• Oliver Nowak

Digital Transformation: Where’s the evidence?

Advanced digital technology is not a new idea, the field of artificial intelligence (AI) research has been around since 1956. Somewhat amazingly, by as early as 1959 programs had already been built that enabled a computer to play checkers better than the average human. If that is true, why has penetration of these advanced technologies been so slow?

It is no secret that manufacturing is leading the way in the application of AI. In fact, the International Federation of Robotics found that in the 5 years between 2013 and 2018 the global operational stock of industrial robots rose by 65% reaching 2.4 million units. The days of dirty and dangerous factories are long in the past, actually, if you look at Tesla’s Fremont plant in California, it looks cleaner than the average hospital. But what has that got to do with the rest of us?

As long as digital technology has been around, it has had its sceptics. Notions that technology will replace humans, causing widespread unemployment; that robots will rise to take over the world, have been around for decades. So, where’s the evidence?

The answer is: no one knows. Very little material evidence exists. In this period of high robotic growth there is no conclusive evidence to suggest that employment, wages or job displacement have been affected. But surely that can’t go on forever?

That brings me round to today’s favourite buzz phrase – the ‘new normal’. It is widely hypothesised that the current COVID-19 crisis will act as an inflection point in the above trends. Digital transformation has always been about automating manual tasks, using analytics to improve decision making, and processing data to make it more universally available. In a world where everything has ‘temporarily’ turned virtual surely there’s a place for all of the above?

Industry experts predict that if there’s one thing for certain, it is that at least a small part of our lives today will remain. Organisations find themselves in a survival of the fittest situation where those that adapt, survive; those that don’t, die. The IMF already predicts that 2020 global GDP will fall by 3% year-on-year.

The question now remains, who survives and who dies? Last year, Harvard Business Review released an interesting article titled ‘How to Survive a Recession and Thrive Afterward’. In this article, analysis of previous recessions found that 9% of companies didn’t just recover after the recession, they flourished. The differentiator was found to be preparation, and this closely aligns to a recent consensus. That out of this thunderstorm of uncertainty has come a new sense of purpose – the charge towards agility.

Are we going to see that the most technologically prepared companies don’t just survive but thrive? Is now the time where the hunt for agility sees renewed focus on advanced digital technologies?

I guess time will tell.


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