Irving Wladawsky-Berger

Becoming a 21st Century Digital Tinkerer

I like to tell people that the key to being and/or sounding smart is to hang out with smart people.  And, one of the names that would quickly comes to mind if asked to recommend who to hang out with is John Seely Brown, aka JSB.  JSB, - who’s been a friend for over 25 years, - was chief scientist at Xerox and director of its Palo Alto Research Center (PARC) until June of 2000.  He is now the independent co-chairman of the Deloitte Center for the Edge and a visiting scholar at USC.  But, as noted in his personal website, his chief occupation is Chief of Confusion,“helping people ask the right questions, trying to make a difference through my work- speaking, writing, teaching.” 

Transform our learning paradigms for the digital age is one of the main topics JSB has long been exploring, most recently in Cultivating the Entrepreneurial Learner in the 21st Century, - an article based on a presentation of the same title.  Entrepreneurial learners aren’t necessarily entrepreneurs, but like entrepreneurs, they are “constantly looking for new ways, new resources, new peers and potential mentors to learn new things.” 

Why is it so important to foster a more entrepreneurial style of learning?  Our educational system has long been based on the assumption that learning is mostly about acquiring knowledge as well as critical skills to enable us to apply whatever we learned in school throughout our careers, say 30 - 40 years.

The Continuing Evolution of the On-Demand Economy

The past few years have seen the rise of what’s been variously referred to as the on-demand, collaborative, sharing, or peer-to-peer economy.  Regardless of what we call it, this trend has captured the public’s imagination.  Articles on the subject now appear fairly frequently.  Some of the articles are focused on the empowerment nature of these technology-based economic models, enabling people to get what they need from each other.  Others are more concerned with on-demand’s impact on the very nature of work in the 21st century. 

In an excellent 2013 report, industry analyst Jeremiah Owyang argues that the collaborative economy is the evolution of the Internet-based economy of the past two decades.  The one-to-many Web 1.0 made lots of information accessible to individuals, but control remained mostly in the hands of institutions.  It was followed by the many-to-many Web 2.0, where individuals could easily share content and opinions with each other.  Now, the on-demand phase of the Internet economy is enabling individuals to go way beyond sharing information. 

“An entire economy is emerging around the exchange of goods and services between individuals instead of from business to consumer,” wrote Owyang.  “This is redefining market relationships between traditional sellers and buyers, expanding models of transaction and consumption, and impacting business models and ecosystems…  This results in market efficiencies that bear new products, services, and business growth.” 

In 2011, Time Magazine named the sharing economy one of 10 Ideas that Will Change the World.  “Someday we'll look back on the 20th century and wonder why we owned so much stuff… [S]haring and renting more stuff means producing and wasting less stuff, which is good for the planet and even better for one’s self-image…  But the real benefit of collaborative consumption turns out to be social.  In an era when families are scattered and we may not know the people down the street, sharing things - even with strangers we’ve just met online  - allows us to make meaningful connections.”

The Economic Potential of The Internet of Things

Like many technological advances, the Internet of Things (IoT) has been long in coming.  Ubiquitous or Pervasive Computing dates back to the 1990s, when neither the necessary low-cost devices nor ubiquitous wireless networking were anywhere near ready.  But IoT has now reached an inflection point, with over 10 billion interconnected smart devices already out there, a number that’s expected to rapidly expand to 10s of billions by 2025 and to 100s of billions in the decades ahead.

“The myriad possibilities that arise from the ability to monitor and control things in the physical world electronically have inspired a surge of innovation and enthusiasm,” wrote McKinsey in a June, 2015 report - The Internet of Things: Mapping the Value Beyond the Hype.  The report analyzes the long term economic potential of IoT, and uses this analysis to estimate the economic value of several IoT-based solutions by 2025.  Given the breadth and complex nature of IoT-based solutions, quantifying their potential value is very difficult indeed, especially since such smart solutions, - e.g., smart cities, smart homes, smart healthcare, - are still in the very early stages of development.

The McKinsey study introduces an innovative approach for estimating IoT’s future impact and economic value.  In addition, it identifies the key enablers required to realize this value and generates a broad set of findings on the likely evolution of IoT over time.  Details of the study can be found in the comprehensive 144-page report, whose key points I will summarize below.

Settings-based Economic Value 

The study is based on a careful analysis of over 150 concrete IoT applications across the global economy.  It applied a bottom-up modeling methodology to estimate the potential economic value of these various applications, including productivity improvements, time savings, better asset utilization and reduced accidents. 

After reviewing the results of their analysis, the study concluded that looking at IoT through the lens of individual applications and industries was inadequate.  Instead, IoT should be viewed through the lens of so-called settings, - the physical environments in which these various systems and applications are deployed, - which better captures the overall value created for all parties in each setting, - e.g., companies, government, consumers and workers.  9 such distinct settings were defined, along with the major applications that apply in each.

“Flexible Security”: A Sensible Social Policy for our Digital Age

A few years ago I participated in an MIT roundtable that explored where future jobs will likely come from, given our increasingly powerful, inexpensive and smart technologies.  Despite the presence of top thinkers on the subject, the answer, in short, is that we truly don’t know.  We are transitioning to a digital economy whose vast implications are not well understood.  Perhaps, as has been the case in the past, we lack the imagination to properly perceive the future, and once more our technologies will give rise to new industries and jobs that we can barely anticipate today.  On the other hand, there may truly not be enough good jobs to go around, a situation with serious economic and societal implications. 

Along with its many benefits, the digital revolution is already leading to serious economic disruptions.  As the July issue of Foreign Affairs reminds us with five articles on the subject, advances in AI and robotics “are causing us to take yet another world-historical leap into the unknown.”  And this unknown era of ever more powerful and capable automation could work out quite differently.  

Can we just rely on the invisible hand of the market to redeploy the work force to new industries and jobs?  Or, do we also need social policies to promote job creation and assist workers who’ve lost their jobs?  One of the Foreign Affairs articles, - The Next Safety Net: Social Policy for a Digital Age  by Nicolas Colin and Bruno Palier, - offers some answers to these questions.

“As advanced economies become more automated and digitized, almost all workers will be affected, but some more than others.” notes the article in its opening paragraph.  Many workers will face “low pay, short contracts, precarious employment, and outright job loss.  Economic inequality across society as a whole is likely to grow, along with demands for increased state expenditures on social services of various kinds - just as the resources to cover such expenditures are dropping because of lower tax contributions from a smaller work force…  These trends will create a crisis for modern welfare states, the finances of which will increasingly become unsustainable.”