Fuck AI

Because CEOs do not think long term. They only think in terms of 3-12 months.

Sure they might save a bunch of money by firing their whole work force and using AI. They will immediately gain a shit ton of profit over the next year simply from the lower expenses.

But then their company services will go to shit, customers will get pissed, their revenues will start to decline but that takes years to show on the books and by then they will probably be at some new company.

Not only that, once they fire their workforce and AI cost 2 million a year instead of 5 million for people, two years later AI companies will increase the costs to 4 million. Then 4 years later it will be 6 million. They can't cancel the contract because then they will have to re-hire and re-train an entire workforce which they already had and probably would only cost them $6 million a year at that point if they had kept them.

Then two years later it will cost them 8 million. So on and so forth

They do not realize that AI costs will increase over time a lot faster than what workers demand since workers don't have as many rights as AI corporations, and they will be held hostage by AI companies once they get suckered in.

On another level, CEOs who tend to enjoy having yes men around now have a permanent yes man in their pockets. I'm really seeing the effect on certain types of personality and it gets them in a sort of business psychosis that can be pretty entertaining to watch when your job is not at stake. They really are leaving reality at escape velocity, who knows what this will lead to.

Remember 10 years back when block chain was all the rage. Companies raced to develop using it. CEO s answer to the board, and if the board members are inundated with marketing crap about the next big tech thing, they will wonder why the CEO is not testing and or implementing.

Board members get caught up in media hype and will treat a CEO who seems to ignore it as questionable.

So board thinks AI is the shit. They ask CEO what are we doing with the new AI tech. If CEO answers that its worthless, but other large companies are testing it and media won't shut up about it, then board questions CEOs judgement.

Well, current High-level Management Culture is very short-termist and mainly anchored on Priviledged Upbringing, Salesmanship and People Skills (networking, spinning good stories, growing up in the right families and so on) rather than Competence in Strategy or Analytical ability.

As it so happens, the upsides of AI are of the immediate and obvious variety - basically as you listed - and pretty similar to those of outsourcing (but on the shorter term AI is actually cheaper). Meanwhile the downsides are mainly longer term costs and risks, and/or derived from complex or systemic characteristics of AI, for example:

• LLMs have a flat profile in the gravity of the consequences of its errors: basically they are just as likely to make errors with serious consequences (say, advise somebody who expressed suicidal thought to "kill yourself") as they are to make errors with minor consequences, whilst even untrained humans have some awareness of consequences and thus have a lower probability of doing higher consequence errors. This means that over the medium and long term AI has a worse risk profile than even untrained people and is thus more likely to do things which bankrupt companies and kill people.
• LLMs don't learn, at all. You can explain it all you want but even if that helps, it only helps as far as their input window contains that explanation since that stuff doesn't actually feed back into the model so doesn't get persisted. Most people do learn, and once they learn they seldom go back. So if one position is occupied by a Junior Something and another is "occupied" by an LLM, in 2 years time the former will have become a lot more productive and capable whilst the latter will be no better than 2 years before (possibly worse: see below).
• If you're running AI hosted by a 3rd party, you've now become dependent on that 3rd party, with all the associated future risks that it entails, especially for companies which have far less money and thus legal power than said 3rd party. The most obvious is that what's "cheaper than hiring" today will not be so tommorrow once that 3rd party has locked your company in.
• More generally, most AI gets trained from materials which were gathered from public contributions and those are getting worse, both because people are now less likely to end up in those places and ending up giving their own contributions and because "contributions" done by AI or with AI generated text claiming to be from people are increasing in those places and, as it has been already been provide in actual scientific studies, the quality of AI goes does the more AI-produced content is used in the training of a new AI, so mid and long term as the fraction of training materials which are pure human-created falls, AIs will get worse, not better (at best, stop altogether improving as no new models are trained), which for companies replacing human labour with AI means that the quality of the work done for them will never improve.
• Then there's the even more broad and systemic problem which also happens with outsourcing: if nobody employs people today for their Junior positions, tomorrow there will be no Seniors.

All this to say, that since the "qualities" of present day upper management are seldom in areas like Strategy and Risk Analysis whilst the problems of AI are mainly complex, long-term and/or systemic whilst its upsides are mainly of the highly visible and immediate kind (thus easy to stop and appealing for Salesmen and Tactician types), it totally makes sense that so many CEOs are going into AI.

It's funny because executives and managers are more similar to target for replacement if all you have is a bot that parrots back what it heard and can't think for itself.

As usual selfishness and sociopathy will cause incredible destruction...

I can guarantee not one of these assholes salivating over the prospect of eliminating all employees is even considering what happens when only ~5-10% of the population has any form of employment to pay for anything. They only care about how to pillage their own personal kingdoms.

Does not require sick/vacation time Does not take FMLA

machines break down all the time.

Does not want a bonus/profit sharing/equity

Um no that's exactly what LLM companies demand.

