AI Governance: Who Still Makes the Decision?

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0:00 In medtech, the difference between a good quarter and a great one isn't always the product. It's the friction standing in the way. Broken sales cycles, misaligned teams, deals that stall at the finish line. Every leader feels it, and the best ones know how to remove it. Welcome to Zero Friction, the podcast where we go inside the minds of MedTech's top commercial leaders to uncover the real barriers they face, the decisions they make, and the systems they build to keep the revenue moving. I'm your host Terry Coutsolioutsos. Let's remove some friction. Welcome to Zero Friction podcast. This is Terry Coutsolioutsos and once again I have a an amazing guest and we're going to learn a lot of new things around governance total quality management and you know in the land of AI and how things are moving at such huge scale and speed a guy who has the expertise that we're going to describe today is going to be really important. So my guest is Jason

Farley. He's the founder of Bridge Gap Consulting and Jason has been in the TQM space and the governance space for a long period of time. I'll let Jason go through his history, what he's done from a historic perspective and then also more importantly, what is Bridge Gap doing today in order to help large enterprise govern and bring new things into their world. So Jason, thank you for being here and we all look forward to learning more. Awesome. Well, thank you for having me. This is a real privilege and I'm excited to share what I think is a really important topic. Excellent. Jason, why don't we start and kind of go back? I know you had um an early career entry into the Q TQM space with total quality management with a Japanese audio manufacturer, I believe.

So, why don't you start there and kind of briefly get us up to speed today and then let's tell us about all the great work you're doing. And I might add that Jason is a consultant. He's a you to be soon author and he's also an instructor, teacher and guy. Awesome. Well, thank you for that. And this was a nice easy intro. So, I feel very confident that hopefully at least I can deliver something that again speaks to why I'm urgent about this and so starting with my background. I did start back in the early 90s and in the TQM movement as you said, right? And that that movement was really sort of this culmination of this uh result of industries across the ocean right coming together. We we've all heard the storied experience of Dr. Deming and how he converted Japan's economy not single-handedly handedly but certainly had a big part in that. Well, all of those things that were taught there came back over and I was there in a working in an automotive wire harness

2:42 Manufacturing facility. We ultimately employed just in that location alone 2,000 folks under one roof. We did injection molding, electronic assembly, and wire extrusion and stranding. And I worked for the quality department and had found some literature. This was a Japanese company out of uh Numazu, Japan, Yazaki. and um they did quality circles across the world and we weren't doing them there where I worked and so I found the literature and I said hey why aren't we doing this and to make the long story short I was given permission to start moving down that path and two years later we took a team to Japan to participate in the annual quality circle competition and I was hooked and so what that means hooked to what well that's what it is interesting right I was in quality but that very quickly evolved to a larger view of connected function if you will and I don't know if that completely says the right story but it certainly is the way that my career moved and so in 2005 as a result of not

Only doing quality in a manufacturing environment but then doing the lean and the six sigma work in transactional environments I opened up my consulting business Bridge Gap Consulting and again so that was in 2005 I worked over the border in Wares Mexico on a second shift implementing being lean and uh and Bridge Gap's been open ever since obviously it's evolved though right so in the same way I moved from just quality and manufacturing to applying these process improvement tools kaizen if you will the TQM principles certainly Deming's profound knowledge moving these over to transactional environments was certainly right for the for the development if you will and so Bridge Gap Consulting over the years has in a similar way evolved involved starting again with the lean with the six sigma and then moving into project management for example and then now with this element that I'm excited to share with you today moving into enterprise governance with a specific definition about what enterprises are what's the nature of an enterprise and given all

The things that have happened especially with AI what can we do today that's different than what we've ever done that's exciting and and so talk to me a little bit about how all this started I I do think that I remember a story that your you were gone on a trip and your wife had collected a bunch of notebooks and some paperwork or you know I think you called it Jason's genius or something along those lines. She did. That's embarrassing. But yes, let's talk about that a little bit because I I think that's you know I think there's a couple components to that are really interesting. one is just the the fact that you're gathering all this knowledge and putting it together in one place and operationalizing it which is really a great start and then you know how AI has kind of changed your life a little bit as well. Nice. That's that's a great qualifier too and I'd love to touch on that as I move through sharing that idea of you know Jason's

