To innovation and beyond – 2019+

My first post of the year – a look ahead for 2019 – was a bit tongue-in-cheek. Now The World Economic Forum (WEF) is meeting in Davos, Switzerland, I thought I would provide a more insightful analysis.

The WEF will be considering the implications of the 4th Industrial Revolution as the headline theme for their annual conference. If you’re new to all this here is a I4.0 primer from CNBC [Link]. 2019 is going to be a year where industrial innovation takes centre stage. 

The thinking from WEF is always good, detailed thorough. I think that some of the crucial themes for unlocking innovative value will be focussed around opportunities and risks. Here are some of my current favourites.

The Opportunities

  1. Using information and reconfigurable platforms to provide new solutions to stakeholder experience. This will establish new ways to create, deliver and consume the core outputs from industrial processes.
  2. Removing the idea of separation between “IT and the Business”. The two are now conjoined. Being good at tech will be a prerequisite of being good in business. Technology will be embedded in every way that work is done, products are created, consumed and delivered.
  3. Empowering the front-line will be crucial. The winners will be faster organisations where workers make autonomous decisions and are rewarded for outcomes. As an analogy think of Deliveroo drivers. For many reasons, more refined models of work-coordination are required but the core autonomous nature of the work is being previewed here. Decentralised decision-making and autonomous action guided by technology removes many of the tasks performed by middle management. I hope we will start to see teachers, dentists, doctors and nurses no longer filling in spreadsheets and working as relecutant automatons directed by ill-informed command-and-control resource-allocation systems.
  4. With power comes responsibility. Without middle management, new forms of controls (and motivation) will be needed to spot problems and reward behaviour. Surprisingly for some, I don’t believe it is the front-line worker, but middle management, that is most under threat from AI, visual computing and big-data. I hope the CFO won’t push progress only on AIQ but that marketing and talent managers will push the AEQ agenda. It’s important we understand not only economics but also pride, satisfaction and feelings of accomplishment.
  5. Innovation may not be in new forms of technology. The tech available to us now is far ahead of our application of it. Deployment options are already available but not used. Innovation will come from the application of existing technology to new areas of business. Those stuck with old infrastructure will not be able to reconfigure fast enough to keep up. Value will arise from designing new ways of working. Capturing the value will rest on finding ways to get the rest of us to work that way too.

And now the risks

  1. Innovation will come from networks. Big companies will look to small companies for ideas, small companies will be formed from collaborative networks of individuals. Ideas will be mashed-up to cross-fertilise creativity. Guards must be in place to avoid exploitative situations – if they arise unchecked it will mean that the small-guys can’t and won’t play for long. Without them, brilliant ideas will never be used. Rights management is crucial for the distribution of the value created. In the way that song-writing credits generate performance fees for artists. Licenses for ways-of-working are needed to stimulate innovation, and society needs to enable easy access to legal enforcement to uphold claims against copying without permission.
  2. Massive generalisation follows: Young people are frustrated by old-people’s inability to embrace new ways of working. Technology savvy folks are orders of magnitude more productive than their peers. They are quicker to make decisions and to multi-task. This leads to not only high-productivity but also to high-error rates. Iterative short-cycle experimentation and learning-by-doing is the hall-mark of agile strategy. This is not an approach that has been adapted to high-risk industrial work-settings. This leads to a clash of culture and an inability to attract and retain talent.
  3. Innovative individuals will continue to pursue independent careers in increasing numbers. Old industries will die, vested interests will be disenfranchised. The world of work, taxation, social contracts, pensions and access to finance will have to evolve to cope with this. To create a consensus and establish a sense of fairness new-politicians will need not only wisdom but also to deploy the old-tools of oratory and persuasion. There will be big disagreements across society and between nations. It will be necessary to create hope for those who fear being disenfranchised. They will not go quietly into that good night.
  4. Politics of property will come to the fore – the control of assets will be important. Whether that is physical real-estate where low-paid important workers are unable to afford to live where the people who need them reside; property from an accumulation of historical data that provides an unassailable lead and monopoly positions; or the “IDEA” that one person has spent 10 years creating that is exploited by a large corporation without reward. Society will need to find ways to address the control and distribution of property in a world where labour and working-time may not function as a distribution & motivation method.

I will spend time exploring these themes during the year – I have a number of initiatives already kicking off for the year and I hope that you’ll be able to help.

Leadership 4.0

The oil and gas industry is finding it hard to access needed talent. There are many reasons for this, and it’s only going to get worse. This report from the BBC is about the GETI (Global Energy Talent Index) survey [Link] that found the oil and gas sector is suffering from a talent shortage and an inability to attract graduates.

The survey said:

“possible recruits are attracted to the ‘technology’ sector rather than oil and gas.”

It did not elaborate on why that might be. My guess is that its to do with the old-fashioned approach our industry takes to adopting new ways of working coupled with young people’s expectations for the way they want to engage with the world. The idea that they want to work “in tech” may be read as they want to work “with tech”, and perhaps they equate “tech” with innovation and creativity.

This report on CNBC [Link] sets out to explain why people want to work in tech instead of finance. It’s findings include: “High-potential grads want to work at tech companies like Google and Facebook because they are more innovative in nature, give employees a deeper sense of purpose and offer flexibility”

The GETI report also found that

“young people were less attracted to big salaries than in the past – and instead wanted roles which offered promotion opportunities.”

What do you think that they meant by a promotion?  Perhaps that’s a desire for autonomy, self-direction, control and flexibility. Perhaps the new generation don’t appreciate being told what to do by an old bloke (and it normally is a bloke) who can’t use his email, who can’t be bothered with these guys who constantly have their face down using “twitbook” or “facesnap” on smarty phones.

The BBC quoted Hannah Peet from Energy Jobline saying

“Leaders and hiring managers recognise that the world has changed and the desires of young people are different, with only 30% of those aged under 25 believing that higher pay effectively attracts talent.  The trick now is to respond by working to provide individuals with more opportunities to grow their careers, travel and work with new technologies.”

What do you think she meant by the word “trick”, surely this language conveys an underlying lack of buy-in to the fundamental change that is required. Trick seems like a quick fix. Perhaps a deception. What I hear when I read it is: “We’re doing it right, we’re not going to change, we need young people to come into our industry – let’s trick them and they’ll come. Then we can show them what the world is really like which is not innovative, or tech led nor does it embrace change and discovery – by then it’ll be too late”.

Well I’m sorry: they’re right and you’re wrong. There isn’t a trick. We need to change – and the young recruits are going to show us how.

Leadership in the fourth industrial revolution is crucial, luckily the WEF (Davos) just published this a guide on how  to lead in the Fourth industrial Revolution.

http://www3.weforum.org/docs/WEF_Leading_through_the_Fourth_Industrial_Revolution.pdf

This quote is from there:

Googling the phrase “Every business is a digital business” reveals a list of today’s leaders attributed to that phrase. Yet, 44% of leaders say a lack of digital skills in their organization is delaying business transformation. Executives believe only one-fourth of their workforce is ready to work with intelligent technology. Less than half of executives believe they possess the skills and abilities to lead in the digital economy.
In his book, Dreams & Details, Jim Hagemann Snabe, Chairman of Siemens, wrote: “The new digital reality requires a new kind of leadership, one that understands the rules of the digital season, reinvents business from a position of strength, thinks exponentially rather than linearly and develops people to unleash their full potential.”