Is AI Coming for Your Boss? + How To Become a Better Storyteller

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2:25Welcome to Office Hours of Prop G. This is the part of the show where we answer your questions about business, big tech, entrepreneurship, and whatever else is on your mind. If you'd like to submit a question for next time, you can send a voice recording to officehoursofpropgmedia.com. Again, that's officehoursofpropgmedia.com. Or post your question on the Scott Galloway subreddit, and we just might feature it in our next episode. Our first question comes from a Reddit user. MXAGNC asks, Hi, Scott. Love your brain and dulcet tones. We all know junior and middle management roles are being decimated by AI, but what might be next?

2:57Experience independent contractors, senior leadership, or even CEOs? There seems to be different cases for each and would love your thoughts.

3:04Scott Galloway:Yeah, it seems to be a big topic lately that AI can replace all management layers. Gartner projects one in five companies will eliminate more than half their middle managers by end of this year. By the way, Gartner doesn't know what the fuck they're talking about. I just don't, I don't, I don't buy that. Anyways, Coinbase caught 14 % of targeting pure managers. Microsoft laid off 6 ,800, citing AI and flatter org goals. Here's what Jack Dorsey had to say about his company block and layoffs. Open quote, for the first time, a system can maintain a continuously updated model of an entire business in ways that previously required humans relaying information through layers of management.

3:42Scott Galloway:So this is my take. AI is just not going to replace management and mentoring. What's really happening here is that a group of CEOs who overhired want to juice their valuations and engage in AI washing. Management is an ability to soften the chaos created by leaders. They're the ones that actually remember why this actual fucking company works. And as you grow, you need people that these people can roll up to in terms of mentorship, job description, solving problems. And what happens is eventually over time, people get hired sometimes out of their competence into management roles and you end up with fatty deposits everywhere.

4:19Scott Galloway:And it's a natural, healthy part of the cycle to go through and call the ranks, not only of managers, but of some doers, if you need less done in that field or they're not that productive. The notion that your AI is gonna bring everybody in and they're not gonna need to have contact with anybody else and the AI will manage them, tell them what to do, and at the end of the year, give them their performance review and a bonus. Even if that was possible, which I don't think it is, it's a nihilistic, fucked up vision of the world. And that is, okay, even if you could figure out a way for one person to own everything and create so much shareholder value that you could, I guess, theoretically, give people enough cheap calories and entertainment, bread and circuses, so they could just watch Netflix all day and be fairly happy, which they wouldn't because work gives people purpose.

5:03I don't think that's gonna happen because I work in a company that's growing, that's considered a new economy company. We use AI on almost everything, but the last mile involves people and it involves judgment. And the idea of me sitting down and outlining job objectives, providing feedback at the end of your review, bonus, solving conflict with AI, I just don't anyone, I don't think anyone's going to go for it. And also AI gets it wrong all the time.

5:31Scott Galloway:And purely AI-driven businesses, AI is essentially predicting the seventh word after looking at the first six and coming up with patterns such that it can answer any question or find any data and spit back a reasonable facsimile of a correct answer to any question. But it's regression to the mean. And that is it gives you great data on a question, but if you're asking it to brainstorm, if you're asking it to solve a problem, if you're asking it to manage somebody who clearly has a substance abuse issue. It can give you facts and best practices, but everything's driven to the medium. The most successful companies will be companies that I believe that AI would say, this will never work because they're thinking unconventionally.

6:13Scott Galloway:So I just don't buy, we always have these fever dreams of flattening the organization and reducing costs. My father was laid off in the 80s in this big kind of wave in the corporate America called re-engineering, where people basically after World War II, we had a monopoly on all manufacturing globally. And as a result, companies just kept growing and hiring more people for no real reason. And they woke up in the 80s when Japan was starting to come online and go, fuck, we're fat and happy. And they essentially fired anyone that had the title VP at it. And they found they didn't miss them much.

6:47Scott Galloway:Anyways, yeah, it's healthy on a regular basis to go through the company and call and figure out where you can de-layer, have fewer reporting layers. I get it. But this, again, is individuals who, quite frankly, in my opinion, don't know a lot about management and think that technology or the capital can replace people. And there will be, I think, job destruction, management destruction across certain industries. I don't think it's going to happen as fast as anyone thinks. And I hope and I believe that the opportunities AI will provide in terms of an increase in productivity, margin, profitability, shareholder value, and the wealth and capital to go start new businesses that leverage AI, that that hopefully will create as many jobs, if not more, that are destroyed.