5:42 Box of genius. Right. So my wife who is a stellar professional in the human resource discipline herself very often would get a little frustrated when I'd leave town say I've been to Iraq for example World Bank project uh there uh Kuwait. So these long trips out of town, she'd sit there and look at this desk of mine with all of these papers and she couldn't handle it. She's like, "Okay, I got to organize this." Well, easier said than done. What she ended up doing is I had all of these notepads, post-it notes, copy paper filled with just all kinds of notes. And when I was working for a mortgage company in 2005, they used to call me circles and squares cuz when I would bring them into meetings, I'd diagram everything. So all of these papers had all of this content and it was collected over the years and she'd put it in these boxes and quite frankly I'd never opened them. But what did happen is at some point not that long

Ago I said I've got to organize or at least I want to look back at some of this stuff cuz I know there are some things that I think would resonate. I I I'm good at making parallel application if you will. I see the big picture and I see things that are here and may have a fit here and explore those and that's all these all these writings sort of you know in in these boxes this box of genius right and please don't take that that I meant that seriously for myself I am by no stretch of the imagination a genius but it's interesting that later on as I started bringing all this content together I ended up deciding I wanted to share this in a book and I named the book a box of chaos and imagine that right the parallel there.

So of course the reference to a box of chaos is speaking to what enterprises exist in the very complex environment that we find ourselves and so AI enabled the collection of a lot of these thoughts. Most of it was me just you know from frontal lobe deep in the recesses of the brain whatever sharing with AI establishing you know pinning it down adding layering and developing what I call the enterprise thoughtware register that I have now my enterprise thoughtware register is specific to the idea ecosystem idea stands for iterative development for enterprise advancement and so I call it ITW so idea thoughtware and it's all of these ideas that I've collected over the years. Then also bringing in for example I mentioned Deming's profound knowledge of course you know there are many sources aside from Deming I gosh you know Singed and and and Ducker and you know go on and on Collins lots of just amazing thought leaders out there and so much of what I

8:24 Bring in terms of this these artifacts that I'm developing I've shared with you again the book and then the idea standard there's an associated compass that will go with that implementation guide and more importantly I'm working on a thing called a GS spec a governance system specification and all of this content is not really anything new and we know nothing new under the sun right so it is the fact though that it can be applied in very meaningful ways today that it hasn't been able to be done previously an example of that we bring a very specific definition to the term enterprise enterprise tradition traditionally has meant a number of things. Enterprise architecture. So it uses it as sort of a framing for the scope of things. Enterprise like Farley's enterprise, you know, means several organizations under one umbrella. And there are a number of other definitions for the word. But if we really think about what an enterprise is, it is an organization in the domain

Of all of its stakeholders, including the external stakeholders. And if we can settle on a definition like that, now we have something more precise to work with. And then further if we can say well what really is an enterprise. And so in pursuing my systems engineering masters in systems engineering when I was 50 years old I did that because I wanted to think about organizations as systems as many have. And this idea then of cybernetics. I started researching that intensely and really enjoyed what I you know the idea the concept the structure its implications. And then as I was putting all of these ideas together, I realized, wait a minute, we can actually do real cybernetics the way it was conceptualized with the power of AI now. And that makes sense because an enterprise being this composition of agency, right? Agents, individuals, people with purpose, that's a cybernetic system. So AI then enables us to truly apply this cybernetic system to the governance of an enterprise. And so I thought that was very important and I

Think that message needs to be shared. Tell us a little bit about cybernetic system and and can you frame that for the audience a little bit so they can kind of pull into that concept. Absolutely. You know when we you know there's Ashb and and Bear and and a number of different antecedants if we call can call them that folks that brought the idea of chaos for example the idea of cybernetic systems. All of these things have been around for some time. The key is that the convergence now where are we today and can we do something about it? So cybernetic is simply this idea like the analogy if you will of a boat and its rudder. So that system of feedback for the purpose of advancing the system to its purpose.

