Paul Tero a member of our Emerging Fellows program examines the feasibility of a digital utopia in his eleventh post. The views expressed are those of the author and not necessarily those of the APF or its other members.
In July 1893, 220 men and women from the relatively new settlement of South Australia decided to start anew and create a utopian society in Paraguay, South America. Although this “New Australia Co-operative Settlement Association” had some quick wins in clearing land, establishing a township and using cattle as one of their sources of nutrition it all fell apart within two years. Despite their efforts, the ideal that this assortment of well-meaning people sought for was beyond them. While examples abound across the globe and across the centuries of utopian projects that ended in disarray, there are others such as the Shaker communities in the 1830’s and the modern Tamera project in Portugal that have achieved success.
When it comes to a future digital utopia will the dream be realised like the Tamera case, or will it be another failed venture like the “New Australia” community? Driving these outcomes are answers to several questions. For example, what does this future state look like? What is attractive about it? Do we actually want to live in a society and operate within an economy where “digital” is more dominant than it is today? What of the relationships between business, government and the citizenry? And then there are global considerations – what structure will the interactions and governance frameworks at a geopolitical level take?
What form will this anticipated mid 21st Century digital utopia take? Could we attain perfection in employment, in well-being and in society? Regarding employment, one can argue that the technologies of automation and machine learning are laying the groundwork for universal basic income. When it comes to health, advances in personalised medicine could lead to us living in trouble-free bodies. Likewise, with the social sciences, and with regtech and fintech, are we not marching toward more efficient transactions and services as well as removing impediments to social harmony?
The Western digital utopian vision may include a freedom to individually pursue creativity and education, but for those across the Asian or African continents the digital utopia may centre on social unity and shared economic activities. While either personal or communal achievement is at the heart of each of these potential future states, individuals motivated by power could well be disenfranchised.
This is where our move to digital ubiquity may actually reconcile competing impulses and world views and realise a digital utopia. For the long-held and default perspective on our atom-centric economy is scarcity. It’s supply and demand. We pay a price in exchange for owning a thing. But in a bit-centric economy abundance is the dominant narrative. This abundance stems from the fact that there is relative little marginal and distributional cost associated with the production of digital goods and services.
For example, social media services don’t have limits on the number of people that can access their platform simultaneously. Likewise, there are relatively few limits that can be placed on sources for Internet of Things data. And with the relative price of computer power and data storage always falling, the opportunities of artificial intelligence influencing the natural and social sciences seemingly knows no bounds.
It is with this perspective of abundance in a fully digital economy that a digital utopia may well come to pass for us all. While not in the same format for everyone across the globe, but certainly with some common threads and with unique contextualisations dependent upon who and where we are.
Charlotte Aguilar-Millan checks the urgency of human resources in future companies through her eleventh blog post for our Emerging Fellows program. The views expressed are those of the author and not necessarily those of the APF or its other members.
The company of the future will not have the same staffing requirements as the company of today. The use of personnel, an often costly fixed cost, has been declining. The company of the future will not rely on personnel to fuel their growth. We are now in an age of technology where unskilled labour is fast being replaced. This can be seen with robotic lawn mowers, self-service fast food and even an order app for Starbucks. These tasks once performed by humans, have now been successfully replaced by technology.
While technology has been developing, labour supply has tightened as the population ages. Unemployment rates have been steadily declining from 2011, with May 2019 seeing rates of only 3.8% in the UK. The last time this was seen was in 1974. With tight labour markets, an opportunity for labour to demand a better working environment is emerging. With this, the workforce is becoming more agile. The company of the future will have to compete to attract and retain staff.
In July, Amazon announced that it will retain a third of their US work force in the technologies of the future. The companies that will succeed will be those who entice new workers and keep them stimulated sufficiently to stay. The rise of the gig economy heralds an opportunity for staff to determine the environment in which they wish to work. The gig economy gives the workforce more flexibility on working hours and location.
