Category: Institutions and Revolutions

How Irrelevant Industrial Age Approaches Are Still Prevalent

I read recently this account ‘Exclusive: Barclays installs Big Brother-style spyware on employees’ computers‘ of how a bank had installed a productivity measuring tool on its employees computer, that issues warning when people pause doing stuff on their computer. And indeed after a quick search I realized there seem to be quite an offer of “productivity monitoring tools” on the market.

This is an impressive application of the Industrial Age mindset as we move into Collaborative Age. Monitoring my computer activity would have absolutely no meaning as to my productivity: my work is about creativity, facilitating, getting people to work together. How can you expect to measure that based on my active interaction with my computer?

The article does not detail what were the specific tasks of the targeted employees, but in most modern organisations people don’t spend their entire day in front of the screen just repeatedly doing tasks that can be measured for actual productivity. Only some specific administrative departments could possibly be considered for that to be relevant.

In any case installing some software is a serious breach of confidence with regard to the employees and says a lot about the workplace culture that must be prevalent there.

In the Collaborative Age, productivity measurement must be more comprehensive than just interaction with a computer; and in case, trust will ever be a more essential characteristic of healthy workplaces.

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How Difficult It Becomes to Create Virtual Legends for Covert Operations

We already know ‘How Easy Modern Technology Makes It For Spies‘, it seems on the other hand that it makes it more complicated on some other aspects, like creating legends for secret agents. As explained in this interesting article ‘There Is No ‘Going Dark:’ Always-On Surveillance Posing Risks To US Covert Operations‘

In this fascinating account, US government seems to be quite worried about being able to maintain secrecy around its operations. Available data makes it relatively easy to know the background of individuals and what their real occupation is likely to be. Agents can easily be under constant surveillance as soon as they are in a foreign country. Biometric verification makes it much more difficult to change identities and travel under a different name.

“This is how spy craft works now. Everything is online, digitized, and likely to be accessed by agents of enemy states. There’s no flying under the digital radar. And if it’s true for government employees, it’s doubly true for US citizens who don’t have the ability to alter/remove collected data or a network of security professionals doing whatever they can to protect them (and their data) from outsiders.”

Even better, some recent reports show how critical it is not allow soldiers to carry their hand phone in battle, making it too easy to geo-localise them or to identify the source of their phone signal.

Our privacy is gone, and one consequence is that it is much more difficult for covert operations to be setup. It becomes increasingly difficult to make believe we are someone else than what really are.

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How Sexy Startups Can Also Sometimes Be Toxic Workplaces

Startups are trendy and many young people dream working there in all the excitement of creating something that will change the world. Still some startups are also incredibly toxic places to work, as reminds us this Gapingvoid post ‘Beware Supersexy‘.

The point is particularly important to make because startups are by essence, stressful places to be where a substantial commitment is expected from employees, and change is prevalent on a daily basis as the venture grows, pivots and struggles. Like in projects, the pace of action is quick and some employees can sometimes feel overwhelmed.

Some examples have recently come to light of cultures of mental and even sometimes sexual harassment, and more benignly of certain toxic work cultures in some startups even some that were very much under the public eye and heavily funded.

It is not rosy everyday in startups, and the strong will that is needed from founders do not always translate in a nice way to work. At the same time I do know a number of startups that have developed very nice ways to work together and where employees are incredibly happy to the part of the adventure.

It’s just a fact that startups, like other organisations, can sometimes be toxic places to work, and that because of the specific pace it can be quite extreme. Startup are exciting, and also demanding. As always it is important to get proper insight about how it is to work there before committing to contribute!

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How Peak Income Comes Always At a Younger Age for Each Generation

One of the graphs presented in Lord David Willetts ‘Have the Boomers Pinched Their Children’s Futures?‘ (refer to previous post ‘How Demographics Can Only Explain Part of the Millennials’ Economic Situation‘) has struck a particular chord with me. In this graph we can see the revenue profile by generation according to age in the UK.

In the speech David Willetts uses the graph to show that for the first time younger generation’s income is lower than previous generation. However I find that the most interesting part of the graph is how it shows that peak income for each generation arrives at a younger age. For people born in the late 1940s just after WW2, it happened in their late 50s; for people born in the late 1960s, when they reach about 40. This all points to a ‘peak income’ sometimes in the decade 2000-2010 with income decreasing later for all.

This observation explains why those that arrive now on the employment market won’t find the same level of opportunities. It is also a question mark about current income levels – across all generations.