Don’t have to pay unemployment taxes, Medicare or SSI

You're paying a contract, and no you can't just sack them like a worker.

Does not require them to spend money on health insurance

Yes you have to pay insurance.

Will not form a union

The tech industry is stronger than any union.

Wont ever file a lawsuit for any number of reasons

The tech industry is more litigious than any worker.

Will work 24/7

Have you heard of a duty cycle ? No machine works 24/7

Typically, wages are the largest expense of most any business. CEO's still get hugely embarrassing monetary bonuses, no matter what they do or don't do. Getting rid of the biggest expense (humans) would shoot their bonuses into the stratosphere. Pretty soon all CEO's will own their own spaceships, not just the current billionaire spaceship owners.

A combo of extremely short-term gains and zero long-term awareness. That's it. That's all.

LLMs are only AI as Accelerators and Amplifiers of Ignorance and Incompetence, with vanishingly scarce examples of Iteration and Insight.

The Peter Principle helps illuminate why many in management consider LLM infected tools as preferable subordinates.

CEOs get paid an exorbitant amount of cash, so naturally they assume that their work is valuable and that they must be very intelligent because surely only highly-intelligent people can produce such highly-valued output.

Then along comes a machine that can do the two things that CEOs believe represent the height of intelligence: talk at length about random bullshit, and make vibes-based decisions. Of course CEOs are going to buy into the hype and assume this technology is genuinely intelligent, it's very good at CEO things and CEOs are very smart! From there it takes very little effort to convince them that this is the technology of the future and that soon it will 'transform' the workplace, replace workers, etc

I think it’s shallower than that.

Business Idiots

It's flashy, does just enough to look impressive, and a lot of people throw money at it. Just like them.

They're stupid and selfish. We are ruled by idiots.

A lot of management don't really understand.. anything. They don't understand how real work happens. They're removed from that world. They just vibe and bullshit.

Ed Zitron has written extensively about business idiots.

Text prompts are entirely how they interacted with others before AI

The response is immediate

The llm makes you feel good about asking it to do stuff, real humans are getting difficult tasks to do and so there is sort of a bad feeling associated with using them.

fully automated luxury space capitalism

Put another way, there's over a trillion in capex on the table. What trillion dollar value could it provide to just break even?

Eliminating tons of jobs. But liability laws are holding a lot of implementation back - which is a big reason AI companies are getting so politically involved

Don't forget to add, "AI is sycophantic." The Alien Invasion curries favor by constantly telling the CEO how right and intelligent he is, while it's picking his pockets and destroying his business.

Not to mention that the sycophantic “personality type” that chatbots display appeals to the egos of CEOs and other executive types - “Finally, my genius is being properly recognized and I am being shown the appropriate the deference I deserve”

The line item for Payroll is often called "burden," if that tells you how they think.

Why do people with MBAs whose entire training is on how to network follow the trend unthinkingly?

Yes to all of this, but I think you're giving them too much credit. There's a more compelling reason that is causing this behavior cycle among executives. Like a school of fish, CEOs swim in the direction and speed they see other CEOs swimming without giving a second thought to why they're following along. There's safety staying with the group. They're going in circles because all the other CEOs are doing the same thing and they fear being left behind, regardless of whether it truly makes any business sense. There's no real thought behind it. "Big tech is doing this, and therefore so should we."

to add to the other excellent theories here: Most if not all flagship AI right now is extremely sycophantic. Not only is it a magic black box that gives correct-sounding answers and never needs to sleep, eat or unionize; it also makes you, the user, feel ✨ s p e c i a l ✨. and wouldn't you know it, CEOs fucking love being made to feel like they're the smartest man in the room, even when (sometimes especially when) they are in fact the biggest moron to suck oxygen in a five mile radius. LLMs are genuinely phenomenal at making your unhinged, disconnected-from-reality half-baked ideas not only sound good, but then they also convince you you're the next Einstein for thinking of them.

Yeah, gee, I wonder why CEOs love AI so much.

Cuz theyre trying to get everyone else to love it so they can control everything

It's "ethical" slavery, why wouldn't they like it?

For the saner ones, it's an excuse to layoff workers after over-hiring. AFAICT there are not AI systems that completely replace a human bean.

I can only tell for CFOs as I am in strategy consulting. It is a mixture of hype and showing to shareholders that they do something to improve, a couple of years back this was robotic process automation, then metaverse and blockchain, then process mining. Now it is AI and in 2-5 years it is going to be something else. These trends pop up and become irrelevant again, it is only about showing off, being trendy, showing action, the actual savings are just superficial arguments so that the employees can do more "value add work" instead, whatever that is. You need to also consider that CxOs are usually only a limited time in their position and they want to show that they are exciting and new.

It's kind of stupid really, who'll need a CEO or even a manager when you have AI just doing all the work? They will not be relevant if their wet dream comes through.