This is only possible where there is a shortage in supply. Specialists in fields such as IT or Finance have seen their conditions significantly improve, with large companies offering incentives such as unlimited annual leave or pet maternity leave. In the unskilled work force, for gig workers in fields such as fast food or transport, the landscape is not so good. Uber provides a platform for gig workers to supply their labour. It determines a driver’s profitability and whether any customers are routed to their cars. Uber’s control over what a worker is paid month on month has created an instability for unskilled labour. It also demonstrates that the company of the future does not need staff. The Company of the future will not even require drivers. Once autonomous vehicles become sufficiently reliable to be roadworthy, these will replace the workforce.
This has enabled companies to exploit the labour force by expecting a pseudo employee relationship with control over the worker. However, they do not have the obligations of a typical employer. No sick pay, parental leave or pension contributions are required where you do not employ your labour force.
The trend to have fewer employees will only continue into the future. Tech companies are leading the way. Facebook in 2019 had an average turnover of $1.4m per employee while Apple had $2.1m per employee. When compared with the successful companies of the past, this demonstrates how the need for employees is in the past. VW’s average turnover per employee was $0.5m with Ford at $0.8m in 2017 and 2018 respectively. The Company of the Future does not need employees in the same way the Company of the past has. The trend of specialisation will continue into the workforce with those unspecialised left exploited.
Will the company of the future need staff? Yes, and no. If those staff are highly trained and motivated, then yes. If those staff are unskilled and could be replaced by robotics and AI, then no. The challenge to society is how to upskill to ensure that the latter aren't left behind.
Tim Morgan inspects the concept of Smart Capital in his tenth blog post for our Emerging Fellows program. The views expressed are those of the author and not necessarily those of the APF or its other members.
We are starting to embed automated decision-making into capital itself. We routinely embed automatic control systems into our processing plants and factories ensuring that optimal use is made of those capital investments. Advertising and sales are increasingly given over to algorithmic management. No industry seems to be untouched by automation. We are infusing our intelligence into our capital systems. So how smart can our capital get?
Once upon a time a computer was a job description, not a machine. Human computers did the hard work of accurately calculating everything from astronomical phenomena to tracking weather patterns. That changed with the advent of stored instruction computing machines. Programmed algorithms could be systematically created from a combination of well-defined repeatable steps incorporating not only mathematical operations but conditional (if/then/else) decision-making logic as well.
We have been developing this computational capability for decades. We still are limited by the need to design and transcribe programs most of the time. The logic is still simplistic and rigid compared to human reasoning. But that design limit is quickly giving way to complex machine learning algorithms. Artificial Intelligence has been a field of study since the beginning of the digital computing era. Now the early promises of decades past are rapidly being realized.
A.I. researchers are harnessing our exponentially increasing torrent of data to train machine learning algorithms. This has resulted in A.I. techniques like Generative Adversarial Networks (GAN) which use competing Generator and Discriminator neural networks to solve problems based on older human-curated examples. GANs quickly learn tasks like creating human-like art, designing 3D objects, and accurately identifying tumors in X-rays.
Other advanced A.I. techniques are moving beyond the need for human training or big data sets. Google’s AlphaGo A.I. beat world Go champion Lee Sedol by 100 games to 0 in 2016. AlphaGo’s neural network heuristics were initially trained using a database of 30 million moves from 160,000 masters-level games. Yet in 2017 with no access to that database and just three days of self-play AlphaGo Zero beat AlphaGo by the same 100 games to 0 that AlphaGo beat Sedol. Go masters worldwide have begun eagerly studying AlphaGo Zero’s unusual moves to inject new strategies into their sport.
Computing advances will not stop with digital computers and machine learning. Researchers around the world are rapidly developing Quantum Computers to take computing capabilities to a whole new level. A leaked paper recently revealed that Google has demonstrated the theorized principle of “Quantum Supremacy”, or the ability of quantum computers to quickly solve problems that conventional computers cannot. Their quantum computer solved a problem in about 3 minutes that the world’s most powerful supercomputer could not perform in 10,000 years.
The cognification of capital via computing will not stop. It will accelerate. Capital will incorporate computer’s gains in self-training and abilities to solve ever harder problems. Capital will acquire more and more ability to self-manage with less and less need for human decision making. The ultimate endpoint may be that it no longer needs our direction. If that happens, capital will go from being owned to autonomous. If it does, we will need to pay close attention to what it wants.