Therefore the interpretation of the graph is rather that there is a general loss of income in the last decade. It impacts the start of millennials’ careers as well as all other active generations. This is the key issue that needs to be tackled, rather than inter-generational transfer issues.

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How Navigation Apps Are Changing Municipal Traffic Policies

This post ‘Navigation Apps Changed the Politics of Traffic‘ explains how municipalities and local governments are adapting to the rise of navigation apps.

The issue is that those apps cater for the needs of the drivers, and not for the needs of the wider community. “Driver-first traffic “fixes,” even with the best of intentions, have deleterious effects on transportation networks overall.” There is a collective price of having each driver optimise its own route. “One widely cited 2001 paper by computer scientists at Cornell found that a network of “user-optimized” drivers can experience travel times equivalent to what a network of “system-optimized” drivers would experience with twice as many cars. Transport engineers call the difference between selfish and social equilibria the “price of anarchy.””

There seem to be some debate on the actual effect of those apps, and whether the algorithms also include some more collective constraints (one can remark for example that on two different phone, they may not give the same itinerary, showing that they try to spread congestion).

In any case as apps encourage the usage of smaller roads not normally used for transit, local governments act in restricting speed and transit possibilities in those smaller roads normally not planned for transit traffic. This has given a different priority to municipal policies. Other possible solutions is to install tolls for transit traffic or otherwise price mobility differently, or to change the overall traffic patterns.

It is just the start of the change of our urban landscape and mobility brought by real-time navigation apps. Expect physical changes and changes of usage.

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How Demographics Can Only Explain Part of the Millennials’ Economic Situation

I found this speech by Lord David Willetts ‘Have the Boomers Pinched Their Children’s Futures?‘ quite instructive, although I do not completely concur with the conclusions.

The main message of this speech and the associated book is that due to demographics in developed countries, baby boomers (born between 1945 and 1965) would have developed substantial benefits to the detriment of the younger generations (the millennial). While it is quite obvious that the economic situation of the younger generations is not quite as good as young people some decades ago, I believe there is a mixture in the analysis between a general trend of economics and inequality increase, and a demographic effect. Everything can’t just be put on the demographics.

I still believe that the dominating economic effect today is globalization and digitization, making it harder for people with low qualifications to get adequate compensation and putting a premium to those that are globally competitive.

Still the weight of the retirees of the baby boom in western countries will be an issue to deal with, albeit a relatively temporary one. And yes, younger generations will possibly have a less easy time in retirement and there will need to be put some limits on economic transfer towards retirees. But that may not be the biggest driver of today’s economical transformation.

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How Low Interest Rates is Not a New Situation and May be the Future too

As you may have noticed I love to put things in historical perspective. This excellent Daily Reckoning post ‘5,000 Years of Interest Rates‘ just shows how the current situation is not new. It even quotes statements from the late 19th century that expressed despair at the low real interest rates of the time.

There is even more: it would appear that the historical trend would be towards lower real interest rates: “Despite temporary stabilizations such as the period between 1550–1640, 1820–1850 or in fact 1950–1980 — global real rates have shown a persistent downward trend over the past five centuries… This downward trend has persisted throughout the historical gold, silver, mixed bullion and fiat monetary regimes… and long preceded the emergence of modern central banks.”

There is a view thus that interest rates should continue to fall down unless another period of exceptional economic expansion kicks-in again (which could be still be possible with the reach of the Collaborative Age).

Historical perspectives are always inspiring. Of course the future is never quite the extrapolation of the past, but one can only observe this ongoing trend towards lower interest rates, that may also be the consequence of more available capital globally.

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How the Covid-19 is a ‘Common Cause Failure’ Crisis

An aspect which strikes me in the Covid-19 crisis is that it is a typical case of a situation made significantly worse by ‘common-cause’ failures. This is a typical situation in snowballing industrial accidents, which we now see unfolding at global scale.

‘Common-cause failures’ is a situation where the same root cause affects several aspects of the system, and specifically those aspects which were supposed to back-up each other. When they happen, they worsen significantly the outcome of incidents because they remove redundancy. Recent examples in large accidents include: tsunami and subsequent flooding in Fukushima, which damaged all redundant nuclear reactor cooling systems; a flock of geese that stuck both engines at the same time on the aircraft that finally landed on the Hudson river, etc.

For industrial risk engineers, preventing common cause failures is the number one action to prevent major accidents because major accidents by definition are accidents that will bypass all redundancies built in the system.

