Burning Questions
May
How Researchers Are Helping Home Health Agencies with HHCAHPS Surveys
jerry9789 0 comments Burning Questions
What Are Home Health Services?
The American adult population aged 65 and older is projected to increase from 58 million in 2022 to 82 million by 2050, translating to an unprecedented 47% growth. From a 17% share of the total US population, this age group’s portion is estimated to grow to 23%.
And an aging population means more elderly adults looking to remain independent at home, in spite of the risks of various chronic conditions as well as unexpected mishaps like losing one’s balance and stumbling or falling. This is where home health services come in. Fast becoming a staple of the healthcare system, Medicare and Medicaid-certified home health agencies aim to provide “acute, chronic, and rehabilitative care from skilled and knowledgeable interdisciplinary clinical teams” while supporting elderly adults’ preferences to remain at home.
Home health services are forecasted to grow from a $100 billion to a $200 billion industry by 2028. The Centers for Medicare & Medicaid Services (CMS) pay for the majority of home health services costs, as Medicaid and Medicare make up over 60% of the US home healthcare expenses. To better evaluate, understand and improve the patient experience with home health services, the CMS has administered a survey collecting feedback from patients or their families about their skilled home care experience.
Copyright: Andrea Piacquadio
What Is A Home Health Care CAHPS Survey?
The Consumer Assessment of Healthcare Providers and Systems (CAHPS) is a program developed by the Agency for Healthcare Research and Quality (AHRQ), as requested by the CMS, which uses standardized surveys for gathering and analyzing information about patients’ experiences with healthcare services, including home health agencies. Unlike customer satisfaction surveys, CAHPS surveys focus on the patient’s experience and/or perception rather than their satisfaction with the care they’ve received. The program’s goals include the improvement of the scientific understanding of patient experience and the provision of tools for organizations to improve quality of care. The CMS publicly reports its patient experience survey results, with some surveys affecting payments to providers.
The Home Health Care CAHPS Survey (HHCAHPS), specifically, was designed to measure the experiences of people getting home health care from Medicare and Medicaid-certified home health care agencies. The first national, standardized, and publicly reported survey of home health care patients’ perspectives on their skilled home care, the HHCAHPS survey asks patients and/or their families about their experiences regarding communication between them and their providers, specific care issues, rating of care provided by the agency, and their willingness to recommend the agency to friends and family. An HHCAHPS survey is conducted by approved survey vendors through three modes: mail only, telephone only, or a mix of mail survey with a telephone follow-up for non-respondents.
The HHCAHPS survey was implemented nationally in October 2009 with home health agencies participating on a voluntary basis before quality reporting requirements for the home health annual payment update (APU) started in the third quarter of 2010. At present, the CMS requires all home health agencies receiving Medicare or Medicaid payments for serving 60 or more survey-eligible patients annually to contract with an approved HHCAHPS Survey vendor to administer the survey on a monthly basis. (Agencies serving 59 or fewer patients may apply for an exemption from the survey requirement.) The survey data is then submitted to the HHCAHPS Data Center on a quarterly basis with public reporting of survey results reflected at Home Health Compare.
Copyright: Kampus Production
What Benefits do the HHCAHPS Surveys Provide?
The HHCAHPS surveys have three broad goals:
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- Produce comparable data based on patients’ experiences for objective comparisons between home health agencies
- Improve the public accountability of home health agencies with the care and service they provide
- Incentivize home health agencies to continually improve their quality of care.
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It’s easy to think that HHCAHPS surveys influence the public reputation of a home health agency as well as the payment they could collect from the CMS. However, that view reduces the survey to the realm of “customer satisfaction,” with its attendant reliance on things like 1-to-5 scales. But instead of a pure “customer satisfaction” framework, the information gathered from HHCAHPS surveys comes from a person-centered viewpoint based on the patient’s perception of experience with the home health agency. This is accomplished through the use of core questions like does the agency effectively explain things to the patient in a way they understand, or do their personnel show a high level of professionalism or respect toward the patient. Framing questions this way lays a solid groundwork for comparing agencies.
HHCAHPS surveys can also effectively identify servicing gaps and suggest creative solutions in the delivery of home health care services. Such insights can lead to better financial outcomes for providers, since the CMS is providing incentives for higher levels of care, rather than paying the same rate for all, regardless of the patients’ perception of performance.
Why Use Cascade Strategies for Your HHCAHPS Surveys?
Cascade Strategies has over three decades of experience serving the health care industry. Our experience and expertise will help transform the information collected from your survey results into actionable insights, elevating the level of home health service and care you provide to make you stand out from the other agencies in addition to maximizing your financial gains from the CMS. Please visit our page describing our HHCAHPS Survey Services here, and let us know how we can help you. Also feel free to ask us questions using our contact form.
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Featured and Top Image Copyrights: Andrea Piacquadio
Apr
AI’s Impact On Critical Thinking and Learning – What Studies Are Saying So Far
jerry9789 0 comments artificial intelligence, Burning Questions
Generative AI and Critical Thinking
On our last blog, we touched on two studies suggesting that Generative AI is making us dumber. One of those studies, which was published in the journal Societies, aimed to look deeper into GenAI’s impact on our critical thinking by surveying and interviewing over 600 UK participants of varying age groups and academic backgrounds. The study found “a significant negative correlation between frequent AI tool usage and critical thinking abilities, mediated by increased cognitive offloading.”
Cognitive offloading refers to the utilization of external tools and processes to simplify tasks or optimize productivity. Cognitive offloading has always raised concerns over the perceived decline of certain skills — in this instance, the dulling of one’s critical thinking. In fact, the study found that cognitive offloading was worse with younger participants who demonstrated higher reliance on AI tools and less aptitude when it comes to their own critical thinking skills.
