Career in the Collaborative Age | The Fourth Revolution Blog

How Machines Are Rising in Financial Institutions

This NY Times article ‘At BlackRock, Machines Are Rising Over Managers to Pick Stocks‘ says it all. Traders are being replaced by machines. Or indeed, by less glamour teams of programmers.

As the article explains this is indeed a defensive move by the bank as “actively” managed funds bringing in high management fees are much less successful nowadays (studies have long shown that the returns of actively traded funds are mostly driven by luck anyway).

It is thus a drive towards lower costs. But due to the traders’ remuneration this move might actually create more programmers jobs than reduce traders jobs!

The interesting part of this situation is that the increasing access to information is making professions that had better access obsolete. This was the case for financial traders, and they do become obsolete, together with their Adrenalin-laden world.

How Banks Are Really Replacing Back Office By Bots

In a stunning move, JP Morgan has automated a process that was worth 360.000 lawyer hours every year. This is detailed in Bloomberg’s ‘JPMorgan Software Does in Seconds What Took Lawyers 360,000 Hours‘. Of course the article does not mention in detauil how much it cost to develop this new ‘Contract Intelligence’ software, but the result is that a number of lawyers are not longer needed for basic legal checks.

This requires a tremendous investment (9% of revenue according to the paper, which translates into billions of dollars) but it is clear that the standard, mundane work is getting automated fast by the most performing companies. Apparently it has also allowed to diminish human error in the interpretation of contracts and deals.

Like traders have been displaced by algorithms, it looks like banking back office is ripe for being displaced by Artificial Intelligence and bots. And this might be the direction all transaction-based companies (like insurance and other similar industries) will take soon. This will create a huge social issue, that can already be observed as to the state of employment in the banking industry.

Why There Will be Less ‘Jobs’ in the Collaborative Age

Irrespective of whether the amount of work available will change (it might remain quite stable), the number of ‘jobs’ (meant as being an employee) will certainly decrease.

Self-employment is already dramatically on the rise in many countries for a while and it is I believe a trend that will remain.

Platforms that serve to link self-employed people and clients are also on the rise.

Self-employment is not always a choice: it is sometimes the only way to keep some activity and a lot of self-employed people work are forced to work part-time and at weird times too.

At the same time, self employment means more freedom and flexibility, and the possibility to have several concurring activities.

It is strange how the administrative organization of most developed countries are so tweaked to considering people as being employee of some organization. This creates all sorts of complications for the self-employed, or requires to create a company to become an employee of sorts.

The trend to self-employment is here to stay. Our institutions should change to cater for this situation and better protect those who work under this model.

How to Approach the Question of Job Availability in the Collaborative Age

Will there be more or less jobs in the Collaborative Age? This is a decisive political question at the core of many discussions and votes.

One one hand, there is an impression that robots will take over jobs, in particular those that are do not require high qualifications. For example, truck drivers represent up to 2.5% of the total workforce in the US and could be soon replaced by robots (to which other types of drivers like taxi etc need to be added, bringing possibly the total to 3.0 or 3.5%). This is a huge, huge number and the shift may happen soon. How will those people redeploy their talent?

Others like Tim O’Reilly in this video titled ‘why we’ll never run out of jobs’ take the stand that the Collaborative Age will provide new opportunities and that work will not be a problem: according to him we’ll never run out of jobs, because:

we will never run out of problems
there will always be the need for new, attractive products
of innovation

That may be true once the transition has been performed.

One thing for sure, jobs in the Collaborative Age will be different than today’s. The skills and talents they will require will be different too.

The conversion of the current generation to the new situation may be painful and this may help explain the tidal waves of conservative fear of change that express themselves at each election.

Why You Should Not Tell Your Friends Luck is the Reason for their Success

“Don’t try to tell your successful friends that they’re lucky. We saw that when Obama gave his speech in 2012 and Elizabeth Warren gave a similar speech, people didn’t like that. Those speeches were completely reasonable […], but people didn’t hear the reasonable part. The message they heard was that they didn’t deserve their success.” This recommendation is given by Robert Frank the author of ‘Success and Luck: Good Fortune and the Myth of Meritocracy‘, in an interview.

