be true five years from now? Two? Tomorrow?
Over the last few weeks, I've interviewed ten different leaders from across the creative industries. Brand leaders, agency founders, global agency heads, global client leads, production experts, creator community experts, consultants, and an advertising industry legend.
And while I was at Cannes, I talked to two dozen more about where the creative industries are headed and what they need to do to ensure their future.
These industries are a complex eco system of competing and contradictory forces built on what I believe is the worst business model in the world: selling original ideas based on how long it took to conceive and deliver them, and then giving up the ownership and the economic benefit of those ideas forever.
It is the equivalent of pricing a Picasso based on how long it took him to paint it. It is selling every patentable idea based on the cost of the labor, while ignoring the impact on people's lives.
According to some reports it takes 24 hours to build an iPhone. Imagine if Apple broke that down into a scope of work and then sold each iPhone for the cost of that scope and, with it, the ownership of the IP. For how long would they remain the most valuable business in the world?
The daily advances of AI challenge every aspect of the creative industries. From defining and articulating the problem, to conceiving, creating and delivering solutions. Every part of the process is being radically changed. And the extent of that change is limitless.
So what should we do about that?
When I finished this series of conversations my first reaction was that there was no through line. That the perspectives and insights of my guests had occupied every point on a far flung spectrum of possibilities.
But as I went back and re-read the transcripts, I realized that not only was that not true, but that the answer to what do we do now was embedded throughout.
It manifests in different ways for different people but it is remarkably consistent.
We need to predict the future we want and then - to use Alan Kay's famous reference point - we need to invent it.
The challenge is that in doing so, we fight our own genetic code.
Humans do not instinctively understand exponential change. We can intellectually understand but not emotionally connect with the fact that a single penny, when doubled every day for 30 days becomes $5,368,709.
As Ethan Mollock points out in a recent newsletter, our view of emerging technology is equally unimaginative.
For millennia, we have underestimated the speed with which technological change overtakes us. We view it in the same way that Ernest Hemmingway memorably once described how we experience bankruptcy. Gradually, then suddenly.
Which means that we regard any piece of technology as inadequate until it passes a critical threshold. And then suddenly it isn't.
As a species, we like the status quo. The known and the predictable. We seek out tribes and communities of like minded people that reinforce our views of what is safe and what is a threat.
And each time we have met a new technology, from the wheel to the printing press, we have reacted the same way. With skepticism, frequently with cynicism and a loud aversion to change. Henry Ford's faster horse observation.
PJ Pereira, Co-Founder of Pereira & O’Dell, memorably described our inability to imagine the future boldly.
“We are humans and we can only see a few degrees from where we are. It's like we're that first caveman that realized that the red spirit that burns forests can be carried on the end of a stick.
I can try to imagine that is going to cook food. I cannot imagine that it's going to melt rocks. Can you imagine explaining to that caveman that one day that super hot thing he has on the end of a stick is going to produce ice cream? It makes no sense. Yet, it is.
AI is that fire, that flame on the end of the stick. We have no idea what the compounded effect of that is going to cause, how it's going to change society.”
We have no idea how it's going to change society.
Except perhaps in one way.
We know already that we are facing a moment different than any in human history.
This is not fire, the wheel, the printing press, the automobile, the steam engine, the telephone, the internal combustion engine, television, the computer or nuclear power.
As dramatic and life changing - society changing - as those developments have been, they all have one thing in common.
They lack agency.
They can be turned off.
If we turned off AI, society would seize up, like a rusting crankshaft, within minutes. Or less.
In February, my ATT networked iPhone stopped connecting for 6 hours. No way to get on the web, or to call anyone. I discovered you can control the implications of that, calmly, for about 38 minutes.
Short of shutting down the entire electrical grid, there is no longer a realistic way to shut down AI. Not at a practical, economic and emotional price that we are willing to pay.
But Generative AI is different, right? That's just an alternative way to make things. We could always go back to the old way.
Except, already, the old way doesn't exist anymore. Tiffany Rolfe, Chair and Global Chief Creative Officer at R/GA, explained it from this deeply personal perspective:
“We're already seeing people connect with digital avatars and have friendships that feel like human friendships in their mind. There's no difference. I see my kids connect in ways that I didn't ever imagine.”
We have already crossed the chasm. The status quo is already built on the capacity of Generative AI to grant us the ability to make things that matter to us deeply. That matter to us emotionally.
And if you think it stops there, well, Generative AI is already changing the economic foundations on which the creative industries operate.