Conversely, participants with higher educational backgrounds showed better command of their critical thinking no matter the degree of AI usage, putting more confidence in their own mental acuity than the AI-based outputs. Aligning with our advocacy for the “appropriate use of AI,” the study emphasizes the importance and appreciation of high-level human thinking over thoughtless and unmitigated adoption of AI technology.
Copyright: jambulboy
Generative AI and Learning
In truth, a number of earlier studies have revealed that the arbitrary adoption of AI tools can be detrimental to one’s ability to learn or develop new skills. A 2024 Wharton study on the impact of OpenAI’s GPT-4 demonstrated that unmitigated deployment of GenAI fostered overreliance on the technology as a “crutch” and led to poor performance when such tools are taken away. The field experiment involved 1,000 high school math students who, following a math lesson, were asked to solve a practice test. They were divided into three groups, with two of these groups having access to ChatGPT while the third had only their class notes. One group of students with ChatGPT performed 48 percent better than those without; however, a follow-up exam without the aid of any laptop or books saw the same students scoring worse by 17 percent than their peers who had only their notes.
What about the second group with the GenAI tutor? They not only performed 127 percent higher than the group without ChatGPT access on the first exam, but they also scored close to the latter during the follow-up exam. The difference? Sometime down the line of their interactions, the first group with ChatGPT access would prompt their AI tutor to divulge the answers, resulting in an increased reliance on GenAI to provide the solutions instead of making use of their own problem-solving abilities. On the other hand, the other group’s AI tutor version was customized to be closer to how real-world and highly effective tutors would interact with students: it would help by giving hints and providing feedback on the learner’s performance, but it would never directly give the answer.
Similar tests with a GenAI tutor in 2023 studied the same issue of AI dependence and the value of careful deployment of AI tools. Khanmigo, a GenAI tutor developed by Khan Academy, was voluntarily tested by Newark elementary school teachers, who belong to the largest public school system in New Jersey. They came back with mixed results, with some complaining that the AI tutor gave away answers, even incorrect ones in some cases, while others appreciated the bot’s usefulness as a “co-teacher.”
Other studies regarding the effectiveness of AI tutors have shown increases in learning and student engagement. These studies have also shown that GenAI can help reduce the time it takes to get through learning materials compared to traditional methods. One study that extolled the benefits of GenAI tutors involved Harvard undergraduates learning physics in 2024, and similar to the third group in the Wharton research, the AI was prevented from directly providing the answer to students. It would guide the student throughout the learning process one step at a time, providing incremental updates of the student’s progress, but never outright telling them the answer. There are merits to the idea of Generative AI as a teaching assistant, but it serves students better when it is positioned to engage one’s attention and abilities rather than induce dependence on it to generate the answers.
Copyright: Only-shot
Can We Use GenAI Without Making Us Dumber?
These studies shed light on how we should approach AI solutions and development, whether the end product is being deployed in learning, productivity or other relevant applications. Beyond thoughtful planning and considerations on how AI tools would be deployed, there should be a focus on engaging the human faculties involved, with safeguards empowering man throughout the entire process instead of letting the machine take over the process wholesale. AI technology is developing rapidly, but we can keep pace and remain reasonable as long as human engagement and empowerment is kept at the core of its utilization and adoption.
Amid contemporary fears that anyone could be replaced anytime by AI, these studies highlight the importance of how vital and interconnected the human factor is to the effective deployment and development of AI tools. One could be content with the constant and consistent output AI tools generate, but progress is only possible when competent human minds are involved in the process and direction. Students can easily find answers with AI tools at their disposal, but why not advance their understanding of how solutions are formed with engaging and relatable AI-powered educational experiences? High-level human thinking grounded by values and experience can’t be replicated by machines, and perhaps there’s no better time than now to incorporate it into the heart of the AI revolution.
While AI development hopes that optimization and automation free the human mind to go after bigger and more creative pursuits, we here at Cascade Strategies simply hope that humanity emerges from all of these advancements more and not less than what it as we entered the AI revolution.
Additional Reading:
Why AI is no substitute for human teachers – Megan Morrone, Axios
AI Tutors Can Work—With the Right Guardrails – Daniel Leonard, Edutopia
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Mar
Are We Getting Dumber Because of AI?
jerry9789 0 comments artificial intelligence, Burning Questions
Is Generative AI making us dumber? Two recent studies suggest so.
A study published early this year titled “AI Tools in Society: Impacts on Cognitive Offloading and the Future of Critical Thinking” showed that growing dependence on AI could lead to a decline in critical thinking. Submitted by Michael Gerlich of the SBS Swiss Business School, the study was based on surveys and interviews of 666 UK participants from different age groups and academic backgrounds. The problem is more pronounced with younger participants who demonstrated increased reliance on AI to perform routine tasks and scored lower when it comes to critical thinking than their older counterparts.
More recently, a study by Microsoft and Carnegie Mellon University shared similar findings that the more workers depended on AI for their work, the duller their critical thinking becomes. The study surveyed 319 knowledge workers who used generative AI at least once a week and examined how and when they apply AI or their critical skills when performing tasks. The more faith the participant put in genAI to produce acceptable outcome, the less they use their critical thinking skills. On the other hand, participants who have higher confidence in their abilities than that of AI’s are found to exercise their critical thinking more out of concerns over unintended and overlooked machine output.
Copyright: Tara Winstead
What is Cognitive Offloading?
Both studies are linking overreliance on AI with cognitive offloading, which is when someone utilizes external tools or processes for completing tasks, resulting in their reduced engagement with deep, reflective thinking. Yes, AI is improving efficiency and saves time and financial costs, but these studies are suggesting that it could make humans less smart over time.
