Of all the talks at Davos last week, one was closest to our mandate for this section of our daily notes: “Big Tech, Big Impact”. The speakers were:
- Matthew Murray. Executive Editor of The Wall Street Journal (Moderator)
- Ursula Burns (UB). Former Chair/CEO Xerox, current Chair of VEON, Uber board member.
- Vittorio Colao (VC), CEO of Vodafone
- Dan Shulman, CEO/President of PayPal
- Ulrich Spiesshofer (US), CEO of ABB
- Ya-Qin Zhang (YQZ), President of Baidu
There is a video link at the end of this section if you want to watch the whole discussion, but since it is an +1 hour long we have some key takeaways here (initials after each comment denote the speaker who made the point).
On the economic and social impact of automation:
Development of automation isn’t just about the factor floor any more – it touches all sorts of jobs and is happening at an accelerating rate. Traditional “white collar” workers have never seen this sort of disruption before. “Blue collar” has seen it for decades. (US)
The responsibility for retraining workers falls to a coalition of the private sector and government/educational institutions. The former has to adopt automation to remain competitive – waiting is not an option. There is a sizable part of the workforce that will be displaced due to age. (UB)
Increasing automation will force governments to reconsider basic human needs and push technology to address those issues. This will hopefully lessen the sting of economic dislocation. This includes health, environment and educational. Otherwise, political pressures will take hold, with unpredictable results. (VC)
Industry and government are not currently structured to address these challenges. (UB)
All of China’s largest companies by market cap are technology businesses. That is because the country has all the “Pillars” in place to create, nurture and grow these enterprises. While China still has a gap in the development of artificial intelligence versus the US, it is closing. Concerns over privacy issues is growing in China, although the state is still friendlier to tech-enabled surveillance than in the West. China is ahead on mobile Internet technology versus the US and Europe. (YQZ)
Technology can be a great equalizer in terms of the financial system and potentially mitigate some of the pain of tech-enabled economic dislocation. Moving/storing/investing money efficiently should be a human right, and technology helps with that. Regulators and policymakers should be open to experimentation to speed this change. (DS)
Should countries adopt the Chinese model of government/private sector partnership?
“Countries are countries for a reason.” Their citizens share values, and those vary from place to place. What works in one territory may not work in another. The common factor is government should ensure that as many people as possible have access to basic services. Different places try to achieve that differently, and tend to alternate between going quickly and slowly in terms of development. (UB)
Technology allows companies to work together more efficiently. The right solutions require a platform approach (more than one company involved) and include governments as well. (DS)
Social problems happen during periods of transitions, such as the one we face now with automation. That makes public/private partnerships all the more important, because social upheaval isn’t good for either institution. (UB)
Gender inequality is a huge issue in this debate as well. (UB)
Tech-enabled disruption creates social stress that challenges democracy. (DS)
What does the coming Artificial Intelligence mean for us over the next 10 years?
Baidu is using AI to make their search product better, but they are also looking at autonomous driving to improve public safety and transport efficiency. Facial recognition will also benefit society through greater efficiency for public safety and payment processing. The bottom line is that AI is coming on strong, and humans will have to adapt to it and manage the global economic system to harness it for desirable outcomes. China has seen this in real-time over the last 20 years as technology/economic development has remade that country’s economy and society. (YQZ)
What one specific thing should be done to make sure the development of technology stays on the “Right path”?
Make sure that social anxiety doesn’t derail tech-enabled economic advancement. (US)
Education – teach young children to code and use technology, especially girls and women. Pair this with the teaching of ethics. (YQZ)
Take a purposeful approach to increasing participation/access for women and girls. (UB)
Business and governments need to lead through a set of values, and diversity/inclusion has to be at the top of the list. (DS)
Regulators must assure competition to encourage innovation. Policymakers need to encourage experimentation between government/non-government organization/companies to get the best results. (VC)
The most provocative questions in the Q&A centered on how tech companies can regain the trust of the populations they serve. The panel’s thoughts:
Clarity of communication is key. As a company expresses its values clearly and consistently, it can regain trust. (US)
More transparency helps as well. Even if a company has a complex business model, it needs to open itself up and communicate. (VC)
Be honest about the problem of automation rather than hiding this issue. (UB)
Our key takeaway from this panel discussion: every major source of societal influence (governments, companies, NGOs) is behind the curve in planning for the necessary transition to a world of increasing automation. No one has a playbook. China may be best positioned, but only because its economy grows more quickly than most and it has some institutional knowledge about managing radical economic change. But what comes next in terms of the effects of technology, automation and AI? No one knows.
Link to watch the entire discussion: https://www.weforum.org/events/world-economic-forum-annual-meeting-2018/sessions/the-backlash-against-big-tech