11:16 Well, that becomes pretty difficult, if you will, or at least what complex, right? When we're dealing with an enterprise of agents, both internal and external, this interaction of all of these this agency, multiple systems, many purposes within. So this you start thinking about well how in the world you know the the term hurting cats comes to mind if you will especially with all the data that is involved in today's business enterprise it's it's no longer you know we're not pushing paper anymore and so you know the data volume in today's enterprise is 10 20 30 100 times more. The speed at which that volume comes is 10 20 34 times as fast. So you not only have scale and speed coming together which is you know creating a lot of infrastructure friction and inertia just because you know people don't know how to architect or govern what's coming in.

How do you architect it? How do you flow it? How do people understand it all? How do people map to and and again I think one thing I love about what you're saying is the clear definition so that everybody understands. You know communication in today's enterprise is where everything falls apart. And so if you're not communicating and if your blue and my blue don't equal the same blue, then we're not talking the same language. Classic six sigma teaching, right? Operational definitions. If we cannot even in terms of educated societies, what do we do, right? We develop language, we develop understanding.

That's a progression. That's an example of some ITW that I developed. And that is this progression of awareness to agreement to alignment. We can't get there if we don't have if we don't develop predecessor. So we cannot agree if we're not aware of something knowledge right and then we cannot align if we cannot agree on this is and so fill it in right qualitative data operational definition. Oh yes that is let's say an M&M yes we can agree oh that's a peanut M&M that's a red peanut M&M. So this now all of a sudden this starts taking on more meaning and then we start moving from qualitative over to quantitative right we move from that is is not binary or binomial scale to okay ordinal what is it a big red peanut M&M right and then well what do you mean by big you can start measuring it on interval scale right so that whole movement through the scaling that moves us towards being able to communicate

13:46 More effectively right well that that's wellstied as is almost everything that I talk about, but applying that to governing the enterprise, that's a different story. What's interesting is, and you brought this up a few minutes ago, and I just want to kind of give a little bit more clarity on this idea of understanding by AI versus by human because at the end of the day, all the AI is going to do is it's going to in this cybernetic structure is going to illuminate. The human still has the sovereign decision, right? But the point that I came to and realized as many have already is that AI enables a level of analysis. You talked about the data, right? That's been around. So we we think about for example business intelligence and big data. Those have been I've got a couple of books up here, dummies for big data and business intelligence, business statistics, etc.

Data's been around and the the need, the desire and the value of transforming that data into information has always been urgent. Think about this. As human beings though, we only have a limited capacity or capability ultimately of transforming ourselves data into information. It has to be chopped up so that we can consume it, right? We've got to break it up. So, so typical graphics or displays, models of data for a person to uh be able to digest are relatively simple. Two-dimensional, three, four, five if we're, you know, skillful maybe is the word to use. But anyway, well, what does AI do for us? We don't have that limitation anymore. We can now take a hundred variables and look at them and assess them and and now that starts reflecting the level of variety requisite variety again box of chaos right so those systems theorists and whatnot who might recognize that terminology we need the requisite variety in order to deal with the complexity of a given system AI enables that that's why we can be now cybernetic

In terms of our systems design and response respon to the governance of said enterprise. So let's talk a little bit let's lean into governance a little bit. I think that's you know one of the strong topics we wanted to talk about today and you know I've worked with some large enterprise systems fortune 100 companies and you know governance topics are always interesting on on how they get framed, how they become implemented, how they get rolled out. Give us a little background on governance and you know the standards by which you're helping companies operate on. Excellent. Thank you for asking that. For so long and rightfully at some level, we associate governance with compliance, with risk, with doing things the right way, making sure that we are good stewards of the business in terms of keeping it in line, keeping it certainly from not performing. And and maybe that last characterization is a little weak, but it leads me to the point that I really want to make. And at the end of the day,

16:49 What really ought to be the purpose of governance, right? It it shouldn't be just a sort of passive, are we protecting, are we assuring, do we have the guard rails in place so that we don't go offline. It should be more than that. Governance ought to be about real leadership and management. And that's really one of the key definitions of governance as we're developing it at the CA, which is Council for Enterprise Advancement. talking about, you know, governance as advancement. That and that's kind of an expression, right?