However, cognitive offloading isn’t new as it existed in a variety of forms throughout time, such as using a calculator instead of performing mental mathematics or simply making a grocery list instead of memorizing all the items you need to buy. It’s no surprise then that there are questions about the merits of the studies, such as self-reporting bias or how critical thinking was measured. Forbes suggests that AI isn’t making us dumb but lazy, while another emphasizes that in order for there to be harm to one’s critical thinking abilities, one must have critical thinking to begin with.
Copyright: Pavel Danilyuk
Rethinking AI Development
Nevertheless, these studies contribute to the conversation regarding the direction of genAI development, now with the nuance of being mindful and respectful of its human users’ intelligence and faculties. Recommendations include rethinking AI designs and processes which incorporates and engages human critical thinking. They’re helping bring back focus to AI serving as a tool augmenting instead of overtaking human capabilities.
For us at Cascade Strategies, we’re glad that these studies have renewed awareness and appreciation of human intelligence and creativity. Our world could’ve easily devolved into settling for more of the same output so it pleases us to learn that more voices are becoming advocates and proponents not only of the “appropriate use of AI” but also of high level human thinking.
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Top Image Copyright: Tara Winstead
Mar
4 Trends Indicate AI Is Disrupting Labor Market
jerry9789 0 comments artificial intelligence, Burning Questions
Is AI going to disrupt the labor market? Researchers think it has already started to do so.
Harvard economists David Deming and Lawrence H. Summers, along with Kennedy School predoctoral fellow Christopher Ong, have presented a new paper that looks at over 100 years of “occupational churn” for a study of technological disruption. “Occupational churn” refers to each profession’s share in the U.S. labor market, which Deming and Summers have always been interested in gauging. With the help of Ong, they applied the metric to 124 years of U.S. Census data, initially sharing their findings in a volume published last fall by the Aspen Economic Strategy Group.
So are robots going to take over human jobs? This sentiment has always been present, and for good cause, whenever breakthrough technologies such as keyboards, electricity, and computer-based manufacturing emerge. The 1950s, ’60s, and ’70s demonstrated volatility that surprised but eventually made sense to Summers, while Deming characterized the 2000s and 2010s as having “automation anxiety.” The study, however, revealed that the labor market enjoyed stability and low churn between 1990 and 2017, when the pace of disruption slowed.
But for 2019 onwards, it appears that there’s a major change set to happen, with four labor market trends pointing towards AI as the new breakthrough technology.
Copyright: Kindel Media
1. High-paying jobs are on the rise
The first trend sees job polarization being replaced by general skill upgrading. Job polarization refers to increased employment opportunities in the high- and low-skill occupations, while middle-skill jobs go through a relative decline. Extending across multiple decades and various economic states, this phenomenon has been influenced by technological shifts such as manufacturing automation and the widespread adoption of office software.
However, the report noted that between 2016 and 2022 low- and middle-skill jobs have both declined, while high-skilled, high-paying jobs have slightly increased. The report adds that data collected through 2024 show similar results, denoting the end of polarization as of 2016 and the start of a trend toward skill upgrading.
2. Low-paying service work employment is flat or in decline
Job polarization during the 2000s was seen as a result of middle-skill production jobs being replaced by low-paid service work. Low-skill jobs enjoyed robust growth during the 2000s but slowed in the early 2010s and was flat throughout the rest of the decade, falling rapidly in 2020 when the COVID-19 pandemic happened. While low-paying occupations have partly recovered in 2024, most service sector employment is back to the same level it started at before its rapid growth back in the 2000s.
The decline in low-paying service work can’t be pinned solely on the emergence of AI, however, as other factors include the aforementioned pandemic disruption, increasing wages, and a tighter labor market.
3. STEM occupations are on the rise
After a decline in the 2000s, STEM (science, technology, engineering, and math) jobs are now enjoying rapid growth from 6.5 percent in 2010 to nearly 10 percent in 2024. This growth also extends to business and management occupations such as science and engineering managers, management analysts, and other business operations specialists.
Firms have also increased their investments in AI-related technologies to match the rising number of technical talents they’re hiring and developing. Mostly driven by the need for more computing power, software and information processing investments are now above 4 percent once again — the same level they were at prior to the bursting of the dot-com bubble and the 2001 recession — while research and development spending as a share of GDP has now reached a record high of 2.9 percent.
4. Retail sales jobs are in decline
Even before the pandemic, retail sales occupations had been declining. Retail sales jobs dropped by 850,000 between 2013 and 2023, which translates to a decrease from a 7.5 percent share to a 5.7 percent share of employment and represents a 25 percent reduction of share in the job market in just a decade.
This reduction is seen as one effect of e-commerce’s early adoption of predictive AI models around the mid-2010s to generate personal recommendations based on customers’ browsing and buying histories, along with predicting local product needs for stocking warehouses. Online retail has more than doubled its share of all retail sales, increasing to 15.6 percent from 7 percent in 2015.
Meanwhile, retail labor productivity has increased while the number of jobs declined, mimicking what had happened with manufacturing production jobs 50 years prior. Online retail’s demand for light delivery service truck drivers for their last-mile package delivery and “stockers and order fillers” in their large warehouses resulted in employment growth in these occupations.
Copyright: u_fg0tkeqgiy
Conclusion
Is AI going to replace you at work? Looking at these four trends, the answer is going to depend on what you do for a living.