Ruth Lewis a member of our Emerging Fellows program discusses the protection of personal data under surveillance in her tenth blog post. The views expressed are those of the author and not necessarily those of the APF or its other members.
What do we make of the practice of actively mining our personal data and building our personal digital profiles by corporations, to observe our behaviour, predict our needs and to nudge us to buy more products? Even more invasive is the retention and use of our information by governments, to scrutinize where and when we may perform anti-social acts. These predict or manipulate us to conform with the dominant governance system through a social credit score or through other less publicly visible means.
Current pervasive use of ‘predictive policing’ seeks to forecast the risk of criminal activity and acts of terrorism before the crimes have taken place. This method seeks to predict who the offenders may be, who the victims of crime may be and where and when the crimes may take place. Profiles are created of individuals, groups and locations deemed to be ‘at risk’ of future crimes. These identified groups are given additional surveillance and intervention from police to prevent future acts. Predictive policing is achieved through sophisticated collection and quantitative analysis by Artificial Intelligence algorithms. Vast pools of stored data are gathered from multiple sources, including historical crime statistics, social media, financial records, CCTV images and geo-location records of vehicles and mobile phone records, much of which would be classified as personal information.
Many concerns have been raised on the use of predictive policing, not least of which that it seeks to apply a ‘technology band aid’ on to what are often endemic socio-economic and political issues, without seeking to understand and remedy the root causes of these problems. Additionally, it may be causing greater harm than good, applying unjust profiling techniques based on biased algorithmic training data onto marginalised or vulnerable elements of our society, subjecting them to ever greater levels of surveillance within a harmful cycle of confirmation bias.
A clear and mature analysis and understanding of our societal ‘wicked problems’ leading to crime, together with strong, mature, transparent and accountable governance over such powerful surveillance tools must be developed before their widespread deployment and use. The creators of these tools need to ensure that there is an intentional commitment to eradicate inherent bias. The various service providers who provide data as input to the analytic algorithms need to build in a strong commitment to collective and individual privacy and personal autonomy of our personal data, and transparency as to the processes and purposes used for collection of this data.
Without this, the more likely risk is that these surveillance tools will catch the innocent in a wide surveillance net. It will undermine personal privacy and liberty, and the ability to engage in our own lives without psychological or physical inhibition within the boundaries of the law. We should not have to constantly look over our shoulder and wonder who is watching us, and how they might be judging us.
Truth becomes distorted in the name of crime prevention, and sometimes bent toward political or coercive outcomes that skirts legality. There are no future facts, nor a way of accurately predicting when someone will break the law. However, there are inalienable human rights – the right to privacy within our lives. There is also the ability to examine where we are now, foresee where this trend may develop, and be concerned about the type of society that this may create. There is the ability to define the type of future that we want to live in, one that seeks justice for all. As a start, we as a society need to demand greater accountability and transparency from our governments and our service providers to protect our liberty, our privacy and our freedom of current and future expression.
Our society’s future aspires to extend beyond our terrestrial realm. How should we consider space travel and off-world habitation? As an extension of our current terrestrial culture with its inherent injustices? Can we envisage a space of liberty and humanity? But how free would that off-world society be, when mere survival will necessitate extreme co-dependence?
Robin Jourdan inspects the functioning of democracy under polarized conditions of the society in her tenth blog post for our Emerging Fellows program. The views expressed are those of the author and not necessarily those of the APF or its other members.
To polarize is to cause people to divide into distinct groups. Polarization is more than just having a different opinion than a neighbor. It’s when we refuse to live near that neighbor we become polarized. During the American Revolutionary War, not everyone in the Colonies wanted independence. Loyalists to the British Crown, aka Tories, included William Franklin, then royal governor of New Jersey and son of Patriot leader Benjamin Franklin. Holiday dinner must have been uncomfortable.
Let’s not be confused that polarization is a political tool. Polarization isn’t limited to the US, of course. Europeans, disenchanted with mainstream politics and growing global anti-establishment sentiment, have extended the fragmentation. There is a price to pay for polarization. For example, we see a decrease in charitable giving and personal health. There is more pressure to conform, and it’s easier for us to be deceived. Legislative gridlock and violence grow.