Governance as advancement. And what that boils down to is is governance is this combination of leadership, which is empowerment, and management, which is enablement. And when you combine those, you get a really engaged workforce, and it also drives enterprise advancement. And that's what governance ought to be. That is what I'm hoping becomes the new definition right along with a clear definition of enterprise so that we're moving these things in a very sort of specific to the need and specific to possibly developing standards around this and and really entering a new age if you will of enterprise governance and just you know lining up with the the podcast zero friction is governance in many many ways it removes friction it it creates alignment it it smooths things out allows everybody to understand and work and collaborate much more effectively. So really does those are things especially you know like a large part of my audience is in the health care space which is you know other than maybe you know banking probably you know the highest regulated

Overmanaged broken system in America you know in many many ways and so when you're operating in these highly regulated environments you know having government structures especially when big enterprise you have finance you have operations you have sales and marketing, they're all looking at their worlds in a different different lens, right? And so everybody's view of good around governance is different. This is why I love what you talk about bringing people together to design this governance together is so important and that what you said and and thank you Terry for reminding me I think is probably the best way to say that that at the end of the day you know we can what is an enterprise right you could literally make a case that any organization I and you as an individual are organized right you are your own enterprise but you know we can scope out an enterprise at any level within an organization but let's this work now as it were with what we typically think of as a standalone business for example and

19:30 Calling that an enterprise well that enterprise has functions right so one of the things one of the key elements within that standard that I was referring to is speaking about a sort of universal design of all enterprises and one of the things I talk about is the business entity the business model and the business operating system and that business operating system one of the three component components is all of the functionality that is required to run the business, right? Well, each of those is their own enterprise, if you will, their own organization. You got HR, you got quality, engineering, production, assembly, whatever, billing, you know, emergency room, whatever the case may be, depending on what kind of business you're in. And these functions, you know, how do they align and how do they govern relative to the entire enterprise and in such a way that they are aligned as we mentioned earlier. And so there has to be this operational element or layer if you will that we connect governance to. And that's a lot of the

Work that I've been doing recently is operationalizing the governance standard and framework so that there's this really tight relationship between running operations handinand because one of the one of the the concepts that is central to uh within the idea standard is this idea of collective perspective. And so the collective perspective is this theoretical paradigm or view perception of the collective. Imagine if you got every single person in the enterprise and you could see through a pair of eyes that saw everything everybody saw at one time, right? I mean, this is the ideal state, isn't it? Being able to see everything from all perspectives all at once and processing that. Well, that's the goal state. That's the ideal state.

We want to get there. We want people's views from the top, from the bottom and all sides to be seen. So this collective perspective once again enabled by AI uh and other tools, right? Is a is an is a is a concept. Yes. But at the same time, isn't it what we strive for when we talk about this whole idea of managing big data and intelligence, etc. And so that's kind of again this driving force behind establishing the connection between operations and higher level governance. And when I say higher level governance, it's a slip really because governance and my whole point about the collective perspective was simply this.

This should be literally a governed sort of framework. I don't like to use the word framework. Sorry. That's why it has a boach if you will. a governance framework though that brings in all of those perspectives in a way that is maintaining equity, you know, an equitable participation in the enterprise. The fact of the matter is, and this is a bit of a touchy topic and I don't want to go too deep into it, of course, not everybody necessarily has a seat at the table for every conversation. You want the people with the appropriate the requisite knowledge and insight to make decisions about certain things. But at the same time, you always have to ask yourself where am I positioning then all the different potential contributors and bringing in their value for what they should have a say so for. Right? And that's interesting. How do we achieve that?