Summers pointed out that that “highly empowering” forms of AI might be so transformative that “certain types of activities simply won’t be done by people anymore.” Data exists to corroborate the assertion that automation claims jobs, Deming citing early 20th-century telephone operators in a Substack post. The study notes that sales and administrative support occupations may experience future declines in employment as AI innovates and improves on certain tasks — for example, personalized product recommendations, rapid pricing adjustments, inventory management, transcription, and automated scheduling.
As AI is increasingly used to boost productivity, there are some tasks where it still might not be as effective as humans. Based on this observation, some firms may conclude that, rather than replace human knowledge workers with robots, it might be wiser to simply increase their expectations from their human workforce. This is one of the reasons the study recommends higher levels of public and private investment in STEM education, reasoning that such training and reskilling of workers will help them adapt to a world in which the new technologies are here to stay.
Additional Reference Article: Is AI already shaking up labor market? – The Harvard Gazette, Christy DeSmith (February 14, 2025)
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Feb
“Distillation” Is Shaking Up The AI Industry
jerry9789 0 comments artificial intelligence, Brandview World
Paradigm Shift
We’ve recently written about recent AI advancements and popularity, particularly generative AI like that of ChatGPT, driving renewed demand for data centers not seen in decades. This surging demand pushed tech investors to put $39.6 billion into data center development in 2024, which is 12 times the amount invested back in 2016.
A recent development, however, has stirred things up, especially the concept that billions of dollars needed to be spent for AI advancement. Developed by a Chinese AI research lab, an open-source large language model named DeepSeek was released and performed on par with OpenAI, but it reportedly operates for just a fraction of the cost of Western AI models. OpenAI, however, is investigating if DeepSeek utilized distillation of the former’s AI models to develop their systems.
Copyright: cottonbro studio
What Is “Distillation?”
According to Labelbox, model distillation (or knowledge distillation) is a machine learning technique involving the transfer of knowledge from a large model to a smaller one. Distillation bridges the gap between computational demand and the cost for training large models while maintaining performance. Basically, the large model learns from an enormous amount of raw data for a number of months and a huge sum of money typically in a training lab, then passes on that knowledge to its smaller counterpart primed for real-world application and production for less time and money.
Distillation has been around for some time and has been used by AI developers, but not to the same degree of success as DeepSeek. The Chinese AI developer had said that aside from their own models, they also distilled from open-source AIs released by Meta Platforms and Alibaba.
However, the terms of service for OpenAI prohibits the use of its models for developing competing applications. While OpenAI had banned suspected accounts for distillation during its investigation, US President Donald Trump’s AI czar David Sacks had called out DeepSeek for distilling from OpenAI models. Sacks added that US AI companies should take measures to protect their models or make it difficult for their models to be distilled.
Copyright: Darlene Anderson
How Does Distillation Affect AI Investments?
On the back of DeepSeek’s success, distillation might give tech giants cause to reexamine their business models and investors to question the amount of dollars they put into AI advancements. Is it worth it to be a pioneer or industry leader when the same efforts can be replicated by smaller rivals at less cost? Can an advantage still exist for tech companies that ask for huge investments to blaze a trail when others are too quick to follow and build upon the leader’s achievements?
A recent Wall Street Journal article notes that tech executives expect distillation to produce more high-quality models. The same article mentions Anthropic CEO Dario Amodei blogging that DeepSeek’s R1 model “is not a unique breakthrough or something that fundamentally changes the economics” of advanced AI systems. This is an expected development as the costs for AI operations continue to fall and models move towards being more open-source.
Perhaps that’s where the advantage for tech leaders and investors lies: the opportunity to break new ground and the understanding that you’re seeking answers from unexplored spaces while the rest limit themselves and reiterate within the same technological confines. Established tech giants continue to enjoy the prestige of their AI models being more widely used in Silicon Valley — despite DeepSeek’s economical advantage — and the expectation of being the first to bring new advancements and developments to the digital world.
And maybe, just maybe, in that space between the pursuit of new AI breakthroughs and lower-cost AI models lie solutions to help meet the increasing demand for data centers and computing power.
Copyright: panumas nikhomkhai
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Jan
The Demand For Data Centers
Do you know how much energy a ChatGPT query consumes? If you use a traditional Google search to find the answer, that particular Google search would use about 0.0003 kWh of energy, which is enough power to light up a 60-watt light bulb for 17 seconds. A ChatGPT query (or even Google’s own AI-powered search) consumes an estimated 2.9 Wh of energy, which is ten times the energy used by a traditional Google search. Multiply the energy consumed by 200 million ChatGPT daily queries by a year and you have enough power for approximately 21,602 U.S. homes annually or to run an entire country like Finland or Belgium for a day.
No surprise then that AI’s growing mainstream popularity and usage have led to an increase in data center demand. For years, data centers were able to maintain a stable amount of power consumption despite their workloads being tripled, thanks to efficient use of the power they consume. However, that efficiency is now challenged by the AI revolution, with Goldman Sachs Research estimating data center power demand growing 160% by 2030.
McKinsey & Company noted in a September 2024 report that data centers consume 3% to 4% of total US power demand today, while Goldman Sachs puts worldwide use at 1% to 2% of overall power. By the end of the decade, data centers could be seen accounting for 12% of total US power and 3% to 4% of overall global energy. This level of demand spurred investors to push $39.6 billion into data center development and related assets in 2024, which is 12 times the amount spent in 2016.
Copyright: panumas nikhomkhai
How All That Power Is Used by AI
What were once warehouse facilities hosting servers mostly found in industrial parks or remote areas, data centers have now progressed into vital institutions in the digital world we’re living in today. The “old” problem used to be that the traditional data centers had some space that was underutilized, while the “new” problem is that space is scarce and critically needed. This has created a surging demand for more of these structures in order to address AI’s accelerating demand for more computing power.
