Digitization: The Good, the Bad, and the Scary

December 5, 2016

Disappearing Work - StuckyIn October my monthly Talking About Tomorrow membership program (“TAT”) featured former IBM researcher and current Distinguished Visiting Scholar at Stanford University – and Very Smart Person – Susan Stucky, who led the group in an important conversation about “disappearing work.”

But Susan wasn’t talking just about all the jobs that are being automated out of existence. She is of course highly aware of, and deeply concerned about, automation, but she asked the TAT participants to focus on another, often unseen, side of the emerging digital economy.

She opened with this statement by economist W. Brian Arthur, External Professor at the Santa Fe Institute, from a 2011 thought piece in McKinsey Quarterly:

Digitization is creating a second economy that’s vast, automatic, and invisible—thereby bringing the biggest change since the Industrial Revolution.

(from “The Second Economy,” October 2011)

It’s not just jobs that are disappearing. As those jobs and the processes that connect them are digitized, the processes also disappear, although not in the sense of being eliminated. Rather, embedding processes in software makes them essentially invisible and therefore extremely difficult to understand, control, or change. And we are risk of losing human knowledge about how those processes work – and why.

In many ways that invisibility simplifies our lives, reduces costs, and increases the reliability of those processes. Here is an example of how automation and augmentation have improved the quality of our lives (again, from “The Second Economy”)

Twenty years ago, if you went into an airport you would walk up to a counter and present paper tickets to a human being. That person would register you on a computer, notify the flight you’d arrived, and check your luggage in. All this was done by humans. Today, you walk into an airport and look for a machine. You put in a frequent-flier card or credit card, and it takes just three or four seconds to get back a boarding pass, receipt, and luggage tag. What interests me is what happens in those three or four seconds.

The moment the card goes in, you are starting a huge conversation conducted entirely among machines. Once your name is recognized, computers are checking your flight status with the airlines, your past travel history, your name with the TSA1 (and possibly also with the National Security Agency). They are checking your seat choice, your frequent-flier status, and your access to lounges.

This unseen, underground conversation is happening among multiple servers talking to other servers, talking to satellites that are talking to computers (possibly in London, where you’re going), and checking with passport control, with foreign immigration, with ongoing connecting flights. And to make sure the aircraft’s weight distribution is fine, the machines are also starting to adjust the passenger count and seating, according to whether the fuselage is loaded more heavily at the front or back.

Susan also mentioned a fully automated bread-making factory, pointing out that while the bread was being mixed, kneaded, and baked without human involvement, we now have a bread factory being managed by people who don’t individually know how to bake bread.

What have we lost because of automation of that factory? Knowledge? Control? The ability to react to unforeseen future of events? An understanding of how to adapt the recipe to different temperature and humidity conditions?

More importantly, what about obviously critical processes, like banking, inventory management, automobile construction and assembly, monitoring of nuclear power plants and the electric power grid? And what could go wrong once autonomous vehicles are widespread and we’ve lost the skills of manual driving?

Susan Stucky is sounding an important alarm. In addition to Automation, Augmentation, and Autonomy, we need to be thinking seriously about two other A’s – Authorization and Access Rights. Who is in charge, or should be, of decisions to embed knowledge in software? And once it’s done, who has access to the code and the resulting data? How do we ensure the safety and reliability of those invisible processes? How do we protect them from fraud, hackers, terrorists, natural disasters, and malicious programmers?disappearingwork

Like it or not, we are overwhelmingly dependent on technology today. But along with improved productivity and quality of life, are we abdicating too much control and governance to unrecognized but powerful individuals and groups? Are we even talking about the risks these decisions by default are creating for our collective future?

That’s food for thought as we celebrate the end of 2016 and look ahead to another New Year. Will 2017 be marked by progress toward a safer and more bountiful world, or will it be remembered as a time of retreat, with even more loss of control over our lives? It’s up to us.

Call me today (+1 510.558.1434) for a free exploratory conversation about how you can become a hero by future proofing your organization and taking charge of your tomorrows.

Download "Digitization: The Good, the Bad, and the Scary" as a PDF

{ 1 comment… read it below or add one }

Robert Buss December 6, 2016 at 8:58 am

Hello Jim,

Great topic to discuss. In an historical context Adam Smith talks about specialization in nail production. It is clear that the individual steps are not mastered by everyone in the factory and the carpenter, as the user of the nail, doesn’t know nor need to care about the steps that have been taken to create the finished product. In some ways the computer systems are no different and part of the process the complete a “product”. One uses the product and it is ok that one doesn’t know what happens behind the scenes, just like a carpenter doesn’t know how the nails are made.

On the other side, if the furnace goes down, no nails can be produced and the carpenter can’t work. Today, if the server goes down, the airline can’t fly. Flights are a service and can’t be stocked like nails, so a server shutdown has immediate consequences. A furnace shutdown wouldn’t effect the carpenter until he used his supply up and the store sold their supply. All proceeds at a pace that might permit purchasing from another factory before the supplies were exhausted.

We are seeing that “just in time” production and services are more susceptible to supply side problems. Also centralization, winner takes all and to big to fail markt actors exacerbates such problems and create major risks for everyone else in the system.

That said, I am still guilty of using just Google for my search needs. I look forward to more thought provoking essays in the New Year.



Leave a Comment

Previous post:

Next post: