10 May 2017
There is currently much debate on the future of paid employment in light of technological advancements in speech recognition, robotics, artificial intelligence and a range of other areas. We are often presented with evocative imagery of self-driving cars and, occasionally, the digital immortality of bodiless beings. I wish here to emphasise more immediate and broader concerns that not only relate to the onslaught of new digital technologies, but also to how we as human beings interact with the technology.
The current technological landscape contains three interrelated elements that connect end-users (notionally the demand-side) with technology innovators (notionally the supply side):
- ‘Computing-in-the-small’ is made up of a variety of user-near-smart and user-friendly digital devices, such as smartphones, tablets, Oyster cards and smart light bulbs.
- ‘Computing-in-the-large’ connects all of these devices through personal, local, and global telecommunication networks.
- ‘Computing-at-scale’ describes the servers, central databases, and globally distributed data centres that tap in to these sources with the support of highly developed computational capabilities. Apple’s Siri, Amazon’s Alexa, and Google Assistant are all services that depend on this global data infrastructure.
This generative digital infrastructure supports the distributed generation of newness, both in terms of new services (think new apps for smartphones and new features for the home-automation gadgets), but also the establishment of new types of service not anticipated by those coordinating the process.
One of the most important ways in which this generative infrastructure has aligned with changes to business practices has been in the establishment of automated self-service. This automation has led to customers doing more of the work than they had done previously. This has allowed businesses to reduce paid staff time and instead more directly link the customer (the end-user in this case) to their digital services. The digital technology can constantly listen to the customer’s expressed changes in needs and desires, and when needed, directly engage them in the fulfilment of the service.
There are many examples of this automated self-service, ranging from the ATMs introduced in the 1980s to the self-check-out counters in shops. The smartphone app store offers a particularly compelling example. Here, smartphone users and app developers engage in globally distributed complex coordination of the creation and installation of millions of possible apps on hundreds of million smartphones in highly individualised configurations. Furthermore, the arrangement supports the distributed negotiation of what types of innovations are accepted within the curated walls of the app store platform. It is generative.
This change from paid effort to customer self-service is developing rapidly. Food shopping was characterised by shopkeepers guarding stock behind counters until the 1950s. The supermarket then began allowing customers to touch and select items themselves. In the early 2000s, internet shopping allowed selection from home, and self-check-out counters, introduced in the 2010s, are now spreading rapidly. This year Amazon Go launched the first checkout-free store, where the customer simply registers their identity through their smartphone as they enter, grabs what they like and walks straight out with items being registered and paid for automatically.
The title of the first book I read at university back in 1982 roughly translates as ‘we can not make a living from cutting each other’s hair’. It alluded to the need for Danish society to produce butter and bacon for the British market, and hopefully other physical goods for other markets as well. We have since learnt that the service sector goes much further than hairdressing, and there is a lot of money to be made in it. Digital transformation is currently extensively automating ongoing service relationships to the extent that the end-users become responsible for managing their own complex and continuously varying service journeys.
Apple, Google, and Facebook do employ a lot of people, but most of us do not yet have personal social media managers, smartphone IT supporters, or personal web-search assistants. This raises the question: how do we make a living from cutting our own hair?There can be many possible answers to this question, and most of these are yet to manifest themselves clearly.
Furthermore, a long and unresolved debate still contains a gap between those warning of extensive unemployment from automation, and those arguing that human ingenuity will invent new types of work in the wake of automation. In the short to medium term, what seems quite clear is that even when we are happily cutting our own hair, we may at times need someone else to do it, but we will unlikely be willing to pay much for the pleasure – unless it is particularly nicely done. Robert Reich makes the argument that in the US, automation has not yet resulted as much in unemployment as in a lowering of wages.
If the rapid successions of digital transformation of the music industry is anything to judge by, then we could very well be in for a lengthy period of significant industrial reconfiguration. It is already challenging to hope for a stable working life with long-term employment in one or two organisations. Amongst my students at the LSE, there seems to be a growing interest in decentralised career solutions, and perhaps careers focusing on doing something that gives meaning to life, while gaining entrepreneurial skills and experiences.
A person’s ability to engage in flexible and ever-shifting working arrangements will certainly be at a premium even if later on they are employed within a large organisation. Increasingly decentralised efforts relying on small-scale global reach do seem to be one viable way of learning how to make a living when much effort is shifting from paid work to be self-serviced. When a novel idea can reach a few hundred people globally, even very strange ideas can lead to viable businesses.
The investment can even be footed by the customers through up-front payments organised on Kickstarter or Indiegogo. If we manage to reconfigure how we engage with each other in leaner and more decentralised ways, we may be able to significantly redefine how we work, play, and exist. We may even be able to invent a range of new ways of engaging in networks of service exchange. However, in the short to medium term, the disruptions will be a major challenge and there are not many new job categories currently in sight.
Carsten Sørensen is Reader (Associate Professor) in Digital Innovation at LSE’s Department of Management.
The image is by Javier Borquez.
This blog is co-published with the LSE Business Review.