As illustrated earlier, AI workloads consume more power than traditional counterparts like cloud service providers. Out of the two primary AI operations, “training” requires more computing power to build and expand models over time. However, the operation that derives responses from existing models called “inferencing” is growing quickly in volume as AI-powered applications become more popular and widely adopted according to a Moody’s Rating report. Their report further predicts inferencing growth over the next five years to make up a majority of AI workloads.
Amazon, Google, Microsoft, and Meta have stepped up to satisfy the demand by building, leasing and developing plans for hyperscale data centers. Moreover, investors have demonstrated a pronounced prioritization of AI projects over traditional IT investments; in fact, an Axios article noted that “tech leaders are actually worrying about spending too little.”
Copyright: Brett Sayles
Chokepoints in the AI Boom
It’s not only power that tech companies and developers have to consider when addressing the demand for new data centers; their location and access to that power are challenging their progress and development. Data centers may consume up to 4% of US power today, but because they are clustered in certain major markets they pose a substantial stress to local resources. McKinsey & Company’s September 2024 report also noted that there is at least a three-year wait time for new data centers to tap into the power grid of a major market like Northern Virginia. The search for available space, power and tax incentives have led developers to look into other markets like Dallas or Atlanta, according to a Pitchbook article.
Unlike investors, some local governments are not as keen on the development of data centers and may pause contracts or prioritize granting access to their power grid to other projects. An October report by the Washington Post revealed that a number of small towns have strongly pushed back against the construction of data centers in their areas.
In addition to concerns from residents over the strain data centers would put on local resources, carbon dioxide emissions can’t be overlooked, as Goldman Sachs estimates that such emissions will more than double by 2030. Areas with rising energy consumption from data centers might therefore find it challenging to meet climate targets.
Accelerated data center equipment demands are also straining the supply chain, as orders are taking years to fulfill. Planned tariff increases could also stress the delivery of offshore-produced parts and components used by data centers.
Copyright: panumas nikhomkhai
Navigating Towards The Future
While it is exciting to witness AI’s mainstream adoption and technological advancements, the challenges brought forth by its explosive demand for data centers could be just as intimidating. Perhaps Forbes expressed best how we should navigate this period of growth and uncertainty: we need to plan with purpose, not panic. We need to build with responsibility, not exuberance.
While the AI boom granted us the opportunity to correct the oversupply of demand centers resulting from the dot-com boom, we need to tread more carefully when addressing this new need for more of these infrastructures. We need to understand what each data center is being planned and built for, its primary purpose, and how it connects to local resources. Yes, we were able to breathe new life into data centers that were underutilized after the Internet boom, but that took years and a new technological revolution to correct. Who knows if we’re also able to enjoy the same chance to recover if we fumble today’s attempts to address the demand for data centers? For all we know, the next technological wave might such be a swerve that it advances beyond the need for data centers.
We should also improve, innovate or discover new renewable and responsible energy solutions as well as increase the efficiency of our developing technologies’ use of power. There’s also an opportunity for the tech industry to enter into dialogues with local audiences about what is happening in the digital world and what they can expect from AI, thus demonstrating transparency and social responsibility.
As investors and developers eagerly meet AI’s surging demand for data centers, perhaps we can pause and appreciate this opportunity to make decisions that not only fortify the connection between the digital space and the world we live in today, but also forge a more responsible and sustainable path towards the future.
Copyright: TheDigitalArtist
The Impact of DeepSeek
While the tech industry searches for solutions to the data center demand, a new player has emerged to shake things up: Chinese AI research lab DeepSeek has released their open-source large language model. Quickly shooting to the top of Apple Store’s downloads, DeepSeek has challenged contemporary views on AI development with a platform that performs just as powerfully and efficiently as OpenAI while reportedly operating at a fraction of its Western counterparts’ cost. While it feels like we’re on the brink of a paradigm shift, we believe its true impact is yet to be seen. We expect to know and learn more in the coming weeks, and we’ll share our thoughts in a future blog.
Copyright: Yanu_jay
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Dec
What’s Going On With Consumer Startups In The Age of AI?
jerry9789 0 comments artificial intelligence, Brandview World, Burning Questions
Enterprise Over Consumer
The dawn of the Internet era witnessed the emergence of huge consumer companies like Amazon while the advent of mobile technology had Uber and the like on the forefront. However, it appears that the tide has changed in this new age of AI with startup founders and investors appearing to favor enterprise over consumer efforts.
This observation is the school of thought on which the PitchBook article “Where are all the consumer AI startups—and why aren’t VCs funding them?” was based and written. It came from the author’s takeaway from her two-day experience attending the recent startup conference Slush in Helsinki where venture capitalists expressed high interests in AI startups as expected, but notably for B2B over B2C.
She further adds that PitchBook data has venture funding for B2B AI startups is at $16.4 billion this year while B2C is only at $7.8 billion. But with the consumer AI market estimated to be doubly larger than its enterprise counterpart by 2032, she posts the question if there is a lack of B2C startups, or if VC are simply just not funding consumer AI companies?
Copyright: fauxels
The Challenges of B2C AI
To start with, it simply seems that investors generally are not keen on consumer startups especially with the VC downturn starting in 2022. A combination of factors such as rising inflation, higher interest rates and valuation markdowns have created a harsh macroeconomic climate for B2C AI to thrive. And when stable profitability is the bottom line, investors would understandably be more attractive to the steady and predictable revenues generated by B2B AI companies over the unsustainable and erratic B2C AI business models.
