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  • - Hello and welcome to Experion's Weekly Data Talk,

  • a show featuring some of the smartest people

  • working in data science,

  • as well as thought leaders leading the industry.

  • Today we're very excited to feature Barry Libert.

  • He's the CEO of Open Matters and a strategic advisor

  • for some of the biggest global brands

  • like Goldman Sachs, Microsoft, GE, and ESPN.

  • Barry is also a bestselling author

  • and has written for the New York Times,

  • Wall Street Journal, Financial Times,

  • Harvard Business Review, and many others.

  • Barry, it's an honor to have you in our chat today.

  • - Thanks for having me today.

  • - Barry I thought it'd be great if we can just kick this off

  • if you could share a little bit about yourself

  • and the work you're focused on right now.

  • - Sure, so this work started a long time ago.

  • It's the basic thesis that just like the human genome,

  • there's an economic genome and you can use data science to

  • basically find out what that economic genome is.

  • - Very, very cool.

  • I mean, it seems like every single day

  • I'm reading articles about artificial intelligence,

  • how it's changing the workforce.

  • There's a lot of fear I think,

  • sometimes those articles about robots taking over

  • and definitely in the financial space

  • we're seeing signs of robo technology

  • and artificial intelligence.

  • In one of your latest articles

  • you wrote for Harvard Business Review

  • you wrote an article focused on how even top consultants

  • in financial services may soon be replaced,

  • and was really curious if you could talk

  • a little about that

  • because that was a really great article you wrote.

  • - Sure, so the article was more

  • than just financial consultants.

  • It was marketing consultants,

  • strategic consultants, financial consultants,

  • auditors, legal, doctors, all consultants.

  • So if you think about the consulting industry,

  • just talk about one piece of it,

  • strategic consulting industry in the United States alone

  • is about a 70 billion dollar industry.

  • Think of them as doctors

  • that are doing business the old fashioned way,

  • which is a patient, a CEO,

  • comes into my old alumni firm, McKinsey, or Bane, or BCG

  • and they ask them a question, what's wrong with me?

  • And that doctor, that consultant,

  • gives them a piece of advice based on their own experience.

  • None of that experience is captured in a data structured way

  • that benefits in today's machine

  • learning artificial intelligence.

  • All our article was proving is that it's not just medicine

  • that artificial intelligence or machine learning,

  • or in financial services where artificial intelligence

  • and machine learning are taking an impact.

  • It's going apply to every single industry

  • where the services industry has had a huge growth cycle

  • in the last 50 years.

  • And that means all the best consultants

  • are going to have to deal with the fact

  • that machines learn faster, are more scalable,

  • and more repeatable than you and me.

  • Nothing more complex than that.

  • - Yeah, I think I even read an article a few months ago

  • talking about Goldman Sachs had a layoff

  • of a lot of their financial advisors.

  • Did you happen to see that one?

  • - I did.

  • And that's happening around the world

  • in the financial services industry.

  • You look back awhile, which is decades now,

  • the financial services industry

  • went from what's called active managers,

  • which was financial advisors giving advice to you and I

  • about what stocks or bonds to buy

  • based on what that manager had as his or her perspective

  • on the financial markets.

  • A long time ago, really a long time ago,

  • John Bogle, who was the chairman CEO of Vanguard

  • had a thesis that monkeys made better decision makers

  • than financial advisors.

  • That you could basically throw darts at the wall

  • and get a better return.

  • Now, the truth in there is he was right.

  • ETFs or what's called passive investing,

  • have outperformed the smartest

  • of all stock and bond managers.

  • Which means that the construct of actively advising

  • is doing less well than passively investing.

  • You've seen the explosive growth of not just ETFs

  • and passive managers, you're now seeing

  • what's called robo investing like Wealthfront and Betterment

  • begin to offer for you and me, the individual investor.

  • - Yeah, and I think it seems that from what I understand

  • around Betterment and some of these robo advisors,

  • sometimes the combination of artificial intelligence

  • choosing what stocks or indexes for people to invest in.

  • But also, there is some element of human management.

  • Do you happen to know how humans are working with AI

  • despite the layoffs?

  • - Sure, the layoffs aren't that big, right?

  • In fact, they're not big at all.

  • Growth in the industry is outpacing layoffs by far.

  • So, there's a massive fear, I call it,

  • on layoffs by, you know, robots displacing you and me.

  • I don't believe that.

  • It's going to create new skills,

  • obviously we might argue that 100 years ago

  • machines displaced humans when we started building cars,

  • or 150 years ago, tractors started displacing farm workers

  • and we started automating farms.

  • This is just the next iteration of machines

  • complementing human workers in ways

  • that you and I don't scale.

  • And all our research has shown and our article was about,

  • was sorry, for all of you people that don't think it's

  • coming to your industry,

  • which is all the services industries,

  • not just the financial services industries,

  • the marketing service industry, the audit service industry,

  • the legal services industry.

  • We gave examples of every industry,

  • the medical service industry,

  • where robots and artificial and machine learning

  • are going to complement human intelligence

  • and human learning.

