Good morning. The launch of OpenAI’s GPT-5 may be near. It’s unclear when this new class of AI model will be released, but some observers say it could arrive in August. (see links here at the Verge and here at the Information, subscriptions required.

Computer scientist Gary Marcus has long chided OpenAI about the launch of 5, “But this time I think GPT-5 really is about to drop, no foolin,” he wrote over the weekend.

Even Marcus, ever a skeptic when it comes to the functionality and safety of large language models, nonetheless anticipates that “GPT-5 will surely be better, a lot better than GPT-4.”

The pace and the very nature of technological development create a huge change management challenge for companies and their tech leaders. The biggest hurdle posed by AI isn’t the deployment of technology itself, so much as making sure that people and processes can evolve with it. (More on that below from Merck’s chief information officer and digital officer, Dave Williams.)

Companies need to simplify their processes to make the most of AI. That’s more radical than it might sound, because it often means eliminating process itself (and sometimes people).

How is your company keeping up with the relentless pace of technological change? Use the links below and let us know.

So much for the summer doldrums. A trade agreement between the U.S. and Europe Sunday begins what should be a big week for market indicators, including jobs, trade and spending on technology.

The agreement, which would set a baseline tariff of 15% for European goods, should ease anxieties that Trump’s drive could lead to a broader trade war and provide some clarity for business, WSJ reports.

Like the weather, spending on artificial intelligence has only risen.  Alphabet last week said capital expenditure expectations for the year would increase by 13% to about $85 billion. This week we will hear from Microsoft, as well as Amazon.com, Meta Platforms and Apple. All report earnings. 

Also this week, Wednesday to be precise, the Fed is expected to keep rates on hold when it gives its decision while the ADP delivers its national employment report for July. 

And finally, Friday marks the Trump administration’s deadline for trade deals.

WSJLI: What are the biggest obstacles to the adoption of AI agents?

Williams: I think of three broad challenges we've got to solve for to actually drive value … in AI and the agentic space.So one is the [large language models]. I personally believe LLMs will become more and more commoditized. And so that's not what we worry about in our GPTeal. [Merck’s proprietary platform] has access to multiple LLMs in a seamless way. We were very deliberate to architect with optionality there. So the LLM layer, I don't worry about. The orchestration layer is still nascent. There's a lot to do there but we'll be able to solve for that technically as things mature. I worry most about the human beings who have to change their workflows and how they work.

WSJLI: And how do you address that problem?

Williams: So it's the humans, the change management, simplifying your process before you throw it into the orchestration layer.

WSJLI: Can you give us an example of how Merck is implementing AI agents right now?

Williams: Our executive team sponsored six Tier 1, gen AI use cases.  A lot of companies have hundreds of ... these and none of them scale, nobody can talk about the return.

One example -- and this is in more of the development phase.

All of this clinical trial data comes in and we have to create a CTD, a clinical technical document. These are hundreds and hundreds of pages that we submit to the agencies that say, here's the results of our trial. Here's all the data. Here's the tables. And historically, this has been a very heavy manual effort by people who were experts in writing these documents, who knew who to go to people-wise, and what data repositories to pull in. We started this about two years ago --it was harder than we thought it was going to be -- but we created a gen AI solution. Based on prompting, it will go out and generate the first few sections of that document.

This is something that used to take six to eight weeks, that now is a couple of days. We're not doing the whole CTD document yet, because this is a massive change management effort. But that's an example of the agent going out and pulling all this. But the human’s in the loop.

--Steven Rosenbush

Managers need a hug. Only 27% of managers reported feeling engaged at work in 2024, according to Gallup’s annual State of the Global Workplace report, a 3-point drop from the year before. What’s behind the decline? Is it AI? Hybrid work’s interminable half life?  According to Jim Harter, chief scientist, workplace, at Gallup, it’s a bit of everything.

When coding tools go rogue. Tools that use natural language to generate code have been giving off some bad vibes, Ars Technica reports, with several instances where the tools effectively wiped out data. One incident, involving Replit, triggered a public apology on X from the coding tool maker’s CEO, Amjad Masad, who called the action “unacceptable and should never be possible.”

Elon Musk tells Tesla investors to focus on a future filled with robots. Musk last week encouraged investors to look past Tesla’s poor financials and focus on its recent achievements with autonomous robotaxis and robots, which he said could make the shrinking EV maker into “the most valuable company in the world.”

The WSJ took Musk up on the offer: “Currently, the robotaxi service is small,” Becky Peterson reported.

The Information takes a look at Tesla’s humanoid robots program, finding that the EV maker has only produced hundreds of Optimus robots, short of the 5,000 Musk has promised by the end of the year.

Anyone who has visited San Francisco in the years following the pandemic would agree that the City by the Bay has some rough edges. Could it be on the way back, thanks to AI? The Washington Post and the city's rising population of startups think so.

Microsoft puts a face on AI. The company last week began making available to some Copilot subscribers a virtual character experiment that will interact in real-time with users. They call it Copilot Appearance and promotional artwork reveals an anthropomorphized bit of fluff with a face guaranteed to attract Clippy-level levels of hate (or maybe love). 

Samsung signs $16.5 billion AI chip-supply contract with Tesla. The deal will likely enable Samsung’s new fabrication plant in Taylor, Texas to focus on producing chips largely used in AI data centers and robots, WSJ reports.

President Trump said he reached a trade agreement on Sunday with the European Union, avoiding a damaging trade war with the U.S.’s largest trading partner and marking his biggest deal so far in his attempt to remake the global trading system through higher tariffs for U.S. trading partners. (WSJ)

Organizations and individuals challenging government actions are finding a number of ways to notch wins against the White House, with judges in a growing list of cases making clear that sweeping relief remains available when they find the government has overstepped its authority. (WSJ)

Israel announced a tactical pause in military activity in parts of the Gaza Strip and the establishment of safe routes for humanitarian aid, as a deadly hunger crisis spreads across the enclave. (WSJ)

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.