A large part of success is luck, that is not to be denied. However we still ascribe most of it to hard work and talent. Find the right way to investigate which was the share of luck by asking the right question.

He continues”That’s not the message of those speeches. If you want people to think about the fact that they’ve been lucky, don’t tell them that they’ve been lucky. Ask them if they can think of any examples of times when they might have been lucky along their path to the top.”

“I’ve tried this many, many times and can report to you that the successful people who would get angered and defensive if they were reminded that they were lucky, instead don’t get angry or defensive at all when they think about the question, “Can you think of examples of times when you were lucky?” Instead their eyes light up, they try to think of examples, they recount one to you, and that prompts them to remember another one, they tell you about that one too, and soon they’re talking about investments we ought to be making.”

What are the purposes of us to be in business – my own 10 purposes

Dear entrepreneurs, why on earth are we developing businesses?

Let’s start with 8 purposes to be in business (video) given out by Robin Sharma:

Fulfill client dreams (market – 3 top dreams of customers)
Remove Client Frustrations
Refuel their joy
Distribute Value (10x value obsession)
Total Craft Mastery (TCM) (seeing work as your craft)
Build a team of Picassos
Scale a beautiful life for you and your loved ones
To serve humanity and create a legacy

Most of these are worthy and I do certainly adhere to most although they might be a bit influenced by Robin Sharma’s coaching a focus. There seem to be some missing, in particular:

regarding the ability to choose one’s path (freedom) and to discover and explore new things and interests that come up as a result of my activity
the fact that the team is not only a team of gifted individuals, but also can deliver something great as a team

So, here’s my personal take on the 10 purposes to be in business:

Fulfill client dreams and refuel their joy
Remove Client Frustrations
Distribute Value (10x value obsession)
Personal Total Craft Mastery (seeing work as your craft)
Build a team of worthwhile individuals that can express their talents (Picassos)
Build a team that can achieve incredible things working as a team and expand one’s capabilities with that support
Be free to choose your development path
Be able to explore new untrodden avenues
Scale a beautiful life for you and your loved ones
To serve humanity and create a legacy

Any other purpose to be in business?

How the Industrial Age World Wants to Suck Us Back Into Conformism

I am always astonished at how the Industrial Age conformism is trying to pull us back in its wake, in particular for that that have somewhat escaped.

I have been on my own as a consultant and entrepreneur for a full 5 years now. In particular since I have come back to France, I have had a lot of comments along the lines of (I simplify): “poor thing scratching your life on your own and having such a difficult life, I hope you’ll manage to get a decent position in a large company soon“. That was in particular a key component of new year’s wishes this year.

Funny how people at the core of the system can only consider success as being successful in the system with all the bells and whistles and external signs of power that go with it. Funny how people consider that being on one’s own is probably so scary and unbearable. Yes, it is probably much less secure, but it is overall so much more fun.

The Industrial Age institutions and corporations are desperate to bring back in their ranks those escapees that live a different life. Let’s resist!

Lessons Learnt From 5 Years On My Own

It has been 5 years since I left the employee status in a large corporation. I resigned in November 2011 and started my consultancy business on 1 Feb 2012. What an adventure with many ups and downs!

5 years and 5 companies founded on 2 continents later, with quite moderate but sustainable success, here are some experiences I would like to share from this journey:

Going on one’s own is not for the faint-hearted. It is tough, and requires a lot of dedication and effort. A lot of people I know do fail.
Family support is essential, as is caring for the comfort of the family.
Pay yourself fairly, while keeping enough in the company for growth. The money you own personally is your freedom.
Commercial skills are essential. They are worth a lot. I am still learning as it is not really my background. In reality I cover most of my companies’ commercial development. Develop these skills early if you can.
Do not start on your own. I made the mistake to start by myself alone. Now that I have experience having ventures with partners and working with teams of people I like and respect, I see how much more comfortable that is, even when it’s tough.
Highs will be high and downs will be very low. Brace for uncertainty and change. Keep reserves and be conservative in accounting.
Clients will not always be fair or follow previous agreements. Protect yourself with enough written stuff. Keep reserves for the unexpected (see 6.). And don’t follow the example of your clients: stay fair to your partners and contractors.
Small is beautiful. In today’s world it is possible to bring substantial change from a small structure. I am perfectly happy to keep my companies small but very ambitious when it comes to their impact to the world.
I am very proud of providing an opportunity to the people that work in the companies I am controlling, having been able to keep them as much as possible through the downs and this a great motive of satisfaction.
Having the freedom to experiment is an essential motivation. We don’t have the means to do a lot, but we can still experiment at the limit of technology some new services for our clients. It is a great motivator.

