society Archives - Aide Memoire

January 28, 2014May 5, 2014

What is the future of work? Zero hours, surveillance, robots and the jobs free future

The future of work has been on my mind a lot over the past few years. It seems that the future of jobs is bleak in a number of ways. For example, zero hours, surveillance, and robots are on the horizon for many workers. This is all part of what I’ve come to call the ‘jobs free future’.

This post about the future of work was originally inspired by Marissa Mayer’s pronouncement in early 2013 banning work from home at Yahoo!. The ever-present drives for efficiency and lower costs mean that businesses are changing the way we work, and they are also changing the way that we are contracted to work.

Digital Panopticon

Increasingly we live in a digital panopticon and technologies like CCTV, drones and the internet of things are emerging and merging to provide mechanisms for better and more omnipresent surveillance of people in all aspects of their daily life. When we add this growth in surveillance to other factors, such as a shift to lower economic growth rates and changes in the traditional twentieth century employment contract, for example the introduction of zero hours contracts, then things are really becoming quite different for workers.

Higher Skilled Jobs Disappearing

Headlines like “Cisco to cut 4,000 jobs” have become a regular sight and it is clear that it is no longer only low skilled or manufacturing jobs that are disappearing. The jobs that are going are increasingly higher skilled and middle class roles. Thus while “Robot Serves up 360 Hamburgers per Hour” is an example of the disappearance of low skilled jobs, we can also see automation impacting other industries. The young woman who used to hand back my dry cleaning is gone now, replaced by a large red machine that dispenses my laundry with nary a snide remark, and it gives a 20% discount too.

the future of work Law is one good example of an industry that is beginning to be disrupted. The first phase is shipping expensive western jobs to lower cost geographic regions, thus legal process work is being outsourced to places like India or the Philippines. This is removing the entry level jobs that law school graduates once used to get a step up on the rungs of their new career. The next phase is automation of other legal processes within law offices, for instance adoption of legal decision support systems. Thus firms will require fewer more senior personnel and hardly any of the para-legal personnel they once required. All of this will be framed as ‘efficiency’ gains for the business. But what it really translates into is a substantial reduction workers required in the legal industry. A consistent pattern across all industries is the implementation of solutions that take human workers out of the business process and replace them with machines.

This automation trend started with the early days of computers and has gathered pace as artificial intelligence technology became a commodity and internet connectivity became ubiquitous. Typically, if a business cannot remove the human workers by means of technology, then they will shift the jobs to the lowest cost region. Thus, at best, we are seeing a downward pressure on wages and salaries, and at worst complete removal of jobs from the global economy.

Casualization of the Workforce

Many new businesses or startups rely upon outsourcing to reduce costs. This means that where once a new business would create a number of jobs at various levels they now use platforms like Air Tasker or Task Rabbit. With the adoption of these tactics by businesses there is increased casualization of the workforce. This casualization of the workforce removes the notion of job security that enables workers to plan effectively for their future by getting a mortgage or affording health insurance. Casualization of the workforce shifts the buying power of workers from the current pattern, where they are good risks for lending by banks due to their regular pay cheques, to poor risks. These shifts in spending power of the workforce will have impact on industries like retail and telecommunications.

In the US the Wall Street Journal (WSJ) reported that “A Jobless Recovery Is a Phony [sic] Recovery. More people have left the workforce than got a new job during the recovery—by a factor of nearly three”. Further WSJ noted that “Long-Term Jobless Left Out of the Recovery. Despite Improving Economy, Prospects Are Bleak for Millions of Unemployed”.

Real Jobs for Real People?

In Australia, according to the Australian Bureau of Statistics (ABS), there are approximately 140,000 job vacancies as at November 2013. And in December 2013 the ABS reported that unemployment increased to 716,000 while the unemployment rate remained steady at 5.8%. Given these numbers it is unlikely that getting the unemployed into education or training is going to help very much unless the job supply is increased substantially. Perhaps they can all become entrepreneurs and start micro-businesses?

If this is where Australia sits regarding unemployment when coming out of a mining boom, with a Triple A credit rating and having successfully negotiated the global financial crisis, then is does not presage well for the future. The mining boom is winding down and jobs will disappear in that industry anyway due to automation (as reported by the University of Queensland).