Jordan Steiner, CEO and developer capital/chief strategy officer at Monadical, shared some unfavorable characteristics he noticed from B2C AI companies he noticed on a LinkedIn post. Most B2C AI ideas these days he found are easily replicable. When competitors can not only easily clone but also improve on an existing idea, this can hamstring any company’s chances from dominating the space or becoming an incumbent. And when these factors create a cycle where users chase the newest cool product and churn when the novelty wears off, it illustrates just how unsustainable B2C AI business models are, especially in this period of time when user acquisition costs are higher.
And when a business model banks more on desirability instead of addressing pain points, there is a continuous struggle to iterate and produce new features or content. This then requires a consistent and ongoing understanding of consumer trends, necessitating access to consumer data and insights that a startup might not have at the beginning and need to build over time, primarily with user acquisition. Incumbent B2C companies would most likely have heavily invested on acquiring consumer data and insights to maintain and defend their longstanding piece of the market.
So why do B2B AI investments seem the more attractive prospects then at this time? By prioritizing pain points over desirability, then selling to and maintaining long-term relationships with key industry players, B2B AI companies are able to eventually build desirability to attract more clients. B2B clients are also more likely to sign up and keep multi-year contracts and subscriptions which not only provide steady and stable revenue but also client data vital for product improvement and customization, helping not only build brand loyalty but also incumbency and low churn.
Copyright: Christina Morillo
Can A B2C AI Company Succeed?
Despite the aforementioned obstacles, there is room for a consumer AI startup to thrive. The PitchBook article suggests focusing “other spaces where big tech has less credibility, such as mental health solutions.” In the same article, Point72 Ventures managing partner Sri Chandrasekar highlights differentiation as being a key characteristic for a B2C AI company to help close investments, this uniqueness holding off attempts to be replicated while tapping into that factor of desirability that excites and engages consumers while attracting investors.
If anything else, a consumer AI startup might need to bootstrap it more than just having an idea to attract investments. Demonstrating and executing on your unique position not only proves your idea as sound and feasible but you are able to get your B2C AI company past the first step towards progressing to the potentially higher rewards offered in this space.
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Top Image Copyright: Photo By Kaboompics.com/Karolina Grabowska
Nov
The Children of Millenials: Getting Your Brand Ready For Gen Alpha
jerry9789 0 comments Brand Surveys and Testing, Brandview World, Burning Questions
You’ve done your high-quality segmentation study and persona development, considered single-segment focus and/or multi-segment strategies, crafted buyers’ journeys with psychographic segmentation. Your marketing plans form a playbook catering to a multi-generational audience of baby boomers, Gen X, Gen Y (Millenials) or Gen Z, but have you made room for Gen Alpha?
Who Are Gen Alpha?
Gen Alpha refers to the generation born between 2010 and 2025. Between 2.5 million and 2.8 million of this demographic cohort are being born each week around the world. Once 2024 is up, the first generation born and raised in the twenty-first century would’ve exceeded 2 billion worldwide, and they’re expected to outnumber baby boomers by 2025. Also known as “millenials’ children,” Gen Alpha is projected to be the largest and most diverse generation yet.
True digital natives, Gen Alpha grew up accustomed to smart devices and social media. This was reinforced further when the pandemic caused the whole world to stay indoors and turn to digital devices to connect, find entertainment and for virtual learning. It’s no surprise then that they exhibit comfort and quick adaptability with new technologies like artificial intelligence (AI), augmented reality (AR) and virtual reality (VR). Now while the digital world is a constant in their lives, Gen Alpha actually takes time offline and away from tech go outside and engage with friends or physical activities in tandem with caring for their mental health, a practice that became increasingly noticeable after the pandemic.
And it’s not only their mental well-being that Gen Alpha are concerned for. They’re also socially and environmentally conscious, growing up hearing and learning about inclusivity and climate change. They thus have a higher preference for products, brands and practices that promote equality, social responsibility, eco-friendliness, and sustainability when compared to previous generations. They’re also more appreciative of diversity due to globalization and digital connectivity exposing them to different cultures and perspectives.
Video-centric YouTube and TikTok are their favorite digital platforms. They’re also inclined to thrive in the safe and niche confines of gaming over contributing to the noisy and oftentimes chaotic discourse found in most social media. More than just the satisfaction of playing a video game, they express themselves in the customizable virtual space offered by worldbuilding games like Minecraft and Roblux. They are empowered by technology instead of dependent on it. And while they follow and take cues from influencers, they appreciate authenticity, personalization, and uniqueness, proving to be generally wary of and resistant to traditional marketing practices.
Why Market To Gen Alpha?
Gen Alpha is estimated to have an economic footprint of $5.4 billion by 2029. While that’s still a few years off, Gen Alpha has already and indirectly flexed their spending power by influencing their parents’ purchasing decisions while demonstrating at the same time a higher degree of brand awareness than older generations. They are confident with their choice of brands as it is a reflection of themselves and the values they appreciate.
The “adolescent demographic” is also challenging conventional marketing and advertising tactics, having already reshaped older or adult brand marketing. Where once there was space for “tween retail” with brands dedicated specifically for this age group and some adult clothing brands introducing specific clothing lines for tweens, mature brands for example simply expanded their size range to include their younger consumers. You’ll find Gen Alpha sharing the same brand choices or favorites with their millennial parents and Gen Z, the generation that preceded them.
With their digital affinity and offline exigencies set to shape the future of work, learning, and culture, brands would need to rework their marketing approach if they would like to attract Gen Alpha as early as now. While their older members are just entering their teens at this time, understanding how Gen Alpha thinks and behaves can help a brand adapt and lay the groundwork for their marketing endeavors as part of efforts to remain relevant and evolve with the times, especially with a generation this willful but informed when it comes to exercising choice.
How Should You Market To Gen Alpha?
