robotics

How Will We Measure the Golden Age?

Industrial revolutions tend to benefit the rich more than the poor, initially. They all begin with great inequality. In unequal societies, life expectancies and trust levels are lowered. They tend to be more violent, experience greater levels of mental illness, and have higher rates of incarceration. In the U.S., one in 50 adults are on community supervision, probation, or parole. One in 50! As it stands today, the future is not evenly divided. The richest 1% of the population now owns 75% of all household wealth and 8 individuals control more assets than the poorest 3.6 billion people combined—or half of the world’s population. The anxiety over automation, the growing digital divide, is real, is present, and is the greatest moral question of our time. Reports vary in their quantum, with some at the low end (25%) and others at the high end (47%), but they all agree that the human workforce of the future is shrinking as more and more jobs are automated out of existence. This increasing anxiety, divide, and inequality will create instability and security concerns for both citizens and states—a general state of unrest. The unrest can manifest itself from within—witness the BREXIT vote—or externally, with bad state-sponsored actors. The transformation is real and it will impact jobs and equality. The strategic space for conflict is changing and new battlegrounds are emerging. In the future, power plants will not be bombed, they will be turned off. Leaders will not be assassinated, they will be toppled by propaganda, data leaks, and fake news. This has already happened in Iran with Stuxnet when Hackers made Iran’s nuclear computers blast AC/DC’s song Thunderstruck in the middle of the night, and even with the 2016 United States Presidential election. The Fourth Industrial Revolution (4IR) also goes deeply into who we are as a people, as a species, and speaks directly to our identity and our communities. Beyond the transformation of all industries, beyond the new winners and losers and the creation of new “Kodak Moments,” how will we measure our new Golden Age of Innovation? I have a series of modest proposals: Personal Responsibility: We each need to take personal responsibility and be a driving force for positive change. We choose and instigate our own actions and we each need to be morally accountable, and thus, drive a common purpose of humanity in our new world, one leader at a time. Education: Education is a game-changer. It creates a happier and more stable life, raises income levels, and creates more equality. It has the power to create independence. A more educated world is more tolerant, safer, peaceful, and surely, more economically prosperous. Educational equality is a dual-track system, supporting vocational and academic advancement, and ultimately, equality. The world needs skilled electricians, plumbers, roofers, carpenters as much as we need doctors, programmers, and lawyers. Youth Sports: I am a product of public education and youth sports. Athletics have a positive, life-long impact. They instill in children the value of teamwork, personal discipline and healthy competition, and teach youths how to recover from setbacks. Sports help children to develop their cognitive and motor skills, provide positive influences and inspiration, and keep kids out of trouble. There is no other activity that affords the opportunity to impart so many positive qualities in children. There is a direct correlation between youth sport participants and a more productive future, but in the U.S. youth sport participation is declining. Roughly 40% of American youth participates in a regular team sport. We must increase participation to ensure a better future. Technology Everywhere: Technology needs to find its way into the poorest communities and countries. Getting fees for a smartphone and rural connectivity down to $150 USD a year is still too expensive. For many, this represents a large portion of their annual income. A billion smartphones in underdeveloped regions like Africa would raise not just a community or a country, it would carry the entire continent into the 4IR. Raising Humanity Out of Poverty: Technological conveniences are meaningless when you consider that much of the world is still living in poverty. Circa 1800, 95% of the world lived in poverty. Today, 50% of the world still lives in poverty. Fifty percent!!! While many view this as an improvement, I believe we can do better. The greatest injustice in this world is poverty. There is no structural reason why we cannot radically change the world— and technology can be the enabler for this. Our Age of Innovation will be truly golden if we can raise the world’s citizens above the poverty line in our lifetimes and perfect conscious capitalism. Testing, one, two, three. Is this microphone working? Can you hear me? Thank you for joining me on this journey to explore the Fourth Industrial Revolution. Find out more about The Golden Age of Innovation and digital transformation at Enterprise World 2017 in Toronto, Canada.

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The Impact on Government

“Good enough” as a measure for government work is no longer good enough. The changing nature of the citizenry (Millennials and subsequent generations) will massively raise the bar for government. Citizens want to engage with their governments. They want to voice opinions, coordinate their activities, and in some cases, circumnavigate their officials. Citizens want full transparency and automated services. Why do we need to file a tax return? If all of our transactions are digital, we should simply be emailed a check or a bill. If the wallet disappears, will our need for a passport, ID card, or a driver’s license persist? Or will we be provided with a digital identity in the form of a digital fingerprint or retina scanner? The revolutionary wave in 2011 known as Arab Spring highlighted the power of social media; the U.S. election of 2016 weaponized its capabilities. Governments will have more data and massive controls over people via their information and behaviors, obtained through pervasive surveillance. Governments can also do good with their data, and set agendas for Open Data, to unlock the value of data sets to spur innovation and invention. Imagine the emergence of educational institutions using the billion dollar infrastructures of NASA and the Departments of Energy or Agriculture to drive innovation. It will be a battle over privacy and citizens must never relent on the protection of their information. Data corrupts, absolute data corrupts absolutely. The very nature of conflict and war will be redefined in the 4IR. Mobilizing troops, engaging in gunfire, bombing power plants, and blowing up dams will be replaced with hacking systems and shutting down power grids. These will be the new acts of war. A new playbook will be required to counterbalance the black-hats, to protect our way of life, and to ensure the analog version of war is minimized and avoided. Just as the rules of war will change, so too will governments. They will need to conform to the theory of global governance epitomized by transgovernmentalism (G+)—as administrators of the collective good, purveyors of the ultimate surveillance program (such as PRISM), and as power centers competing with other governments. At the end of the day, governments will need to re-think how they protect citizen workers in the 4IR as labor is displaced at scale. As labor is displaced, the economic divide will widen. It will be our responsibility as governments, businesses, and individuals to harness the potential of the Fourth Industrial Revolution to bridge this divide for the greater good. We are in the midst of a technological revolution known as the Golden Age of Innovation. If technology is an enabler for change, then the 4IR has the potential to raise every citizen of the world out of poverty. To achieve this will be the ultimate measure of success. I will explore this more in my final blog in this series. To read more, download The Golden Age of Innovation. I’ll be taking this message on the road for Enterprise World. Learn more. I’d love to hear your thoughts. To provide feedback, or if you would like to see additional topics covered in future publications, please add your comment below.

