Tag: future

Contemplating a jobless future

Few industries are going to be untouched by the disruptions of the next decade and that’s going to present challenges for all of us.

Last October, ahead of the company’s Orlando Symposium, Gartner Research Director Kenneth Brant released a paper looking at the effects of technology on the workplace.

“Most business and thought leaders underestimate the potential of smart machines to take over millions of middle-class jobs in the coming decades,” Brant wrote. “Job destruction will happen at a faster pace, with machine-driven job elimination overwhelming the market’s ability to create valuable new ones.”

Brant’s view about middle class jobs is a sobering thought, many of the corporate ‘knowledge worker’ positions can be easily replaced by computers to make the decisions now being made by armies of mid level managers, bean counters and clerks.

Indeed the whole concept of ‘knowledge worker’ that was fashionable in the 1980s and early 90s in describing the post-industrial workforce of nations like the US, Britain and Australia is undermined by the rise of powerful computers and well crafted algorithms to do the jobs unemployed steel workers and seamstresses were going to do.

Twenty years later and the ‘knowledge workers’ had morphed into the ‘creative class’ and it appears the computers are coming for them, too.

Personally, I subscribe to the view in the medium to long term new jobs in new industries will evolve – a view shared by economists like GE’s chief economist, Marco Annunziata.

Over the next decade however there’s no doubt we’ll be seeing great disruption to established industries and the hostility to Google buses in San Francisco may be just an early taste of a greater antagonism to the technology community in general.

For managers, the problems are more complex; while their own departments, corporate power bases and even their own jobs are at risk, they are going to have to find ways to incorporate these changes into their own business. Gartner warns CIOs in its briefing paper;

The impact will be such that firms that have not begun to develop programs and policies for a “digital workforce” by 2015 will not perform in the top quartile for productivity and operating profit margin improvement in their industry by 2020. As a direct result, the careers of CIOs who do not begin to champion digital workforce initiatives with their peers in the C-suite by 2015 will be cut short by 2023.

Few industries are going to be untouched by the disruptions of the next decade and the resultant job losses are going to present challenges for all of us.

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An era of exponential innovation

Deloitte Center for the Edge founder John Hagel talks about our era of exponential innovation.

“How do we move to an exponential approach to innovation” asks John Hagel, Director of Deloitte’s Centre for the Edge in the latest Decoding the New Economy video.

The Centre For The Edge is Deloitte’s Silicon Valley based think tank that identifies and explores emerging opportunities related to big shifts that are not yet on the senior management agenda.

John tells us how the cycles of change and innovation have varied over the last thirty years in the industry; “the biggest thing for me is that nothing is stabilising. I often go back into history and look at things like electricity, the steam engine and the telephone – all hugely disruptive to business practices.”

“But the interesting pattern is they all had a burst of innovation and then a levelling off,” says John . “You could stabilise and figure out how to use all this technology.”

“With digital technology there is no stabilisation.”

That lack of stabilisation leads to what John has termed ‘exponential innovation‘ where he sees business and education being rapidly transformed as technology upends established practices and methods.

Healthcare, financial services and “any industry that has a high degree of information content ” are the sectors currently facing the greatest challenges in John’s view.

John sees the solution for businesses and managers in looking at the current era not as a time of technology innovation but of institutional innovation. That institutions, like companies, have to reinvent how they are organised.

Reinventing well established companies or centuries old bureaucracies is a massive challenge, but if John Hagel’s view is right then that radical change to institutions is what is going to be needed to face a rapidly changing society.

Bank image by Ben Earwicker, Garrison Photography of Boise, ID through sxc.hu

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Lowered expectations – What is the future for Apple?

Where to next for Apple in an era of lowered expectations?

Last Friday I had a story in Business Spectator on the future of Apple in light of the company’s warning of a 20% fall in revenue next quarter.

The clear message from Apple’s executives was that the company is facing a terminal decline in iPod sales and the iPhone – it’s most profitable and highest selling product – is facing slower sales.

So the search is on to find something that will replicate the iPhone’s success, with the biggest candidate being the iWatch.

The problem with that is the entire wearable technology market is only forecast to be $6bn which is a seventh of Apple’s $42 billion profit last year, so the iWatch can never replace falling iPhone sales.