22:46 That's a design issue and that's some of the continued work that we're building into this. How do you design a little bit of tension into the whole process? because I'm sure you can't get to a phenomenal outcome with a little tension or a little designed, you know, friction in the process to to really get to the best outcome, the best balanced outcome, right? And the answer, man, you just you're you're really doing great with helping me to say the things that I think are important to say. So, thank you for that. Principles, the answer is principles. You know, at the end of the day, all of this has to be princ principal driven, principalbased behavior, right? So what are the principles? Now that's interesting as we start making familiar to uh the business community this term governance system specification GSP spec right each enterprise will develop their own GS spec there can be a baseline but at the same time every enterprise is its own entity and therefore has the right to

Establish principles and values. Okay. So, so then now that goes back to that whole thing about the aware, agree, align. And so, you know, it all starts with these principles and then we move into this idea of the thoughtware. And so, if we can be aware of things and come to agreement, that's where the friction starts reducing, right? That's the alignment piece, right? So, it starts with principles. And of course, culture, who has the influence on culture? Leaders. But if we all of a sudden make it cultural that everybody's a leader now it's on all of us to lead that way right it's on all of us to become if you will I use Maslo's hierarchy you know what is that all about it's motivation but it's all about a set of needs right this hierarchy of needs and as we climb to a point of becoming self-actualized what does that mean another way of looking at that is that we're less needy and if we're less needy that means we're more powerful but

Who are we powerful ful for are we powerful for ourselves? A real leader isn't. You think about James McGregor Burns in his book leadership, right? Transformational leadership. We're powerful for the purpose and we're powerful for the team. We're powerful for others, right? And imagine if everybody was self-actualized and became powerful for others. Okay. Now, when you couple that with enabling and because you become more able, you have more knowledge, you have more resources, you have more ability to provide direction. Well, that leadership, going back to the leadership piece, that's what we ask of leaders is to lead by example. One of the ways you empower folks is showing them the example so they can see clearly to you know how does this behave? How do we behave? And so that's you talked you asked your question was about friction and and it really involves leadership self leadership to start with and and I would just say like you know leadership comes in two different directions as well just in from my

25:34 Perspective and culture. So, you know, it is really amazing how culture when it's built the right way and and delivered the right way, it sets standards. And so, leaders will create and set the standard for certain cultures of whatever organization they're leading. But what also becomes really remarkable to me is when that leadership culture has really been ingrained into the community is that that culture itself governs itself. Like the leaders don't have to govern the culture anymore because the people that are embodying that culture and if they see things falling out of norm then that culture tends to correct itself without leadership really getting involved.

That term you used is exactly how I was going to qualify what you were saying norms. We create norms and so the behavior it's kind of the chicken and egg question isn't it? What came first the behavior or the culture? And the answer is you know they they're just there. They are what they are and exactly as you described it, that's how we should lead and manage it. We act the way we want things to be and we act like that because that's the way things are.

And but like a time piece, it has to be always looked at to a higher standard and calibrated. That's a big issue, isn't it? Calibration. Cuz we're imperfect, aren't we? Human beings, humanmade systems are certainly imperfect. So what do we do over time to make sure that we are in fact operating by this value set by this set of principles and that that is you know looked at critically going forward. So what's next for you Jason as you move forward in this really interesting world of AI that's going to need help and support and guidance. What's next for you? And I know you you you're working on, you know, getting that author thing done too. So, can you tell us can you can you tell us a little bit about what's next? Sure. So, I do have a box of chaos out for review. It was in peer review. Now, it's in publisher review, if you will.

So, God willing, you know, the book's coming out sooner than later. And so, that's the first step. I think it says some really cool things. The formatting, you know, in the age of AI, we do see uh something that's very common. In fact, if you notice, some of our languages starting to change because I call them AISMs, right? words like quietly um etc. you know, we have this AI language because we're doing a lot of writing with AI, which I'm not sure why people have heartburn with that as long as we're disclosing, right? There's nothing wrong with writing with AI. For example, the book, what did I do? I developed for, you know, a passage, for example.