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The Digital Self

Just as our analog notion of self (flesh and blood) consists of RNA and DNA, our digital sequence—let us call it the “Digital Self”—consists of code. Each day, we are creating massive and permanent data trails that contain essential attributes of encoding, decoding, and expressions of our genes (or self). We do this both consciously and explicitly, and subconsciously and indirectly. Consider the behaviors that you produce every day, stored permanently in “Digital Land”: you search the web, read ebooks, watch movies, post videos, tweet, list your friends, order food, and complete online transactions. Billions of us have actually submitted our own definition of our Digital Self into various social networking sites (name, address, age, marital status, education, employment, friends, likes, dislikes, political views, etc.). We volunteer this information—willingly! Imagine storing patterns of your behavior—sharing your movements via wearable technology, updates to your medical and bank records, driving information, purchase history, and so on. It is all there, a complete record of your digital RNA, DNA, and behaviors. Permanent, indefatigable, revealed truths, one digital bread crumb at a time, uploaded to the Cloud. Sounds like heaven. Now feed all this information into a computer, every minute of every day. Run an algorithm against that data, and a digital sequence of you is created. Perhaps multiple sequences are created. You could use a CRISPR and have a super-digital sequence of yourself. Then pump that into an artificial intelligence or learning machine, and suddenly your Digital Self is “alive.” Science fiction or a revealing truth? A friend recently received a call from his granddaughter who was in jail. She wasn’t able to ask her parents for help. He was her one call. She needed a $2,500 USD wire transfer to post her bail and get out of jail. He wired the money as instructed, but it turned out that the call was a scam. A bad actor used a digital self of the granddaughter to steal funds using digital payments. What does this mean for the person, for business, for governments and society? For the person, if we dismantle the notion of the self, the societal, spiritual, and religious impacts are profound. Your Digital Self lives on, ever collecting knowledge, and is in all places at once. To quote the movie Lucy: “I am everywhere.” We all become Brahma (the creator) and Shiva (the destroyer). Facebook is buying data to “fill in the profiles” of their almost 2 billion subscribers; rounding out their digital selves without the users’ explicit consent. For business, the Digital Self will be exploited to deliver better ads, provide better recommendations, drive purchasing decisions, and reduce risk. Consumer businesses will know what you need before you even need it. A perfect and persistent personal assistant. Governments will be obligated to protect the rights of our Digital Selves. Does the Digital Self become like a corporation, thus serving as a new shareholder in the definition of a Corporate Self? Ultimately, one has to “opt in” to this new Digital Land, the digerati, and leave the Flat Land, the land of the Luddites. For those who opt out, can they function in society, or are they a new super-culture or subculture? The British television series Black Mirror features an episode that addresses this notion of a Digital Self being created, captured, and exploited. It is a modern-day Twilight Zone, with sharp undertones of an expectant and emerging reality. It is so much an emerging reality that it is already happening in Shanghai with the recent release of the app, Honest Shanghai. In an effort to make Shanghai a global city of excellence, the government is using apps like Honest Shanghai to reward residents for their honesty, morality, and integrity. The app aggregates some 3,000 items of personal data collected by the government—creating a digital copy of Shanghai residents—to generate “public credit” scores that range from “very good” to “good” to “bad” (imagine your government rating you). Users with a higher score can reap the benefits in the form of discounts, lower loan rates, better positions in lines, travel discounts, and more—while those with a bad score may have to deal with declined loan applications or inferior seats on planes. There goes a little honest graft. We need to harness the transformative aspects of the 4IR to change the world, and obsessively but thoughtfully conquer the perils. This will prove to be a challenge for governments, which I will discuss in my next blog. To read more, download The Golden Age of Innovation. I’ll be taking this message on the road for Enterprise World. Learn more. I’d love to hear your thoughts. To provide feedback, or if you would like to see additional topics covered in future publications, please add your comment below.

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The Impact on the Person

The “Physical” Self The Fourth Industrial Revolution (4IR) is expected to accelerate knowledge like never before. As I mentioned previously, technology will advance with artificial intelligence (AI), resulting in medical breakthroughs. As a leukemia survivor, I carry three DNA sets and, thanks to a third-party donor, replaced my stem cell production. I guess that makes me not a cyborg, but a chiborg (chimerism + technology). (And yes, I just coined a new term.) Medical advancements like these will redefine what it means to be human. Nanotechnologies in the medical field will drastically change how we deliver drugs, kill microbes, repair cells, and perform surgery—all on a nano-scale that is more targeted and more accurate than previous medical methods and practices. As a result of breakthrough technologies, life expectancy should increase as we finally slow—or even reverse—the effects of aging and decay at a cellular level. Body parts that have failed will be replaced with parts grown from stem cells, biomechatronic body parts, or perhaps even 3-D printed organs. More humans will become cybernetic organisms (cyborgs), like Motoko Kusanagi in Ghost in the Shell, a movie in which much of humanity is connected to a vast electronic network through cybernetic bodies (“shells”) which possess their consciousness and give them superhuman abilities. In addition to increasing life expectancy, technologies such as genome editing will provide us with the tools for human enhancement, allowing us to replace defective genes or modify immune cells to fight diseases. As technology advances exponentially, so too must our civil, moral, and spiritual motivations to accommodate and adapt to the 4IR. The 4IR will, therefore, change our fundamental understanding of our physical selves—that we were born to die naturally. The introduction of designer babies, cyborgs, and veritable immortality will shift how we view our physical self and how we fundamentally organize ourselves. Our traditional concept of the family might cease to exist. The way we appropriate resources might also shift as designer babies have the potential to outsmart and outwork the now older, yet stronger cyborg population that might not die. Cogito ergo sum Descartes’ famous assertion that “I think, therefore I am” has guided modern Western philosophy and ontology for centuries. The notion of self is based on humankind’s ability to think and acquire knowledge. This ontological concept of the self will be challenged during the 4IR. Machine learning and interconnectedness, along with the advancement of AI, will eventually produce an intelligence that is sentient and may potentially trigger the Singularity. A self-thinking and self-improving machine would transcend our notion of self because if a machine is self-thinking, does that make it human or does it simply make it sentient? Would you consider Dolores in Westworld to be human or merely a sentient machine? If we were to consider these androids to be human, what changes would we need to make to our society to accommodate this increasingly powerful and smarter form of “human”? On the other hand, with the advance of cybernetics and a vast network of connectedness, can humans also attain the same level of knowledge as a sentient machine? Imagine again Kusanagi in Ghost in the Shell, where her self inhabits a shell and connects to everything. Is she still a human? Or would transhumanism (H+) take over and advance the human race? Humans could start to control machines through synchronization to accomplish tasks no machine or human could accomplish alone (like the large fighting machines in Evangelion controlled by teenagers). Or maybe, humans would possess so much knowledge that an omnipotent, Lucy-like person could exist. Finally, humans could potentially tap into our stardust memories to unlock the inner universe’s power within us, like Akira did. The 4IR will advance machine intelligence and sentience while also ushering in transhumanism. Thinking will no longer be sufficient in defining who we are. Disappearance of the Self or Enhancement of the Self? The 4IR will connect everything—all networks, all things, all selves. Everything will have access to every datum, available for access in real time. Robots with AI will roam among humans. Humans will have cyborg bodies and their selves digitally copied, stored, and continually backed up in multiple locations, like the horcruxes of the Harry Potter universe. Transhumanism will be a reality. Will the notion of the self disappear? If everyone is connected and doesn’t die, would humans as a race be the only self that is left—a collective self and mind? Would all humans merge into this self and become a godlike creature, rivaled only by the equally godlike AI? Or will humans retain their individuality and personality, remaining connected to others as an enhancement of their own selves? The 4IR will not only accelerate technological revolutions and knowledge acquisition, it will challenge the most fundamental understanding of what it is to be human and the notion of the Physical self. But what about the impact on the Digital self? I will delve into this topic in my next blog. To read more, download The Golden Age of Innovation. I’ll be taking this message on the road for Enterprise World. Learn more. I’d love to hear your thoughts. To provide feedback, or if you would like to see additional topics covered in future publications, please add your comment below.