Of the many forces shaping polarization: tribalism, trust, community, technology, media, and politicians are reaching a collective apex. Tribalism is almost religiously seen today by groups that compete, especially where negotiation and compromise are perceived as a betrayal. As Abraham Lincoln put it, “Constitution and Laws” were to be America’s “political religion.” All this talk of tribalism misses a crucial point. Diversity, when combined with equality, makes us stronger. This is not new.
Who benefits from polarization? Take a lesson from Deep Throat: follow the money. Today’s Fifth Estate: search engines, social media, and news media benefit from polarization. The first two, using algorithms and personalized content create non-arbitrary access to information. The growing glut of information generates confusion and discomfort for many. Algorithms assuage this by providing only that information which is personally comfortable and self-reinforceable.
Countries with less diversified but emerging media markets, e.g., China and South Korea, are becoming more polarized due to the development of such media. When business models are based on how much time and interest a user spends on a site, the incentive is clear. And nothing outdoes puppies followed by outrage. In the West there is a quote: “Common etiquette says not to talk about politics, sex, religion, or money. But these are the most interesting things to discuss!”
Going forward, as the Gen Z society’s comfort with diversity becomes influential toward mid-century, businesses that improve transparency will build trust and thrive. Evolutions in the business world will similarly progress expectations on representatives. But growth can be stunted by a lack of trust in unconstrained technology. New technologies support opportunities only if the public has confidence in how the data is used. Missed opportunities will grow. Only 1-2% of consumers today trust that their personal information will be protected in the markets through mid-century. Wearable and implantable technologies enable people to interact in new ways. Digital services can contribute to a shared vision of social justice, environmental and economic stability if a generally inclusive worldview expresses public dialogue.
Can democracy function in a polarized society? The principle: nature abhors a vacuum is equally true in a political ecosystem. Manipulation byproducts of the Fifth Estate will diminish only when government earns confidence by solving real problems. Political systems failing to deal with complex issues and social dissatisfactions have many reasons for fabricating distracting headlines. First, governments must learn from the business sector and catch-up with real transparency. Without the possibility of polarization, where differences of opinions allowed, we stumble into authoritarianism no matter how well intentioned at the start.
Second, polarization ignores moderates. Today, moderates in the US are leaving the traditional 2-party system in favor of the “Independent” party. A moderate’s goal is not to make the world conform to some extreme perspective. Instead, it’s to work in the world as it actually is, with all its messiness and confusion. International relationships that are based on mutually relevant values, and respect, signal moderation. Have we reached a global or regional “peak polarization”? Not quite. However, today, moderates matter more than ever. Every swing of the political pendulum includes a moderation period.
Esmee Wilcox inspects the ability of social entrepreneurs in solving wicked problems through her tenth blog post for our Emerging Fellows program. The views expressed are those of the author and not necessarily those of the APF or its other members.
Our world in 2050 will plausibly be connected in ways that seem unimaginable now. Not least the integration of virtual and physical socio-economies, and artificial and human re-combinations. We will have had to understand how to work with the complexity this creates. We know how difficult it is to bridge different systems. We know how corporations, education systems, and political movements proffer binary answers as a technique for maintaining the status quo. Looking ahead to 2050, how will social entrepreneurs need to be operating then to be more effective in solving wicked issues? What do they need to consider to make strides towards this?
In practice, how many of us have been involved in long-term visioning projects that generate promise and movement but fail to translate into the necessary significant change? Why do we keep repeating the exercises believing it will be different with a tweak? What we’re missing from these technical exercises are the difficult conversations about the new norms, values and behaviours that exist in these new futures, and how they affect us personally. We find it easier to hunt for examples of practice that we can recreate to transition from where we are now to this agreed plausible future. Instead of understanding the conditions – that our own behaviours create - in which these solutions could arise.
Take some of the self-organising movements in health and social care. These are deliberately and explicitly creating the service organisations that are congruent with the theory of agency over personal health. Practitioners interacting with patients have agency and are valued in ways that correspond with the agency and value they are supporting patients to find in themselves. By explicitly working on the values and behaviours that are required in the organisations of the future, they are disrupting and tackling the values and behaviours that are no longer effective in the present.