Australia is on the cusp of a dilemma. We face an ageing population that is about to put substantial pressure on the welfare budget, reduced traditional employment opportunities for both low and higher skilled workers, and the end of a jobs-rich mining boom. Heavy industrial manufacturing is all but dead in Australia, and the car industry is dying too. This is clearly demonstrated by the recent exit of Holden leaving Toyota as the last remaining Australian car manufacturer (and even Toyota is likely to exit the market over the next few years). Then there will likely follow the demise of car component manufacturing in Australia too, unless the component manufacturers can find other markets.

Traditionally construction and retail picked up the slack in the Australian economy during lulls in mining booms. However, the continuing weak performance of Australian retail makes it an unlikely contender for jobs saviour. And while we are seeing construction increase as the mining boom eases, neither industry is likely to have the capacity to fill the increasingly large gap between the number of available workers and suitable jobs. This issue is reflected by the markets in lower currency rates based on weak jobs data. And a lowering of the currency, while helpful for export driven sectors, reduces consumer purchasing power to support the retail and housing markets.

The Future of Work?

There are no obvious replacement industries to fill the gap left in the traditional jobs market in any of the western countries. We are facing enormous structural change, and there is an emerging crisis. What is to be done about a post-jobs future? I wonder who in the Government and Opposition is thinking about these issues? It seems kind of important.

Disclosure: For a considerable part of my career I worked on large scale operational efficiency and innovation projects that removed workers from business processes and implemented process automation; where that was not possible work was typically outsourced to lower cost regions.

February 25, 2012

Connectedness – it's not just a technology thing, it's a people thing

For many years now my friends, colleagues and I have been talking and thinking about the hyperconnections made available to us by the growth of the internet, telecommunications devices and networks, and social platforms. For a good background on it check out Mark Pesce and Ross Dawson.

But I think that we have reached a state in our evolution as human where the practices of hyperconnectivity have changed the way we are doing, being, and thinking.

Connectedness is no longer about technology it is about people. Our need for connectedness is beginning to transcend the technology. I believe that, even if the internet disappeared tomorrow, our desire for and expectation of connectedness would continue and that the behaviours engendered by the internet will remain to be expressed.

Ian Shafer summed it up nicely recently:

“I think this whole notion of connectedness is more a state of human evolution than rather a generational thing.”
from: Ian Shafer, in Generation C: A new demographic label for marketers by Kai Ryssdal, 24 Feb 2012

Movements like #Occupy and the Arab Spring around the world show that people connecting is more than just a technology thing, although technology has amplified the ability of people to connect across distance.

Human beings don’t want to just engage and connect with brands, a desire to create a world better suited for the beings that inhabit it (and their progeny) is growing and we see real life communities growing.

A good example of this Social Innovation Sydney. It started online but this community connects in real life meetups and the human network creates connections, relationships, and activities far beyond the initial starting point.

If the internet disappears tomorrow how will you be able to find your tribe?

January 2, 2012

De Profundis: The final mystery is oneself

Recently I was re-reading Oscar Wilde’s De Profundis, a moving letter from prison that looks at spirituality and faith from the depths of despair and degradation.

This particular quote stood out for me, especially the notion that we do not know ourselves very well.

“But with the dynamic forces of life, and those in whom those dynamic forces become incarnate, it is different. People whose desire is solely for self-realisation never know where they are going. They can’t know. In one sense of the word it is of course necessary, as the Greek oracle said, to know oneself: that is the first achievement of knowledge. But to recognise that the soul of a man is unknowable, is the ultimate achievement of wisdom.
The final mystery is oneself. When one has weighed the sun in the balance, and measured the steps of the moon, and mapped out the seven heavens star by star, there still remains oneself. Who can calculate the orbit of his own soul?
When the son went out to look for his father’s asses, he did not know that a man of God was waiting for him with the very chrism of coronation, and that his own soul was already the soul of a king.”
Oscar Wilde – De Profundis

It seems, as we move into the interesting year of 2012, that this is a good time to turn our efforts towards understanding ourselves more fully. And, along with that, to discover how to accept ourselves as we are, both flawed and fabulous in parts.