Your marketing cornerstone can start with leveraging existing and emerging technology to understand and engage Gen Alpha. For starters, traditional demographics are already challenged by how diverse Gen Alpha is along with their preferences for personalization and uniqueness. Adopting AI and machine learning into your marketing strategy to analyze consumer behavior data and foresee trends can therefore help you craft a personalized and dynamic buyer experience for Gen Alpha. You can also employ AI-powered virtual assistants for personalized assistance during the shopping journey. AI can also grant your brand the flexibility to adapt to trends and feedback quickly in keeping in line with Gen Alpha’s needs for instant gratification.
Use gamification, polls or promos to enhance engagement and interactivity instead of conventional ads that Gen Alpha more often than not ignore or scroll past by. Add another layer to the shopping experience with AR and VR where virtual spaces allow them to visualize, explore and engage with products before even purchasing.
Gen Alpha is immersed in the digital world but they also seek engagement in the physical world. Offer in-store pick up options for online purchases to allow their shopping experience to extend to physical locations. Use geolocation and location-based services for sending relevant and personalized promotions and notifications, such as in-store only discounts and offers. Develop apps that not only incorporates these points but also enhances your omnichannel presence with seamless transition between online and physical shopping experiences. Don’t forget to promote and collect user-generated content as testimonials to the engaging and immersive experience your brand offers.
Some of the aforementioned technologies are still relatively new to the mainstream but learning and leveraging them as early as now allows your brand and marketing to evolve alongside them while growing and staying relevant with Gen Alpha.
Your brand would also need to increase focus on data protection and privacy, as Gen Alpha is particularly mindful of how valuable their personal information is in this era of data breaches and leaks. Brands need to be able to communicate clearly their privacy policies and demonstrate responsible data handling in addition to offering consumers control over how their personal information are use.
As mentioned before, Gen Alpha are acutely aware of social and economic issues aside from being the most diverse cohort yet. With this comes the rise of purpose-driven marketing where your brand needs to strongly communicate, commit and exemplify your mission and values, lest you be called out for virtue signaling. Gen Alpha are expecting brands these days to support and feature diversity and representation, calling out those that they perceive lack this value. Your brand would need to highlight and be transparent with your sustainable and ethical practices, including sourcing, production, packaging, and labor, while continually seeking areas for improvement and better, more modern methods to adopt.
While influencers are one of the top sources from where Gen Alpha learns and considers products to purchase, there is a shift nowadays on which personalities to follow thanks to this generation’s penchant for authenticity and shared values. Instead of considerably bigger names and one-time sponsorship, brands can consider long-term partnerships with micro-influencers and nano-influencers. Their niche following might be smaller but they are highly engaged and more connected, allowing for more organic integration of your brand messaging through collaborative content creation. As what we’ve already learned with high-quality segmentation study and persona development, your marketing goals can sometimes be better served by identifying, focusing and tailoring your campaign towards that consumer instead of a “blanket” approach with demographic data for reach with an influencer with a large following.
While this generation is still a year shy of rounding out all of its members, understanding and engaging with Gen Alpha as early as now would benefit brands looking to find a foothold into future markets. As technologies evolve and attitudes change, there might be no better time than now for brands and their messaging to organically connect, resonate and grow alongside Gen Alpha.
For further reading:
https://www.tokinomo.com/blog/gen-alpha-consumers
https://medium.com/@daisygarciathomas/marketing-and-consumer-behavior-of-generation-alpha-9492ceaf63ee
https://therobinreport.com/get-ready-for-gen-alpha-consumer-behavior-shifts/
https://hbr.org/resources/pdfs/comm/journey/TheBusinessCaseForUnderstandingGenerationAlpha.pdf
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Nov
“Humanizing” Market Research with AI
jerry9789 0 comments artificial intelligence, Brand Surveys and Testing, Burning Questions
The Boon and Bane of AI
The increasing and widespread utilization and demand for Artificial Intelligence have been met with both excitement and reservation. Excitement for the possibilities AI’s implementation unlocks, oftentimes steps ahead of the curve or beyond expectations; reservations not only stemming from the risks over its unethical and unchecked use, but also the ramifications for human involvement now that intelligent machines represent an optimized and economical choice for completing tasks and processes. But can there be a middle ground somewhere where AI and human engagement coexist and collaborate?
The “Humanization” of Market Research
“Capturing the Human Element in an Artificial World” by Eric Tayce (Quirk’s Marketing Research Review, Sep-Oct 2024) posits that such a midground is possible, especially in market research. An industry that’s all aware of its excessive dependence on technology to necessitate a push to “humanize” research data, it saw a dramatic shift from “data-intense tomes and clinical-sounding slide titles” to “streamlined, narrative-style reporting” focused on “the unique motivations and experiences that drive customer behaviors.” The latter “humanized” approach is able to communicate business goals while connecting and engaging on an emotional level. However, generative large language models (LLMs) cast a shadow on this “humanized” approach by offering synthetic outputs and progressive algorithms.
But combining both AI and efforts to “humanize” research can result in the whole being greater than the sum of its parts. The article shared that AI can help collect more unstructured data from survey research by employing conversational chatbots to create a natural, richer experience for the respondent. That unstructured data in turn can potentially provide more organic, more human insights with AI-powered algorithms, an undertaking that was once considered too complex or time-consuming. AI can also build multifaceted perspectives through context by linking survey records with a broad range of data sources. And in lieu of traditional static deliverables, data and insights can be presented in a vibrant and interactive narrative by an AI-powered persona.
The “Human” Element
All these interesting prospects can only be achieved when AI is tempered by high-quality human input and thoughtful implementation considerate of ethical and moral implications. Aside from AI mistakes and hallucinations existing, AI has been observed to be too helpful and excitable. Human oversight and input remain key in ensuring AI models are trained, fine-tuned and grounded with quality and relevant datasets while having enough flexibility to engage appropriately in open-ended interactions.
