A tech revolution that changes the way we organize work & the danger of digital serfdom

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The old style company, that is the company circa 1880-2000, had firm boundaries and fixed hierarchies in order to function efficiently. But with the advent of digital technology and the consumer social computing revolution there is a seismic shift in how technology is used within companies. There are also significant changes in worker expectations and, as a corollary, companies are changing their demands upon workers. Huge power shifts are underway and it is important that we start analyzing them now.

The Past

The technology that enabled communication and control of large and dispersed groups of workers was inefficient and required supplementation by human resources in the form a supervisory and managerial hierarchy. Computer resources were initially tightly held by a few individuals within an organisation due to their high capital cost to acquire. And companies had access to much better technology resources than the average individual could ever hope to acquire.

For example, in 1956 a 5MB hard drive from IBM cost US$50,000, and in 1981 a 5MB Apple hard drive cost US$3,500. At prices like these the average person had little opportunity to acquire such technology.

It was this technology asymmetry that also contributed to the non-porous boundaries of the firm. Information stayed inside the firm and was not easy to share. Instead companies were in charge of their information and shared it only on their own terms. And usually that sharing of information occurred through bought or earned media and through ‘official’ news media channels.

The Present and Near Future

Today companies are grappling with the huge shifts in communications. Newspapers and other news media no longer hold the preeminent position they once held. Corporate communications are no longer about faxing out a press release.  Companies are developing their owned media resources and learning to use the diverse earned media opportunities available now via the internet.

Increasingly companies are requiring workers to develop their own social media and social networking personas on behalf of the company.   Also workers are being required to manage corporate social media channels as part of their jobs.  One challenge with this shift in work to social media channels is that they often need tending 24×7. Thus other workers are beginning to feel the operational demands of 24x7x365 operations that those of us in the IT department have felt for many years now.

Another shift is the control over technology within an organisation. In the past centralized control of technology resources was easy due to high cost and complexity to implement. But now with cloud computing as a commoditized service we see the real risk that other departments can go around centralized procurement and IT to implement whatever takes their fancy.

Gartner has just released their vision for 2012 and note that in 2012 we can expect more cloud and consumerization, less IT control.

Increasingly we are seeing workers bringing their own technology into the workplace – smart phones, tablets, and social computing. And articles directed at CIOs are saying: IT’s future: Bring your own PC-tablet-phone to work.

Thus we are at the beginning of a technology revolution in the office that will see the centralized control that was necessary to achieve economies of scale in the last century wane.

Instead we will see the growth of decentralization driven by cost and user demand pressures.  We will also see increased attempts to control behaviour through data and  monitoring due to the growth in the panopticon as I’ve discussed previously.

The Dangers of Digital Serfdom

My buddy Ray Wang posted recently on the right to be offline. We are facing a world of hyperconnectedness in which we can evolve into digital serfs tethered by our digital devices and an un-free as a slave in ancient times.

The risk is that the boundaries between work and personal time become so blurred that they cease to exist. The risk is that employers consider that, with a wage, they have bought our time as and when they choose to consume it any time of the day or night.

The moves to remove penalty rates for IT workers and others also support this trend. Once the unit cost of a worker is standardized an employer does not care what time of day or night they work.

I cannot articulate the concern we should have for retaining this right to be offline any better than Ray:

“There is one thing that I am very worried about actually, is I think it is of the uttermost importance that we preserve the right to be offline. If we don’t preserve that we’ll loose all our freedoms. It starts with ability to be able to escape … of being offline. And so we can be punished for not being offline. For not being online we cannot be punished. It’s happening right now. We are recreating Skynet, we are recreating Matrix, we are recreating all the things that we would fear on our own. And if we can’t protect that basic right of being able to be offline, and being able to conduct a life offline, we’re in trouble. We are in big trouble.”

I commend Ray’s thoughts to you, check out his video:

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Friction, hypereconomics, and social intercourse

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Friction is one of the more important concepts in the world. Many things are either made possible or impeded by friction.

Strike a match and the friction creates a flame. Yet that same kind of friction stops other things from flowing smoothly.