This is how Adam Tucker, Global Client Lead at WPP, described the evolution that he's already experiencing.
“The thing that I think this will do is accelerate the move to outcome based compensation. The value of ideas, deliverables based renumeration. I’ve had the opportunity now to work on several clients who have moved to deliverables based remuneration. And I don't really want to go back to the old way because frankly, this works so much better. You do not spend any of the time that you spend in the old way, justifying who's on the business, what their title is, how much they're paid, either inside the company or to the client.
Whereas on an outputs deliverables based remuneration, you're talking about the work, what you're delivering, what you need to deliver. You have to be pretty sophisticated with scoping. But it's a breath of fresh air. And so I think this is the perfect instigator and catalyst to get clients to move more toward the output space.”
If we think AI is moving at the speed of sound, the very end of Adam's answer suggests we might need to re-calibrate whether even that is the right measurement.
Because as Dave Rolfe, Head of Global Production at WPP explains, the “output space” that Adam refers to, itself no longer exists as a defined step in a process. Soon, if not already, the beginning and the end are the same and then we’re moving at the speed of light.
“I see fusion of production into ideation. I think once it leaves your imagination, it becomes a form of production. It becomes executional because now, right out of ideation, we can be iterating. So I just think that the entire journey is probably a production journey.”
So, if AI has already infiltrated our emotional responses, if we have already ceded it agency, if it is already changing the economic structure of the creative industries, and blowing apart not only what we do, but the way we do it, if it is already more powerful by the time you finish reading this than it was before you started, how do we meet this moment?
That, depends on where you sit.
L'Oreal, the world's fourth largest advertiser, are all in. As Asmita Dubey, the company's Global CMO explains:
“So for beauty consumers, it's absolutely a new kind of relationship. Our mantra is Beauty for Each, Powered by Beauty Tech. So for us, AI brings great opportunities in bringing a more personalized, more inclusive, more sustainable beauty to everyone in the world.
AI is at the heart of our beauty tech transformation. Since its inception, we termed the word “Beauty Tech” and we started this Beauty Tech transformation in 2018. So we have developed a particular expertise around AI over these years, to the extent that, overall in our group, we have almost 8,000 people who are in digital, tech and data, and more than 1000 in data alone.”
So, today, L'Oreal is s beauty tech company, building unique, one to one relationships with tens of millions, potentially hundreds of millions, of consumers.
Intimacy at scale.
But AI does not simply allow brands to deliver differently. It allows them to understand what their consumers want, through the simple (and technologically extraordinarily complex) act of listening.
Tiffany Rolfe explain why this changes our expectations of brands:
“I think it fundamentally shifts the relationship with brands into being much more two way. The point of brands that listen, that anticipate, I think you have to make sure you're not doing it in an intrusive or creepy way. But I think it's really designing an experience around me. It's like my version of Nike.”
And Jamie Gutfreund, the Founder of Creator Vision, underscores the depth and breadth of listening capabilities that brands can now take advantage of:
“There's a phenomenal company called GLYSTN. It uses AI to look at the comments, and can really pinpoint way beyond sentiment. It can tell you, this percentage of your audience really loved this style of content. This part of your audience wants you to do the following three things. And it can tell you that across all of the channels and platforms that a creator is working on.”
Human beings want two things from life, assuming our basic needs are met. We want to belong. And we want to be heard.
AI is already starting to meet those needs for us.
But, it is not yet all seeing or all knowing. There is still room for human beings in the creative industries.
Nils Leonard believes that the line between human briefs and technology driven deliverables is already clear.
“I think what it's going to do is remove the average, the quick, the logistics, the consistency, the low cost content, it's going to remove all those things that I think our industry has convinced itself we should be selling, and it's going to do them better.
And the short story is it's going to leave the only thing that we can actually do brilliantly, which is the act of creativity, of radical creativity.”
And when asked why he believes that will always be the case, Nils offered this impassioned description of the distinction between souls and circuits.
“ It's not fed by tragedy. It's not fed by loss or by a heart attack or by a lover that's left you. It's not fed by a night on red wine and weeping and music. And it's not fed by sudden and dramatic radical change in somebody's life to lead them to do something.
And so as a result, yeah, it can offer up great alternatives to average problems and average solutions and offer those medians. But it will never give you that. It will never write, “Push the Sky Away". It will never write, "Grief is a thing with feathers". Because it just simply won't be able to understand or comprehend or even play back the leap that was required to do that type of work.”
