diginomica 2016 - Martin's choice

Profile picture for user mbanks By Martin Banks December 22, 2016
Summary:
The best of diginomica 2016 courtesy of Martin Banks.

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1. Staging the first Societal, not Industrial, Revolution?

There was a large elephant in the room of the Convention Center at the Aria Resort and Casino in Las Vegas…….. That elephant is the alter ego of automation: what happens with all the people? and the elephant is growing because the messages that make up the digital transformation and automation story are exceedingly attractive.

Why? Purveyors of automation, be that business or industrial, are all quite keen on the pushing the notion that history can and will repeat itself when it comes to the social impact of their technologies. Yes, the weaving industries of Manchester and Leeds may have wrecked the lives of skilled hand weavers, but they did create vast numbers of new jobs. The same observation can be applied across many other industries that arose during the Industrial Revolution.

The suggestion now, made at BMC’s Engage Conference as well as other companies and events, is that the same will happen again, and new, as yet unknown and undefined jobs will emerge to keep the population in gainful employment. Up to a point this is highly likely as we rush headlong towards what is being called the Fourth Industrial Revolution, except that elephant……what type of jobs might these be, how skilled will people need to be to do them, and how many of them will we actually require?

Sadly, BMC is one of the few large vendors with a stake in the development of automation and its application to acknowledge that these questions mark a real issue that has to be faced and answered. Previous automation developments have improved the speed and accuracy of tools and systems, but they have still retained their innate stupidity: they are dumb beasts and need guidance, control and management.

The difference now is that Artificial Intelligence (AI) and its close relative machine learning are becoming an integral part of the mix. Those automated tools will need less and less management as they not just learn how to do the job better and faster, but learn how to solve those operational problems that till now have been the key role humans could still play.

This is one of the most important factors facing not just businesses and their use of IT, but Governments around the world. At present most seem to be ducking the issue or hiding behind the fervent prayer that new jobs will appear from somewhere. It is to be fervently hoped that they do, but much of the evidence is, at the moment at least, pointing the other way.

See:

http://diginomica.com/2016/09/12/bmc-engage-staging-the-first-societal-not-industrial-revolution/

http://diginomica.com/2016/11/11/ai-and-government-some-benefits-and-some-cautionary-notes-for-policy-makers-from-the-uks-chief-scientific-adviser/

http://diginomica.com/2016/05/17/is-the-enterprise-ready-to-automate-security-operations-splunk-makes-the-case/

2. don’t wait for your business to be disrupted, hybridise it

This is about not fearing disruption, nor trying to avoid it. But neither is it about running towards disruption misty-eyed and wearing rose coloured glasses, either. It is, however, about seeing the point – and the time – when the disruptor and the disrupted might just be hybridized.

Why? Because everyone is talking about disruption and many, amongst both the vendor and the user communities, want to be seen as the cause of disruption for others rather than the disrupted, perhaps on the basis that if they say it often enough, and loud enough, it will be seen to be true.

But this presentation, by Prof Nathan Furr at Netsuite’s London event, SuiteConnect, set out to offer some alternative advice. Rather that worry about which competitor is likely to sneak up on you and disrupt your business, or even fret about what innovations your IT teams are not coming up with fast enough in order to disrupt your competition, he suggested looking for where your business can `disrupt’ itself by hybridisation.

He suggested looking for what is already good about the products you make or the services you provide. The look for what is coming down the track that will disrupt your business but when the technology has improved. Then ask the question is there an achievable hybrid that takes the good parts of each to make a real improvement? 

He cited the Toyota Prius hybrid car (which has started a whole sub-set of that industry) and the Microsoft Surface Pro, which crosses the laptop with the tablet and throws in direct access to large corporate information systems, as good examples.

But the key learning, especially for business users, is to see how such hybrids can help build rich digital transformations that open up new ways of doing business.

See:

http://diginomica.com/2016/10/14/lessons-from-suiteconnect-dont-wait-for-your-business-to-be-disrupted-hybridise-it/

http://diginomica.com/2016/10/27/five-ways-to-transform-the-vmware-countdown/

3.  5G – fat pipes for all are coming in the air

Many users will move their entire service requirement away from fixed cable-based services and onto all-wireless infrastructures.

Why? Well, the diginomica view on the state of communications services in the UK is not much of a secret: the situation is already pretty dire, as the recent report by the National Infrastructure Commission points out, and with the build out of the all-important 5G infrastructure now beginning, this will be one of the most important area for investment over the next two or three years.

That investment should not be left to the service providers, either, not least because they will be honour-bound to try and recoup their investments in pretty short order, which will only push up costs to consumers. There is a real need for central Government investment here, for the benefits – both socially and in terms of new and valuable business opportunities – could be huge, and will only be stymied by lack of investment and/or the high usage costs of service providers recouping those investments. With Brexit around the corner the commercial need for the far-flung corners of the UK to have the best possible communications systems with far-flung corners of the world will be paramount.

The core technologies of 5G – expected to be in mainstream service in fours year’s time – are already in place and ready to go. They spread from using high-bandwidth multiple G/bit line-of-sight channels to old, disused 405-line TV transmission channels to reach those awkward corners of the country. The question now is whether the UK and comms authorities have the wit to bite this bullet. If not, however, we are likely to end up in an even worse position than our current 54th best in the world at exploiting WiFi.

See:

http://diginomica.com/2016/09/01/5g-fat-pipes-for-all-are-coming-in-the-air/

http://diginomica.com/2016/11/29/aboutt-time-ofcom-finally-calls-bts-bluff-toxic-openreach-axis/

http://diginomica.com/2016/08/01/will-brexit-break-up-bt-ceo-boasts-that-eu-law-means-uk-regulator-cant-enforce-openreach-separation/

http://diginomica.com/2016/07/26/bt-wins-uk-loses-as-spineless-regulator-ofcom-fails-to-force-openreach-split/

4. Tech talk – the taxonomy of yesterday

For a second I thought he would raise, what to me is, the obvious point – that the vendors need to face up to this problem and provide both development and management tools in the taxonomy of the users, rather than just dumping more levels of complexity on them.

Why? Because this is a fundamental fault with the IT industry as a whole. The expectation that the user community must be able to speak `tech’ at the same level as the vendors is an attitude that is well past its sell-by date. Indeed, it stands on the verge of becoming a dangerous inhibitor of the development and use of IT resources and capabilities at a time when the real lead in innovation is moving into the hands of the user community, not the tech developers.

Till recently this taxonomical divide was not that important, and there was a cosy relationship between vendors and enterprise IT departments. But the arrival of the cloud and the commoditization of the technology means the common language has to change to one the users understand. People say `turn on the light’, they don’t talk about `energizing filaments to a heat where they come a viable light source’.

The vendors now have to understand what the users are talking about – in their vernacular – so they can match the technology to their needs and their innovations. I suggested at the time this might be an `old-hat’ topic by 2017, but at the present I am not holding my breath to see it happen.

See:

http://diginomica.com/2016/08/10/tech-talk-the-taxonomy-of-yesterday/

5. Changing the CERN lightbulbs with ServiceNow

The reason is not only simple, but also demonstrates how the same fundamental processes – and the same solutions – apply to most areas of service provision, whether that is rapidly on-boarding a new employee and getting them productive with the IT tools they need, or making sure they have a working lightbulb over their place of work.

Why? Not least because here is a user story with a degree of `aaahhh’ about it. Here is an experienced IT guy given the job of getting the day-to-day service management side of a huge, multi-national research organisation – CERN – into some sense of order. Anyone with any experience of such a job will know that it often involves large wallcharts, masses of paperwork and that feeling which comes when you realise you’re never likely to get near the top of the mountain.