It may well be for Apple that the period of massive profits and growth is drawing to an end, it doesn’t mean the company is dying – for a start they has nearly $200bn in cash reserves and a healthy $150 billion in sales each year.

Short of Tim Cook unveiling something similar to the iPhone, the future for Apple is probably going to be a bit modest than past few years of huge growth, that’s not a bad thing.

Rather than being the end of Apple, it’s more a revision to the role the company has held for most of it’s existence – a high profit, niche business that sells on quality and brand rather than fighting in the commodity markets.

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A soonologist’s view of the future

BT Futurologist Nicola Millard on being a futurologist and the future of the workplace, the open plan office and customer service.

“I think my job title is a little bit misleading,” says Nicola Millard of her role as BT’s Customer Service Futurologist. “Most people would imagine futurologists have a crystal ball that works and maybe talking about twenty to twenty five years out about a future where intelligent robots have taken over the world.”

“My horizon tends to be a bit shorter,” Nicola explains. “My time tends to start in about three weeks time and tends to extend to five years, so I’m more of an industrial futurologist and CEOs tend not think beyond the next three weeks.” “I guess more of a ‘soonologist’ than a futurologist.”

Nicola was talking to the Decoding The New Economy YouTube channel at BT’s London Demonstration centre where the time frame is somewhat more than the next three weeks as the company shows off the technology and product lines it believes are going to change the communication industry.

For BT and Nicola, much of the near future is focused in how consumer and workplace behaviour is being changed by IT and communications technology.

Nicola sees an interesting relationship between technology and people – technology can radically change peoples’ behaviour but it also can amplify existing behaviours. “It can certainly influence the way we work, rest and play, in the ways we approach the office and how we consume,” says Nicola.

“Behaviour changes are really fascinating when we give people people access to technologies that give them more choice and more information than ever before. It untethers us. All of these thing present opportunities to change that way we do stuff.”

The untethered office

Technology has also untethered the office, says Nicola. “In the old days we had to go to the office at nine o’clock in the morning and leave at five in the afternoon. We didn’t have any other options – we had a desk, we had big technology and we had masses of paper.”

“That’s all changed.” Workplaces have always struggled with collaboration and Nicola sees the open plan office as being a 1970s attempt to get workers to talk and work with each other rather than hiding behind closed doors. “By forcing people into open plan we hoped that by breathing the same air they would start to collaborate.”

“Now we collaborate with people that aren’t necessarily in the same place as us. The office itself has become a collaboration tool,” Nicola says. “We’re seeing the evolution of the office.”

Today’s technology tools and remote working have changed the role of the workplace with the office becoming a place for workers to collaborate and work together, however that nature of work has changed.

Working beyond the office

With improved connectivity the home office and mobile workers have come into their own with BT having around ten percent of their workforce operating from their residences and the company finds they achieve around a twenty percent improvement in productivity from those staff.

However home working isn’t for everyone. “I’m a terrible home worker,” Nicola says. “I tend to go mad so if I want to collaborate I go to the office but I want to work quietly I go to the coffice’, which is generally a third place outside the office or home.”

“There’s only four things I need to work; good coffee, good cake – these first two are non-negotiable –  good connectivity and then I need company. Not necessary office type company but just a buzz.“

The change to retailing

Today’s buzz extends to shopping, the shops are fuller on a Saturday afternoon than they have ever been before. The showrooming phenomenon – where customers use their smartphones to check prices and proudcts while in the shop – allows retailers to enhance their sales strategy as the same available to shoppers can also be used by sales assistants.

“Shopping is sometimes a contact sport,” Nicola observes. “the fact we are comparing and contrasting, the fact we are challenging the physical shop. Waving our mobile phone on the shopfloor.” “Retailers for a long time resisted showrooming, they split their online and physical spaces. We’re now seeing those physical lines blurring.”

Emerging trends

Nicola sees the biggest challenge facing business in the near future being agility – as cloud services expand, it’s easier for companies to scale which places pressure on many incumbent businesses.

