Jan 092016

Just what do people think about the on-demand, or gig, economy? A survey by public relations company Burston-Marsteller looked at those who use and provide services for companies like Uber, AirBnB and Instagram.

Unsurprisingly the majority of users are have positive experiences with on-demand services which allows them to access product they couldn’t afford otherwise.

More important are the views of the contractors, and those who are doing these jobs for the flexibility are matched by those who’d rather have full time employment but can’t find a role.

Strikingly, the longer a contractor has worked for one of these services the more likely they are to find the company’s practices exploitative and more than half believe the platforms are gaming the regulations.

Overall, it shows participants in the ‘sharing economy’ have no illusions about the caring aspects of the services that employ them, unlike many of those touting the benefits from the sidelines.

Dec 272015
Single person operation of the connected garbage truck

The defining technology of the Twentieth Century was the automobile. While there were many advancements – antibiotics, mains electricity and mass communications to name just three – nothing changed society to the same extent as the motor car.

A hundred years ago it was impossible for a pundit to appreciate how the motor car was about to change communities, the population’s increased mobility saw the suburbanisation of cities, the creation of the consumerist society and the rise of industries such as supermarkets and drive in theatres, none of which were foreseeable fifty years earlier.

Change didn’t happen in isolation, those new industries were the result of a number of changes in technology alongside the motor car, for instance the supermarket couldn’t have happened without refrigerators becoming household items along with radio and television developing new markets through the advertising industry.

Economic drivers

The biggest driving force was economic, once motor cars became affordable for the typical worker – just before World War II in the US and in the mid 1950s in most of rest of the Western world – the cost of travelling fell dramatically.

With the cost of moving around falling, workers had the opportunity to move out of the dirty, grimy inner city to new and clean suburbs where they could commute to their jobs in offices and factories. At the same time it also meant families could travel further to buy their groceries, forcing the end of the cornershop and the milkman.

Autonomous vehicles change those economics again, as Uber founder Travis Kalanick pointed out last year, the most expensive item in a taxi or Uber fare is the driver.

During his interview at the Code Conference Kalanick went on to describe how eliminating the driver changes the economics.

“When there’s no other dude in the car, the cost of taking an Uber anywhere becomes cheaper than owning a vehicle. So the magic there is, you basically bring the cost below the cost of ownership for everybody, and then car ownership goes away.”

Changing ownership

The assumption in today’s discussions about autonomous vehicles is that car ownership will become and thing of the past, something that fits into Travis Kalanick’s view.

Should that be the case then a whole range of new industries open up. Who owns the cars, who dispatches the cars, who plans for peak and normal usage are just a few questions and opportunities that open for savvy entrepreneurs.

A changing concept of ownership doesn’t come without problems, not least who owns the code controlling the vehicles and the data being generated which in turn raises privacy issues.

Loss of jobs

The obvious other question with driverless vehicles is what happens to all the taxi drivers, couriers and long haul truckers as automobiles no longer require operators.

With truck driving being the dominant occupation in most US states, employing 1.8 million workers according to the Bureau of Labor Studies, this is a serious question. Interestingly the BLS forecasts employment to grow five percent per annum over the rest of the decade.

That scale of  job losses hasn’t been unusual over the last century. The agricultural industry itself has seen a massive fall in employment in that time period with the proportion of Americans working in agriculture falling from half the population to a tenth of that.

Creating new industries

Obviously half the US working population didn’t end up being unemployed, with the many of those displaced by the motor vehicle – either in the agricultural sector or in those fields catering for the pre-motor car market – finding work in other fields.

That the economy adapted to the loss of jobs in what were traditional fields in 1915 gives us a clue to where the jobs and industries of the future are going to come from as the changing nature of the economy means new businesses are created.

As the economics of these industries change, we see the need for workers move further up the value chain. We also see those reduced costs open opportunities for new ideas, just as the supermarket concept took hold in the 1950s as the economics of household shopping changed.

This is where the greatest opportunity lies for today’s entrepreneurs lies, in figuring out how those reduced costs will change the way consumers and society use transportation. In turn that will drive the next wave of employment growth.

Oct 312015

The US smartwatch market in not yet ready for prime time says Kantar Worldpanel finding most consumers are saying the devices are too expensive and don’t add enough value.

