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Essays on applied AI, engineering and organizations

Explanations of how AI works inside a company and what it changes: the models and the systems around them, the engineering, the organization and the money. Each essay starts from a question a company meets in practice and follows the mechanism to its conditions and consequences.

Each essay shows its version and the date its sources were checked, and is updated when the facts change.

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For readers in a company deciding what to do with AI.

  1. Thinking Got Cheap. Work Hasn't Caught Up.

    The price of a competent machine answer falls about tenfold a year. Capability rises fastest where answers can be checked. And almost nobody has rebuilt their work around either fact yet. What is actually changing with AI, and where that leaves a person, a team or a company.

    Reviewed · version 3 · 14 min read

  2. Where the Saved Time Goes

    Speeding up one step of a job rarely speeds up the job. The time piles up at the next bottleneck, usually checking and deciding, and the gain only arrives when the flow around the tool is redesigned.

    Reviewed · version 3 · 9 min read

  3. Designing an AI Program That Ships

    Most company AI programs produce a strategy document, a stack of licenses and pilots that never reach daily work. A program that ships changes one process at a time, end to end, and makes each one leave behind something the next can reuse. How to sequence, staff, fund and measure it.

    Reviewed · version 3 · 11 min read

  4. Data Access Is the Real Integration Project

    An AI assistant is worth what it is allowed to see and do, and that permission is granted by people whose job is to say no carefully. The code takes days; the access takes months. The craft is making the first yes small and each later yes easy.

    Reviewed · version 3 · 11 min read

  5. Who Should Build It

    AI made the first version of an internal tool nearly free and left the cost of owning it where it was. Build what encodes your own advantage and will outlive the next model. Rent what someone else will improve for you.

    Reviewed · version 2 · 11 min read

Routes by need

Essays not yet available appear as in preparation.

All essays, by area

How models learn and behave

  • The Model Never Sees Your Words

    What does a model actually receive, and what follows from how text is cut into tokens?

    Reviewed · version 3 · 11 min read

  • What Training Actually Changes

    Why does each lab's model behave differently, and why does last year's prompting advice stop working?

    Reviewed · version 3 · 11 min read

  • Confidently Wrong

    Where do convincing errors come from, and why do different fixes solve different problems?

    Reviewed · version 3 · 11 min read

  • Why Progress Arrives Unevenly

    Why did coding agents improve faster than almost anything else, and which kinds of work come next?

    Reviewed · version 3 · 9 min read

  • What Does a Model Actually Learn?

    How do a training objective and enormous data produce abilities nobody programmed one by one, and what remains open about 'understanding'?

    Reviewed · version 3 · 11 min read

Reasoning and inference

  • What Thinking Buys

    What do reasoning models do differently, and when is extra thinking worth its cost?

    Reviewed · version 3 · 11 min read

Programming and software architecture

  • What Changes When Code Gets Cheap

    If writing code costs a fraction of what it did, what happens to software, maintenance, teams and the price of products?

    Reviewed · version 3 · 11 min read

  • Tests Are the New Specification

    Why do tests become the main way to tell an agent what you want, and what makes a test useful to a machine?

    Reviewed · version 4 · 11 min read

  • Reviewing Code You Didn't Write

    When agents produce most of the code, what should humans review, and how do teams avoid a review bottleneck?

    Reviewed · version 3 · 11 min read

Context, memory and knowledge

Harnesses and agent systems

  • Same Model, Different Results

    Why does one model feel brilliant in one product and ordinary in another?

    Reviewed · version 3 · 10 min read

  • Giving an Agent Room to Work

    How do you let an agent act without letting anyone who writes text control it?

    Reviewed · version 3 · 11 min read

  • Workflows or Agents?

    When should steps be fixed in code and when should a model decide what to do next?

    Reviewed · version 3 · 10 min read

  • When the Tool Call Fails Halfway

    How do retries, idempotency and uncertain states keep an agent from paying twice or sending the same email three times?

    Reviewed · version 3 · 11 min read

  • Reversible Work and Irreversible Effects

    How should autonomy change depending on whether an action can be undone, compensated or neither?

    Reviewed · version 3 · 11 min read

Standards and interoperability

  • Why MCP Spread

    What problem did the Model Context Protocol solve, why did competitors adopt it, and what does it not solve?

