May 262016
 
cheap robots cleaning computers

Taiwan’s Foxcomm, the world’s biggest electronics manufacturer, has announced it will replace 60,000 Chinese workers with robots.

As the cost of robotics falls and the price of Chinese labour increases, the economics of automating low skilled work increasingly looks attractive.

While automating manual work is process that’s been familiar for three centuries, this automation is now heading into the management suite as artificial intelligence increasingly becomes a viable alternative for lower level supervisory roles.

The workplace of the future is going to look very different to today’s, all of us need to be asking if we have the skills that will be needed by it.

May 142016
 
Future proofing your business free webinar

One of the challenges we face in looking at the economy’s future is going lies in identifying what tomorrow’s industries will be.

I’ve spent the day at the 500Startups pitch day at the Computer History Museum in the heart of Silicon Valley listening to the startups on the program making their investment spiels and in many ways those businesses are a glimpse of the future economy.

While not all of these businesses will survive, and many will pivot over time, they do indicate directions the economy is taking.

The question though is what sectors will drive jobs growth over the next quarter century and whether those industries will pay enough for workers and their families to survive, let alone keep a consumerist economy ticking along.

Apr 202016
 
the taxi industry is being disrupted by mobile apps

“It has to be disruptive technology,” bleated the consulting firm facilitator at the Future Transport Summit in Sydney earlier this week.

The hapless, but well paid, consultant — a depressingly frequent feature of Australia’s current ‘ideas boom’ — was protesting when one of the participants at his ‘ideation session’ had raised topics such as integrated timetables and changing commuting habits.

Mr Consultant’s running orders for his ‘ideation session’ were to focus on ‘digital disruption’ and his employer;s cluelessness illustrates a danger for business leaders and policy makers.

Selling the snake oil

Digital disruption is real however it’s not just the only factor facing governments and industries. Demographics, economics, politics and climate change will have greater influences on business and society.

Uber, the favourite lovechild of those spruiking digital disruption snake oil, is a very good case in point. While the service certainly has disrupted the taxi and motor vehicle industries, these sectors were facing major challenges as governments enacted policies to reduce carbon emissions, voters became tired of cartel like taxi companies and the Western world’s young and wealthy moved back to the cities and away from owning motor vehicles.

If anything, Uber was the result of GenY entrepreneurs like Travis Kalanick finding existing services didn’t meet their needs rather than the result of technology desperately looking for a problem to solve finding a niche.

Complex changes

While the smartphone was critical in Uber’s success in disrupting the global taxi industry, technology was only one facet of a much more complex set of changes.

The motor industry is a good example of the complexity of change. A hundred years ago it was clear the transport industry was about to be disrupted by the automobile, it was by no means obvious access to affordable personal transport would allow urban sprawl and the suburbanisation of western society.

Coupled with the motor car and truck, the availabilty of mains electricity meant refrigeration also became accessible which lead to the rise of supermarkets after World War II. This disrupted the local corner store in ways shopkeepers could never have foreseen in the interwar years.

Shifting demographics

Now, the opposite is happening as the young and affluent reject long commuting times from distant suburbs and city densities start increasing.

The social and economic factors that drove Uber are affecting public transport usage patterns and it’s no coincidence that the cities where ride sharing services have most successful, such as Sydney, also have underfunded public transport systems that are struggling to meet their population’s demands.

Which brings us back to the foolishness of discussing the future of transport only in relation to technology. Smartphones, apps, big data and the internet of things will all be critical parts of future transportation but the social and economic factors will shape how people use the networks.

Focusing on technology while ignoring the other big influences is a folly that will cost businesses and government dearly. Although one suspects the management consultancies will do well regardless of how well change is managed.

Apr 012016
 
Raven_II_medical_robot

Despite the embarrassment of their foul mouthed racist bot, Microsoft are pressing on with a move into artificial intelligence.

Ahead of this week’s Launch event in San Francisco, Microsoft’s CEO Satya Nadella laid out his vision for the company’s Artificial Intelligence efforts in describing a range of ‘bots’ that carry out small tasks.

Bloomberg tagged Nadella’s vision as ‘the spawn of clippy’, referring to the incredibly irritating help assistant Microsoft included with Office 97.

Tech site The Register parodied Clippy mercilessly in their short lived IT comedy program Salmon Days, as shown in this not safe for work trailer. While The Reg staff were brutal in their language and treatment of Clippy, most Microsoft Office users at the time shared their feelings.

While Clippy may be making a comeback at Microsoft, albeit in a less irritating form, other companies are moving ahead with AI in the workplace.

Robot manufacturer Fanuc showed off their self learning machine a few weeks ago which shows just how deeply AI is embedding itself in industry. Already there are many AI apps in software like Facebook’s algorithm and Google’s search functions with the search engine’s engineers acknowledging they aren’t quite sure what the robots are up to.

