Are our employers and institutions ready for the New Machine Age?

By Neil Patrick

Researching for my post on the zero marginal cost society led me to the great work of Erik Brynjolfsson and Andrew McAfee. They have painted a dazzling picture of the digital future and described the changes that people and society need to make in order to prevent being left behind. I think the potential is bright too, but today as the dog days of summer retreat, I’ve got a nagging feeling about one thing…

MIT’s Erik Brynjolfsson and Andrew McAfee have coined the term and titled their book, The Second Machine Age. It describes an almost utopian future. It’s a very uplifting vision of how technology holds the potential to fill the world with more possibilities than we can even imagine.

I featured Andrew McAfee’s great TEDx talk here a couple of weeks ago.

But can this vision be realised? Technology frees us up to achieve more than we ever could have dreamt of, but will organisations be able to keep up? After all, apart from the goods and services we consume, most of us rely on organisations for one other very important thing…our jobs.

People, organisations and societies have to keep up with the speed of technological change

The Second Machine age will require constant change, delivering at speed, innovative thinking, fast-paced learning and cross functional collaboration like never before.

So my worry isn’t with technology per se. My worry is that the pace of technological change is moving so fast that people cannot keep up. Let alone corporations and society as a whole. And if organisational thinking can’t keep up, how on earth can organisational culture?

The future’s here, ready or not

Brynjolfsson and McAfee paint an optimistic picture of the future. As the full impact of digital technologies is felt, they profess that we will realize an immense bounty in the form of dazzling personal technology, advanced infrastructure, and near-boundless access to cultural items that enrich our lives.

They admit that amidst this bounty will also be wrenching change. Professions of all kinds, from lawyers to truck drivers will be relentlessly downgraded and delisted. Companies will be forced to transform or die. But will they spot the need to transform quickly enough to respond? I think it's safe to predict that some will and some won't and will suffer the consequences. Recent economic indicators already reflect this shift; fewer people are working, and wages are falling even as productivity and profits recover.

But will organisations and employers keep up?

I don’t doubt the guarantee of technological transformation. What I doubt is the capability of organisations to transform fast enough to keep up. Let alone institutions and legal systems…

On the one hand technology is enabling things to be made and done faster and cheaper than ever before. At the same time, this speed is outpacing people’s ability to extract enough money from the system to live.

Brynjolfsson and McAfee recognise that to adapt, society must change rapidly. This includes revamping education so that it prepares people for the next economy instead of the last one, designing new collaborations that pair brute processing power with human ingenuity, and embracing policies that make sense in a radically transformed landscape.

I agree that this is needed. What I struggle with is the idea that persistent ideas and attitudes left over from 20th century top down command and control structures can possibly evolve fast enough to prevent giant chasms opening up between technology and policy and culture.

From the time I have spent teaching business in universities, I took away a lot of learnings. And one of these was that the smallest unit of time measurement used in the management of educational institutions is a year. And that's just far too slow to keep up with the world of tech.

But educational institutions are not alone in being slow to change. Commercial businesses are so focussed on day to day and week to week revenues, that the medium and long term changes they need to make are deprioritised. And this makes them vulnerable. And this will leave many people exposed to redundancies, lower incomes and longer periods without work.

Our organisations have got to embrace this new economic reality or they will die. And one way they can do this is to hire more people who understand what's going on and how to capitalise on this new economic era not be crushed by it. And this creates a whole new world of economic winners and losers.

Who will respond and who will not?  That's the most interesting and important question I think...

Andrew Keen’s interview with Erik Brynjolfsson and Andrew McAfee here may help you decide for yourself: