Marchick: Whether it's writing, reading, underwriting investment, analyzing a problem, coming up with ideas for a new business, and that they know the shortcomings of AI as well. And so we're trying to teach them to do that.

Haddad: So it's not just you're allowing them to use all of it, you're encouraging them. And what about your professors? How did you find professors that knew all about it?

Marchick: So it's interesting. In academia, faculty moved very, very slowly. We found that our faculty were eager to move forward. And I would say that a third of our faculty was already doing this. They were running ahead and didn't need any encouragement. About a third of our faculty was like, okay, I need to learn. So I'll go get retrained and improve. And then a third of our faculty were reluctant. What we did is we brought in experts, really from the private sector, because they're way ahead, to retrain our faculty. So I'll give you an example. We had a faculty training session for two plus hours, and we brought in a CEO of a company that's using AI. We brought in a senior vice president of marketing, a person who runs marketing for PBS, and used to run marketing for Sony and Marvel. And then we brought in a 26-year-old former graduate in the finance industry who's using AI for everything. And they trained our faculty. And then every other week, we have sessions on AI where our faculty are learning from each other what's working in classes, what's not, how do we do things better. Honestly, everybody in this field is making up things as they go along. And we're doing that. And one of the things we said to our faculty is, have a high degree of risk tolerance, and it's okay to fail. Because this is new, and it's okay to fail. And just tell your students, we're learning at the same time as you are.

Haddad: Let me ask you a specific. How does the program balance the technical skills necessary for AI with the ethical and leadership considerations key to business success?

Marchick: We teach the problems and shortcomings of AI in the same ways we teach the advantages and the tools. I'll give you an example. We have a faculty member who is an expert on disability, okay? And he's one of our leaders in AI. And he teaches AI ethics. He teaches biases in AI. So the example I gave that actually Kent Walker, the CEO of the president of Google gave, if AI were not trained, if the machine learning was not balanced, and if there wasn't intervention by humans, if you looked up a question that said, give me a picture of a criminal. Well, AI untrained would produce probably a picture of a Black man in their 20s. Because if you look at all the movies, if you look at television, if you look at newspaper articles, that's the composite that has been created. Obviously, that's racist and problematic. So AI has to be trained to improve on the shortcomings of machine learning. And we teach that. I'll give you another example. A number of companies have used AI to do the initial round of interviews. Large companies get tens of thousands of resumes. And companies have used this for their HR function to initial screening. Well, a number of companies, and our faculty has uncovered this, have found that the machine learning, the AI tool, is biased against women. And so we have to train it to get rid of the keywords, to unbias the bias that is inherent in machine learning.

Haddad: Well, that's a heavy lift.

Marchick: It's a very heavy lift. And I think companies are focused on it. And we have to teach that in academia as well.

Haddad: What about entrepreneurship? How is it helping? I mean, entrepreneurship is talking to other people, developing ideas. Has it changed how you're teaching entrepreneurship?

Marchick: It's a great question. So we have a fabulous professor named Daniel Vogel, who's a former entrepreneur. She started Glenn's Grocery, which is a sustainable grocery chain. And she actually, I would say she was an AI skeptic. Okay, this year in her class, she assigned her students an assignment to use AI to help create a better business idea, better ideas for new businesses. We have an incubator at AU to support students creating their own companies. Most of them fail, but that's fine. We have a number of successes. What Danielle found was that the quality of the student ideas, the interaction, the testing of ideas, of the shortcomings was better this year. Students were more prepared, more creative and more precise by using AI than they were before AI, because it's a tool to test, to probe, to ideate. And she found that it actually helped students come up with better ideas.

Haddad: How did the teachers handle that? Do you say, well, AI just told me this and the professor told me something else? Have you had to deal with that?

Marchick: And that's one of the things we teach our students. And that's one of the things that the experts that come in and train our faculty really emphasize so that AI can be a tool to come up with an idea, to make an idea better, to come up with a formula, to underwrite an investment. But you have to test it because AI is very, very imperfect and has many flaws.

Haddad: But if you're talking about integrating AI into marketing, how do you teach that?