So what does this mean for social entrepreneurs that are already creating these ‘future fit’ enterprises? The skill is not only in being able to operate in these experimental transition spaces. It is also to create connections and meaning for people whose system is codified in the present. The practice needs to be in making the values and behaviours of everyone visible, explicit and connected to purpose in the new future. To then consciously move away from the present and step into new uncodified practice together, social entrepreneurs have to think about trust. Can social entrepreneurs extend their trust across competing value frameworks to hold the discomfort, the anxiety, and the tension when working in-between systems? Is part of this about being explicit about what’s behind the intention of actions? This would fit with evidence that we can mobilise surprising agents of change when we make our underlying preferences known.
Where social entrepreneurs can help institutional actors step into the transition space, we can imagine the release of band-with to tackle wicked issues. Including the paralysing healthcare conundrums such as investment in long-term wellbeing in conflict with short-term needs, which exist because we cannot conceive of the meta conditions changing. In this way social entrepreneurs are capable of solving the preponderance of highly connected, multi-causal, wicked problems we will become used to seeing as we enter the latter half of the twenty-first century.
At the same time, we ought to consider a parallel question about the impact of further atomisation and divisiveness within society. If social entrepreneurs are to succeed in tackling latter century wicked problems, how might they also work across these incendiary tribal lines?
Felistus Mbole a member of our Emerging Fellows program checks the responsibility of capitalism in her tenth blog post. The views expressed are those of the author and not necessarily those of the APF or its other members.
Capitalism has been the key driver of global wealth and prosperity. Despite this, it has yielded huge economic inequality and mistrust. This is because the system which is driven by private owners operates to maximise shareholder wealth. The need to generate profits at whatever cost works contrary to the interests of other members of society and the planet. The idea of shareholder supremacy is deeply entrenched within the current corporate culture. Everything else takes secondary priority. The outcome has been huge global inequality and a looming backlash.
The cry for responsible capitalismwhich started after the Second World War is climaxing.The need to conduct business in a manner that is equitable and balances the interests of shareholders, suppliers, employees, customers and the larger society is dire. Despite their benefits, there is a sense of unfairness and being overburdened accompanied by a loathing and mistrust of enterprises. As legal personalities in society, corporates should owe responsibility to others in how they conduct their affairs. Yet this has not been the case. What will save capitalism from itself? What will responsible capitalism look like?
Responsible capitalism is not corporate social responsibility. It is not giving a tiny proportion of the wealth generated by enterprisesin the form of charity or a gesture of goodwill to society.It is the integration of the needs of the wider society into how business operates, a manner that benefits all stakeholders. Responsible capitalism isan economic system which appreciates the need for harmonious co-existence between enterprises and other members of the community.
Left on their own, markets will continue to maximise shareholder wealth at the expense of the rest of society. The 2008 financial crisis is a clear illustration of this. Responsible capitalism will take a greater role by state in regulating the affairs of markets. Governments will need to rise to the challenge by prescribing ways in which corporates should conduct themselves. The UK’s Companies Act 2006 for instance encourages responsible capitalism. These will be inform of policies that ensure fair work terms and conditions and redistribution of the generated wealth through taxation for society’s common good.To whom much has been given, much will be required.Responsible global enterprises will diligently pay rather than seek to avoid taxes to support the communities in which they operate.
Responsible capitalism will be enterpriseswhose strategic purpose is to serve society alongside their investors. This will mean fair compensation to employees and minimising of margins in pricing of goods and services to customers. Responsible corporates will be aware of the planet boundaries and mindful of the impact of their business activities on the environment.
In today’s increasingly dynamic and complex world, enterprises will have an opportunity to demonstrate their responsibility by rendering a service to society. They will use their resources to address the wicked problems facing global society for the common good. Their service to society will need to be embodied within their corporate strategies alongside delivery of value to shareholders. Responsible capitalism will take a paradigm shift in corporates’ purpose for existence from maximising shareholders’ wealth to serving society. A realisation that it is in serving society that sustainable value is created for investors. It will comprise enterprises focused on long-term rather than short-term gains.
Alex Floate,a member of our Emerging Fellows program envisions the financial system of Africa by next three decades. The views expressed are those of the author and not necessarily those of the APF or its other members.
