Arming young, new entrants to the workforce with the language and capabilities of the digital world must become non-negotiable. Given the current situation of education, the task seems daunting
The exponential growth of technology and digitisation, and the way it has dramatically disrupted our lives is without precedent. In the words of Eric Schmidt, executive chairman of Google, “We are going in a single lifetime from a small elite having access to information to essentially everyone in the world having access to all the world’s information”. The changes that this democratisation has wrought is profound to say the least. In this piece, I want to discuss some of its impact in our workplace and how we can possibly harness it to our advantage.
Rise of intelligent automation
The first round of change was brought on by computerisation. And as prices of hardware and software kept dropping, most Indian companies adapted to this change within 7-10 years. But as the process of change accelerated relentlessly, a lot of us brought up in an analog world struggled to keep up. When I came back to e-commerce four years ago after a stint in physical retail, Google had changed digital advertising so dramatically that online marketing as a process had become unrecognisable to the traditional marketer.
The first impact was felt in the world of media and marketing through the rapid growth of social media platforms. But the real impact will be felt when we allow business processes and content to be digitised. Let’s look first at the benefits of digitisation. Automation immediately reduces the degree of process variations within key business functions, perhaps making them error free. And while capital expense may go up initially in some cases, a drop in operating expense should reduce the price for the customer. In parallel, standardisation of processes would likely convert to better product quality as well. In the analog world, better quality usually converted to a higher cost and therefore higher price. This new reality entails a parallel drop in cost and improvement in quality. This could potentially be a marketer’s dream, or pose a few headaches by disrupting traditional pricing models.
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These changes by themselves have the potential to dramatically alter business models, or at the very least, throw up interesting new opportunities for incumbent companies.
A great example is GE, which is rigorously transforming its high-tech product businesses to service-led businesses with ongoing revenue streams by harnessing the power of digitisation. Of course the fact that digitisation allows for huge entrepreneurial opportunities to establish disruptive models in existing industries, goes without saying.
Revisiting business models
As digitisation of process and content accelerates, intelligent automation will significantly reduce the labour component, perhaps making it redundant in many cases. And this will in turn free up time. This immediately gives rise to two questions. What happens to the labour that is getting redundant? And what to do with the additional time that is now available to knowledge workers? I have personally experienced the disruption caused by freeing up managerial time through automation and it can be disorienting for many. We must use this time to refocus our energies on our customers, understanding their needs even better, even if we do a fair job of it now, and create better products and services to address those needs. And that means revisiting business models, product strategies, pricing models: better products at better prices must be the mantra of this age, and real innovation must be the means to this end.
Businesses can and should be a part of the solution instead of merely being the source of the problem. Education or re-education is one obvious all-encompassing solution, yet to make it actionable we need to detail out an agenda and identify the means of its execution. For example, amongst the affected staff within a business, some surely hold the potential to be re-aligned/re-educated to graduate to knowledge workers.
The larger challenge of course is education itself. Arming young, new entrants to the workforce with the language and capabilities of the digital world must become non-negotiable. And yet, given the current state of education, the task seems daunting to put it mildly.
Fortune estimates that with all the disruption only about 15% of the potential conversion to digitisation is currently complete in businesses based in the US. In India, perhaps the number is a fraction of that. Yet the digital storm is raging and is likely to continue.
The more we embrace it the more we are likely as businesses to survive this perfect storm and even thrive, else prepare to be swept away. The choice is entirely ours.
The author is senior VP, head —e- & m-commerce, Shop CJ India