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The Luddite Fallacy: How AI Will Change the Jobs We Do

Artificial intelligence (AI), robotics, and machine learning are automating jobs and bringing sweeping societal change. While this is not a sudden shift, the impact of this disruption is spreading to roles once considered “safe” from automation. We’re seeing automation move from the auto manufacturer’s floor to the legal office, the writer’s desk, the surgeon’s table and beyond. The Luddite Fallacy The thought of job automation is a worrying thought for many people. The idea of losing a job to a computer or robot is obviously unsettling. But, while the Luddites (which I wrote about here) saw an impact on their livelihoods long-term, automation generally created greater wealth and more jobs. This is commonly referred to as the ‘Luddite Fallacy’—the belief that the technological disruption of employment is unique to the present, and will fracture society as we know it. Yet, time and again we see that while a process may be turned over to machines, humans still play a large, and often more satisfying role. Automation-ready Industry Sectors It’s undeniable that automation and AI are making their way into our daily lives. Amazon Go is eliminating the need for cashiers, and self-driving vehicles won’t need truckers and cab drivers at their wheels. Artificial intelligence is beginning to diagnose disease, perform surgery, and even write film trailers. On the face of it, the sectors most affected by automation are manufacturing, wholesale and retail, and transport and storage. Examples of retail exodus are not hard to find; in the U.S., h.h.gregg, Rue21, and JC Penny all announced plans to close a total of 758 stores collectively. In the first half of 2016, the U.K saw more than 15 shop closures a day across the country, and the number of new openings has now fallen to the lowest level in five years, according to a report that highlights the pressure on the retail sector. In retail labor, Amazon has had a huge impact, with warehouse automation all but replacing traditional shipping and packing work that used to be carried out by people. On a typical Amazon order, employees will spend about a minute total taking an item off the shelf, then boxing and shipping it. The rest of the work is done by robots and automated systems. But nuanced human interactions are much harder processes to codify. While managing a machine via software is the norm, automating the deeper “thinking” tasks is much more complex, and until now something that could really only be managed by humans. But technology is now affecting those roles once considered “safe” from automation. The legal profession, once heavy with tradition and a lifetime of experience, is slated for transformation via AI and eDiscovery platforms that can review and create contracts, raise red flags to spot potential fraud and other misconduct, do legal research, and perform due diligence before corporate acquisitions—all tasks that are typically performed by flesh-and-blood attorneys. Automation Touches Every Role From the factory floor to the Boardroom, no position will be untouched by automation. Research suggests, “even the highest-paid occupations in the economy, such as financial managers, physicians and senior executives, including CEOs, have a significant amount of activity that can be automated.” The trend towards automation is one that reaches worldwide. In the U.K., up to 30% of existing jobs are susceptible to automation from robotics and AI by the early 2030s. In the U.S., that number is 38%, in Germany 35%, and in Japan 21%. Life in the Automated World Working life will change radically as we embark on the fourth industrial revolution. The world is ablaze with new ways to automate, and while it is hard to embrace change when it is perceived to threaten your livelihood, perception is not necessarily reality. I believe that job creation—and more specifically interesting job creation—is as much an outcome of automation as job elimination. The challenge is to leverage new automation to improve our way of life—not just eliminate jobs. Technology will radically change the sort of roles we all do—it always has—but we have the opportunity to embrace the areas of technology that can take our abilities from human to superhuman. Learn more about how you can digitize, automate, and optimize your enterprise information flows with OpenText.

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The Rise of the Machine

It is happening so fast it cannot be stopped. From Oxford to MIT to Harvard to the World Economic Forum, they all say the same thing: The Fourth Industrial Revolution (4IR) will automate up to 47% of all jobs in the U.S. over the next 20 years. This will motivate a labor migration greater than that of the Great Depression. Even at the lower end of this range, it will be a rude awakening in what some call “a world without work.” I am a believer that it will be a full-on technological revolution for robots, machines, and cognitive systems (incorporating analytics, artificial intelligence, and machine learning). Extreme connectivity, extreme computing power, and the new economics of automation are driving the rise of the machine. Jobs that are labor-intensive are at risk, especially when the cost of a robot is significantly lower than a human salary. For an employer, the cost of an employee (including salary, healthcare, and other benefits) can total $45,000 USD a year. A robot can do exactly the same work for much less and be more “reliable” in the process, requiring maintenance rather than benefits (robots don’t take sick days). It can also produce the same product or service at the same (or faster) rate in exactly the same way, every time. The more human incomes increase and benefit costs soar, the wider the crossover point grows, or if you will, the alligator jaws widen. This is the economic argument, not the moral one. The two arguments need to be solved, conjunctively. Machine-to-machine communication is driving vast increases in asset utilization and efficiency, more accurate information, and greater safety. For example, by the end of 2020, there will be approximately 53 million smart meters throughout the U.K. Will it make sense, or even be feasible, for a human to be dispatched four times a year to read and record the information and hand this to another human only to be correct 80% of the time? Engine monitoring—planes, trains, and automobiles—is a great advancement. Sensors in various locations can gather information about the engine. Fuel consumption, engine performance, irregularities, preventative maintenance, and more—all of this information is sent in real time to the operator for correction, or to machines for analysis, or to ground crews to ensure parts and labor are immediately available to get the asset performing again. The same goes for robotic handling, welding, assembly, dispensing, and processing. Over the last 10 years, the prevalence of industrial robots in welding has grown by nearly 100%. At the same time, U.S. manufacturing jobs have fallen 15%. In the auto industry today, one robot is employed for every 10 humans. Numbers are reaching critical mass. Researchers predict that by 2025, Japan will have 1 million industrial robots installed and there will be more than 7 million unmanned aircraft (or “civilian drones”) flying the U.S. skies. Over the next 10 years, there will be 60 million robots in the world. That’s the equivalent of the entire U.K. population! The rise of machines is real and reaching scale and the future of employment is being redefined. The business, ethical, and policy questions on how we treat a machine versus a human need to enter public discourse. As machines get smarter, more perceptive, better at manipulation, more creative and socially intelligent, more jobs become vulnerable. Here I am talking to a robot while checking in for a flight from Tokyo to San Francisco. The robot was useless. I tried to use one of those passport scanners and it could not read my passport, so I ended up speaking to a human and printing my ticket. The effects of the 4IR will be extended far beyond the workplace. In my next blog, I will explore the potential impacts it may have on individuals. To read more, download The Golden Age of Innovation. I’ll be taking this message on the road for Enterprise World. Learn more. I’d love to hear your thoughts. To provide feedback, or if you would like to see additional topics covered in future publications, please add your comment below.