I have come to suspect that our good relations with others hinge more upon our own understanding and acceptance of our own self than upon any other thing.

Hopefully we are not fated to suffer – as did Wilde (or Verlaine or Prince Kropotkin) – similar trials to achieve clarity and understanding.

October 23, 2011

Occupy Wall Street Activist Slams Fox News Producer In Un-Aired Interview

As the various Occupy protests fan out around the world many of us are trying to make sense of them, and to ascertain into which particular mental box these protests ought to go.

This interview of Jesse LaGreca, a vocal member of the Occupy Wall Street protests and writer for the Daily Kos, by Fox News is fascinating. It gives an insight into the kinds of problems Jesse is interested in addressing. Of particular interest is his desire to not have the movement end with a specific goal in mind:

“As far as seeing this end, I wouldn’t like to see this end. I would like to see the conversation continue. This is what we should have been talking about in 2008 when the economy collapsed.”

This video comes courtesy of Kyle Christopher from OccupyWallSt.org media team.

Also worth a read is another article: Jesse LaGreca: The Smartest Man on Wall Street?

October 17, 2011

What about CSR and the triple bottom line?

In response to yesterday’s post someone on Twitter, @dmanww, raised the very sensible issue of the triple bottom line, or as some might call it, corporate social responsibility (CSR).

However, having worked in a number of organizations that took the triple bottom line and corporate social responsibility very seriously, I know that it is not pervasive within the organization in the same way as the maximization of shareholder value.

To put it bluntly my bonus often had a small component of CSR involved, but the major KPI was always contribution to revenue (a.k.a. shareholder return). Very rarely were major issues discussed in terms of CSR impact, but issues were often talked of in terms of impact on shareholder return.

Measurement of the triple bottom line is not the problem. It is only a problem in an environment where the only things that matter are those that are monetized and which are realizable within a short term timeframe. In that context it is impossible to measure other things that matter – like quality of life, social impact, or common good.

Corporations focus on what provides revenue. That is the nature of the beast. It is not evil to pursue revenue. However, the pure pursuit of revenue is an amoral activity. This is especially true if executed in an environment where things – people, environment, society – are objectified and monetized.

I got interested in the idea of implementing a triple bottom line back in the 1990s. From my perspective it has not made much progress. CSR is still largely the responsibility one department within most companies. It has not become a pervasive filter for everyday business decisions. And I do not think it ever will become one with the current way corporations are structured, rewarded, and assessed.

Even if a corporation wanted to change their approach on CSR and implement it more fully, the market analysts would most likely punish them. This is because CSR necessarily impacts upon returns to shareholders. Since most public companies focus on analyst reports to ensure share prices are maintained this is a problem. And the problem is related to executive rewards, since often these are tied to stock performance.

For modern corporations the complex nexus between corporate structure, executive reward, and market assessment means that truly implementing the triple bottom line is fraught with risk.

October 16, 2011

Maximizing shareholder value should NOT be the only goal of the corporation

It is interesting to think about this now that we see Occupy Wall Street spreading around the world (even to Occupy Sydney).

Back in 1976 Michael Jensen and William Meckling argued that the solution to the principal-agency problem — business leaders advance their own interests not those of shareowners — was to make the goal of the corporation the highest return to shareholders and to align shareholders and business leaders through granting stock options. Today this remains the prevalent model of organizing and motivating people within organizations in the western world.

I have long argued that this approach evokes extremely dangerous behaviours in companies – creating corporations that are run as if they are peopled by soulless automata.

The construction of reward systems that prioritize shareholder value as the sole objective of the corporation encourage risk taking, little focus on other concerns (such as social and environmental good), and poor treatment of human resources.

Dan Ariely has written about Better (and more) Social Bonuses – it is worth reading. Bonus scheme incentives encourage unhealthy competition and can drive unintended outcomes, such as ignoring due process (as in the various bank scandals such as the recent UBS rogue trader).