  • - Yeah, it's amazing.

  • It's amazing to see the growth

  • and I feel like just in the last year

  • just tremendous growth in people interested

  • in machine learning, artificial intelligence.

  • I mean, I was looking at some Google trends

  • on the amount of traffic being generated around those terms.

  • Part of it might be out of fear, but then to your point,

  • there is going to be this strategic alignment

  • between human and artificial intelligence working together.

  • And, I think it's going to be a beautiful thing.

  • And I really like your positive outlook about,

  • just as we looked in the past,

  • how technology has displaced some workers,

  • there's just new jobs that were created from that.

  • So, I love your positive outlook.

  • I'm curious about some of the feedback you received,

  • because your article in Harvard Business Review

  • was very very popular, was shared all over the web.

  • I loved reading it.

  • I'm just kind of curious at the responses you've got.

  • - Well, surely there were both positive and negative

  • as you might imagine because we were taking a pot shot,

  • right, at the world's most elite.

  • My alumni firm, McKinsey, and Megan Beck who's my co-author

  • is an ex-Bain person.

  • So Bain-iac, right?

  • And my brother was at BCG,

  • you know, this our heritage from a lifetime ago.

  • It's hard for them to understand when they are reporting

  • all day long, McKinsey at their very best, is reporting

  • on the impact of AI in all other industries.

  • But not their industry.

  • It's like them suggesting,

  • like the taxi industry wouldn't be impacted by Uber,

  • the consulting industry wouldn't be impacted by AI or Alexa,

  • right, which what I think is coming anyway.

  • You and I will be getting my advice from what's sitting

  • right there on my desktop.

  • And, so, we had obviously had negative feedback.

  • Consultants saying, well what job will I have

  • and who's going to write your next article Barry?

  • - (laughing)

  • - According to your interview, a bot is going to have

  • some influence on that as well.

  • But there's negative and there was a lot more positive.

  • Which was trying to understand what does it mean to me,

  • just like you said, how do I think about it?

  • We were surprised, on my own LinkedIn page,

  • 2,500 reviewers, right, and likes.

  • It was amazing to me.

  • - Yeah.

  • - HBR, I think there was 400 or 350 comments.

  • It just blew my mind.

  • - Wow.

  • - People are interested, right,

  • in this article on this area.

  • - Yeah, like I said, it popped up on my radar,

  • I saw all the sharing.

  • People obviously loved it.

  • And yeah, so I was just curious to hear about,

  • obviously there's going to be people

  • that are kind of frustrated or upset,

  • especially in those in Fintech,

  • who might be fearful of their jobs.

  • But I think you definitely touched on a hot topic

  • that everyone's very very concerned about,

  • but also excited about too.

  • - Yep, I think that's was our point.

  • But the most important part of our point was to tell

  • truth about something.

  • Megan and I were both presenters

  • at the annual MIT Platform Event.

  • And, it wasn't just falsehood in that article.

  • My co-presenter as the keynote speaker

  • at the annual MIT Platform Event was Alexa.

  • We had to mike Alexa.

  • And, we literally asked the machine questions

  • that no consultant could ever

  • ask about global economic trends that were the synthesis

  • of machine learning AI looking at 40,000 companies

  • across the world, across thousands of variables,

  • and tens of millions of words over 40 years.

  • - Oh, wow.

  • - It wasn't that we were kidding.

  • But, we're happy to share an image

  • that shows me talking to Alexa on stage.

  • I mean, of course I started with a silly quote,

  • an Alexa knock-knock joke, but I took Alexa

  • all the way to the end, asking board level questions

  • of things they couldn't get from their consultants

  • if they had to pay 10 million dollars.

  • - Wow, that is amazing, that is amazing.

  • Just seeing the voice, AI, products being developed,

  • Alexa, Coursera, and what's possible.

  • And like, what you just shared

  • because of artificial intelligence,

  • because of the amount of data that could be crawled

  • and analyzed and for Alexa to be able to return back to you

  • smart answers very very quickly

  • where it would take an advisor a lot more time

  • to go do some digging.

  • I mean, the ROI on that is just phenomenal.

  • - Yep, my always message is I have a simple thesis in life.

  • I wanna replace a Barry call, a call to Barry,

  • with a call to Alexa.

  • I'm tired of getting calls

  • that ask the exact same question to me every day,

  • I don't wanna become a platform network and AI company

  • for the last 20 years when AT&T was my first client

  • a long time ago.

  • And I said to them, I'll have a call answering service,

  • they can call right to Alexa and they can say

  • I'm calling Barry and Alexa will answer the phone.

  • - Yeah.

  • I think there's gonna be a Barry bot.

  • - There you go.

  • I'll hook it up so you can answer

  • some of your other interviewees

  • and people that you've had on your show

  • so I can figure out how to do that next.

  • - Yeah. (laughs)

  • It's so funny because when I, when Alexa first came out

  • I was thinking, oh, so it's just something

  • you can ask about the weather, you know?

  • I had a