Perhaps the best description of the challenges that arise from friction is from the well known military strategist, Clausewitz:

“Everything is very simple in War, but the simplest thing is difficult. These difficulties accumulate and produce a friction which no man can imagine exactly who has not seen War . . . in War, through the influence of an infinity of petty circumstances, which cannot properly be described on paper, things disappoint us, and we fall short of the mark.”

From: Clausewitz, On War, Book I, Ch. VII

Recently Mark Pesce asked “What happens after we’re all connected?“, and he came up with the answer: “hypereconomics”.

Economics, fuelled by hyperconnectivity and enabled by the removal of friction in processes between people, equals hypereconomics.

And it is this removal of friction in processes, enabled by the internet and mobile technology, that creates the next frontier of opportunities for business.

The combination of mobile accessible applications and peer-to-peer social networks offers an astonishing array of new business opportunities.

In the Arab Spring and Occupy movements we have already begun to see the social and political shifts that are enabled when citizens can communicate and organize effectively through use of mobile technology coupled with social media.

The impact of these political and social movements will necessarily flow on to economic structures. This will create a gap for development of new business models based on removing friction and leveraging peer-to-peer capabilities offered by mobile devices.

Also people are getting used to helping themselves and each other, and the technology is enabling them to act collectively without a great deal of effort. This is the big shift.

We can now collaborate and act collectively even though separated geographically. No longer do we need to meet face-to-face to act. Collective action is enabled and made more efficient with mobile technology in so many hands. And it even facilitates better face-to-face meetings and action (viz. Occupy and the Arab Spring).

I am expecting to see a lot of disintermediation – shifts in the supply chain that that remove some existing intermediary players.

One of the first areas I expect to see this in is new mobile and online peer-to-peer payment models. Another area is aggregation of service providers and potential customers. Up until now aggregating those types of services required large capital investment, but now it just needs a peer-to-peer smart phone application.

If you are an existing economic or financial intermediary it’s time to start planning for this new reality. If you don’t then the dispersed peer-to-peer linked mob might just eat your lunch.

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When robots rule the world – the future of jobs in a hyperconnected world

UNSW CSE robot
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Steve Hopkins was telling me recently about an interesting law firm he’d come across in San Francisco – it’s called Robot. Where lawyer and junior partner Tim Hwang and his senior partners, Apollo Cluster and “Daria” XR-1029, work to merge legal and technical systems.

It was this law firm, and an interesting conversation Steve had with Tim Hwang, that sparked the idea for Steve’s session at last Saturday’s Social Innovation Unconference at Barangaroo.

We discussed the time in the future when robots run everything. And it got me thinking just how much robots already do for us. For most people the robots that run things are unknown and operating below their level of consciousness.

But let’s consider some of the work that robots already do for our society:

  • manufacturing – e.g. assembly lines for things like cars and packaging, quality control, building electronics components such as circuit boards
  • call centres – e.g. automated voice response systems
  • financial services – e.g. business decision support systems, straight-through-processing trading systems
  • the internet – e.g. search engine bots or those annoying Twitter bots
  • military – e.g. unmanned combat air vehicles (aka drones)
  • home and industrial cleaning – e.g. vacuum cleaners

I’ve been personally involved in developing and implementing intelligent business systems for a long time. Starting in the early days of voice automation and straight-through processing of financial transactions in the 1990s, through to the present day.

A large part of my work during the late 1990s and early 2000s was automating business processes and removing human beings from business processes. It was a huge shift in labour from human beings to robots. Those were mainly clerical jobs where a computer with a decision engine could easily replicate the work done by people.

Consider the productivity savings achieved by many of those projects; for example one project halved the number of call centre operators through the use of automation. That saving was achieved by addressing throughput constraints in both the inbound and outbound queues.

Firstly savings were achieved through the use of automated outbound calling technology – not waiting for the humans to dial a number but rather having the system start making the new outbound call while the earlier call was finishing. It also improved throughput by automatically bringing up the data entry screens for the call centre staff.