Except that, his experience included using ITIL to manage the complexities of large enterprise IT organisations and the wit to realise that ITIL could be applied just as effectively to his new job. From there, finding a supplier of an automated ITIL solution was but a short, logical step.

And the moral of the story? Perhaps just that this is a fine example of new, leading edge IT tools can find a new life out in what some of us would call `the real world’, well away from the intra-IT bubble.

See:

http://diginomica.com/2016/06/24/changing-the-cern-lightbulbs-with-servicenow/

6. Blockchain and the enterprise – enter Acronis Notary

Viewing it as a log of all transactions fits what many companies want to achieve in a wide range of applications. They want to ensure that the log is not modified, and Blockchain provides a way to time and date stamp a transaction with a unique signature which means the log entry cannot be changed.

Why? The connection between blockchain technology and the growth of Bitcoins as a means of financial transaction has so far constrained its potential application to the bleeding edges of the financial services market. And next year is expected to see make significant inroads there in terms of application.

But nearly every action in an increasingly digitalized world makes use of a transaction at some point in the process, and managing them securely and reliably will be a key capability.

With that in mind, blockchain has the potential to become a real cornerstone of digitalization and in particular the transformation of all business processes. Expect to see much more written about it, especially when the user stories start to emerge. For example, look below for the reference to Everledger and its application of blockchain to establishing the provenance of valuable items, such as art, diamonds and fine wines. There a new application that really could not be done securely before.

See:

http://diginomica.com/2016/06/10/blockchain-and-the-enterprise-enter-acronis-notary/

http://diginomica.com/2016/05/04/is-the-blockchain-enterprise-ready-consensus-2016-panelists-air-it-out/

http://diginomica.com/2016/12/12/2017-year-ibms-blockchain-ambitions/

http://diginomica.com/2016/11/28/blockchain-disrupt-telecoms-industry/

http://diginomica.com/2016/10/26/visapaymentdigital/

7. GE Digital CTO – integrating the Industrial Internet with business management

We think autonomous cars will turn up in the next five years or in the next decade. But by the same token, you can be looking and talking about autonomous manufacturing facilities, where the facility itself or the factory itself is self-healing, self-optimizing. People will always like to know what’s going on, but you really don’t always need a human in the loop.

Why? The Internet of Things has already sub-divided into three major branches of application – healthcare, smart cities, and the industrial internet – and while there is a degree of inevitable overlap between them, each is starting to grow its own `champions’ and market leaders. When it comes to the industrial internet GE Digital, the US IoT arm of US industrial and manufacturing giant GE, is certainly up there as a strong contender.

It is also a company willing to talk about some of the issues that come with the growth of the industrial internet, even if that can be somewhat defensively. So the arrival of the fully automated factory as a reality is an important subject to discuss, not least from the point of view of the inter-relationships and collaborative requirements that must be created between the `industrial’ side of the equation and the existing business side of ERP, raw materials management, sales and marketing services and the rest.

This is also the sector with the potential of a very real negative impact on society, and the ability of such businesses to create employment opportunities. GE Digital is currently of the opinion that the new job types will emerge, and will be an on-going talking point for several years to come.

See:

http://diginomica.com/2016/05/02/ge-software-cto-integrating-the-industrial-internet-with-business-management/

http://diginomica.com/2016/11/23/iot-urban-use-cases-emerge-mrinal-wadhwas-view-from-the-field/

http://diginomica.com/2016/11/14/ge-digital-acquires-servicemax-for-915m-to-further-iot-vision/

http://diginomica.com/2016/10/13/non-existent-iot-security-is-a-menace-for-everyone/

http://diginomica.com/2016/06/06/tibco-may-have-nailed-down-the-all-important-edge-of-iot/

8. The Babel Fish becomes a paradox

That down-side is the fact that each of those distributed applications and services ends up growing its own database or repository, and every business then ends up with N different sources of similar and closely related data that could be anywhere around the globe. For the business, there is no single version of the truth about the business; instead there are N partial versions of bits of the truth.