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New Skills are Required

Over the last decade much attention has been applied to a handful of skills for the professional worker. This is about the future of jobs, skills, and workforce strategy. To date, emphasis has been placed on some key skills: people management, coordinating with others, negotiating, and active listening. These are all good skills, and in many ways, are table stakes for a modern workforce. But what skills will change the most and what is required for the Fourth Industrial Revolution (4IR)? As we look to the future of jobs and the most important skills required to succeed, these top three skills emerge: creativity, critical thinking, and complex problem solving. With new products, new technologies, and new ways to work, employees and employers will need to be more creative to make businesses function cohesively. Disruption will drive more critical thinking and new business models will require more complex problem solving. Think of a taxi driver. They require two skills: driving and the ability to read a map. Both of these skills are being replaced by self-driving cars and online map services. In airports, you order your meals on an iPad. Grocery stores have moved from self-service checkout to monitoring your activity and just billing you. I have always believed in this formula, and as time passes, I become more convinced: Killer Product = Function {Knowledge + Idea + Innovation} Turning an idea into a killer product is insanely hard and the success rate is abysmally low. Turning an idea into a killer product is a function of knowledge and innovation. Knowledge is the accumulation of facts and information, with new methods applied: Innovation. The plus (“+”) is the human, our talent pool, requiring new skill sets in the 4IR. Is Angry Birds (product) a function of cumulative knowledge (Sesame Street characters) plus a new idea (a sling shot) added to the innovation of mobile technologies? It may look simple, but developing the concept is insanely hard. Conventional thinking is a hurdle that must be overcome to free up creativity for true innovation to happen. When I traveled throughout Asia speaking about the 4IR and this Golden Age of Innovation, Fredrik Härén gave a presentation on ideas and the impossible. During this talk he asked members of the audience to imagine achieving the impossible and to write down their top three or four answers. His findings were incredibly revealing. The majority of people wrote down the same answers: flying, walking on water, time travel, immortality, space travel, world peace, the ability to teleport, invisibility, discovering a cure for cancer, and proving the existence of God or even to be godlike. If we were to ask a child the same question, their answers would be imaginative, limitless, and truly impossible: “I want to hold an elephant in the palm of my hand.” Products are a function of knowledge plus innovation. The skill sets required for the future of work has changed. Generation Xers need to redefine their thinking about what is impossible. In my next blog in this series, I will look at how the combination of new ideas and new technologies are transforming the workforce as we know it, giving way to the Rise of the Machines. To read more, download The Golden Age of Innovation. I’ll be taking this message on the road for Enterprise World. Learn more. I’d love to hear your thoughts. To provide feedback, or if you would like to see additional topics covered in future publications, please add your comment below.

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Industries are Transformed

Every industry will be transformed by new technologies, a new workforce, new business models, and new buyer expectations. All businesses will become software and analytics companies (Uber, after all, is just software; they do not own any cars or have many employees, yet they are becoming the world’s largest logistics company). Bitcoin is just software called cryptocurrency. Money will soon be software too—in fact, most of it already is. In 2001, in my book eBusiness or Out of Business, I wrote “you banish software, you banish the world.” Let us consider how software will transform various industries over the next 10 to 20 years: Financial Services and Banking: Smartphones will replace wallets and physical cash. Processing will be instant for account creation, credit, and money transfer. In 1990, 90% of all NASDAQ volume was driven by humans. By 2025, 95% of all NASDAQ volume will be driven by machines. A handful of algorithmic trading firms will capture the vast majority of equity value creation— after all, it will be a zero-sum game and the person with the largest computer will win. Automotive: Self-driving cars will become the norm. You will summon them using your phone and they will drive you to your desired destination. You will pay only for the distance traveled and be productive in the process. With autonomous cars, will our children even need a driver’s license? Cities will be transformed and become safer as the number of cars on the road (and accidents) are significantly reduced, saving millions of lives each year. The competition is already reeling at the advances that Tesla, Google, and Apple have made with driverless and electric cars. Traditional car companies as we know them today will disappear. Each car will be powered by over 150 million lines of software code, more than is currently required by Google Chrome or the Mars Curiosity Rover or an F-22 Raptor. Did I mention cars will be electric? Insurance: Aging insurance agents will be replaced with direct relationships between customers and insurance companies as they fortify their franchises. Data companies with a digital sequence of the person or a property will eliminate the need for applications or consumer-supplied information. Algorithms in massive computer farms will be applied to instantly measure risk profiles, underwriting needs, and the required premium for each specific policy. As cars become autonomous, accident rates will plummet and the car insurance market will disappear. The day of digital reckoning is quickly approaching for the unprepared insurer as extreme computing, online data, and mobility reach critical mass. Know the person or the property (or its digital sequence), and you know the risk. Agriculture: Enter the agricultural robot, or agbot. Agbots will bring efficiencies and benefits to agriculture, eliminating physical, back-breaking tasks. As the price of agbots falls, farmers will transition from working in their fields to working as managers of their fields. In many ways, this is still analog thinking; in the future, we may not even need livestock farms. Agbots will change the world and the future of food production by optimizing land use and eliminating a dependency on livestock. Nearly 60% of all ag-lands are used for beef production. A single cow takes up nearly two acres of land and 441 gallons of water for one pound of beef. That same cow produces the methane equivalent of four tons of carbon dioxide a year (a significant percentage of all greenhouse gases). The need for beef will be diminished by innovative approaches like substituting insect protein for meat or in-vitro (synthetic) meats designed to taste like grade-A5 Kobe beef. Are you ready for your veal created in a petri dish? Legal: Law school graduate unemployment has hit a record high. What was once a future-proof degree will see 80% of its work eliminated by supercomputers. Within seconds, computers will be able to produce legal advice with 90% accuracy compared to 75% human accuracy. Though perhaps there will always be a need for human specialists. Retail: I liken transformation in this industry to an iceberg, with 20% visible above the surface, and 80% hidden from view, below the surface. There are the must do’s above the surface for extreme automation of operations, customer-centricity, omni-channel experiences, two-hour delivery, and technology augmentation for every sport, for every age (from team scheduling to fantasy sports to golf-swing analysis). Three-D printing will be the transformative technology allowing retail companies to turn high-resolution scans into highly customized products. A China-based company is already selling 3-D printed homes. They can print 10 homes a day at a cost of $5,000 USD per home. When raw materials, suppliers, supply chains, distribution, and logistics are all transformed, the end result will be bespoke, high-performance product—from athletic shoes to homes—for the consumer. Energy and Electricity: Renewables win. Electricity will become cheap and clean. We are now installing more solar energy than fossil fuel-based systems. The price of solar will drop so much that it will force coal companies out of business. In 2014, Ontario, Canada eliminated coal production. With cheap electricity comes cheap transportation and abundant water. The average consumer could save $2,000 USD a year. Producing water from desalination will cost less than running your toaster for a year. Water is not scarce, potable water is. Imagine a world where potable water is abundant. Healthcare: Big data will create cures for cancer, turning clinical specialization into globally available protocols. Nanotechnology will change drug delivery and targeted therapy. The cyber-knife will become widely available. Genome editing could eliminate mutations and deliver enhanced humans (H+). Three-dimensional printing will make prosthetics affordable and liberating. Life expectancy now exceeds 80 years of age. Living to be 100 years old is well within reach. Education: As connected devices become ubiquitous, younger generations will have access to education like never before, without even having to leave their homes. Education will become democratized, despite threats from terrorist groups or governments controlling or limiting access to education—especially for young women. Gender will no longer be a roadblock for access to education and educated young women will become educated mothers, ensuring generational access to education. As industries evolve, so too will the skills required to succeed in the 4IR. I will look at these new skills in my next blog. To read more, download The Golden Age of Innovation. I’ll be taking this message on the road for Enterprise World. Learn more. I’d love to hear your thoughts. To provide feedback, or if you would like to see additional topics covered in future publications, please add your comment below.  