And this is exactly what happens with the Covid-19. A lot of complaints on the availability of hospital beds and medical supplies are based on the fact that no planning considered the simultaneous problem to happen nationwide and globally. Spare capacity elsewhere was not available any more to compensate for a local overwhelming need. Europe plans was relying on China providing supplies; US emergency response was relying on relocating local casualties to other states…

Thus Covid-19 is a common cause failure and this explains the extent of the snowballing crisis we observe, as many redundancies built in our institutions and supply chains have been affected.

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How We Now Realize What VUCA Really Means

The VUCA concept has been trendy for a while to describe the modern complex world: Volatile, Uncertain, Complex, and Ambiguous. I am not quite sure all of those that used this term really understood what it meant. The Covid-19 pandemics has provided an interesting example and probably a realization for many!

We actually should not be astonished by such events in the modern world. Because of globalisation any such events becomes global much more quickly than before. This crisis will probably go down in history books as one of the fastest spreading crisis throughout the world, where worldviews and appreciation of the situation have changed drastically from one day to the next. Still, there have been such crisis before and there will be in the future. Only, changes happen now much faster and in a more unpredictable manner.

When spirits will get quieter after the crisis, we’ll certainly see that the global economy was ready anyway for a shake-up as it does every decade or so. The Covid-19 was a strong initiator, more so because of the impact of the initial event. New equilibrium will be found for a few years, with probably western democracies weakened compared to Asia. As any catastrophic event, it will lead to a new world stability model – for a while only.

The funny thing is really that the proponents of VUCA got probably overwhelmed too by the violence of the crisis. Welcome to the collaborative age!

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What Physical Changes Systematic Remote Work Will Create

Following up on our previous post, since the pandemic accelerates the transition towards remote work, what are the practical and physical changes we can expect?

First, houses and apartments will have to have a home office, leading to larger surfaces or different arrangements.

The equipment of households in terms of computers and tablets can also be expected to grow to at least one device per person, children included (that’s a big topic just now as schools are closed and children have to work from computers).

Since less people will commute we can expect less tension on public transportation and similar infrastructure (although there will be days where everyone will be expected to meet at the office, so some days in the work week may still be quite busy). Therefore there may be less days with significant traffic jams in large cities. Conversely there will be more tension on the internet infrastructure but that will be easier and cheaper to fix.

We can expect office times to be more like 2 or 3 days per week, letting office spaces being shared between companies or departments.

I am not quite sure there will be a visible impact on flight traffic as personal connections will still remain important and tourism can expect to still develop.

What other physical changes do you think we can we expect from this increase in remote work?

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How the Pandemic Accelerates the Move to Remote Work

The Covid-19 pandemic has really shaken the world. And it has accelerated the move towards virtual remote work. I like this title from Mitch Joel: “It Took A Global Pandemic To Change How We Work“.

While I have been practicing this work mode for years as a global consultant, many more people have found out that it can work provided there is a reasonable organisation at home to allow it. I have many contacts in large companies that discovered this mode of working for the first time, and were obliged to do that for weeks!

I am deeply convinced that in the collaborative age, we’ll still have face-to-face meetings but we will also work increasingly from home or remotely.

The key, I believe, is to know each other physically if possible before starting to collaborate virtually. Although that may not even be fully true as long as there has been some one-to-one personal interaction on an emotional level before, and that can also be through some remote video meetings.

And this will also mean some profound changes in architecture: home offices will become a must and not any more an option.

Welcome to the age of remote work!

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How the Horizon of Investors in Startups is Not Always Compatible With Their Development Cycle

Following up from our previous post ‘How Venture Capitalists Don’t Really Play the Role We Believe‘, I also observe as a Business Angel that the typical 5 to 7 years’ time expectation of investors, and investment funds in particular, is not always consistent with the time-frame for developing an innovative company.

As a Business Angel with industry experience I have a specific tendency to invest in start-ups that develop tangible innovative products mostly in B2B situations. For those start-up companies, between developing the technology in a sufficiently mature stage, the decision cycle of industrial managers and the time to effectively setup the hardware, the usual investment cycle of 5 to 7 years will often be too short to demonstrate the full value of the company. A horizon on the order of 10 years may be more realistic.

The 5 to 7 years horizon may be more suitable to virtual products in B2C mode and effectively in that space, this time-frame is often sufficient to show the value of the innovation.

I am a bit unclear whether this difference in startup situation is well appreciated by investors and there may be many cases where industrial start-ups will be forced to take decisions that are not supportive of their development after 5 to 7 years because many investors will want to leave at that point.

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