Why? The Babel Fish was the invention of author Douglas Adams and played a key role in his famed four-book trilogy, The Hitchhiker’s Guide to the Galaxy by providing universal communications between all forms of sentient beings.

Its place as a motif in the IT world is becoming more relevant as collaboration between different applications becomes more an every-second part of running more complex business processes. Working together these applications – often widely distributed through cloud services and cloud service providers – can create a richness of business functionality that could only be dreamed of a few years ago. But they also can end up creating a quagmire of subtlely different information sets as each keeps a database containing its own version of the `truth’.

The paradox is that the more a business exploits the benefits of distributed, collaborative applications the more it needs a single, centralized point of information clarity – that one version of the truth about the business and its activities. And this is just area where the need for dynamic transliteration between data sources will become ever more important, unless someone comes up with the universal, all-format database.

See:

http://diginomica.com/2016/03/30/the-babel-fish-becomes-a-paradox-as-druva-demonstrates/

http://diginomica.com/2016/03/16/breeding-a-babel-fish-for-internet-of-things-analytics/

9. Why Apple may need to ‘steel’ itself

But while the Mac-erati have so far been stupendously loyal to the idea of buying everything the brand comes up with, there has to be a question as to whether this essentially stylistic change of removing the camera bump is going to be a big enough draw?

Why? Some two years ago now,  I wrote about the potential impact on IT systems vendors of an old industrial `law’ known as the Steel Intensity Curve. This is a tool for modelling the development and long term trends for the steel production industries.

It proposes that, over time, each percentage point increase in GDP leads to less steel being required to achieve it. As GDP grows, more and more of the reasons for steel consumption have already been fulfilled. The bridges needed to be built have been built, and they last maybe a hundred years and only need maintenance, which requires much less steel.

Over the last year the applicability of this model to the IT vendor community – and I particular the hardware industries – has become more apparent. Indeed, one of the largest, most revered and most financially healthy hardware companies, Apple Computer, has started to show real signs of coming up against the effects of the Curve.

Where the Apple fanbois would readily buy anything the company chose to make they now show signs of holding back. At the same time, Apple seems to be showing signs of running out of new ideas to keep the pot boiling. Recent developments in the product have been increasingly marginal.

And in a world where increasingly standardised and commoditised hardware is providing a common platform for highly innovative developments in applications software, chasing the tail of marginal hardware development looks a mistaken objective.

See:

http://diginomica.com/2016/02/09/why-apple-may-need-to-steel-itself/

http://diginomica.com/2015/05/15/steel-yourselves-the-curve-is-coming/

10. Universal Basic Income “has to happen”

Society has typically allowed for people with varying degrees of skill sets to find some sort of work, whether that be working in a factory, flipping burgers or practicing medicine. However, as the jobs that can be automated do actually become automated, how do we bring everyone along with us in to the future of work?

Why? This is probably THE most important question that all developed countries, and the global businesses that feed off them, now has to answer. What do we do with the millions of people who will find themselves eased out of employment as automation and AI takes over?

If humans were like PCs we could be switched off and parked in a cupboard. But we are not, and if the dystopian `Logan’s Run’ scenario is not to be adopted as the solution then some form of Universal Basic Income will become necessary in order to keep commerce and industry afloat. They all live off the disposable income of working people, and if they have none then there is no commerce or industry.

Many of the IT vendors leading the charge in automation and AI express the hope that new jobs will emerge, and there are trials being undertaken aimed at finding ways to make the idea work. But it may also require the IT vendors to start creating some of those new jobs in the not too distant future.

See:

http://diginomica.com/2016/12/02/slush-2016-universal-basic-income-happen/

http://diginomica.com/2016/10/14/nexteconomy-what-is-the-research-saying-about-the-future-of-work/

http://diginomica.com/2016/09/10/the-robots-are-coming-and-were-all-royally-screwed/

http://diginomica.com/2015/07/09/automating-political-apoplexy-for-a-dystopian-future/