28:13 Hey, here's my ITW thoughtware. Let's I want to write about this. And so, I start with AI, of course, why wouldn't I avail myself technology? But then I put my wording in there. And so, uh, the book itself, did I use AI to help me develop the book at speeds that we were never capable of, that we couldn't fathom? You better believe I did. The other thing that I think is important, and I do want to get involved more in um, this sort of promotion of AI, I personally, and I don't know, probably most of us by now, have suffered from the effects of ADHD throughout my career. It has hampered me in ways that I'm really embarrassed almost to share with. But at least now recognizing that AI has helped tremendously with that. It is so powerful. It has literally brought me to tears at moments during my work.

Just being able to bring my ideas fully and completely together in a way that was coherent as AI likes to use, but meaningful so that I could conclude so I could bring something of value. That whole box of genius, as as cool of a story as that may be, it was a source of real frustration for me. And I I sat on it for years and years and years and couldn't do anything with it. Now I can. So that's one voice I want to bring to the power of AI. What it has enabled people like me to be able to do. It's not cheating. Listen, a box of chaos was not written by AI. It was that box of genius put into a book. AI facilitated the process, and there's nothing wrong with that. So, I'm looking forward to a box of chaos coming out. There's a nice inlay in there, a story. It's called The Venture, and it's a narrative, if you will, a workforce environment, like an

Employment agency environment where the expository plays out in real life characters. And so, it's it's a neat little treatment. I also built in sort of this story arc similar to A Monster Calls. And so there's a lot of complexity in this book and I'm excited about that coming out. The other thing though that led the way and which I'll be putting a lot of energy we we mentioned it a few times but the idea standard of course is the origin of everything and then the council so the council for enterprise advancement I really want to promote that there are a number of organizations participating already. I would love for that organization to really grab the idea standard and start elevating it to a level of global interaction and development. This is going to definitely be out there and available for folks to give their input into. It's going to it's going to go out in multiple languages, but not only language as in Spanish, English, German, etc., but I'm

30:54 Also going to write it at three levels. Something AI allows us to do, right? There's going to be casual, there's going to be a sort of professional register, and then more of an academic register. So, it can resonate at three different registers across the communities. So, anyway, that's those are a couple of things, a few things. And then ultimately, the final element is the GSP spec. So, the proprietary GSP spec that I develop in my business is called we and I, which is a play on the development of the triad, the philosophical triad that I use in designing the GSP spec. So it's Will, Isis, and Eddie. So we and I. It's BGC's version of the GS spec. The idea standard is also going to have an idea GS spec, which is the fundamental baseline for how to design a governance enterprise governance system standard, if you will. So anyway, sorry that's probably more than you wanted to hear, but those are a few of the things that

I'm working on that I'm cooking. That's exciting. Uh, and then if you give me one more, you know, 90 second reply. I try to ask this question to each one of my guests if I can remember, but what would you know today's Jason provide? If they could give one piece of advice to 22-year-old Jason, what advice would you be providing? That's deep. That's not fair. That is not fair. Oh, wow. So many things, my friend. So many things. I think probably the biggest would be emphasize emotional intelligence as a priority.

Okay, I think that's a great, you know, especially in today's age of AI where the IQ is becoming commoditized or democratized or whatever you want to claim it to be is that the real performers are going to find a way to to execute and implement with EQ and I think that is a phenomenal piece of advice not just in today's age but in any age. Cool. So, thank you very much. Absolutely. Well, Jason, it has been wonderful. I feel privileged. I feel smarter already, by the way, just by being Well, thank you. I I doubt it, but thank you. That is very nice being connected with you on this podcast today, and I I look forward to big things and I look forward to staying in contact. So, thank you so much.

Well, Terry, thanks for having me on. This has been really a pleasure. Thank you. That's a wrap on Zero Friction, the show built around one simple idea. Remove the barriers and the revenue will follow. If today's conversation was valuable, please subscribe and share it with somebody who needs to hear it. That's how we will grow this community. I'm Terry Coutsolioutsos, revenue architect powered by AI. Come find me at my website, myrevrx.com, and let's talk about what friction is costing you and your organization. Until next time, keep removing the barriers and keep the revenue flowing.