    Reviewed · version 3 · 10 min read

Evaluation and evidence

Infrastructure and AI economics

  • Where the AI Money Goes

    Prices per token keep falling; why do AI bills keep rising, and where will budgets move?

    Reviewed · version 3 · 10 min read

  • Why AI Products Have Thinner Margins

    How do inference costs change the economics of software companies built on models?

    Reviewed · version 3 · 11 min read

Product design and distribution

  • Distribution Beats the Better Model

    Why do incumbents with mediocre AI often beat startups with better AI, and when don't they?

    Reviewed · version 3 · 11 min read

  • What Becomes Possible Now?

    How do you find products a new capability makes possible instead of bolting text generation onto every screen?

    Reviewed · version 3 · 11 min read

  • A Product That Improves With the Model

    Which products built on someone else's model get stronger as models improve, which get absorbed, and how do you design for the first?

    Reviewed · version 3 · 9 min read

Enterprise reality and adoption

Transformation programs and delivery

FDE work and team organization

  • How AI-Native Teams Organize

    How do roles, review, planning and team size change when each person directs several agents?

    Reviewed · version 3 · 11 min read

Value, measurable impact and compounding

  • Where the Saved Time Goes

    AI made a step ten times faster. Why didn't the job get faster, and where did the time go?

    Reviewed · version 3 · 9 min read

  • When Work Starts to Compound

    What does a project leave behind that makes the next one cheaper, and what makes AI work repeat itself?

    Reviewed · version 2 · 11 min read

  • Measuring AI Impact Without Fooling Yourself

    Which metrics show real value (lead time, quality, cost per finished task, counterfactuals) and which only look good?

    Reviewed · version 3 · 10 min read

  • Output, Outcome and Value

    What is the difference between producing more, achieving a result, and that result being worth something to someone?

    Reviewed · version 3 · 10 min read

  • Who Receives the Gain?

    How is AI's value split between customers, employees, vendors and owners, and what decides the split?

    Reviewed · version 2 · 11 min read

Budgets, pricing, procurement, build/buy/partner

  • Who Should Build It

    When options change every few months, when should you build, buy, integrate or hire?

    Reviewed · version 2 · 11 min read

  • Where the AI Budget Comes From

    Which budget lines fund AI adoption, and how does the purchase change when it competes with software, consultants or headcount?

    Reviewed · version 3 · 10 min read

Labs and startups

  • Open Weights and Closed Labs

    Does it matter whether a model's weights are public: control, cost, residency, incentives?

    Reviewed · version 3 · 11 min read

  • Why Labs Build Products

    Why are model labs moving into agents, apps and enterprise sales, and what does that mean for everyone building on them?

    Reviewed · version 3 · 9 min read

  • Capability, Product and Business Model

    What separates a technical edge from a useful product and from an economically sustainable company?

    Reviewed · version 3 · 11 min read

Durable advantage, data, know-how and acquisitions

  • Where the Moat Moves

    If software gets cheap to produce, what stays hard to copy?

    Reviewed · version 3 · 10 min read

  • The Price of Know-how

    Why do large companies pay what looks like too much for small AI teams, and when is it a mistake?

    Reviewed · version 2 · 11 min read

  • Most of What a Company Knows Isn't Written Down

    How do you capture tacit know-how (exceptions, judgment, the why) so people and models can use it?

    Reviewed · version 3 · 11 min read

Industry mechanisms

  • Customer Support Went First

    Why was support the first department to change, what the evidence shows, and what other departments can learn from it?

    Reviewed · version 3 · 11 min read

  • Selling Hours When Hours Shrink

    What happens to consultancies, agencies and software services firms when AI cuts the hours a job takes?

    Reviewed · version 3 · 10 min read

  • Finance and the Reconciliation Wall

    How do accounting and finance use AI when every number must reconcile and be auditable?

    Reviewed · version 3 · 11 min read

  • When Answers Replace Links

    What happens to publishers, search and online marketing when people get answers instead of clicks?

    Reviewed · version 3 · 10 min read

Human learning, work, attention and resistance

Regulation and incentives

Routes, vocabulary and dated notes