Kantar’s findings are underscored by Apple’s giving discounts to buyers of its smartwatch, something the company is certainly known for.

For all the hype, it appears the smartwatch may well have been the classic tech solution looking for a problem.

Sep 282015

“No business or brand has a divine right to succeed,” said McDonald’s CEO Steve Easterbrook last May.

As McDonalds’ management desperately try to adapt to a changed marketplace, Bloomberg Business spoke to some of those bearing the greatest risks – the fast food chain’s franchisees.

The expansion of menu items and the shift to more custom produced burgers is creating problems for franchisees and store managers as equipment and procedures designed for simpler times struggles with varying demands.

McDonalds is in a terrible bind as the company faces a society-wide shift in consumption that leaves its business model stranded at the same time that the market is wanting more customised products.

The latter is an aspect that many businesses whose success and profitability is based on mass production are now facing as customised products become easier and cheaper to produce.

While McDonalds isn’t likely to go out of business soon, the broader trends aren’t running in its favour. That’s bad news for both the company and its franchisees.

Sep 032014
mobile payments through smartphones and other devices are changing business

This post is the second in a series of four sponsored stories brought to you by Nuffnang.

During the recent switch over to chip and pin payments, many in the restaurant industry feared that tips would fall and waitstaff would lose jobs, the reality is somewhat different claims PayPal.

Last week I had the opportunity to tour the PayPal Innovation Centre in San Jose where they showed off the work they are doing in the retail and hospitality industries to change payment systems.

One of the products they showed was their Pay At Table app that integrates into a café or restaurant’s point of sale system and allows customers to pay their bills immediately.

The immediate reaction to this has been resistance from restaurant managers who were worried customers to skip without paying. For waitstaff, the worry was they could be replaced by an app.

It turns out the technology has had a different effect, the productivity of floor staff in the establishments where the app has been trialled has improved substantially.

“In a typical café it takes around ten minutes to get the check,” says the lead demonstrator of the Innovation Center, Michael Chaplin. “We find that freeing waitstaff up to help customers and letting them pay their bills faster means everybody is happier.”

With that ten minute per table improvement, management have found customers’ satisfaction has improved and the waitstaff have seen tips improve – partly because diners are happy and also because the tipping is integrated into the payment, calculating an appropriate gratuity is always a hassle in the United States.

That ease of payment from mobile phone and table apps is rolling across industries, it’s not just limited to the hospitality sector. Increasingly these technologies are being used by tradespeople, retailers and across the service industries

Increased productivity is more than just saving money and reducing staff numbers, it’s about giving the customer a more seamless and easy experience.

All business need to think carefully about how they can use technology to improve their service and increase revenues.

Jun 172014

Today Amazon is expected to launch a smartphone which the New York Times suggests will tether consumers to the company.

With 240,0000 apps in its Kindle store, Amazon will be formidable competitor to Google Android devices and Apple. Like iTunes, Amazon also have a strength in already knowing the customer’s credit card details.

The question is can Amazon be trusted? As we see with the Hachette book publishers dispute, Amazon is a company that’s ruthless in bullying suppliers and has a mandate to do so from its shareholders.

With the smartphone becoming the centre of the connected lifestyle, the stakes are high as whoever controls the customer’s pocket controls the customer’s smarthome, smartcar, retail and health applications.

Of course whoever wins this battle, they’ll still have to pay Microsoft for patents.


Apr 182014

After four decades the smartphone comes of age,” proclaims Micheal Wolf in Forbes Magazine.

Wolf is right to a point but he misses the key reason why the smarthome, or the entire internet of things, has become accessible – the technology has simply become affordable.

It was possible to build a smarthome two decades ago, but it was fiendishly expensive and only a few rich people could afford the technology. Today that technology is cheap and easy to install.

This is the common factor with all aspect of the Internet of Things, connecting devices has been possible since before the internet became common but it was expensive and cumbersome so only the highest value equipment – such as oil rigs – was connected.

Now it’s inexpensive and simple to connect things, people are doing it more and that is why there’s a range of security and privacy issues which weren’t so pressing when it was only a few obscure industrial devices that were wired up.

We aren’t inventing the wheel with technologies like the internet of things or big data, they already existed – they are just more accessible and that’s what’s changing business.