The Morning Download: AI Evolution Pushes Leaders to Keep Pace

Good morning. Beneath the turmoil of the financial markets, developers keep extending the limits of what AI can do. The steady, iterative evolution of models and their agentic frameworks is as disruptive as the occasional breakthrough. Companies and their leaders need to find a way to keep up. No one expects organizations to move as fast. But they can’t remain static, either.

“For the fiduciary professions that we serve, so legal, tax, accounting, audit, the like, the tools are in many senses ahead of the change management,” Thomson Reuters President and CEO Steve Hasker said yesterday during an event organized by Anthropic.

“In other words, a general counsel's office, a law firm, a tax accounting firm, an audit firm, need to rewire the processes to be able to take advantage of the benefits the tools provide,” Hasker said. “I think that work is ongoing, but I think it's 18 months away before that sort of change management catches up with the standard of the tool.”

(More after the break.)

Hasker made his comments during a panel discussion at the event, where Anthropic unveiled yet another series of expansions and improvements to its agents that have been “sending shock waves through the markets,” the WSJ Leadership Institute’s Isabelle Bousquette writes.

“Amid a market frenzy over artificial intelligence’s impact on traditional software, AI giant Anthropic Tuesday launched new updates to Claude Cowork, a platform it expects to become the “central brain” for the way knowledge workers engage with AI,” Isabelle says. You can read her full account here.

Cowork, released in research preview in January, lets users build AI agents that understand company context and can connect into a host of downstream enterprise apps like Slack, through Anthropic’s model context protocol. On Tuesday, Anthropic announced additional integrations with Google apps including Gmail, as well as Docusign, LegalZoom and others.

Platforms like Cowork can help the companies deliver more value to their customers and end users get the most out of that software, according to Scott White, head of product for enterprise at Anthropic.

“We’re not a company that is trying to own every workflow inside of every tool. We’re trying to help people get their work done,” he said.
But companies need to develop their organizations and their people in order to take advantage of AI. And that’s a moving target.

How is your organization adapting to AI? Let us know.

The AI story is moving ahead in multiple directions everyday.

Tech’s approach to AI adoption: Use it or leave. While many industries are still experimenting with AI, tech has taken it to the next level — tracking employee usage and enforcing it when necessary, the Journal's Katherine Bindley and Katherine Blunt report. 

Around 42% of tech-industry workers said their direct manager expects AI use in day-to-day work as of last October, up from 32% just eight months before, according to a survey from AI consulting firm Section.

• Managers of software developers at AWS have a dashboard that outlines engineer AI-tool usage. 
• Google factors AI use into some employee performance reviews for software engineers
• Meta’s new performance review system will take AI use into account
• Microsoft managers include questions about AI use in performance discussions.
• Salesforce goes one step beyond: Employees must use an AI agent to  file for paid time off.

“We are using carrots and sticks,” says Seth Besmertnik, chief executive of Conductor, a 300-person digital marketing startup. “The only way to have a thriving company is if you have all your staff having a high level of competency.” He won’t consider hiring candidates without AI fluency.

An AI safety advocate revises policy. Anthropic was founded in 2021 by former OpenAI employees who believed safety wasn’t being taken seriously enough. It has since become one of the industry’s most outspoken voices on AI’s potential for superhuman harm, urging stronger guardrails and regulation even as it rolled out increasingly powerful models and signed enterprise deals.

Now that balancing act is being tested. The Journal reports the startup is softening its core safety policy.

“The policy environment has shifted toward prioritizing AI competitiveness and economic growth, while safety-oriented discussions have yet to gain meaningful traction at the federal level,” Anthropic said in a blog post announcing the changes.

The shift comes amid a pressure campaign by the Pentagon. Defense Secretary Pete Hegseth has given CEO Dario Amodei until Friday to comply with Pentagon demands over military use of Claude, which Anthropic bars from actions such as domestic surveillance and autonomous lethal operations.

Hegseth, no stranger to the misuse of technology, warned he could label the company a supply-chain risk or invoke the Defense Production Act. Either move would be nearly unprecedented, experts have said. Designating a company a supply-chain risk means that businesses working with the Pentagon would have to certify that they don’t use Claude models in any of their work with the military.

An Anthropic spokeswoman said the safety pledge is unrelated to the Pentagon negotiations.

‘Tech sovereignty’ is not so easy. Many European military officials oppose the EU’s “tech sovereignty” push, warning that shifting away from U.S. software, cloud, weapons systems and digital infrastructure would undermine security. “Most of our European platforms are relying on American back-end,” one military official tells the FT. "It’s just not possible.” Spurred partly by Trump’s Greenland threats, the European Parliament last month backed a resolution to curb reliance on the U.S., the WSJ reported.

Amazon's AI talent shuffle. David Luan, head of Amazon’s AGI lab, is leaving less than two years after joining, CNBC reports. Hired in December 2024 to lead the San Francisco–based group focused on long-term AI research, Luan oversaw the release of Nova Act, an extension of Amazon’s Nova model. His departure follows a reorganization placing the unit under cloud executive Peter DeSantis. Luan’s former boss, Rohit Prasad, exited late last year, Bloomberg reported.

Is AI killing business software? Not so, said Workday CEO Aneel Bhusri during a Tuesday analyst call. “Just for what it’s worth, Anthropic, Google and OpenAI all run Workday,” he said, according to Bloomberg. “No amount of vibe coding is going to produce an HR or an ERP system.” Despite that claim, Workday shares fell more than 9% in extended trading Tuesday after the company's guidance on subscription sales came in short of analysts’ expectations, Marketwatch reports. 

Teens have a new study buddy. A Pew Research Center survey of U.S. teens ages 13 to 17 found widespread chatbot use. More than half (54%) said they use them for schoolwork help, while 47% use them for fun. About four in 10 use chatbots to summarize content or create and edit images and videos, and roughly one in five turn to them for news.  One in 10 said they do all or most of their schoolwork with chatbots’ help.

Waymo’s city surge. Waymo announced it is operating in four new cities—Dallas, Houston, San Antonio, and Orlando—bringing its total number of cities with commercial robo-taxi service to 10, Barron’s reports. Waymo also operates in San Francisco, Los Angeles, Phoenix, Miami, Austin and Atlanta.

President Trump told a national audience on Tuesday that he had unleashed a new age of economic prosperity. One thing he didn’t say: I feel your pain. (WSJ)

Bill Gates apologized to staff of the Gates Foundation over his ties to Jeffrey Epstein, admitting he made mistakes that had cast a cloud over the philanthropic group while insisting he didn’t participate in Epstein’s crimes. (WSJ)

Warner Bros. Discovery said Tuesday it has received a revised offer from Paramount to buy the entire company for $31 a share, up from its previous per-share purchase price of $30. (WSJ)

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The WSJ CIO Journal Team is Steven Rosenbush, Isabelle Bousquette and Belle Lin.

The editor, Tom Loftus, can be reached at thomas.loftus@wsj.com.