Marchick: Well, I'll give you an example that we were taught from a real world example. Okay. So my friend Ira Rubenstein, who's an adjunct faculty member at Kogod, is the senior vice president for PBS for marketing. Obviously, the number one product that PBS markets is Ken Burns. So Ira has a lot of creative people on his staff. He has lots of agencies. He has PR companies. When he was starting to market the Ken Burns Buffalo movie, he went to an AI software and he had to create a flyer, a poster, an image to put, you know, what's the equivalent of an old movie poster, but now it's done digitally. So he went to an AI software program and said, give me an image of a buffalo with a Native American theme in Ken Burns’ style. And it came up with an image and he printed that out and gave it to his creative staff and said, do something based on this. And he basically created the poster in a matter of hours compared to a matter of weeks. I mean, you've done this, Tammy. You test an idea. You have 30 different people in the creative business. Everybody loves things or hates things. AI is a tool to do things faster and better. Ultimately, it requires a human to make decisions. So we teach that how to in communications and marketing, use AI to create language for email campaigns, for distribution campaigns, for targeting of audiences. It's a tool to make marketing better and more efficient. And that's what we're teaching in class.

Haddad: And are students getting better jobs because they're AI literate?

Marchick: It's early because we just started this this fall. But we believe that our students will be better prepared than others because we are infusing this throughout the curriculum. When our students showed up in August for orientation, one of the first sessions they had was how to use AI. And now it's throughout the curriculum. So I would say ask me in a year or two and hopefully we'll see outcomes.

Haddad: And what about other schools? Have you made them nervous?

Marchick: My son's over at the University of Maryland Business School and I don't think they're allowed to use AI. We're 100% student focused. Now we have scholars that have used and will use AI for their own research. Maryland is doing incredible work in research and AI. They have some of the best faculty and the best research scholars in the world. They have an AI institute. What we're doing is really focus on students and helping our students have better outcomes and be better prepared for the job market. That's unique.

Haddad: Do you think that they'll be able to find a job more easily because they're so modern, because they've spent so much time on AI?

Marchick: My view is in anything, if you have a comparative advantage and you have a leg up on your resume compared to other people, you will be more employable. You have to have the basic skills. You have to be a good communicator. You have to have good technical skills. But if everything else is equal and you have shown on your resume that you've been trained on AI or you have a badge or certificate showing AI proficiency, I think that'll help the students.

Haddad: And how does AI help their decision making? Because isn't that what being a business leader is all about?

Marchick: So AI can be a tool to help you make better decisions, to do research faster, to test your arguments, to be a better writer, to proofread. It allows you to program. AI can come up with a programming language, so you don't have to be as technical. So at the end of the day, it's a tool in the same way that when we moved from an abacus to a calculator or a ledger to Excel, that created more productivity and it allowed you to do so much more. In the same way that the advent of the personal computer changed life. I remember 1993, I was sitting in USTR and someone showed me the internet. And they said, look, CNN can be on the internet. And I thought, that's the dumbest idea. I just want to go turn on CNN. Why would anybody do this? And obviously, in the last 30 years, the internet has changed everything. And I think AI will be the same in the next 10 to 20 years.

Haddad: And what about the professors? We've been talking about students. Are they grading papers with AI?

Marchick: Some of our faculty are using AI to grade papers to focus on the answers. And that allows them to be more efficient with kind of the rote part of grading and allows them to focus more time on the value added, helping students become better writers, better thinkers, to analyze critical problems, to analyze complex problems. So it's a tool for everything.

Haddad: One of the most frightening parts of AI is workforce. Who's going to have a job? How will they get the job? What's the training that's needed? What do you teach on the workforce front?

Marchick: I think it's too early to tell. But in the same way that our iPhone has replaced a bank teller, it replaced a traditional camera, it has replaced the fax machine, AI will have the same impact in productivity. And so that way, if students know AI and they're learning it in school, they'll have a leg up over the competitors. And we want to have our students be best prepared for the job market when they graduate.

Haddad: Do you talk about, well, Llama is good for this, use Gemini for that? These are already brands with the big companies. We're still waiting for the startups to come in.

Marchick: We're technology agnostic. We want them to experiment with different technologies. There are some specially technologies for different industries. So, for example, in the finance industry, a lot of the finance world is using a technology called Hedbia, which allows you to underwrite investments using an AI tool that they've created. In the marketing business and the image creation business, Adobe and their other specialized software. I think it's so early that it's too hard to pick who's going to be the winners and losers. So we're trying to get general fluency and flexibility so that they're prepared to use whatever technology emerges as the winners and losers.

Haddad: You've had a long career in business. Can you just give me your view of where you think AI and business are going just for the entrepreneur, for the big company that's trying to figure it out?