Secondly savings were achieved by adding customer self help options at the start of the inbound call process and by providing support to move customers to online self service. Instead of a human being tied up on the phone for 2-5 minutes with a customer trying to ascertain their needs the IVR and the customer did that work thus freeing up the operators to take more calls.

Arguably these improvements through increased automation were not as good for customers as they were for the bottom line of the companies, nor were they very good for the call centre staff that became redundant. And many would argue (as do I) that shifting the business processing efforts to consumers does not always make for excellent customer experiences. But cost and process optimization is a fundamental business practice.

It’s interesting to consider what other jobs will be removed from people via the next rounds of automation. The jobs that will go next are most likely to be middle class and white collar jobs.

The jobs that could go include: journalists, lawyers, managers and supervisors, warehouse personnel, sales staff (if the sales are all online how many do you need in a store?). Fundamentally, if your job or substantial parts of your job,  can be defined by means of a decision tree then your job is at risk of a robot taking over.

Welcome to the brave new world of work. What’s your plan to survive when robots rule the world?

Note: I’ve left out the entire area of robots for health since I don’t know much about it – but I reckon that will be huge too.

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Welcome to the panopticon

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Tonia Ries has just published an article titled Privacy Fail: Klout Has Gone Too Far, which outlines how Klout is indexing social networks and creating/measuring user profiles, even if they have never registered with Klout.

About the same time Facebook was accused of creating ‘shadow profiles’ on users and nonusers.

As I said recently, welcome to the panopticon.

When Jeremy Bentham originally came up with the idea of a panopticon he introduced it saying:

“Morals reformed – health preserved – industry invigorated instruction diffused – public burthens lightened – Economy seated, as it were, upon a rock – the gordian knot of the Poor-Laws are not cut, but untied – all by a simple idea in Architecture!”

Source: Bentham, Jeremy The Panopticon Writings. Ed. Miran Bozovic (London: Verso, 1995). p. 29-95

And thus it is, that by the beginning of the twenty-first century, we have (well most of us) willingly and freely chosen to become part of an electronic panopticon.

Privacy is now only possible by a steadfast refusal to participate in digital society in any way – by becoming like the Unabomber and moving to a shack in the woods. And even then, if others who participate in the electronic society mention your name or activities online, you are still caught up in the net.

Global surveillance has been made easy, simple, and ubiquitous. The very devices – laptops, tablets, mobile phones – we all carry enable this constant geophysical tracking via the SIM cards and wifi connections.

However, as we are seeing with the various #Occupy movements around the world, these same technologies that enable surveillance of us by the authorities, also enable sousveillance of the authorities by us.

This is one of the interesting things about living in an electronic panopticon. Unlike Bentham’s inmates we are not physically constrained to cells. We can move about freely (for the most part).

And we can also co-opt the same technology to create our own networks. Those networks can become peer-to-peer and frictionless. They can enable us to organise into groups very easily and to share information and ideas in ways that used to be hard.

The panopticon is here, it’s time to turn it to our own ends.

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Social media, radical transparency, insights, and klout

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One of the various social media influence scoring platforms – Klout – has just changed its algorithm and overnight many people’s Klout scores have dropped.

This has caused one of several reactions:

  1. complete indifference
  2. refutation of the importance of social media influence measurement
  3. howls of pain at the destruction of hard work in achieving high Klout scores
  4. humour like that of @jason_a_w
  5. even an #occupyklout movement

All very amusing  to someone like me.

But the really interesting thing is that we have entered an age of radical transparency.  Now our social connections and interactions are open to analysis because of our increasing use of social networks and social  media.

If the data is there and publicly available then it will be analysed.  There is little we can do to stop this phenomenon.  As users of social networks we are fair game due to the public nature of our social discourse.

However, as  a marketer, I’m often on the other side of this equation. In our businesses we seek to understand who the relevant influencers are for our particular niche or geography.

Social media is the new focus group.  And it is far richer than any focus group we ever had in the past. Now brands can engage with people in realtime and adjust strategy and products in response to feedback.

We need to find ways to cut through the enormous bolus of information that is there to be digested. And we need to make some kind of sense of the new landscape we all inhabit.