For organisations dealing with massive amounts of data, artificial intelligence based programs are going to be essential in dealing with unexpected or fast moving events. Those programs will also affect a lot of occupations we currently think are immune from workplace automation.

 

Jan 222016
 
SepuKuma-assisted-suicide-robot

It turns out Seppukuma is a parody and I fell for it. My apologies.

Continuing the theme of Japanese robotics meet SeppuKuma, the friendly robot bear that might be the last thing you ever see.

When we look at the future of work, health care comes up as one of the fields that is least vulnerable to automation. Seppukuma shows we shouldn’t take that for granted.

Seppukuma is also an interesting example of how technology can subvert laws. Banning assisted suicide means little when a robot can be programmed to it.

As cheap and accessible robotics become commonplace so too do devices like suicide assisting androids which raise a whole range of legal and ethical issues.

Even though Seppukuma is a joke, the technology is feasible. We need to consider the issues and risk these devices will raise.

Dec 192015
 
Google-self-driving-car

With the rapid advances in driverless cars, it was only a matter of time before the question of what happens when people encounter them would be answered.

It turns out not too well for the autonomous vehicles reports Bloomberg citing a study by the University of Michigan’s Transportation Research Institute that found driverless cars have accident rates double those of normal vehicles.

As it turns out, those accidents are usually minor and are caused by humans colliding with the autonomous vehicles as the law abiding computers catch drivers unawares.

That people aren’t very good at driving cars isn’t a surprise but now we’re seeing what happens when distracted, mistake prone humans encounter cautious and usually correct computers.

We now have to start thinking about what happens when artificial intelligence encounters human frailty.

Dec 172015
 
commonwealth-bank-in-lockart-nsw

Earlier this week the Financial Times reported how the eleven biggest North American and European banks had shed 100,000 jobs this year, so it when I was asked to do a segment on the future of banking for radio station ABC666 in Canberra I was more than delighted.

The ABC producer’s interest had been piqued by an Ovum research paper detailing the IT spending of banks and their increasing focus on security.

Rethinking payments

In Ovum’s view much of the banking industry’s security  comes from the diverse range of payment options coming onto the marketplace. Another factor in the increased spend are the US credit cards moving to contactless payments.

Certainly the increased focus on payments security is being driven by the range of new devices with smartphones, wearable technologies and the Internet of Things opening up a whole new range of commercial channels. This is something driving the development of services like Apple’s and Google’s payment system and part of a wider battle over who controls those channels.

Underpinning much of the security focus is the interest in blockchain technologies which move the authentication records off central ledgers – historically one of the core functions of banking – onto a distributed network of databases.

Core challenges

That shift in record keeping is just one of changes affected the banking industry’s core functions, crowd funding and peer to peer lending threaten to displace banks from being the main providers of business capital, one of the fundamental reasons for the banking sectors existence.

It should be noted though the banks have largely stepped away from being the providers of small business capital over recent decades as the ill conceived ‘reforms’ of the 1980s and 90s saw the finance sector being more focused on housing lending and doing mega M&A deals with the big end of town.

The Financial Times report notes a decline in M&A deals is one of the drivers for the staff lay offs at the major banks, it’s notable that technology is changing that business function as much of the due diligence can be better done by artificial intelligence and algorithms rather than highly paid corporate lawyers and bankers.

Where have the bankers gone?

As the banks lay off senior staff, it’s notable many are finding their way to fintech companies. The Wall Street Journal however describes the relationship between incumbent banks and their would be disrupters as far more complex than it seems.

Increasingly banks are buying or taking stakes in promising startups along with establishing their own investment arms and running hackathons to identify potential disruptors. Many in the banking industry are quite aware of the changes happening.

That the banks are adopting the new technologies and identifying the threats shouldn’t be surprising, over the past fifty years the sector has been adept at applying technology from batch processing on mainframe computers through to deploying Automatic Teller Machines and rolling out credit cards to improve their business operations. Banking is one sector that’s proved itself fast to identify and adopt technological changes.

Are the banks going away?

So with fintech startups snapping at their heels, is it likely today’s banks are heading for extinction? Probably not suggests the CEO of fintech startup Currency Cloud, Mike Laven who describes such talk as being part of the “Level 39 bubble”, referring to the financial services startup hub based in London’s Canary Wharf.

Laven’s view is some banks will evolve while others won’t do so well and historically that’s what we’ve seen with other technological shifts – some of the incumbents adapt and reinvent themselves while others are not so adept and wither away.

Some of the bigger threats to banking may be social and economic change. Today’s rising of interest rates by the US Federal Reserve may mark the end of the last decade’s ‘free money’ mentality that’s been so profitable for them in recent times. The end of the consumerist era also challenges those financial institutions basing their business models on a never ending growth of consumer spending and household debt.

Almost certainly the banking industry is not going to vanish, however it is going to be a very different – most definitely a much leaner – beast in a few years time. What is certain though is the days of banks as we’ve known them in the second half of the Twentieth Century are undergoing dramatic change in the face of technological and social change.