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New Business Models Emerge

New business models have emerged in the Fourth Industrial Revolution (4IR) that distinguish themselves from “the way business was conducted” in the Third Industrial Revolution (3IR). A common theme that has been applied to these new methods is disruption. Let us look beyond disruption and consider the distinguishing characteristics of these new models: From Analog to Digital: This is perhaps the most obvious. Every analog version of a product or service has a digital version. The quest to eliminate every piece of paper often requires the rethinking of a process. It could be the “Kodak Moment,” the elimination of the wallet and cash, removing a lockbox process, challenging a title process, redefining intellectual property, or going wireless with headphones. Challenge every analog process or product you have, even the very notion of being human. From Partners to Disintermediation: One of the distinguishing elements in the 4IR is disintermediation, or the removal of the middle person or partner, going direct, direct to the customer, buyer or supplier. We see disintermediation occurring in all industries. Direct in retail. Direct in software. Direct in insurance. The ownership of the customer or consumer is a new battleground for trust, brand, and share of wallet. If the intermediary does not add value, it will be destroyed. From Transactional to Subscription Economy: In the 3IR, we purchased products or services to own them. In the 4IR, we will subscribe to products or services. This will change relationships and processes from one time to recurring. Customers and consumers will desire more agility and flexibility. But do the math. There are breakeven models of owning versus renting. I find the answer to many of life’s questions is 42 (as in The Hitchhikers Guide to the Galaxy by Douglas Adams). In the case of owning versus renting, the breakeven point is usually 42 months. After 42 months, you are better to own. From Me to We: The Sharing Economy: The sharing economy, as it is called, is all about asset utilization. How do I utilize non-working labor or an idle car? Uber. How do I utilize an unoccupied room or house? Airbnb. How do I utilize programmers with available time? Code sourcing. How do I utilize the collective energy of a group of individuals? Crowdsourcing. And so on. These new business models are rooted at the nexus of the extreme changes in technology (connectivity, computing power, and automation) and a generational or societal change. Millennials are changing the way we do business. They are not shackled to tradition or location, they do not believe in the value of face time, they are impatient learners and seek immediacy, they prefer to learn through experiences, and they believe in life, not a work-life balance. Technology reflects life. This drives innovations like on-demand, public SaaS, Cloud, a sharing economy, subscription services, and disintermediation. After all, you can run your life today only using one finger on an iPad. In my next blog in this series, I will explore how industries will be transformed as a result of disruptive new technologies, business models, value chains, and buyer expectations. To read more, download The Golden Age of Innovation. I’ll be taking this message on the road for Enterprise World. Learn more. I’d love to hear your thoughts. To provide feedback, or if you would like to see additional topics covered in future publications, please add your comment below.  

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The Impact on Business

The Fourth Industrial Revolution (4IR) is servicing new market needs while simultaneously disturbing existing products and services. New business models and value chains are emerging, and in some cases, supply and demand cycles are being slammed together to become one. In almost all cases, new entrants have an advantage over incumbents. New entrants have vast access to capital, have no legacy infrastructure to transition into the future, innovate at the speed of thought and without political or organizational boundaries, and investors are more interested in grabbing subscribers and market share than generating profits in the early years of the 4IR. Even more important than all of this is the ability to conceptualize in the 4IR, perhaps because the new inventors are borne of an age with a maniacal focus on the customer experience, transparency of their services, and a reinvention of how products and services are conceived, designed, delivered, marketed, sold, and supported. Business leaders need to transform their thinking along fundamental lines to break synchronous orbit and achieve exponential thinking. How do we deliver solutions that are more customer-centric, faster, at greater scale, and are disruptive and thus provide higher barriers to entry? In the 4IR, I see a new business codex: It is more important to be fast than perfect We need less data and more insight Conduct less planning, and encourage more experimentation (and at scale) Be customer-led, versus merely customer aware Talent, in many cases, is more important than capital The skills of critical thinking and creativity are more important than interpersonal and organizational skills Innovation is real time, iterative, and not a linear waterfall Experiment at hyper-scale It is one world; build one company Do for machines what we did for humans There is a new latticework for the 4IR. As the 4IR continues to disrupt, new business models will emerge. This is the topic of my next blog in the series. To read more, download The Golden Age of Innovation. I’ll be taking this message on the road for Enterprise World. Learn more. I’d love to hear your thoughts. To provide feedback, or if you would like to see additional topics covered in future publications, please add your comment below.

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The Fourth Industrial Revolution

What makes the Fourth Industrial Revolution (4IR) different from the Third Industrial Revolution (3IR)? Well, everything. It is marked by exponential thinking where linear solutions no longer apply. The digital version replaces the analog version. Knowledge and invention are cumulative. Evolution is just the re-encoding of information, after all. Every person, culture, industry, and country is affected. All forms of production, management, systems, and governments will be transformed. The opportunities are unlimited: faster prototyping and time-to-market with 3-D printing and production, conquering disease and illness with nanotechnology, micro-financing using robo-advisors and advanced algorithms, more efficient and affordable connected homes, safer and more convenient travel with autonomous vehicles. Not to mention other improvements made in human longevity, energy, material sciences, entertainment, consumerism—the list goes on and on. All of these advances will be predicated by developments made in Artificial Intelligence (AI), machine learning, algorithms, massively large data sets, and robotics. But as the opportunities flourish, so will the perils: identity theft, cyber-crime, espionage, new definitions of conflict and war, de-humanization, a widening of the digital divide, automation anxiety, radicalization, propagandizing. Last year, my identity was stolen and I only discovered this because the Internal Revenue Service (IRS) rejected my tax return, claiming that I had already filed. Sixteen months later, I am still dealing with the aftereffects. The 4IR is delineated from the 3IR by three main concepts: extreme connectivity, extreme computing power, and extreme automation. Extreme Connectivity: Cell phones currently connect almost 5 billion people. By 2025, this number will be 6 billion. Today, a smartphone costs $150 USD a month. By 2025, it will cost $150 USD a year. Further, it is easy to follow the curve to attaining 1 trillion connected devices (machines) over the Internet (cars, phones, homes, machinery, airplanes, trucks, ships, soda machines, etc.). Six billion connected people, 1 trillion connected machines—this is extreme connectivity. Extreme Computing Power: Today, you can rent almost endless processing power from Microsoft Azure or Amazon’s AWS. Enter quantum computing and the Qubit. Quantum computing will become a reality in the 4IR. Humans can no longer beat a computer at chess. The world’s Go champion is also a computer; the alpha male is replaced by Google’s AlphaGo. This is nothing compared to the capabilities of quantum computing and the Qubit. Quantum computing has already reached 128 Qubits of processing capacity for a single system. At 1024 Qubits of quantum processing power, all the world’s traditional encryption codes can be unlocked by a machine in near real time. All doors are instantly opened, from banks to vaults to personal accounts to weapons systems. It would be a world without doors and locks. This is extreme computing power. Extreme Automation: With extreme connectivity and extreme computing power, the exponential opportunities for automation are revealed (truths are revealed, never created): cognitive, AI, machine learning, 3-D printing (prosthetics, cloths, and machine parts), algorithms, and methods at hyper-scale. Five billion Google searches a day, 200 million daily orders on Alibaba, and 2 billion worldwide Facebook subscribers. Automation will drive cars, cure cancer, replace entire labor pools, reduce underwriting risk, fight wars, and entertain us. Ultimately, it will create a new class of sentient beings with artificial consciousness. This is extreme automation. The 4IR has the potential to disrupt in ways we have yet to realize. In my next blog, I will look at the impact it will have on business. To read more, download The Golden Age of Innovation. I’ll be taking this message on the road for Enterprise World. Learn more. I’d love to hear your thoughts. To provide feedback, or if you would like to see additional topics covered in future publications, please add your comment below.