Mechanisms to measure people’s influence have always existed. Clothing, manners, motor vehicles are only a few of the ways we’ve judged people’s status and influence in the past.

Social media influence measurement and monitoring is only just starting.  Our lives are now lived in plain view and the data is open to analysis.

Welcome to the panopticon.

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My Geek Origin story, what's your story?

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This post was inspired by Michael Kordahi, well known to many as @delic8genius, who put out a call encouraging to geeks to share their geek origin stories.

My geek origin is shrouded in the mists of time.  It was so long ago that there is no only one photographic record [update: which is now in the hands of Michael Kordahi, heaven help me].  But there was a revolution going on and I became part of it.

During school and university I had no interest in technology or gadgets.  My passion was for the humanities – history, philosophy, anthropology.  Nothing to do with any of the so-called ‘hard sciences’ or mathematics.

But my first job was in a bank, one of those boring jobs I mentioned recently. Thus my first exposure to computers was to the mysterious mainframes to which one submitted requests that were returned, if you were lucky, two days later.

Yet I was still not attracted to technology. After all, what was there to love about the cold hard mainframe? And where was the immediate gratification?

After escaping from the job in a bank to a stockbroking firm I was given client trust accounts to manage.  There were lots of things to track. Again we relied on the slow and klunky mainframe (oh the joys of JCL and TSO I could recount).  Then a colleague showed me his new gadget – a personal computer running MS DOS – it was the only one in the office, nay the only one in the building.

That gadget fascinated me and, before my colleague realised it, I had co-opted the machine for myself.  I was suddenly able to keep track of things using new fangled things called spreadsheets. Then I discovered you could make it do what you wanted by writing programs.

Not yet a geek, but well on my way toward it.

Landed my next job partly due to my PC skills, still doing finance work.  But one day I was standing in the kitchen chatting with the CEO (as you do) and happened to mention that there was a problem with the computer system in the office.

[Pro-tip: never casually mention problems to a CEO unless you are prepared to help fix them]

She mentioned that we needed an IT manager and, since I sounded like I knew about that ‘stuff’, asked if I wanted the job.  My ‘prudent’ response (having no experience at all for this job) was “yes”.

Thus began my geek apprenticeship: inheriting the world’s most unstable and unreliable Unix system and applications. From there I discovered how hardware, operating systems, networks and databases work; and how various programming languages work (starting with shell scripts and moving on from there). It was endlessly fascinating.  Eventually I had to accept that no one can ever know everything about technology. I also had to accept that I am a very bad software programmer and an even worse metadata modeller.

The next interesting thing I came across was a guy in Finland who proposed an open source version of Unix, eventually known as Linux. In retrospect, by that time, there had been an evolution in my life: from the early days of humanities studies, to hanging out with friends for days on end (eating pizza) while we fooled about reverse engineering kernels. By this stage I was an unconscious geek (i.e. a geek but completely unaware of this fact, even though a member of AUUG).

Then came the web.  From the first time I heard about the web and hypertext it held enormous fascination. The power inherent in the notion of hyperlinking and hyperconnecting documents, people and things seemed to have great promise.

From the early days of the web I worked on enterprise web development, managing teams who were building large scale web applications.  The roles varied: project manager, enterprise architect, software development manager, consultant.

In the late 1990s I worked as one of the architects on a large scale middleware application – we called it a “multi-channel integration architecture” – that enabled multiple front end channels to interconnect with heterogenous backend systems.  Off-the-shelf middleware like we have now did not really exist so it had to be created from scratch.

From there I moved onto development of early e-commerce for both B2B and B2C, and customisation of supply chainERP and CRM systems. The power of technology to revolutionise business and business models inspired me to study management, marketing and e-commerce at university.

While working on all these large-scale enterprise systems, I was also playing with what has come to be called web 2.0 and experimenting on my own time. Learning HTML and other scripting languages for fun.  Started blogging for fun too, before blogging tools existed.  Was an early user of Blogger, Typepad and finally migrated to WordPress.

It was during the blogging that I finally became conscious of my geekiness.  But I didn’t really come out of the closet then since there weren’t many women geeks in my circles of acquaintance.