Marchick: Let me pivot a little. That's an unfair question. Let me pivot a little. And Brad Smith, the president of Microsoft, was at our school last week. And he's one of the most impressive and brilliant people I've ever seen in business. He did a 23-minute speech, which is on YouTube under the Kogod channel. I'd encourage anybody to watch it. Where he compared the advent of electricity with the advent of AI. And he traced how electricity changed the whole economy, starting with fuel, which used to be coal, then moved to natural gas, which is now heavily solar and renewable. To power plants, to cables and infrastructure that's needed for electricity. All the way up to the toaster oven, the electric vehicle, the electric bike, these new microphones we're using. And he said the same way that electricity changed the whole economy, we're now going to have an AI economy. Starting again with energy, because AI requires more energy. But then continuing to the semiconductor. We talked about why NVIDIA is such a valuable company. All the way up to apps. So that at the end of the day, there's going to be some winners and losers in the core technology. But there will be millions and millions of different apps for specialized use in AI. And that's where a lot of the creativity is. So he said, if you're an electrician, it's a good time to be an electrician because there's going to be more demand for your services because AI is going to use so much electricity. So I would say Brad would say AI over the next 20 years is going to reshape the whole economy. And I'd encourage people to listen to his speech. It's really brilliant.

Haddad: And what about nuclear energy? Are you surprised that there's such a turn in that direction from government, from business?

Marchick: Well, nuclear energy is a safe and effective carbon neutral form of energy that we should use more of in the United States. And the efficiency and effectiveness of nuclear energy, I think, will only increase over the coming years. But that's almost an example like AI. People are so afraid of nuclear, even though it's cleaner. And all the things you've just said, how do you change that point of view? If you look at the safety record of nuclear and you compare it to any other fuel source, it's actually much safer. We've obviously had massive disasters in Fukushima, Three Mile Island, which are scary. But if you look at the number of refineries or power plants or chemical plants that have had problems and the number of accidents and deaths compared to nuclear, actually, nuclear has proven to be quite safe.

Haddad: So let's turn to government. You're back in the government. You're working for the American people. Thank you so much, Dave, for going back in. How would you approach AI from how you teach government AI as well as regulation? Teaching it first, so AI can be a tool for governments to be much more effective and much more efficient.

Marchick: Then the other question is regulation. Ultimately, this is a new technology that's going to change the world. And there needs to be some regulation that balances innovation with fairness and safety. Fairness because AI is inherently biased. And because the technology is so powerful that it can be used for problematic purposes. I'll give you an example that Kent Walker, the president of Google, gave when he came to our school. AI has been incredible in terms of helping people who are hearing challenged. You can point a camera at someone speaking and AI will translate it using lip reading. That's a huge, powerful technology that will aid people who don't hear as well as you and I do. It can also be a tool to monitor people. You can point a camera at someone a mile away or three blocks away and you can understand what they're saying. That's a powerful tool for espionage. You can imagine the Chinese or the Russians using that in the United States. And so there needs to be some regulation to ensure safety and also fairness, fairness of AI. And so I think we're early days in government agencies and the Congress and other authorities thinking about how to balance innovation and fairness and safety. But at some point in the coming future, there has to be regulation of AI.

Haddad: And what role do you think companies should have in that regulation? We've heard about the voluntary commitments. We're halfway through this process. But should they take more of a leadership role?

Marchick: Companies can and should take a leadership role in educating policymakers on both the opportunities and risks of AI. And obviously, companies will shape it to their benefit. Ultimately, the government, the Congress or other regulators have to make the decisions to balance innovation and safety and fairness. Companies will always inherently be pushing on the innovation side and less on the safety and fairness side. And every company will have their own view of safety and fairness. Ultimately, Congress or Congress and the executive branch will have to make those decisions.

Haddad: What do you think of the efforts of the Biden administration on chips, chips for America? I know you know the folks who used to be at the Commerce Department. But how much do you think that helps the young people that you're dealing with to understand the importance of technology?

Marchick: I think it's a very important initiative because semiconductors, as I just mentioned, are going to be one of the building blocks for competitiveness. And unfortunately, much of the semiconductor manufacturing has moved offshore. So it's a national security and a national competitiveness issue. And I really think it's a great initiative on a bipartisan basis. Ultimately, it's still a drop in the bucket in terms of the amount of money that has to be invested and will be invested. But it can be a catalyst if it can help companies make a decision, which was maybe going to be biased towards manufacturing offshore. If it can be a weight to create more onshore manufacturing, I think that's great. And the other thing is we need more diversification in manufacturing. In the same way that the solar industry right now is dominated in China and solar is becoming much more important. We need more manufacturing outside of China in the solar industry. Same as the case for the semiconductor industry.

