The Coronavirus has propelled technological adoption in a way that no one could have predicted at the start of 2020. What was once a future trend has become a now reality. In some ways, a foretaste of this was given in 2018 by Satya Nadella of Microsoft who started talking about a concept called tech intensity, describing it as an organization's rate of technology adoption along with an ability to build its own digital capability.
It wasn't given much notice at the time, perhaps because it seemed something for a few large organizations. For many of us, it was vendor techspeak and something for the next five or ten years. Now it's a phenomenon that many businesses of every size have been forced to embrace, whether they know it or not. The problem is that tech intensity, at least as seen through the eyes of many businesses, is not just about the technology.
What is tech intensity?
The underlying message of tech intensity is about how to innovate and grow in today's digital economy. As we have found in 2020, it's about adopting and applying technology in ways that are faster than anything that's been done before.
In 2018, Nadella mentioned two aspects of tech intensity.
- Every organization will need to be a fast adopter of up-to-date technology.
- They will also need to build their own unique digital capabilities, starting by skilling up workers in the latest technology.
In retrospect, it sounded like Nadella was trying to do a 21st-century version of Bill Gates' "computer on every desk and in every home".
He also stated that tech intensity needs an organizational mindset and business processes to encourage the development and growth of digital capabilities, remove data silos, enable information flows to bring insights and predictions, and implement automated workflows. In tandem with this technology investment, companies should also invest in their human capital so that they have a workplace culture that encourages collaboration to build that capability and generate new ideas.
Then in 2019, Microsoft published a survey, the State of Tech Intensity. This survey found that many of the 700 executives interviewed believed that tech intensity was a key competitive driver. What was hard to swallow was that the survey seemed slanted, sounding like every large company was into tech intensity. It also focused more on the tech side than the education issue. And of course, Microsoft emphasized how its Azure stack could deliver tech intensity.
Software has eaten the world
This wasn't the first mention of a digital tsunami. In 2011, Marc Andreessen published Why software is eating the world in the Wall Street Journal. Andreessen forecast a number of things that have become fact.
- Increasingly, businesses will be run on software and delivered as online services.
- Every industry needs to assume that a software revolution is coming.
- Software-driven businesses will deliver their products and services at a global scale.
- A global economy that is fully digitally wired, which is almost there but still has gaps.
He also mentioned that many people lack the education and skills needed to participate in the new world of business that will come out of the software revolution. Without education:
...many workers in existing industries will be stranded on the wrong side of software-based disruption and may never be able to work in their fields again. There's no way through this problem other than education.
One section of the State of Tech Intensity mentioned that providing skills training was essential to retain talent, but not in as much detail as the technology. After all, this is a Microsoft survey.
The World Economic Forum has gone into the education needs of a future workforce in its Future of Jobs Report. The report notes that 50% of all employees will need reskilling by 2025. Disturbingly (in my view), it reports that the majority of business leaders (94%) expect employees to pick up new skills on the job.
The report highlights the top 10 job skills needs, which includes:
- critical thinking and problem-solving - employers believe this will grow in prominence in the next five years;
- skills in self-management such as active learning, resilience, stress tolerance, and flexibility.
The WEF report estimates that around 40% of workers will require reskilling taking six months or less, so it won't be an extended process. Without the training required, the WEF estimates that 85 million jobs may be displaced by digital transformation. On a more positive note, the report reckons the technological disruption that is transforming jobs can also create 97 million new ones and help people learn new skills.
What is needed is a more holistic approach rather than the tech-oriented Microsoft report. In the book Future Ready: A Changemaker's Guide to the Exponential Revolution author Nick Davis advocates that organizations should do two things to cope with disruptive technological change.
- Build a capability to develop a future vision and align its practices with that vision.
- Enable people and operations to move quickly to keep pace with, or exceed, the rate of change in their industry.
In other words, tech intensity is much more than tech and needs leadership, strategy, and culture. In fact, the human and cultural aspects of change can be more challenging and complex than the technology aspects.
Focus on skills and technology
It's now accepted that both life and business are being digitized. The solution for those whose lives are impacted is not just investing in new technology for technology's sake. That won't get organizations anywhere. It's the people who use technology that are going to get things done.
In a Microsoft blog post that promoted the State of Tech Intensity report, Deb Cupp, Corporate VP of Worldwide Enterprise and Commercial, talked a lot about how Microsoft customers, mainly large corporations, had adopted the tech intensity approach but she made little mention of the human and cultural issues. Many mid-size companies will treat this kind of message as being irrelevant to their situation.
It's not just up to employers, or even individuals, but also governments that will need to work on providing education policy so that future generations will have the digital skills to use technology productively. Many countries, especially in the developing world, have not yet got the table stakes ready. For example, widespread access to reliable connectivity is at best spotty in many regions.
We are going to need to be more technologically invested because, if nothing else, what we have learned from the pandemic is that those businesses that were more digitally able and prepared were more resilient and capable of transforming in the face of major structural changes in the marketplace.
What we don't need is just talk about tech. Businesses must consider the much harder aspects of reskilling and cultural change. Waving a hand and pointing to those who were born digitally native as if that qualifies people in some magical way ignores too many people alongside running the risk of losing generational knowledge that cannot be easily replaced. For tech intensity to be truly transformational, everyone needs to be brought along.