We’re currently at the start of a new wave of creative destruction – and I recently had the pleasure of joining a group of blue-chip businesses and government organisations to discuss ‘The Rise of the Machines.’
The event, a monthly knowledge sharing forum for sustainability enthusiasts called ‘The Crowd’, was a chance to share and explore views on this triple whammy of technological forces – the replacement of muscle with machine, the automation of knowledge work and machine-to-machine convergence. These will result in the development of a new type of business model and related supply chain – one I call the Personal, Automated and Local (PAL) supply chain (see next week’s pointZero for a fuller explanation):
- Personalized through mass customization and on-demand manufacturing, combined with devices that remember personal preferences and AI systems that predict what you want, before you want it.
- Automated using autonomous vehicles and smart robotics that pick, pack, and produce goods, while Blockchain technology, robotic process automation, and chatbots handle the administration and customer queries.
- Localized due the re-shoring of production to where consumers are located, as the cost advantages of making, storing, and shipping goods locally and in smaller quantities using smart machines and on-demand manufacturing become increasingly pervasive. A micro-logistics network, using warehouse robotics and autonomous delivery methods – from drones to mothership vans that contain delivery robots.
Robotics and AI journalist Chris Middleton illustrated the power of automation by referring to three numbers – 15, 66,000 and 1 million. Fifteen is how many people a robot replaces in China, 66,000 is the number of robots China bought in 2016, and 1 million is the total number of workers all 66,000 replaced. As Chris states, this might not seem like an extraordinary figure for a country of more than a billion people, but China is automating faster than any other economy to retain its cost proposition, so this number is only going to grow.
If you also consider that according to the International Federation of Robotics, 1.4 million new industrial robots will be installed in factories around the world by 2019, this means 21 million human jobs will potentially be replaced by machines in just two years.
The impact of technology on the business world is not limited to factory floors and supply chains
Of course, the impact of technology on the business world is not limited to factory floors and supply chains, with Avida Hancock, COO of AI company Satalia, describing how AI can be used to create entirely new organisational models that remove the politics and personal agendas that blight businesses today, and able to operate without managers or administrators.
How does it work? Hancock explains: “We collect all of our data from every event that happens within the organization, across every network tool, and we pour it into a data lake, called Cosmos. We use data science and machine learning to extract insights from it and to power a system that provides information to everyone in the organization: what opportunities are available, what activities people are working on, who is connecting with who, how much projects are costing us, and our priorities within a collective strategy. This enables us to work in a completely non-hierarchical way.”
Chatbots were then discussed by Kriti Sharma, VP of Bots and AI at Sage Group. She is responsible for an ‘invisible accounting’ concept using Pegg, a personal assistant chatbot that manages business finances. She asked the audience: “Who loves expense reports? Or chasing purchase orders and asking people to pay you on time? I realised that what Sage does is not something that most people enjoy, so how about we give them someone else to do it for them? Business owners are not geared towards mundane work, they would rather be building new products.”
Researchers often have a benign vision of how much robots could play a useful role in our society
Professor Kerstin Dautenhahn, Professor of Artificial Intelligence from the University of Hertfordshire openly declared that “Researchers often have a benign vision of how much robots could play a useful role in our society, to assist people, rather than replace humans. While I’m involved in building these systems, I will not be the person making the decisions about how they will be used… There’s a danger that cutting human labour costs will be the main driver of using robots and AI in care, which is not how many researchers, including myself, envisage it.”
I was struck by the sheer variety of views shared in group discussions, some were openly concerned for their jobs in this age of automation; others welcomed this transition. Some were simply curious as to what capabilities we will need to be relevant in an automated machine future.
Jobs being replaced by automation has happened since we left the fields for the factory. The difference now is that more skilled and cerebral jobs can be replaced. It is also creating a completely new relationship with technology; Sharma stated that we are more wedded to our smartphones than our partners, and quoted a Gartner statistic that “by 2020, the average person will have more conversations with an AI than with their partner”.
But it’s important to remember that technology is not self-deterministic. It doesn’t have its own agency. It depends on people and how we choose to use it, for good or bad. For example, fire can burn your house down or keep you warm – it’s what you choose to do with it. Humans are innovative and adaptive, and have managed to continually create new jobs and new ways to contribute to society. The question is how to transition as quickly and smoothly as possible to minimise the pain of transition.