Photo credit - Sam Altman/Wikipedia
Over the weekend, the tech world witnessed unprecedented turmoil within the walls of Open AI, following the firing of Sam Altman (their former CEO (at the time of writing)), and the ripples are bound to echo through leadership discussions for years to come. Below is a glimpse into the revelations and perceptions stemming from these fast-paced events over the last few days:
CHANGING PERCEPTIONS - Open AI (the startup behind ChatGPT, DALL-E 3, GPT-4 and other highly capable generative AI systems), will no longer be seen as the invincible beast that it was until last Friday. Instead, it has revealed its vulnerability and no doubt, investors are now likely to invest in alternative Language Model (LLM) start-ups, thus challenging the dominance of Open AI
‘Don’t build your house on rented land’'
BUILDING ON SOLID GROUND - With some developers now scrambling to Open AI competitors like Anthropic, never has the adage ‘Don’t build your house on rented land'’, rang more true.
CALLS FOR OPEN SOURCE RATHER THAN CLOSED SILO SYSTEMS - Open AI was created as an open source (hence the name “Open” AI), a non-profit company to serve as a counterweight to Google, however, it has become a closed source for profit company effectively controlled by Microsoft which has resulted in Altman coming under criticism from many in the tech world. However, it's difficult to see how Open AI could have continued in its previous structure given the cost to develop and maintain AI can be extraordinarily high due to various factors including: the need for powerful computational resources, extensive data requirements, scarcity of AI talent, R&D, ongoing maintenance and so forth.
AI REGULATION TAKES CENTRE STAGE - Nothing screams “AI Regulation” more than this saga and this could, perhaps, focus minds and hasten acceptance of the EU Artificial Intelligence Act by countries such as France, Germany & Italy, who have some reasonable concerns over a section of the legislation which they believe, could hamper Europe's own development of ‘foundation models’ – the AI infrastructure that underpins LLMs like GPT and Google's Bard. Needless to say, the events over the weekend will no doubt move AI regulation further up government to do lists.
B CORPS AND INVESTORS - These events also raise another question. Can B Corp entities work in tandem with investors given one’s approach is ‘profit with purpose’ while the other, follows the doctrine of shareholder primacy?
NADELLA’S STRATEGIC MOVE - Whether his offer to Sam Altman is simply a ‘holding pattern’ or will come to fruition, Satya Nadella (CEO, Microsoft) has played an absolute blinder and the $13bn that he invested in Open AI, has resulted in a yield of $1 trillion in market value for Microsoft. In addition, even if Open AI implodes (highly unlikely given it still retains a partnership with Microsoft), reports suggest that at least 725+ Open AI staff out of 770, have pledged their allegiance to Sam Altman who, one way or the other, has committed to continuing working with Microsoft. Premature were reports which until last week, were reporting fissures in the relationship between Satya and Sam.
IPO HANGING IN BALANCE - Open AI was all set for an IPO worth $90 billion from the sale of employee shares allowing them to cash out their stock at rollover lottery jackpot winner levels. This could now be in jeopardy and means many staff at Open AI are willing to risk losing out in this jackpot. However, given how united they seem to be, should things settle down and the band gets back together and remains at Open AI, then it may make sense for them to IPO asap. The interest that Sam and Open AI have generated has been unprecedented.
LEADING WITH EMOTIONAL INTELLIGENCE – Regardless of the outcome, Sam Altman and Satya Nadella will be written about in leadership books for years to come - one who has the support of 90% of his workforce and the other, demonstrating true leadership with Emotional Intelligence (EQ) - agile, calm under pressure, and, it seems, the adult in the room.
WHAT DO THE EVENTS TELL US ABOUT MS TEAMS - For Satya, there are two big flies in the ointment: (1) the fact that he invested $13bn in a company in which Microsoft had no seat on the board and (2) the decision of the Open AI board to use Google Meet over MS Teams to oust their CEO (another poor leadership judgement on the part of the Open AI board – in terms of the manner rather than the tech used). That said, perhaps once he completes manoeuvring this Open AI flight through turbulence (although the recommendation is to keep autopilot ON during a turbulence (read into that what you will)), Satya also needs to get his best engineers on to MS Teams pronto.
CHALLENGES AHEAD - The current (interim) Open AI CEO, Emmet Shear (ex CEO of Twitch, the live streaming platform for gamers which was sold to Amazon for just under $1bn in 2014), faces challenges ahead not just in terms stabilising the ship, crisis & reputation management but in also, gaining the trust of the Open AI staff. It was reported that most Open AI employees skipped an all-hands video call on Sunday night that was meant to introduce them to him. AI is nothing without high quality data-sets and people who are experts in their field.
REFLECTION FOR LEADERS - How many of the people reporting to you, would risk their careers as well as millions and some even billions of dollars, to join you if you were unceremoniously ousted by your company?
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