Unwinding What Happened at ChatGPT Vendor OpenAI

When choosing technology for a company, you have to look closely at the vendor. Do they have the money to stay in business? Are their practices in harmony with what you would expect? Do they have a management team that can help them evolve and keep products and offerings on track? Might they suddenly pull the tech rug out from under your feet.

Has everyone there taken a crazy pill?

That latter might sound hyperbolic — unless you  heard about the utter governance and management meltdown at OpenAI, vendor of the seemingly ubiquitous generative AI products ChatGPT and DALL-E 3, respectively generating text and images. Here’s a quick summary:

• Thursday night, Nov. 17 — OpenAI’s board of directors tells company co-founder and CEO Sam Altman that he was going to be being fired. He told co-founder and president Greg Brockman who made things public in a post on X/formerly Twitter.
• Friday, Nov. 18 — The board publicly announced that it fired Altman because he was “not consistently candid in his communications.” CTO Mira Murati becomes interim CEO. Microsoft, the company’s biggest investor, only hears right before the announcement. Ilya Sutskever contacts Brockman to say he’s being pushed off the board but is considered “vital to the company” and will stay as president. Brockman sends a message to the board saying he was quitting.
• Saturday, Nov. 19 — There board reportedly is in discussions to bring Altman back as CEO. Microsoft and its CEO Satya Nadella get involved in the negotiations.
• Sunday, Nov. 20 — Negotiations fail, and the board dismisses the idea of bringing Altman back.
• Monday, Nov. 21 — Twitch cofounder Emmett Shear becomes interim CEO. Microsoft announced that Altman will become CEO of a new AI group at the company and a number of high-profile former OpenAI employees like Brockman are joining. Most of OpenAI’s employees — including Sutskever, who was originally voting with the board for all this and said “I deeply regret my participation in the board’s actions” — sign a letter demanding that the entire board resign.

This is about as strange a head-snapping narrative as anyone might find in business. It’s illustrative of why companies in every industry, including CRE, need strategies that stand above and beyond any one vendor. Companies can go out of business, lose control of important technology or needed talent, make bad decisions for future development, or totally implode, lose top people to another company, and then leave customers wondering who owns what and how long they can expect software to word and to be improved.

Many years ago, there was a saying in corporate IT departments that you couldn’t go wrong buying products and service from IBM. And that was true until it wasn’t. Always have alternate plans.