Author: jmeacock

Global Chief Strategy Officer at Deloitte responsible for strategy and innovation. Member of Deloitte Global Executive

The Future of Work is Human

The Future of Work is a topic that many write about.

It is an exciting opportunity for companies and individuals – to make work more interesting and have more meaning.

Sadly so many people think that the best way to get a headline or attention is to use scare tactics – come up with claims about how many jobs are going to be eliminated through AI and automation. Most of these have no or very rudimentary analysis to support these claims.

Our Deloitte Australia team has done a fabulous job in providing a balanced and substantiated view of where the opportunities will be and the skills/roles that will go away and those that will be in short supply.

It talks about work going from the hands to the heads to the heart.

Below is a link to the full report.

I would urge you to take the time to read – it is an informative, easy read.

https://www2.deloitte.com/insights/us/en/focus/technology-and-the-future-of-work/building-the-lucky-country.html?id=us:2di:3em:4diAU22531:5awa:6di:061219:fow&pkid=1006529 

What makes this a time of disruption?

Every generation has had its share of shifts and disrupters.

5 years ago really saw the coming of age of cloud to make SAAS a reality.

10 years ago it was mobility and social impacting the way we worked and played – changing retail forever.

15 years saw the emergence of platform businesses such as google and Amazon – creating one of the most significant transformations in business model for a century.

20 years ago was Y2K – in the end a non event but creating a huge update on the financials and technology.

25 years ago was email and ERP changing the way Business was done. This paved the way for standardized processes and the creation of supply chains and ecosystems.

All of these had a significant impact on business, in the day and ongoing. (And all had started well before the year I mentioned)

So why is now the age of greatest disruption?

It is the convergence of all the shifts noted above with the coming of age of AI, the introduction of 4G moving to 5G creating the Internet of Things, the changing expectations of consumers and the connecting of regulation around the world that makes this a momentous time. All of this means that businesses are compelled to address their business model in order to survive and thrive.

Voice on AI, Eye on AI

Recently I posted about AI not being for fast followers. ( see post from May 6).

At the risk of ‘I told you so’ see below an extract of a post today from Jonathan Vanian of Fortune – saying the same thing.

Great minds think a like or ….

“Executives who are afraid of long-term commitments should avoid artificial intelligence.

Like with romantic relationships, using the technology requires an appetite for hard work, planning, and patience. Even then, failure is a real possibility.

“If you are not going to make this investment for the long term, it is not a good idea to do machine learning,” LinkedIn’s vice president of artificial intelligence Deepak Agarwal told Fortune in a recent interview.

Agarwal leads the social network’s many machine-learning projects that power tasks like recommending job openings to users or determining which posts are the most relevant to them and that they are most likely to click on. He’s been involved with machine learning and statistics for years, after previously working at Yahoo and AT&T in senior technology research roles.

One thing Agarwal has learned is that it can take at least a year to see a financial return from machine learning. During that time, companies must navigate the mundane work of cleaning and properly labeling data, and figure out the correct machine-learning algorithms and data infrastructure to use.

Agarwal recommends that small companies, which often have little data, make an effort to collect it before implementing machine learning. Without a large archive of information, the technology is nearly useless.

For some companies, machine learning makes no sense because it requires a lot of computing power to crunch the data. And renting cloud computing infrastructure can cost more than any additional profit that machine learning can create, Agarwal explained.

But when the technology works, the payoff can be huge. For large companies like Google that have embedded machine learning throughout their businesses and apps, a modest 2% improvement on a particularly important metric could result in financial gains in the hundreds of millions of dollars.”

Who are the biggest private employers in the USA?

The answer might surprise you.

Number 1 is Walmart – but the next eight are the major private equity houses through their vast holdings in investee companies. Think the likes of KKR, Carlyle, Blackstone, TPG etc.

It demonstrates the huge shift we are seeing in capital markets – a shift away from public companies to private organizations.

In addition, thanks to Geoffrey Garrett The Dean at Wharton School, the graphs below show that more companies are owned by PE than publicly listed.

The second graph shows that the value of publicly listed is greater, however this will most likely change over time.

The rise of ‘wealth’ funds of all kinds – sovereign, PE, mutual, hedge etc – is fueling this change.

In addition, the move to quarterly reporting and monthly benchmark of returns is accelerating the move away from public companies.

Publicly traded organizations have had to focus on short term results – no longer being able to look at longer term strategies.

Ironically, this a complete flip from ten years ago – now if you want to invest long term or restructure, being in PE’s hands is a better place to be.

#privateequity #PE

Angst that AI will take our jobs ….

There is huge angst about AI taking over human jobs – with talk of 30%-40% of roles disappearing.

What if we were to reframe the discussion and look at it a different way?

What if we were to look at it as an opportunity to really enhance human capabilities?

To look at it in a way that says AI will take away the mundane aspects of our jobs but increase the need to bring the human capabilities of creativity, problem solving, collaboration, driving social purpose and communication.

I firmly believe that AI will create opportunity to do more, enjoy more, be more productive and to live more purposeful lives.

We know that increasing productivity creates wealth and in turn creates more and different jobs.

Every technological change has brought similar cries of job loss – the computer was going to take away jobs, that the ERP wave would eliminate significant parts of the workforce and the internet would eliminate significant numbers of workers.

However, every time, productivity has improved, mundane aspects of work have been eliminated and new roles have emerged. The take up of AI will be no different – it should be seen as an opportunity rather than a threat.

Below is a link to a recent Deloitte report that takes on the view of reframing the way we think about AI.

https://www2.deloitte.com/content/dam/Deloitte/us/Documents/human-capital/us-human-capital-flipping-the-narrative-toward-brighter-future-of-work.pdf

How do you compete with digital natives?

The No.1 issue for most business executives is ‘the sustainability of their business model’. In other words, they are asking the question ‘is my business model going to be disrupted anytime soon?’

They point to Uber, AirBnB, Amazon etc as great examples of new business models and talk about transformation to a ‘platform’ or ‘flywheel’ model as an imperative.

The trouble is that the companies mentioned are digital natives. They didn’t transform their business model – they were always online platform models . They transformed their industry but not their own model.

Finding organizations that have completely flipped their model is difficult. A lot have transformed components of their businesses through acquiring or developing digital components that impact the customer experience or make them omni-channel rather than purely physical.

So the question is, ‘do you need to completely transform your model?’ The answer? It depends- depends on your industry/sector/business and who your are competing with.

A number of organizations are doing incredibly well by taking on the challenge of a disruptor.

They understand the need to transform but also understand:

– what part of their organization they need to transform to compete, and

– how to leverage their traditional strengths and competencies.

Walmart is a great example. You could argue that they had more to lose than most from the rise of Amazon. Yet, they set out to bring technology into the heart of their business and become truly Omni-channel while leveraging their huge strengths of store coverage, distribution network and buying power. The acquisition of technology and platform businesses into the Walmart business has been successfully achieved.

Pointing to VR

I love it when organizations do something clever with technology.

British Airways have a very clever billboard in Piccadilly Circus that has a young boy pointing to a BA plane flying overhead with the Billboard stating where the plane is going to or coming from.

If you haven’t seen the advertisement there is a link below to YouTube:

It is a taste of what is to come in the future – the use of new technologies such as Virtual Reality and Augmented Reality to change our experiences.

I think these technologies are still underused by most organizations. We do see places like IKEA starting to use it to show how furniture will fit within your own home.

At Deloitte we use them as a good training tool and we are starting to use them increasingly to show clients what an outcome of an initiative would look like.