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Revolutions. Industrial or Otherwise

The Fourth Industrial Revolution changes everything. Although it has many names—Industry 4.0, Digitalization, the Singularity, the Internet of Things (IoT), Connected World, Smart Home, Cognitive, etc.—it will be known as the Fourth Industrial Revolution, or 4IR. It is being driven by vast technology advancements and will change the nature of wealth, health and happiness, how we live, work, relate to one another, as well as how governments engage, regulate, serve, and protect. By 2025, 50% of the world’s GDP will be derived from digital (a process that is completely automated by machines, which does not require human intervention). This will have profound implications. The First Industrial Revolution (1750 – 1840) was powered by water and steam to mechanize production. Inventions such as the steam engine, iron working, textiles, cement, and railroads terraformed our landscape as humans migrated from rural (agrarian) to urban (city) settings in massive population shifts. Language and reading skills increased with the printing press and so our civilization advanced. Great libraries of the world were built and opened to the public. Revolutions ensued and Napoleon conquered most of Europe. The very fabric of society changed and great thinkers like Voltaire, Paine, and Rousseau agreed that society should be organized according to rules based on rational thought rather than religious ideology. Indeed, most western advances are based on rational thought, behavior, and market dynamics. This is changing in our time. The Second Industrial Revolution (1840 – 1969) was driven by electronic power to create mass production and predicated inventions such as cars, airplanes, the television, the telephone, and even the hydrogen bomb. It was the great age of iron, steel, rail, electrification, petroleum, chemicals, engines, telecommunications, and modern business management. It demonstrated the greatest increase in economic growth in the shortest period ever, introduced by mass production and modern manufacturing. The foundations of globalization were laid and great western populations rose up out of poverty while many deadly commonplace diseases were eradicated. Civil war defined America, Germany rose to power, and two world wars were fought. The Third Industrial Revolution (1969 – 2000) was enabled by Information Technology to automate production. Inventions included the integrated circuit, the personal computer, smartphones, the Internet, space exploration technologies, and the laser. In 1988, Kodak had 170,000 employees and sold 85% of the world’s paper. Within a few years, their business model disappeared and they went bankrupt. Yes, digital technologies replaced film, but what Kodak failed to realize was the disruptive force around them, its opportunities, and the appropriate investment in them (thus, the defining “Kodak Moment”). The Fourth Industrial Revolution (2000 – present) not only digitizes production, but also “intelligence-based tasks,” which previously could only be handled by the human mind. This revolution is of a scope, scale, velocity, and complexity unlike anything else we have faced. Its effects will impact all of humankind, all industries, all countries, every facet of every glorious element of our society—revolutionizing business models, reshaping the world, and even redefining our very existence. The technological opportunities presented by this revolution will be unlimited and challenging, having the power to create and the power to destroy; and as we say in Vermont, any fool can burn down a barn. Extinction events happen. The Cretaceous-Paleogene extinction event (i.e., the meteor that wiped out the dinosaurs) decimated some 75% of the plant and animal species on Earth. Some add sentient machines and the Singularity—or the point at which a machine can think and act at or beyond human capability (thereby rendering us redundant)—to this list of possible present-day extinction events. This blog series highlights the power to create inherent in the 4IR as the Golden Age of Innovation, but it is important to note the perils that are equally present. In my next blog in this series, I’ll explore what makes the 4IR difference from the 3IR in more detail. To read more, download The Golden Age of Innovation. I’ll be taking this message on the road for the Innovation Tour and Enterprise World. Learn more. I’d love to hear your thoughts. To provide feedback, or if you would like to see additional topics covered in future publications, please add your comment below.  

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Is the Microphone Working?

Testing, one, two, three. Testing, one, two three. Can you hear me? Is the microphone working? Testing (tapping on the mic a few times). As I stated in the intro blog for this series, we are in the midst of the Golden Age of Innovation that many are calling the Fourth Industrial Revolution. Over the last decade, the top 20 U.S. technology firms have created over $1 trillion USD in value. U.S. venture investment topped $60 billion USD in 2016. Software is now contributing over $1 trillion USD in Gross Domestic Product (GDP) to the global economy. And there are 4.5 million professional software developers in North America alone—more than ever before. Innovation drives progress. Software and hardware innovation accounts for nearly 15% of all R&D, pharmaceuticals for almost 10%. In 2015, U.S. patent applications hit a record high, topping over 600,000. Half of the world’s best-known brands are now platform companies. In this golden age of innovation, we all need to be software companies. The ability to innovate at scale needs to transcend nations, cultures, and people. Many cultures find it difficult to innovate. My experience suggests there are three key ingredients to innovation: access to talent, access to capital, and an entrepreneurial spirit. The Fourth Industrial Revolution describes an era marked by digital innovation, exponential thinking, and unlimited potential. This will be a revolution of scope, scale, velocity, and complexity unlike any other in human history. But what will be the ultimate measure of this transformation: is it profit, peace, quality of life, or a new form of conscious capitalism? The Organization for Economic Co-operation and Development (OECD) Better Life Index ranks Norway, Australia, Denmark, Switzerland, Canada, Sweden, New Zealand, Finland, United States, and Iceland as the top 10 countries for wellbeing. The United States would rank in the top three if not for: community, civic engagement, and work-life balance. I am not one to lecture on work-life balance. But democracy is not easy, and the great American experiment has invested deeply in a government of, by, and for the people, yet only 50% of eligible American citizens vote or experience civic engagement. This is shameful. In regards to community, despite progress over the last 100 years, 15% of Americans still live in poverty, which is completely unacceptable. My grandfather was born before planes, cars, televisions, telephones, and electricity were commonplace. He lived for 98 years (smoked for 60 of those and ate bacon and eggs every morning). He also worked on his farm every day until he passed, and left America only once to sail across the Atlantic to France to join the Allied Liberation Forces in WWI. There were many phenomenal aspects to my grandfather, but let me highlight the incredible human spirit of adaptability that led him to transition from horses to planes, from whale oil to electricity, from dirt roads to a nationwide transportation network. He also lived to see the first personal computer, and his grandson earn a computer science degree. As a software engineer, I have never seen a more gilded time to positively impact society and humanity through technology. This is the Golden Age of Innovation: And so begins the Fourth Industrial Revolution and our individual responsibilities for creating a better future. …Testing, one, two, three. Is the microphone loud enough? In my next post in this series, I will discuss each of the four industrial revolutions, highlighting their innovations and impact on business, society, and culture. To read more, download The Golden Age of Innovation. I’ll be taking this message on the road for the Innovation Tour and Enterprise World. Learn more. I’d love to hear your thoughts. To provide feedback, or if you would like to see additional topics covered in future publications, please add your comment below.