There’s no denying just how transformative AI is in reshaping industries today, including market research. Despite concerns of machines taking over jobs, one can look at it with the perspective of roles changing and adapting. AI with its generative and synthetic capabilities can elevate the “humanization” of market research, but to get to that point we simply can’t forget that humans are indispensable to the whole process.
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Oct
Concerns Over AI in The Workplace
Much has been said and concerns have been raised regarding the impact and influence of Artificial Intelligence in the way we do work and conduct business, despite AI’s popularity and appeal reaching mainstream and cultural heights in just the last few years. Most of these reservations stem from the thought of machines replacing people, as AI is continually applied to automate tasks, optimize efficiency and cut down costs wherever and whenever possible. But is the workplace of the future looking to be that dire and devoid of human ministration with the ever-increasing utilization of AI?
The Wall Street Journal did a good job of trying to answer that question by asking several top thinkers on this subject for their point of view. This article touches on those viewpoints and provides some of our own.
Many people fear that our growing dependency on AI could lead to indiscriminate and thoughtless applications, which may result in huge and unintended errors, perhaps even to the point of irreparable consequences. Even well-intentioned initiatives might bear inadvertent effects with one example being the use of digital assistants. Jonathan Gratch, professor of computer science at the University of Southern California, shares some insights from their research that indicates the weakening of emotional bonds and social checks present in a traditional team setup, or even in typical face-to-face negotiations. These ethical checks are reduced when AI-based virtual or digital assistants are involved, with interactions becoming more transactional and self-interested. Some people have also been observed instructing AI to channel deception and manipulation in order to gain unfair advantage.
Deliberate unethical usage is cause enough for alarm and worry as Stuart Madnick, professor of information technologies at the MIT Sloan School of Management, pointed out that AI makes scamming involving the use of personal details much easier and more dangerous. Whereas hackers and scammers were traditionally selective of who they victimize based on the ratio of the money they would be swindling to the effort and time involved to get the scheme going, an AI-driven con could widen the net they cast to include targets of lesser finances and resources they would normally not go after. In an office environment, this might mean AI-generated emails or phone or video calls with deep fakes that are so convincing an unsuspecting employee might transfer funds upon the instructions of their “boss.”
Sherry Turkle, author and Abby Rockefeller Mauzé Professor of the Social Studies of Science and Technology at the Massachusetts Institute of Technology, also points out the effects of pretend-empathy machines that are now commonly being employed for job interviews and performance assessments. When the opportunity to be hired or retain one’s job depends on AI judging and scoring us based on qualities it values the most, we might find ourselves training or adjusting “to please the machines.”
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Opportunities at The Workplace with AI
But it’s not all sad and gloom for the workplace of tomorrow with AI. One can also find opportunities if they’re able to look past all that uncertainty and apprehension. AI technology is bridging us to the future, but human intelligence can ultimately shape how that bridge is formed.
Circling back to task automation, this could mean that organizations would eventually have fewer employees and fewer layers of management. Depending on perspective and needs, this could either be the bane sceptics have been heralding or the boon that would serve as the catalyst for more change. With routine tasks having been automated, this would open up avenues to explore on what new work you could assign to your employees that a machine simply could not perform. You might also find some middle-tier work that could be trickled down to lower or greener employees, challenging them and helping them grow within your organization. This could also reduce the need to hire for midcareer posts outside your company which is a likely recourse if an organization is unable to grow their own talents in-house.
Alberto Rossi, finance professor and director of the AI, Analytics and Future of Work Initiative, at Georgetown University, shared that asset managers are now hiring more human advisers instead of laying them off, a result of offering hybrid advisory services that involve both human input and algorithms. The advisory service algorithms are assigned certain simple tasks while advisory personnels provide that essential human connection that’s key to client satisfaction and retention.
With the right data, AI tools and data analytics can transform not only how companies find and recruit talents but also build for the future with team recommendations and identifying organizational gaps. Guided by human judgment, AI can boost better collaboration and productivity at the workplace. Generative AI such as ChatGPT has been found likely to improve the productivity of all workers, especially low-skilled workers who appreciate the availability of such tools, helping narrow the productivity gap between this group and their higher-skilled peers.
An interesting development is the possible rise in value of workers older in age. The experience and knowledge they gain through the years can be leveraged to identify which issues need the most attention and immediate or timely resolution along with validating AI-based solutions and recommendations. Investing in further training and upskilling can also lead the way to improved AI utilization and collaboration; just as AI makes automated customer interaction feel much more natural, AI services can decrease complexity with coaching and continued education at the workplace with conversational interfaces and natural-language processing. This reduction in complexity can also extend to AI-powered “concierge” systems when assisting employees seeking benefits and services from their employer.
Ultimately, these exercises in the utilization and collaboration with AI can pave the road for organizational development from task-oriented AI to goal-oriented AI.
Copyright: Pavel Danilyuk
Transforming The Workplace with AI
As you might have noticed, we’ve painted two different futures for the workplace with AI: one conveying caution and warning, the other promoting potential and exploration. One of the key differences that separate both realities is the thoughtful and ethical application of AI. At Cascade Strategies, we’ve always advocated for the “Appropriate Use of AI” as we firmly believe that the effective and productive application of AI in shaping the future can only be achieved when tempered with human values and experience.
The AI boom has driven organizations and businesses to rethink the workplace. And in the midst of all the automation and optimization that would involve, we are hopeful that there’s always room for high level and inspired human thinking, the kind that unlocks genuine breakthroughs and achieves true excellence.
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