2019 – There is a small isolated village in Africa. In this village is a small one-room schoolhouse built by a foreign aid society in the early 1970s and still used for its intended purpose. This school, like the rest of the village, is not electrified, but it does have large windows that allow light to shine on the large slate blackboard at the front of the room. Sticks of chalk fill the tray, and the board is clean except for a small note in the upper right corner; “Please silence your cell phones.”
2049 – A prefabricated multi-purpose building has replaced the one-room schoolhouse. An array of solar panels and small satellite dishes powers the air conditioning and connects the village with the outside world. In one part of the building, students engage in small groups or interact with holographic images. In another, villagers take advantage of the cool air to lounge and discuss village politics, or conduct business over their various networks. A message flashes across the glasses of one of the villagers; FedEx drone inbound, ETA 5 mins.
Even though the ancestors of all of us originated in Africa, the continent was the last place to achieve the post-colonial dream of self-rule and determination. In many places, local strongmen took advantage of colonial structures and culture to exert control over the people and the economy. The promises of freedom and economic prosperity fell mainly to those involved in the corrupt governments or local representatives of foreign resource extraction firms.
There was an advantage for Africa as the 21st Century began. Without large scale legacy infrastructure or deeply entrenched economic systems, Africans were free to begin creating new ones. For electricity generation that meant there were fewer coal plants or outdated nuclear reactors creating environmental and safety issues. For finance, that meant fewer established institutions to dominate the commercial and political landscape.
The first step came with the build-out of cell phone capability. In many places, mobile phone penetration exceeded access to electricity, with users dependent on gas generators or solar panels for recharge. As networks increased in broadband capability, the population became adept users of phone apps. They used local networks focused on creating and marketing businesses, sharing information on resources, banking, education, and news.
New financial products to meet the needs of the population began appearing. With over 50% of the population sub-Saharan Africa previously excluded from the financial system, these new products began offering new opportunities. The ability to save and invest allowed for an accumulation of wealth. Mobile payments allowed for participation in markets outside their local ones. Micro-lending and new insurance products provided farmers and entrepreneurs with increased opportunities. The companies providing these products prospered as well, extending their reach throughout the continent.
African entrepreneurs understood they did not need to industrialize, but to innovate in today's finance and technology markets. The impetus to build finance hubs throughout Africa, and in the process marshal both homegrown and foreign funding, increased both the quantity and quality of financial companies. Initially done at a city level, as the results began to show promise and profits, national governments began to examine how to duplicate the results through investment and policy.
By the 2040s, Africa had built a modern consumer and entrepreneur focused financial system, while creating and tapping new local and global markets. An expanding financial system built for purpose served as an example for the world on how a finance system can serve the needs of people while, in the process, unite a continent.
Paul Tero a member of our Emerging Fellows program inspects the business agility in digital economy through a new post. The views expressed are those of the author and not necessarily those of the APF or its other members.
One of the dominant narratives of the business world is that in order to succeed the products you provide either need to be cost competitive, be differentiated in some way, or you need to be quicker to market than others. Will this narrative hold as the economy turns fully digital?
Consider what happens today. In order to maintain profitability an external improvement approach may be taken: variations of current products may be offered, or price discounting may take place to increase the quantity sold, or new markets might be opened up. Another approach would be to focus internally. That is to reduce costs and to streamline processes. And a third approach would be to go down the innovation route and develop new products for the same or for different markets. All of these are variations on the faster, better, cheaper narrative. A narrative that holds true in an economy based on atoms, but does it hold for an economy solely based on bits?
We can gain some insights into this future state from the transition that is currently underway. This shift can be seen in the increasing proportion of business, of the economy, of even work itself being categorised as digital. Consider some observations. First, the marketing of goods and services. No longer does the maxim hold of “not knowing which half of the marketing budget is wasted”. For with the analytics available from advertising campaigns using social media channels and search engines the marketing budget can be spent more efficiently.
And second. What about the potential of big data, machine learning and the internet of things currently being brought to bear on say manufacturing processes, the logistics sector, and on agricultural practices? Finally, not forgetting consumers in all this data processing potential: we can find what we want or need more efficiently among the increase array of choices available to us.