Many people reading this will be lifted by Nils' evangelism. I'm one of them.
But creative evangelism is not enough. If you value creativity, if you respect it, care for it, love it, then you have to put it work.
Because creativity is not a reaction. It is an intention. A decision to make the world different.
Like this, in Nils’ view of the future:
“I think the next 10 to 15 years are going to be mad. And I think we're going to find new words for the oldest human values. And I think we're going to find new behaviors that we think we discovered that are pretty much the ones we were doing a thousand years ago, probably.
And we're going to do it in the context of our lives. And it's going to be f*cking amazing. And there are going to be heroes that have been a part of that, that created that way of living for us and fix the problems of our time. And what an amazing chance we all have to be those people.”
And fix the problems of our time.
Fred Wilson is one of the most successful venture capitalists in history. He and his partners at Union Square Ventures have built their success on the foundations of “thesis based investing”. Fred has written a blog for more than two decades. In November 2009, he wrote a post in which he described their investment philosophy.
“Thesis driven investing involves drawing a picture of where your particular area of focus is going. I like to take a five to ten year view. And once you have mapped out that picture, it becomes your thesis. And you evaluate every investment you make in the context of that thesis.”
Their initial thesis was that, “the internet would be driven by primarily consumer focused businesses where the value of the service to a user increases as others use it, too. These network effects create defensibility and lead to scale.”
This thesis drove their very early investments in businesses such as Twitter, Etsy, Tumblr, Foursquare, Behance, and Kickstarter.
This approach comes with a user warning label. In that same post Fred cautioned this.
"I believe thesis driven investing produces the best returns when the thesis is directionally correct and probably also the worst returns when the thesis is wrong."
The creative service industries are known for brilliant, original thinking that builds valuable and lasting relationships between brands and their customers. The insights and ideas and solutions that come from the brilliant minds throughout these industries have changed businesses, cultures, societies and the planet.
But, no one would ever claim that the creative industries have been built and evolved using a strategic plan.
Talent, commitment and charisma have always been the currency that spoke loudest as we shaped the future in our own image. There is no thesis that focuses thinking and investment on what should happen next.
But, at the end of these last few weeks of conversation, I am left with the belief that talent, commitment and charisma are no longer enough. Indeed, they might be the very catalysts of our demise. Short term drugs that encourage more of the same behavior.
Wait for a problem to emerge and then solve it.
AI will do that too, with more commitment and charisma and yes, talent, if you are willing to call it that, than we can offer. And will do it faster. And cheaper.
Which means that if we wait for the future to appear, we will find it already invented.
PJ Pereira has a vivid description of what that will feel like:
“I grew up in Rio, and when you're a kid in Rio, you learn something very quickly. When a wave comes, you either lean in and surf it, or you run for the sand. You don't stop a wave. Waves are not stoppable, they're bigger than you. You know what's going to happen. You need to decide if you're going to lean in and surf it or run for the mountains.”
And if we do lean in, what does the future look like? Nick Law, Creative Chairperson at Accenture Song, thinks it will look like this:
“There will be a great changing of the guards. I think it looks like new companies emerging, new companies that are born and have built their whole premise off this technology, as opposed to trying to adapt older ways of working to a new technology.”
The best way to predict the future is to invent it.
At the end of this series, the next step for each of us seems clear.
Develop a thesis, a specific view about what will matter in the future. And then invest ourselves and our talent, body and soul, into making that vision a reality.
This has two things going for it.
The first is that problem solving is what the creative industries is designed for.
Second, it is powered by the attribute that human beings uniquely possess and which Nils described so memorably. The act of radical creativity.
All it requires is that we have belief in ourselves.
Which as Sir John Hegarty described, is what it has always been about:
“Ultimately creativity is about confidence, the confidence to dare, to really go out there and try something very different as opposed to, well, I know this has been done before, so it'll be okay. I don't want okay.
So you've got to create an atmosphere of fearlessness, and the sense that there is no wrong answer, but there are just some that are better than others.”
Create an atmosphere of fearlessness and define your own future.
So what’s your thesis? And how will you put AI to work to bring that future to life on your terms?
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If you’d like to know more about the podcast, or about our leadership practice, go to fearlesscreativeleadership.com, where you’ll find the audio and transcript of every episode, and more information about our work with some of the world’s most creative and innovative businesses.
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Frances Harlow is the show’s Executive Producer. Josh Suhy is our Editor. Sarah Pardoe is the show’s Producer.
Thanks for listening.