7:33The key question is, is will the velocity of decline overwhelm our ability to repair and renew and create new jobs? That's the question. And unemployment actually isn't the issue in terms of social unrest. What causes social unrest usually is not someone who can't find a job, but someone who's working 16 fucking hours a day and still can't afford to buy, you know, meat. Those are the people that tend to get really, really angry. So I don't, I don't, I think this flattening of the organization is a bunch of people who overhired during the pandemic and also maybe overestimated the demand for their product or service, want to sound revolutionary.

8:14But I don't, you know, I'm a big fan of player coaches and every company I've had, everybody has to do something. I do podcasts in addition to managing. The woman who runs our company, Catherine Dillon, manages a lot, but she also edits things, is fantastic in terms of design. She gets very involved inside. Everyone does, if you will. I think that's a good general zeitgeist within a company, but you absolutely have to have managers. You have to have people communicating who create institutional and corporate knowledge. So in sum, I think this is more nihilistic bullshit from a group of people who have no or very little humanity, are very nihilistic, and also, in my view, don't understand or are willing to admit that managers evolved for a reason.

9:01And a good manager motivates people, figures out where the overlap, creates a hole that's greater than the sum of its parts. So will there be a calling? Yes. Will there be a lot of, quote unquote, middle managers? A hundred percent. And they're the ones, quite frankly, that understand why we're all fucking here.

9:20Scott Galloway:Question number two comes from Aaron, who emailed us. Scott, I'm a strategy lead at a Fortune 10 retailer and my AWS agent usage on Claude is probably running a few hundred dollars in tokens a day. Multiply that across an engineering org and you've got seven or eight figures a year fast. Companies are simultaneously telling employers to use AI for everything and quietly watching the meter spin. How does this resolve? Do enterprise AI bills become a real P &L line that competes with headcount? That's a good question. So most individuals pay a flat monthly fee for AI tools, but when companies build AI under their own workflows, things like coding assistants, automated pipelines, internal agents, they pay per use with no ceiling.

10:03Scott Galloway:And the more engineers that use it, the bigger the bill automatically. In other words, modern enterprise AI is metered, similar to electricity or mobile data. The number of organizations that reported AI costs as a serious budget concern doubled in a single year from 31 to 63%. Now, the question is, will AI just get cheaper? Partly. The cost of a basic AI query has dropped roughly 50x in three years, but the more powerful the task, including complex reasoning and AI agents running autonomously, the more compute it burns, and those prices haven't followed the same curve. Think of it as Moore's Law where processing power doubled every 18 months and the cost got halved, but people continue to find more and more uses for bandwidth or for processing power.

10:48And the same thing's happening here. That these technologies are usually highly elastic and that is as the price of compute plummets, you'll see more uses for AI and it'll broaden the market and there'll still be more demands for compute and for inference. is this becoming a real P &L line? Oh, 100%. 59 % of companies are investing over$1 million annually in AI, but only 29 % report significant ROI. So right now the investment is out of the return. And in practice, the usage costs are frequently not the dominant expense once we add integration, security, and change management. The full cost of AI is much larger than what showed up on the bill.

11:25I appreciate the question.

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13:45Scott Galloway:Welcome back. Question number three. Hey, Scott. My name is Andre and I'm from Edmonton, Alberta, Canada. My question to you is related to a point that you've made in several podcasts. And it's the importance of being able to craft a strong narrative and being a good storyteller. I'm an avid listener of all of your podcasts. I've read several of your books and you're definitely an amazing storyteller. And so my question to you is, what tips do you maybe have for either content creators or business professionals or even professors to be able to craft a good narrative? I notice in a lot of your books and in a lot of your podcasts, you're really big on research and leading with numbers and facts.

14:38What other tips do you have for individuals who really want to strengthen this skill? Thanks for everything that you do.

14:45Scott Galloway:So I would refer you, at least first off, Prop G Markets research lead, Miel Saverio, did a live stream on Substack on this very topic. She puts together my decks for our speaking gigs, and she put together a deck on storytelling. And it's still, I think, to date, the most popular live stream we've done on Substack. And this is kind of top line, the cliff notes on what she said. you want to create drama. Drama is what makes people care. And there's three ways to do it. You make an emotional, even unsexy topics can evoke anger, sadness, or excitement. If you've, if you find the human stakes, I talk a lot about my personal life and things that have moved me emotionally, whether it's my kids, you know, I talk a lot about my parents and I, you know, I'm not afraid to sort of be quite vulnerable and talk about, you know, success.