As you can see the positives far exceed the negatives. If you consider such a move, plan it well in advance. But do it, it is worth it.

How to Address the Paradox of Required Flawless Success

We are expecting from our leaders to be overachievers and at the same time to a flawless record of success. But wait! that’s not consistent.

If a leader has achieved something of significant in his past life, he or she will have been criticized, hated. He or she will have faced failure and disappointments. The project they were working on might only have achieved a small part of its original (grandiose) goals. Thus, an effective leader will not have had a consistent flawless record of success and approval.

When electing or choosing our leaders we need to face this paradox. And we fall into the trap so often! In large companies it is often the quiet achiever that gets promoted (to avoid controversy). In politics, any failure at any point will be duly raised up to demonstrate incapability. Dictators will re-engineer their history to appear flawless.

As a note though valid flaws should not include improper behavior and language, lack of respect etc. This shows a flaw in character, not the impact of having tried something worthwhile. These are not always easy to distinguish from valid failures but they finish by coming out in a long campaign (cf. US presidential campaign).

Inspired by Seth Godin’s post – a must read! ‘The paradox of the flawless record‘.

How To Personally Network More Effectively

Our network is important for success and fulfillment. In her post ‘A Smarter Way to Network for Decision Makers‘, Valeria Maltoni reports “According to research conducted by Rob Cross and Robert Thomas, the executives who consistently rank in the top 20% of their companies in both performance and well-being have diverse but select networks —made up of high-quality relationships with people who come from several different spheres and from up and down the corporate hierarchy.”

There is a way to network more deliberately so as to more effective. What I find particularly interesting is the need to have diverse networks. The quote above concentrates on a closed organization but of course networks need to transcend arbitrary boundaries and this principle is applicable to our personal network in general. It can be a particular network related to a religion, sport activity, children school, combined with one or several work-related networks.

I firmly believe that a lot of the value I personally bring to people comes from my exposure to very varied industries, countries and practices. Having a number of very different networks creates a lot of value and many opportunities.

I am learning to be more deliberate about this diversity. What about you?

Why Social Media Presence is a Now a Must

Using social media today is not anymore an option. And this is the case as well in the professional world. If you don’t have any presence on Facebook or LinkedIn, or a minimum proficiency in social media, you look outdated and inadequate in the new world of work.

Let’s thus face reality: you have to have an online presence in the world today to exist.

It is not any more adequate to take a position of ‘non interest’ or ‘privacy defense’ to justify not to use social media. Not having any social media account to relate to brands or interests will increasingly become a handicap in the world of work and beyond.

We are not obliged to share the most intimate details of our lives or the faces of our children. But a minimum online presence around our interests, and the maintenance of a minimum social network, is now a must.

Strong message for all of you that have not yet started using social media!

Hat tip to Paul Hermelin, Cap Gemini CEO, for inspiring this post from his remarks at a conference.

How Algorithms Increasingly Rule our Lives

Another example of how algorithms rule our lives is related to employment. Algorithms sift through applications and personality tests that are increasingly common on job application sites. This is well detailed in this Guardian column: ‘How algorithms rule our working lives‘.

We had already written about how algorithms and Artificial Intelligence already influence our genes. In the essay on employment, the author shows how algorithms decide on the fate of applications taking into account a number of parameters which unfortunately appear sometimes to disadvantage the poor or sick. One other aspect is also highlighted: many companies tend to use the same algorithm/ subcontractor, therefore the lack of diversity creating exclusion.

Data crunching can surely detect certain aspects of our lives that are covered today by medical secret, by law. Anti-discrimination regulation will have to be upgraded to account for this issue.

And we will have to learn how to make our applications more machine-compliant, by adding the frequency of the right keywords too. All in all, our internet presence will become increasingly an important factor to master so as to project the right image to the algorithms that will take important decisions for our lives.

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