There is a revolution going on under our noses that most of us are barely aware of. The power of the internet is steadily transforming our lives as creative people invent yet more applications to make life easier, reduce the amount of human effort required and reduce the cost of delivering the goods and services we want.
The real impact of this revolution that I think will affect us most is not the advent of something like a driverless car that will transform how we get around our cities and towns, but rather, how we keep the wheels of our economy working when such little effort is required in future to provide the services we use.
At its broadest level, the digital revolution is great news because the reduction in labour requirements in our economy represents a tangible improvement in our collective standard of living. This is because the consumer is actually part of the supply chain in a working economy.
If the wheat crop fails, we could have a famine but the person who buys and eats the bread is as important as the farmer who grows the wheat. If no one can afford to buy bread, we will still have a famine.
The rise of machines and automation
Today, cheap machines and automation are competing for low-skill jobs and our ability to afford bread is under serious threat. Our GDP is growing, but our wages are slowing.
What should our practical response be as business leaders to these forces at work in our society? The obvious answer is to invent the next massive app, and then retire to somewhere warm in a beachside palace. Failing that, there are some practical factors we should consider as we adjust to our rapidly changing world.
5 practical factors to prepare for the digital revolution
Don’t resist change.
Don’t be the person who queues at the bank to cash a cheque instead of using the ATM to preserve bank teller jobs. This revolution isn’t being masterminded by an evil business mogul intent on destroying our lives and it’s coming whether we want it or not. So the way forward is to adapt rather than resist.
Expect an increase in people wanting part-time work at a greater hourly rate.
A successful future economy will value an hour of effort far more highly than today. If our economy used to require 100 hours to produce all the goods and services we demand but now requires only 50, expect wages to double and leisure time to increase.
Invest in knowledge.
Knowledge workers are the way of the future and new bespoke services will have value in the new economy. Don’t rest on what works today but look for opportunities to broaden your product or service offering, particularly towards specialised, small-run and one-off products. And make sure you charge for them because your customers will value them.
Expect unimaginable products and services to become a reality in the near future.
What will the customers of tomorrow look for in their products and services? We can scarcely imagine. Not all new inventions will work, but we are entering the age of the entrepreneur with a visionary idea. Look out for new innovations and lever opportunity from them.
Shift your focus towards new and growing industry sectors.
Retail and manufacturing don’t have a great outlook compared to the future-focused industry sectors such as entertainment, education and tourism. These are the types of services that a society with more leisure time available will demand.
Business leaders, take a frank and honest look at the work you do and the knowledge you have today and put it up against the digital revolution sweeping us along. Ask yourself if you are the farrier in the late 1800s and you’ve just seen your first motor vehicle drive past your business location. If so, resisting the advent of cars will have less positive impact on your way of life than opening up a motor vehicle servicing function alongside your farrier business.