But with the advent of Twitter, and connecting with many amazing women who were also geeks, I finally came out of the closet and embraced my geekiness.

And that is the story of my geek origin, what’s your geek origin story? And, as Michael Kordahi (a.k.a. @delic8genius) said:

“This year at TechEd (super secret but super high profile project for now), I want to profile and capture your Geek Origin Stories.

What memories do you have that define you?

I’m looking for your personal stories that tap into what makes you geek. Stories like mine that tap into your geek DNA and the (tacit) attributes that define you.

So, please email me one or a few of your Geek Origin Stories. Also please include a photo or video of you being a young geek.

Email me at michael.kordahi@microsoft.com or post your own online and send me a link.”

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Innovation: operational excellence is not a path to sustainable growth

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I’ve been thinking about innovation a great deal lately and am fascinated by how many people confuse two different kinds of innovation.

The two different kinds of innovation are:

  1. continuous improvement – the drive for operational excellence, which is driven by optimising existing business processes and products (in the Six Sigma world the DMAIC approach is used for this kind of change)
  2. step-change innovation – creating new ways of thinking, new products and new ways of doing things (in the Six Sigma world the DMADV or DFSS approach is used for this kind of change)

It often seems that the revenue and cost impacts of these two different kinds of innovation is little understood.

The former, optimisation, generally has the effect of reducing costs. This is an admirable thing and is always worth doing.

However, I sometimes think that we are in danger of optimising the customer service and humanity completely out of our business operations by focusing so much on cost out initiatives.

The second kind, step-change innovation, is more focused on new revenue opportunities. This is the lifeblood of any business, it is not sustainable to keep taking costs out of the business and merely optimising the existing business and products.

Sustaining innovation within existing businesses is hard. Academics have been researching for years seeking the secret sauce of innovation so that we can pour it into our businesses and succeed according to some formula.

But it is not that easy. Innovation is hard. I’ve done it from inside of large organisations. New ideas are difficult to achieve consensus upon. New products are hard to bring to birth when everyone is already doing well with the existing products. It is hard to get people to buy into change unless there is a substantial reason to get their attention.

Everyone is usually running hard to keep up and to meet the current KPIs and the last thing they need is some crazy innovator trying to stop them from getting business as usual done.

Innovation is risky and entails the possibility of failure.  It is important to ask ourselves how we can make this risky business of innovation work for our particular organisation.   A key factor is how failures are treated.  Another important factor is allowing some time out of normal business to build the innovation idea into reality.

In my experience innovation within a successful existing business is only possible with the help, protection and support of highly engaged senior executives.  Every time I’ve tried it without this type of support it’s been almost impossible to survive the political tension between innovation, business as usual and meeting existing KPIs.

However, there is one certain thing.  Operational excellence and continuous improvement are not the way to grow a business.  But they are a great idea for freeing up some funds to invest in step-change innovation that creates new business models and new products.  Thus it is important for an organisation to make space for both kinds of innovation.

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#Digicitz 9: Politics & Digital Activism in the Social Age

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Tomorrow night I’ll be hosting a panel for Digital Citizens on Politics and Digital Activism in the Social Age. The panel has a fascinating and diverse group of people:

  • Penny Sharpe – Labor Parliamentary Secretary for Transport and Roads
  • John Bergin – Director of Digital News for Sky News
  • Steve Hopkins – from Ai-Media
  • Thomas Tudehope – Director of Engagement and Strategy for SR7

These panel members are all active in social media and each is a practitioner at the coalface of digital activism. They have some remarkable stories and experiences to share about the changes that the digital revolution has brought to the political and activist worlds. And each panel member brings a unique perspective of politics and digital activism.

YOU CAN REGISTER HERE
The venue for this event is the Shelbourne Hotel, 200 Sussex Street, Sydney, doors open at 6.30pm for a 7pm start. Tickets are $10 with 50% going to charity Sydney Cats and Dogs Home – who shelter over 4,000 lost and unwanted animals each year.

If you can’t make it tomorrow night then please consider donating to the Sydney Cats and Dogs Home Parched March fundraiser.

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