Big Data also presents opportunities, “there’s always been big data, we’ve always had too much data, the analytics tools have changed.” For great challenge though for business is change and this is what will focus executive attention in the near future. “Businesses tend to be built to last rather than for change.”

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Navigating the future of accounting and business with the cloud

Cloud computing is changing the accounting profession and many other businesses with it says Steph Hinds of Growthwise accounting

Steph Hinds of Newcastle accounting firm Growthwise  is one of the new breed of business advisers using cloud and mobile technologies to change her profession.

At the recent Sydney Xero Conference I had the opportunity to speak to her about some of the ways her business is changing.

The interview with Steph as part of the Decoding the New Economy YouTube channel covers how the accounting profession is changing, what industries are being the most affected and where she sees the growth opportunities for her businesses.

Like many other professional services industries, the big change Steph sees is how accounting is moving from being based upon client transactions to requiring much deeper relationships with clients.

“The transactional model has been commodified completely,” says Steph. ” I started as a trainee accountant and we had those big ledger books and I was coding things and I’d go through cheque butts to enter them into the system.”

“Now all of that work is done for you.”

Like Xero founder and CEO Rod Drury, Steph doesn’t see this change as being generation based with older accountants adopting technologies as quickly as their younger counterparts.

However legacy systems do hobble existing businesses with both Xero and Growthwise finding 40% of their clients are new, startup businesses.

“We’re finding a lot of new businesses are starting up now,” says Steph. “it is so easy to setup in business, we’ve advised a lot of accountants that rather than spending five hundred thousand dollars to buy into a practice, you can spend ten thousand dollars on licenses and a laptop and all of a sudden you’re really in business.”

Changing the building industry

Steph sees the opportunities being in retail, hospitality and trades where being are struggling with paperwork and need fast responses in a customer driven market. The building trades are one of the big areas Steph sees for growth.

“Guys not having to drive to the office to get their instructions and their things for the day, not having to drop off timesheets, getting paid on the spot and billing on the spot.”

“We see traditionally see trades, particularly in the building industry as having cashflow issues and people go bust,” says Steph. “I think this is a huge opportunity to change things.”

Having information is at managers’ and proprietors’ fingertips is one of the benefits of cloud services and Steph also sees the app ecosystem, providing plugins like mobile job management are very powerful.

“The big data angle, for benchmarking – we have real time access to our clients’ data and how they are doing against industry benchmarks and being able to help clients,” says Steph.

Steph Hinds and Growthwise are examples of how the business world undergoing a dramatic change as the information and systems that were once only available to big business can now be accessed by anyone.

The real digital divide lies between the business who are prepared to grab the opportunities and those who are happy doing things the way they’re done today.

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We’re all Luddites now – Wage deflation and falling living standards

As the consumerist society runs out of credit, we have to find new ways to drive our economy

A post on today’s Macrobusiness describes how Australia’s General Motors workers being asked to take a pay cut is the harbinger for a general fall in the nation’s wages.

This is coupled with a post by Paul Krugman in the New York Times sympathising with the Luddites as technology takes away many middle class jobs that were not so long ago thought to be the safe knowledge jobs of the future.

Krugman points out that in the United States income inequality started accelerating in the year 2000, the stagnation of most Americans’ incomes started a decade or two before that.

For the last few decades, expanding credit allowed the consumerist society to continue growing, but the crisis of 2008 marked the end of that that economic model. Although governments around the world have tried to keep it alive by pumping money into their economy.

Now we have to face the reality that the Western world’s standard of living is falling for the first time in a century.

For some this is going to be really tough – although one suspects those who will really complain are those least affected.

What is clear is that many of our business and political leaders aren’t prepared to face this change. Dealing with that is going to be the biggest challenge of this decade.

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Australia’s economic rigor mortis

Australia has become too complacent in a competitive world warns one US business leader.

This is worth watching, Dow Chemical CEO Andrew Liveris and Australian Business Council chief Tony Shepherd spoke on Sunday with Alan Kohler on the ABC’s Inside Business.

At 5.40 Andrew Liveris says Australia is suffering a state of economic rigor mortis – “we’ve lost the ability to innovate” – with no plans and a great complacency. It’s something all Aussies should reflect upon, although don’t expect these blokes to be any help.

 

 

 

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