Updated: May 27, 2020
The driving forces that will shape the Innovation Economy
The innovation economy is being driven by digital business models fuelled by the discovery and use of influential, highly publicized intelligent technologies such as AI and blockchain. The availability and commoditization of information feeds these intelligent technologies. I believe a deep dive into these intelligent technologies is less important than performing a cluster analysis to tease out the key driving forces that will impact a majority of roles in the workforce of the innovation economy - helping us design lifelong learning strategies to empower and develop workers. This is our focus at Kids Hack Labs.
The three driving forces are:
Commoditization of Information
Commoditization of Information
It would be possible to teach an entire university course on the impact of the availability, distribution, organization, decentralization and ultimately, commoditization of information. This commoditization of information is the driving force behind the transition to the learning worker, as well as a key attribute to automation and outsourcing. Innovative technologies such as AI only became effective when we hit a critical amount of organized, quality, data on the internet - providing the flow of information for computers to learn via the translation of information into intelligence. Early AI was limited by the amount of available usable information.
The availability of information empowers others to complete work that was once restricted to the domain of a set group of knowledge workers. Non traditional medical professionals are now making accurate medical diagnoses. Individuals are teaching themselves to program computers. A statement such as Google knows everything seems too simplistic. However, the availability of information is breaking down barriers that once protected the value of a knowledge worker. Information can be consumed for the completion of jobs that was once restricted to a knowledge worker, by an individual with less educational credentials. Those in fields like engineering and the medical field will be expected to shift to being creative with this information, creating new information, engaging with colleagues to innovate, etc. Simply having the knowledge will not be sufficient to contribute in the role.
The decentralization of the information through technologies like blockchain will lead to less centralized databases controlled by large corporations such as Google, Facebook, Amazon, etc. Bitcoin is an extreme example of blockchain’s potential for disruption but I will leave it out of this discussion (it's like a distracting lighting rod). The concept of information being in the public domain as opposed to being held behind corporate firewalls will have a large impact on the future of the economy. The concept of blockchain can be overwhelming but picture it as a database or repository of information that is not centralized and controlled by a single owner but decentralized with numerous caretakers and gatekeepers within the public domain. Intelligent technologies such as smart contracts, (“a self-executing contract with the terms of the agreement between buyer and seller being directly written into lines of code...exist[ing] across a blockchain network. ”) will use blockchain to minimize the role of certain knowledge workers such as the need to purchase knowledge from a lawyer. The key takeaway is that what previously established and maintained the importance of the knowledge worker is dissipating.
Fueled by the commoditization of information, automation gets a majority of the spotlight when people speak about the wave of change approaching. People speak about the loss of jobs as more and more frequent and repetitive tasks are automated. The amount and sophistication of automation will increase as AI improves. Automation has already moved from completing exact repetitive tasks, to making decisions such as screening resumes. As technologies develop, AI decisions will become more complex. There is an undeniable impact on jobs, however the spotlight has been on how they are lost, when in fact they are more often changing, rather than disappearing in the face of AI development.
Automation and AI are being used to complete human resource tasks, data entry, customer service and even to build intelligent technologies. Applications have been created that can produce computer code at a rate that significantly outperforms a human coder. Workers will be performing more and more interactive and collaborative tasks and other learning skills to contribute beyond deploying knowledge.
Outsourcing is not new, but it is shifting. The impact to the knowledge worker is similar to that of automation. Outsourcing will play the role of an intermediate step from the knowledge economy to the innovation economy. Knowledge work, as seen with manufacturing work will be outsourced to geographic regions with reduced salaries until it can be automated. I recognize there are a number of geopolitical and social issues associated with outsourcing in regards to its impact on societies. For this blog I will not debate these impacts but simply acknowledge its happening and is expected to increase.
Computer programming is a good example. Applications are being coded by lower wage employees, and in the legal field, tasks such as research and the writing of simple legal contracts are being performed by those with lower wages. The ability of those in developing countries to acquire information or knowledge that was once the prized possession of developed nations is creating a supply and demand issue. We are reaching an oversupply of knowledge workers, driving down the cost of work. It's following a similar trajectory as manufacturing work.
As with all economic transitions, the stories of doom and gloom set-in. Transition is not easy but the transition to the knowledge worker created the high standard of living we enjoy today. If we plan correctly and make the required policy changes within our key institutions such as education, we will sustain our quality of life and maybe improve on it through decreased impacts on the environment. At Kids Hack Labs, it's our mission