One characteristic of the shareholder value model in action is the objectification and monetization of things – people, environment, social good. This attitude has inherent problems for all stakeholders in a business, even for the shareholders. Shareholders are people too, they live within a society and an environment. Thus prioritizing shareholder value over social and environmental good is not necessarily good for shareholders.

As a senior manager in large corporations I often found myself referring to people as FTE (a.k.a. full time equivalents). This objectification of the people within the organization – treating them as if they are mere machines – is a characteristic of this shareholder primacy model.

Once the people who work in the business are successfully objectified it is much easier to treat them in ways that previously impossible. It is easier to implement inhumane or unsafe work practices. It is easier to fire people. It is easier to ask people to do things that are unethical.

The other part of this unhealthy equation is the large institutional shareholders in corporations. Because they represent interested parties at second or third hand again we see objectification of the process. They too seek only to maximize benefit for the shareholders that they represent. But because they represent those shareholders at arm’s length they do not understand the needs or wants of those shareholders. Thus the real people who are shareholders are assumed to only seek maximum value no matter how that is achieved.

The common thread in all of this that real people with real desires to create a good world for themselves and their grandchildren do not have their interests adequately represented. Instead we all suffer – people, planet, nature – because of this single-minded pursuit of maximal shareholder benefit.

September 26, 2011

Leadership: Doing the right thing, even if nobody is watching

I have worked with a number of great leaders and managers over the years, some of them are famous for this but others are quiet achievers. Watching ABC’s Four Corners program about St Ann’s Secret on television tonight made me think about what makes a great leader.

The story of abuse of disabled children by paedophiles in Adelaide was heart-rending, and the failures of leaders in various roles and in various situations often seemed to compound the damage.

It takes leadership to stand up and do what is right. As an one of my managers used to say it’s about “doing the right thing even if nobody is watching”. And he often noted that it is also about being seen to do the right thing at the right time.

Over the years I have also worked with leaders who flirted on the edge of illegality (some of them even went to gaol a few years after we parted company). The organisations that were led by those people all foundered over the years. The story in each case was similar: procedural irregularities, illegality, bankruptcy, civil and criminal charges, many ordinary workers and investors betrayed.

The common thread was that these leaders encouraged their staff to skirt probity and fiduciary duty. The road to hell is not just paved with good intentions, it is also a long slow and slippery slope. Attention to small things and attitudes to them are paving stones on the road to hell.

And the consequences of those little things do not just fall on a business, or on its investors. The consequences also fall on society at large, upon families, and upon young people.

We see the consequences of this bad behaviour of organisations in the scandals that rock our churches so regularly, in the business failures that damage lives and our economy, and in the world our young people will inherit.

How organisations function comes down to all of the individuals, but it is the leaders who set the tone. And it is the leaders who bear the responsibility for the kinds of behaviour that are seen as acceptable and appropriate.

Leaders need to think about what messages they send about which behaviours and practices are appropriate. It is not merely the explicit messages that signal to people how they should behave. In many cases it is also the behaviour, comportment, and gestures of the leaders that set the tone.

Organisations are organic and their culture is viral. And the strongest form of the virus comes from the leaders. If you’re a leader it’s time to think about the example you set.

September 16, 2011

Are we living in the age of rage?

There are so many angry people these days. It’s something I don’t really remember from my youth and childhood. Only in recent years does it seem that everyone is angry.

I’ve been trying to understand why there should be more anger now than in the past. It might be something to do with our standards now. Standards for everything are so much higher now than in the past. We expect everything to be ‘awesome’ and ‘amazing’ all the time.

Are we putting too much pressure on ourselves and the people around us with our attitudes?

The daisy chain of pressure in our lives is remarkable. If we want an awesome house/car/boat then we need an awesome job to go with it. Those jobs often mean that both parents work. Which, in turn, means that there is constant time pressure on the family. Then there is the pressure of being accountable to your boss and the company as well as to your family and friends.

And on top of all of this we commute. Our commutes are often long and add to the pressure we feel. To get from home to work, or from work to childcare when the traffic is heavy or the train is late just adds more pressure.

For many of us there are very fine margins of time between activities. And this lack of gaps and lack of downtime adds pressure too.

I’m becoming aware of how much pressure we put ourselves under. Racing the clock. Trying to achieve all the things we want. And how, we can get angry when the pressure builds. How a little thing like a missed train or a traffic jam can cause rage to build.

So here we are: overworked, tense, and tired, while some suffer from lack of money and struggle financially – the tension builds up with nothing to dissipate it.

Very few things in our lives work to dissipate this tension, there appears to be few outlets. Instead it builds and bursts out when kinks hit our extremely tight schedules. And when it does burst out it does so in reaction to delays and interference in our plans or tight schedules.

But what can we do to change this? A few things I’m trying include saying ‘no’ to adding more things or activities to my life and doing yoga classes a few times each week.

It does make me ponder the notion of existential estrangement.

September 10, 2011

Labour, forced labour, and capital – is the ground shifting?

Free people offering their labour in exchange for monetary reward has been fundamental concept for western society. Since the mid-nineteenth century we have not really used forced labour for production. But two examples in recent times make me wonder if that assumption still holds true:

We’ve blithely assumed that we will always be able to sell our labour on the free market and that there will be some (more or less depending upon the economic situation) buyers of our labour – hence much xenophobia on the part of many.

We’ve also assumed that our only competitors for selling our labour on the free market are other free people – either native to our lands or foreigners.

Forced labour used to be an important component of the labour market in Australia, after all we were founded as a penal colony for the UK. However, for the most part, in the west we have not had indentured labour since the nineteenth century.

There also appears to be a growing idea that we should also apply ‘user pays’ principles to people who receive support from society. This means that there is a growing notion that prisoners (and the unemployed) owe society something in return for the support that they receive from society.

I wonder how long until western industry works out how they can use the nexus of this ‘user pays’ ideology, the the need to reduce costs, and the adoption of forced labour? It’s interesting to consider this idea given the continued drive to reduce costs and while the prison population is not in a good position to protest their treatment.

UPDATE: And now I see that the redoubtable Douglas Rushkoff is asking Are jobs obsolete? it seems that I’m not the only one with questions about the shifting relationship between labour and capital. Also it appears that in the US the Unemployed face tough competition: underemployed.

August 24, 2011

What kind of zombies have we created?

I was reading Bill Bonner’s recent post Zombies Born of Government Spending where he posits the notion of zombies in our economy. As Bill defines it:

“In economic terms, a zombie is a parasite. He contributes less to the economy than he takes from it. He lives at the expense of others.”

His argument is that social welfare programs as practised by most of the developed world only work during good times. As he argues:

“It’s relatively easy to turn people into zombies. And it’s fairly easy to support them when an economy is healthy and expanding. But when an economy goes into a contraction, you can no longer afford to give the zombies their meat. Then what?”

This is an interesting question. Western societies have created a group of people with few skills and no means by which they might generate value to exchange. Nor do many in this group appear to have bonds to the society within which they exist and they exhibit few loyalties to ideas or ideals outside of mere existence and consumption.

But the real issue is how we create a new economy, one that is founded on creation of real value and its exchange, and not ephemeral things (like hybrid securities and CDOs). One that sustains and nurtures community rather than destroying it through extreme competition and crazy ideas like the priority of shareholder value above all other things.

This raises some important questions:

If the government can no longer sustain them (or us) then what happens?
How do we create ways of connecting people with skills to share with those who want to learn?
By what mechanism can we develop shared values that support the creation of valuable skills?
How do we create communities of people that choose to contribute and collaborate for the common good?

We don’t have to let what’s happening in other places happen here. We have the choice. We can create communities where real value is exchanged between real people. Not what passes for value in the some places – faux celebrity, immediate gratification, and continuous consumption – but sustainable and sustaining value.

There used to exist such things as commons in the past – commonly held land and other resources. But we have few of these remaining to us nowadays. It might be times to create some new common resources to share in a fair and equitable manner? We have already seen the rise of new forms of sharing and common ownership through Creative Commons on the internet. It makes me wonder what other things for which this approach will work. I suspect that Mark Pesce’s work on his Plexus innovation is a beginning in this quest.

It is worth considering how we can each begin to nurture collaborative behaviour and thinking in our local spheres to work against the zombie world view.