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Introducing The Golden Age of Innovation

By all accounts, we are entering the Golden Age of Innovation, which many are calling the Fourth Industrial Revolution. Some of the early innovations of the Fourth Industrial Revolution are visible in consumer and personal use cases, such as gaming, shopping, and entertainment. But the vast majority of these innovations—like software, Artificial Intelligence (AI), medicine, robotics, and transportation—have yet to impact society or productivity. When they do, their effects will be exponential and staggering. All industries will be transformed over the next 10 to 20 years by technology. These transformations will affect us as individuals, as a society, as businesses and governments, and will change how we live, work, govern, keep the peace, and wage wars. My recent book, The Golden Age of Innovation, describes the impact of this technology-driven revolution, exploring the opportunities it presents and the risks we face as it unfolds. I’m pleased to kick off a new blog series based on this book. In this series, I will continue my exploration of digital transformation with a collection of topics addressing the radical impact of the Fourth Industrial Revolution—from disintermediation to the subscription economy, automation, and the “Digital Self.” I invite you to follow the series, and together, we’ll discuss these topics in more detail: Is the Microphone Working? Revolutions. Industrial or Otherwise The Fourth Industrial Revolution The Impact on Business New Business Models Emerge Industries are Transformed New Skills are Required The Rise of the Machine The Impact on the Person The Digital Self The Impact on Government How Will We Measure the Golden Age? To read more, download The Golden Age of Innovation. I’ll be taking this message on the road for the Innovation Tour and Enterprise World. Learn more. I’d love to hear your thoughts. To provide feedback, or if you would like to see additional topics covered in future publications, please add your comment below.

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How Digital Transformation is Giving Humans More Time to Really Think

The pace of technological change today is being called the “fourth industrial revolution.” New solutions powered by artificial intelligence (AI), robotics, and machine learning are enabling machines to handle processes that once required human decision-making. Just as mechanical muscle lowered the demand for physical labor in the first industrial revolution, today cutting-edge technology is reducing the demand for human intervention. The “migration” of tasks from humans to software and machines has been evident for quite some time. From ATMs to automated check-in at airports, technology has been performing relatively simple and repetitive tasks. Today, this transformation allows much more complex and nuanced tasks to move from human speed to machine speed, across industries that have remained largely untouched by machine intervention. Most recently, AI and cognitive systems have found a place in legal discovery, insurance applications, underwriting and claims processing, and the delivery of financial investment advice. In healthcare, telemedicine allows diagnosis and monitoring without the need to physically see a clinician, and a surgeon can operate from another hospital or country—just more examples of where jobs long understood as “human” are being displaced by technology. The automation option New opportunities for automation will continue to appear, as mechanization, automation, AI, and robotics replace human workers. But it’s not all doom and gloom. As “traditional” roles are replaced, new jobs will be created in the transition—jobs that require creativity, innovation, and strategic thought. As we do away with mundane work, the time gained through automation can be used to innovate, germinate ideas, and conceive new processes fueled by the kind of thinking that only happens when our minds have time to wander. The beginning of a sweeping societal change? The World Economic Forum, economists, analysts, and labor organizations have predicted a wave of job losses due to the surge in AI, robotics, and other technologies. We could see a net loss of 7.1 million jobs over the next five years in the 15 leading countries that make up approximately 65 percent of the world’s total workforce. But two million of the jobs will be offset by the creation of new positions that will support and foster the new wave of innovation, beyond what we see as credible or possible today. But as some roles are automated, others will come online; for instance, individuals who can build, develop and make sense of these sweeping changes. Developers, programmers, scientists, and technologists will—more than ever—be required to drive forward the accelerating pace of change. There will also be a greater need for economists, lawyers, and policy makers who can interpret how governance, intellectual property, and society at large will have to adapt. While algorithms may automate decision-making, it won’t be easy to replace leaders who can navigate this new fast-paced, intense change. At the end of the day, you may wonder if a machine could do your job. And the answer is that it could probably do some of it. And that’s okay, because automation will free us up to do more of the thinking required to come up with what’s next, perhaps with the help of a new robot friend or two.