Another insight from this transition is the merging of values with business activity. No longer can a company opaquely distance itself from that which is socially unacceptable. Today’s consumers, and even employees, increasingly call out participants in the local, national and global economies for lack of transparency and corporate behaviour at odds with forward looking standards.
A final insight is with respect to legal and political matters. Until recent times, the digital economy could be regarded as this anarchic wild-west frontier where the scale of profits was beyond comprehension and regulation was an anathema to the full gamut of stakeholders. But now we are seeing serious discussions concerning appropriate taxation regimes, effective safeguards of personal and private data for business use, and a range of attitudes of governments when it comes to how they use their citizens’ data.
So, from one perspective digital technology is making the market more efficient. Perhaps even moving it toward that holy grail of it being a perfect market. Where there is perfect information, sufficient products are available for consumers, and where the lowest cost is the hallmark of all goods and services produced.
And from another perspective, digital technology is making the market more transparent. Where the ulterior motives of its stakeholders become clearer and the governance of data is weighted in the consumer’s favour. In other words, there is possibility that a defining characteristic of the market of the future is its integrity. That across the globe the economy operates with a high level of ethics.
A fully digital economy, then, has the potential to be described in terms of it being a perfect and ethical economy. And this potential will shape the current dominant “faster, better, cheaper” business success narrative. Where even if you are “faster, better, cheaper” due to the nature of perfect markets long lasting economic rents will be almost non-existent. Where even if your business succeeds by being “faster, better, cheaper” the rewards may well be short-lived if that path to victory was less then ethical.
The implication is that “faster, better, cheaper” is becoming “faster, better, cheaper, clearer”. For even if the systems involved in the current transition to an economy based on bits seem opaque, the potential is for all digital economy systems to be fully pellucid.
Charlotte Aguilar-Millan inspects the key players of future companies in her tenth blog post for our Emerging Fellows program. The views expressed are those of the author and not necessarily those of the APF or its other members.
The key actors of companies of the future will demonstrate a significant influence from Generation Z. By 2030, 30% of the workforce within the US will be Generation Z. They will act as key stakeholders of the future through their purchasing power and consumer habits. Companies should not assume these habits will be the same as previous generations.
Climate change is rapidly becoming a higher priority for consumers. This will heavily affect the success and profitability of future industries. Greta Thunberg is a telling example of the future desires of consumers. She is a significant climate change activist and often heralded as the voice of the future generations. On her trip to New York from the UK in 2019 she rejected the efficiency and economic pricing of flying due to the affects this would have on the environment. Instead, she took two weeks to sail there on a journey that had a zero-carbon footprint. This carbon reducing style of holidays is evidenced by the rise of the staycation where tourists remain in their home country for their holidays. The majority (52%) of those in the UK who had a staycation in 2019 were aged 25 to 34.
Airlines must develop in coming years to offer not only low costs, many routes and reliability. Attributes which current consumers expect. They must also address how they are offsetting their carbon footprint. Today this is offered as an optional addition to consumers booking flights. However, the Company of the Future will have this as a mandatory cost. Most likely borne through taxation. Companies should get in front of climate action to not only help the planet but to act as a leader within their industry. Corporate social responsibility will also drive the Company of the Future. As the population live longer, aspirations of successful careers, fulfilling hobbies as well as families grow. The Company of the Future that demonstrates progressive working solutions for parents as well as offering true work life balances will thrive.
Generation Z are not content with a static workplace. They have grown up seeing tech start-ups develop into unicorn IPOs. Generation Z are more mobile and entrepreneurial than previous workforces. They require a flexible workplace, as has been seen with the rise of the gig economy, that will enable them to fit in work around their lives. The largest actor in the Company of the Future will be the individual. As the individual becomes more aware, they will not accept a workplace that demands long hours that does not support new parents and will leave the individual at retirement without a liveable pension.
Social awareness of the profits and bonuses large companies make is on the rise. No longer can a company use employees as a resource without respecting the individual also. The individual will also vote with their consumer habits on the companies that will thrive in the future. Companies that do not actively plan to effect positive change for the climate cannot be successful. Companies need to take a leaf out of Greta Thunberg’s book to evolve into the Company of the Future.