Haddad: So you wrote this book and I'm going to read the title, The Peaceful Transfer of Power, An Oral History of America's Presidential Transitions. We're coming into hopefully a peaceful transfer of power. First of all, talk about your role in the last transition. And what do you think needs to happen this time?

Marchick: So in the last transition, I ran a nonprofit project with the Partnership for Public Service, where I was the director of something called the Center for Presidential Transition. That was during the Trump to Biden transition. So we worked early days with the Biden team, Ted Kaufman, Jeff Zients, Johannes Abraham, to help them design and plan their transition. And then throughout the process, we supported them. And then we also worked with the Trump White House to help them plan either for a second term, should he have won, or to transition power. And we worked closely with the fellow named Chris Liddell, who was the deputy chief of staff, and did a really good job under very difficult circumstances to facilitate the transfer of power. We're coming up on a very, very fascinating period where the incumbent is leaving. If Harris wins, she'll be only the fourth sitting vice president in American history to become president. There were three very early in the United States, obviously Adams, Jefferson, and then in 1836. And then the only other one was George H.W. Bush, who took over from Reagan. What was interesting about that transition is that many of the Reagan officials assumed, oh, well, Bush was part of our transition. I'll just keep my job. And they soon learned that Bush wanted his own people. So he famously had a very strong national security team with Scowcroft and Baker and Dick Cheney. And he did make a lot of changes. So he did keep a lot of officials, but a lot of changes.

Haddad: And then if Trump wins, the question is, will he have an effective transition?

Marchick: So there have been twice now that Trump has actually had people that have done an effective job working on a transition only for him to throw it out. So in the 2016 transition, Chris Christie actually did a very good job managing transition preparation process during the cycle. He was appointed in April and May of 2016 and put together a very good transition operation only to be fired by Trump and Steve Bannon three days after the election because of the dispute he had with Jared Kushner. And then when Trump left office, Chris Liddell and a number of career officials in the agencies did a very effective job planning under the law for a potential transfer of power. There's a law called the Presidential Transition Act that mandates the incumbent president and administration prepare for potential transfer of power. Biden's doing that now. And then when the election occurred, Trump basically didn't recognize the outcome of the election and put the brakes on the transition. And that was at a period where we had multiple crises going on. The biggest crisis was COVID. And the vaccine was developed under the Trump administration, but distributed during the Biden administration. And the country would have benefited if there were more cooperation earlier between the outgoing Trump team and the incoming Biden team. We also had millions of Americans out of work. And we had a racial reckoning in the wake of the murder of George Floyd. So it was a very, very complicated process culminating in January 6th, which is one of the worst days of American history. One of the only days where people have died in the United States during the transition of power.

Haddad: Very heartbreaking to even think back to that day. How do you talk to your students about government and considering to go into government?

Marchick: I'll give you one example. One of the things that I'm most proud of in my career was working at the DFC. And during COVID, we funded manufacturing sites for COVID vaccines in Africa and India. And they produced hundreds of millions of vaccines for people in Southeast Asia and India and Africa who did not have access to vaccines quickly enough. And I remember my team and I, after we were vaccinated, went and visited the sites where they're producing these vaccines. And when the vials came off the manufacturing facility, we saw these huge vials put in boxes. And we all just broke down crying because it was so meaningful to be able to do something to help save people's lives. And so I think government is a great opportunity, both professionally and in terms of fulfillment and having an impact. And I think that the more young people can do it. And the skills are transferable. Leadership skills are transferable from the government to the private sector, to the media, to any industry. And I think it's a great thing to do.

Haddad: Thank you so much, David. David Marchick, who's the dean of the Kogod School of Business at American University, leading on AI. We thank you for all you've done for the government, for business, and now for AI and academia. And look forward to talking to you again.

Marchick: Thanks for having me.

Haddad: And thanks for everything you do to share and spread the word on AI in Washington.

Marchick: Thank you.

Haddad: This is the Washington AI Network podcast. I'm Tammy Haddad. Thanks for listening. Thank you for listening to the Washington AI Network podcast. Be sure to subscribe and join the conversation.

Outro: The Washington AI Network is a bipartisan forum bringing together the top leaders and industry experts to discuss the biggest opportunities and the greatest challenges around AI. The Washington AI Network podcast is produced and recorded by Haddad Media. Thanks for listening.