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Top Tech Trends for 2017

Information technologies are accelerating at an exponential rate, ushering in the fourth industrial revolution. This is a digital revolution and the pace of change is unprecedented. This revolution incorporates machine learning (think parallel processing and neural networks) and the concept of self-assembly or self-programmability. As technologies continue to advance, they accelerate the progress of other technologies, and so on and so on. To illustrate this, we can look at the evolution of disruptive technologies. In 2016, everyone was excited about the promise of 3-D printing. Now, we’re gearing up for 4-D printing, an emerging technology that will enable us to print objects that reshape or assemble themselves on-the-fly, based on intelligent data. To make this level of self-assembly a reality, we will need dynamic and agile systems. Enter the Internet of Things (IoT) as the digital platform of the future. But the potential of the IoT has evolved into the “Intelligence of Things”. Even Uber, the popular ride sharing app, has advanced its concept of on-demand travel to incorporate a fleet of electric aircrafts (called “Elevate”) to lift us up and out of the chaos of gridlocked ground traffic (yes, just like in “The Jetsons”). The old approach to technology development moved linearly at the speed of human coders. The new model progresses exponentially at the speed of data, intelligence, and self-assembly. Based on this new model, here are my top picks for technology trends that will dominate in 2017: 1. AI and Advanced Machine Learning: The Automatic Enterprise Thanks to parallel processing, big data, cloud technology, and advanced algorithms, Artificial Intelligence (AI) and machine learning are becoming more powerful. As tech giants like Google, Facebook, and Apple invest in AI, it is becoming more mainstream. People already interact with virtual personal assistants (PAs) like Apple’s Siri and Google Assistant. Facebook successfully created technology to identify people’s faces with its facial recognition app. Recommendation engines and robo-advisors are becoming a reality in financial services. And robotic butlers are delivering room service in hotels around the world. The analysts are jumping on board, with Forrester predicting that investments in AI will grow 300% in 2017 and Gartner forecasting that 50% of all analytical interactions will be delivered via AI in the next three to five years. These are impressive numbers. But how will these investments pay off for the enterprise? Are computers really more intelligent than people? Many jobs will disappear through automation and others will change significantly as the enterprise becomes more automated and intelligent. Over the next few years, some of us could be answering to robo-bosses. From a productivity perspective, we spend a third of our time in the workplace collecting and processing data—AI could all but eliminate this work. Every job in every industry will be impacted by machine learning. The upside? The opportunity to think exponentially means that the potential applications for these technologies are limitless. For businesses, understanding cognitive systems, big data analytics, machine learning technology, and AI—and how to leverage them—will be critical for survival. In the short term, these technologies will give organizations faster access to sophisticated insights, empowering them to make better decisions and act with agility to outpace their competitors. 2. The Year of Intelligent Things: A Smarter You in 2017 The capability of smart machines increases substantially as they are infused with standalone intelligence. AI and machine learning will be embedded into everyday things like appliances, cars, sensors and drones. Even our thermostats will continue to become more intelligent; they will not only learn our heating and cooling preferences, but also analyze factors like on- or off-peak use, weather forecasts, and previous consumption patterns to give us recommendations to reduce utility bills. This intelligence will be coded into apps. These apps will be driven by data and context, they will synthesize vast amounts of information, learn our behaviors, and react and adapt in real time to deliver relevant and personalized outcomes. Whether they make us more productive at work, optimize our health, or manage energy and utilities consumption in our homes, intelligent things and apps have the power to direct our actions and influence our interactions to help us make better decisions and, ultimately, improve our quality of life. 3. Get Ready for Your Digital Twin In 2017, advances in connectivity and machine intelligence will enable us to demonstrate the large-scale advantages of digital twins. A digital twin is a dynamic software representation of a piece of equipment or system that emulates the original’s materials, measurements, component parts, and behavior. More importantly, a digital twin also includes data that is unique to the asset it represents. Digital twins are created and maintained to allow simulation, analysis, and control. Initially developed by the military for aircraft, digital twins are gaining traction in other industries, such as renewable energy and manufacturing. The GE Digital Twin has created cloud-based computer models of wind farms which connect turbines while collecting and analyzing data to make them 20% more efficient. Black & Decker has digital twins of assembly lines and materials in one of their factories and has reported improvements of 12% and a 10% increase in throughput. Over the next year, organizations will use digital twins to boost efficiency, optimize design and performance, and improve quality. Over the next five years, billions of objects will be represented by digital twins, including equipment, facilities, environments, processes, and even people. For every physical asset there will be a virtual copy running in the Cloud. Their potential lies beyond demonstrating proof-of-concept to mirroring an entire supply chain to support globalization and promote economic gain. In the not too-distant future, our own digital twins will help us make better decisions. As the next version of the virtual PA, an algorithm-based identity will maintain all of our preferences and relevant data, prompting us to act based on this information through notifications, reminders, recommendations, and more. 4. The Evolving Mesh App and Service Architecture With all the apps, networks, devices, and channels, how do you make the experience seamless for the user? This is a question that will influence tech R&D in 2017. The “digital mesh” refers to everything that is connected across digital ecosystems—from people to processes to things. As more services and apps connect across more channels and networks, the digital mesh is growing and as it does, it is fundamentally altering the user experience. Consumers expect a seamless experience that flows across a shifting set of devices and channels, combining the physical and virtual. This kind of ambient user experience requires that the supporting platforms, technologies, and architectures must also change. Enter Mesh App and Service Architecture (MASA), a modern architecture that allows for modular, flexible, and dynamic solutions. MASA connects devices, apps, services, and other information sources in a consistent user experience across the digital mesh. It leverages cloud and server-less computing, containers and micro-services, and dynamically supports user needs as they interact with their technology and devices. MASA is an architectural shift that will require significant changes to enterprise infrastructure and R&D. 5. The Best Defense is a Good Offense with Adaptive Security Adaptive security tops the CIO agenda. While moving to digital presents enormous opportunity for business growth, it also presents great risk for cybercrime. In 2016 alone, cybercrime was the second-most reported economic crime. As the number and sophistication of cyberattacks increases, an effective enterprise security becomes more critical than ever. The traditional (reactive) approach that relies on antivirus software and firewalls to protect the perimeter and responds to incidents as they occur is just not good enough. In 2017, the enterprise will go on the offensive, assuming that its network is constantly under attack. To pre-empt cyberattacks and information leaks, organizations will implement an adaptive security architecture with continuous, real-time monitoring, big data, and analytics. As the next generation of security, an adaptive architecture delivers the preventative intelligence needed to uncover anomalies and potential threats and prioritize risks. 6. Digital Platforms Lay the Foundation for the Future Digital platforms will continue to play a prominent role into 2017 as foundational platforms for transformation. For enterprises that have already transformed, they will be key to supporting future growth. In particular, Digital Experience (DX) platforms and the IoT will be essential. The year 2016 bore witness to a pivotal tipping point with shoppers making more than half of their purchases online. As this number continues to rise, DX will become an integral digital platform for the enterprise. In 2017, the digital customer experience may be the only interaction consumers have with a brand. It will be important for organizations to get this experience right the first time. We also saw an estimated 5.5 million new devices connect to the IoT each day in 2016. This exploding ecosystem of tightly interconnected devices and people will only get smarter. The result will be digital environments that respond to each individual in highly personalized ways. In 2017, we will build a new world. Using digital platforms and leveraging the existing IoT infrastructure, interconnected intelligent devices will transform the way we interact with each other and our environments. 7. A Hyper-connected Global Ecosystem Creates New Opportunities Over the past few years, business networks have been driving opportunity for business. In 2017, as business networks expand into new ecosystems, they will transcend geography, industry, and language to create exponentially more opportunities for digital enterprises. Much of the technology required for this ecosystem (like AI, robotics, sensors, and the IoT) already exists. A culture of information sharing and collaboration is required to connect the dots. Data and standardization are also fundamental for the development and sustenance of digital ecosystems. When business networks are reliably and securely connected, they can be layered with intelligence. As information is added, the ecosystem and opportunities for growth will only increase. Organizations are connecting across industries to form digital ecosystems with the customers at the hub. Auto manufacturers like Tesla and Fiat are partnering with technology companies to integrate GPS, navigation, social media, and entertainment services in ways that are transforming the driving experience. Adding intelligence for predictive maintenance and servicing integrates suppliers into the network to deliver efficiency and convenience. Taking advantage of the emerging concept of the connected car, it’s only a matter of time before standardization enables cars to tap into a broader range of networks, like smart transportation systems that automatically locate vacant parking spots, for example. When all of these services are connected in the self-driving car (or aircraft), we will truly be able to sit back, relax, and enjoy the ride. 8. Customer-Centricity Drives Transformation In 2017, customer-centricity will drive transformation across all industries. In 2009, Uber created history by disrupting an entire market. Today, the company supports global operations and is valued at over $60 billion USD. What is the secret of its success? Many would say disruptive technologies or even intelligent data but, in fact, Uber’s customer-centric approach played an even greater role in the company’s success. Uber stepped into a market that needed an overhaul to offer more responsive and convenient travel for consumers. By focusing on the customer, Uber was able to quickly build trust. And while it is true that technology has given consumers more choice than ever before, technology is only an enabler. The key to success lies in customer-centric approaches, technologies, and business models. Over the coming year, digital leaders will shift from marketing digital products and services to embracing customer-centric operations. They will invest in IT to become more responsive. Customer-led self-service will be a requirement, along with AI and predictive analytics, innovation, and the agility needed to adapt to changing customer needs. In the digital world, consumers have come to expect higher levels of service. The fight for differentiation will be won by excelling at customer experience and this can only be achieved through customer-centricity. Whether you’re ready or not, the fourth industrial revolution is here. We are witnessing incredible breakthroughs in every industry, driven by disruptive innovation. And the possibilities for application are unlimited. To quote Sun Tzu: “In the midst of chaos, there is also opportunity.” I wish you all a Happy New Year and great success in 2017.

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