15:34Scott Galloway:And And I mean, I try to be pretty raw up there. And I find that of all the things I've ever done, the most popular newsletter I've ever done was when I talked about putting down my dog and just the emotions I was feeling. I write about stocks and I'm a quote unquote, a business analyst or write books about economics. And the most popular piece of content I ever put out there was about my dog. Most recently, the clip I had go viral that got, I don't know, 400 or 500 ,000 likes and I think seven or 8 million views was on Diary of a CEO. I was talking about how much I miss my mom. So emotion, right?

16:15Scott Galloway:Surprise, unexpected information triggers dopamine, which literally enhances memory formation. And then kind of wow factor data. Before adding any data point ask, would this make someone say, I didn't know that. If not, cut it. You also want to zoom out. Don't settle for the obvious first order take. Ask what the upstream causes and downstream effects are. Let's look at GLP-1, for example. Instead of covering Novo Nordisk, Mio followed the supply chain to Catalanth and followed patient behavior all the way to a spike in plastic surgery. That's where the fun starts is, okay, we know that GLP-1 drugs are big, but what else is going to be big?

16:53Try to provide context. Big numbers mean nothing in isolation. Data center water use sounds alarming until you learn one data center uses half as much water as the average golf course per year. So context is what makes data meaningful rather than fear-mongering. And then aesthetics, visualizations. People process images faster than words. We look through every deck and say, how do we show this versus say it? How do we replace it with visuals? The NVIDIA versus Intel market cap example, you can say it in a sentence, but showing it lands harder. We do these McCandless graphs that show spatially market cap of, you know, NVIDIA is greater than the market cap of Germany.

17:31And you show every single public company and the one square is bigger than the other.

17:35Scott Galloway:And then trying to find an authentic voice. I think it's a little harder. Understanding whose voice you're telling the story in determines what to cover, how to frame it, and how to make it sound real rather than generic. So some other just tactical things. It sounds pretty basic. I think great storytellers are usually pretty big readers at a young age. I didn't read an inordinate amount, but I did read quite a bit when I was younger. Also, if you want to be a great storyteller, I think you have to be a competent writer. I think the discipline of trying to write out grammatically correct prose, organize it, chunk it.

18:08Scott Galloway:You know, Jeff Bezos is famous for anyone who pitches an idea has to do it in a five or 10 page deal memo. I think that, and by the way, I got a C in English my senior year in high school. I found writing very difficult. I now technically communicate or write for a living, but I think if you want to be a really great communicator, you have to be at least a competent writer. Then what I want you to do is I want you to pick a medium that you feel comfortable in. It might be LinkedIn. It might be a podcast. It might be videos. It might be presentations using PowerPoint. But I need you to find a medium or a platform that you think you could be in the top 1 % of and try and get to the top 0.1%.

18:51Scott Galloway:And that is say, all right, I'm gonna really be an outstanding orator or I'm gonna commit to writing amazing content on LinkedIn and I wanna be the top 1 % of LinkedIn content creators. But discipline is small acts of, well, what does success look like? Success is small acts of discipline every day that add up in compounds similar to investments. And to be a great storyteller, I want you to read a lot, I want you to write a lot. And then I want you to find different mediums where you think you could be in the top 1 % and start investing in those mediums. and have sort of a ready fire aim. I'm gonna do three LinkedIn posts a week.

19:25I'm gonna try and amass 10 ,000 followers on Instagram by a certain time, right? Whatever the medium is or my goal is to get, I wanna start a sub stack and I'm gonna put out at least one 1 ,500 word article on this topic every week. So find your medium, set deadlines,

19:49Scott Galloway:set goals and benchmarks, and just start. I make my living communicating. A lot of it was because I got a ton of practice teaching twice a week for, or sometimes four times a week for 24 years. And also as a consultant, I was constantly presenting my ideas. But this is something you really want to get your kids into. You want to get yourself comfortable with. But if you're not a great presenter, everybody thinks a great communicator is someone who'd give this moving eulogy. Well, you might be the person who's really good at handwritten notes. You might be the person who's really great at doing 30-second TikToks.

20:24Scott Galloway:Find your medium, find your weapon and your sport of choice, if you will, and commit to being in the top 1%. But again, I think it starts with simply reading and writing. That's all for this episode. If you'd like to submit a question, please email a voice recording to officehoursofprop2media.com. Again, that's officehoursofprop2media.com. Or if you prefer to ask on Reddit, just post your question on the Scott Galloway subreddit, and we might feature it in an upcoming episode. This episode was produced by Jennifer Sanchez and Laura Janair. Kami Rika is our social producer. Brad Williams is our editor.

20:58Scott Galloway:And Drew Burrows is our technical director. Thank you for listening to the PropG pod from PropG Media.

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