Tuesday, May 23, 2023

You can expect an explosion of innovation in the next 18-24 months from June 2023

 I am going to go out on a limb.  Not a big limb, but any time you make a written prediction that people can come back and check, you put yourself at risk.  My prediction has to do with innovation.  Predicting innovation will seem unusual and risky for many people, because innovation seems so random and difficult to anticipate, like a lightning strike.  But if you understand the conditions that make a lightning strike possible, suddenly the strikes don't seem so surprising.  The same is true with innovation.

Why innovation will flourish in the next two years

Innovation will flourish in the next two years for a couple of reasons.  First, we are going into (perhaps already are in) a recession.  As you look around, you can see many large companies cutting staff, in preparation for leaner times.  People are asking questions about hard and soft landings, about the length of the recession and so on.  History shows that most recessions are relatively short, about 18 months, and the economy often rebounds with great strength.

But I'm not forecasting recessions, I am forecasting innovation.  Another thing we know about recessions is that lots of new companies get created by all the people who are released from larger firms.  People start up businesses and pursue ideas that they would not have done otherwise.  While startup money is tighter in a recession, expect thousands of new companies to be created.  This will lead to new products, services and business models.  To be honest, this isn't a prediction as much as it is a recitation of fact - almost every recession in the last 40 years has led to immense innovation.

There are some other factors to consider that make this time period different, however.  First is artificial intelligence, ML and ChatGPT and all of the new technology that will make people obsolete.  Just as the loom did not replace all workers - in fact created more jobs - AI will not replace all workers but create new roles and new jobs, as well as new products, services and business models.  

Innovation creates and spawns new adjacent jobs as well.  New technologies and new services require new marketing and sales channels and messages, new support structures, new payment mechanisms.  The interwoven layers of technology will create new jobs.  New robots require maintenance techs to ensure the robots are working correctly and programmers to improve how the robots operate.  

Creative destruction

What we are going to witness over the next few years is what Schumpeter called "creative destruction", which means that new ideas will reach the market as new products, services and business models and will destroy existing industries and jobs.  That sounds scary, and it can be, for those unwilling to understand the emerging possibilities.  In every transition from one technology to another, people have rebelled.  The printing press was considered a threat to copyists, the automated loom to weavers.  And the people who held those jobs were right - those jobs were under threat, but other, better jobs emerged.

We are likely to see creativity unfold in ways we've rarely seen previously in these tectonic technology shifts, because we have layers of technology that other technology is built on - computers support the internet, which enables machine learning and artificial intelligence.  We are gaining exponential benefits from previous investments in innovation, going up a learning curve.  That learning curve and its impacts will have difficult implications for some jobs but will create other opportunities as a by-product.

We are likely to see the destruction of jobs and industries as well.  Increasingly, white collar work will become threatened by the power of artificial intelligence, and there could be a resurgence of high-tech blue collar jobs.  Machines can already read x-rays as well as humans, and much more quickly and far less expensively.  Plenty of white collar jobs gathering, analyzing and making sense of data will be at risk.  


There are gaps, however, in this possible future, the biggest of which is the growing gap between those who are dialed in to new technologies, either as the technologists or knowledgeable users, and those who do not have the skills or capacities to understand or harness the strength of digital transformation.  It's becoming critical that we rethink how we educate people and how we introduce them to what is about to occur in technology, so they can be involved either in the creation of new AI and ML, or at least become knowledgeable about how to use and deploy these tools and other manifestations such as robots.  If too many people are left behind, unable to create these technologies and uncomfortable or uncertain about their implementation and use, a widening gap between those who understand and control technology and those on the outside will threaten the stability of the markets.

There is a huge opportunity here, and when opportunities emerge, there is another opportunity for innovation.  We cannot afford to create two classes of citizens, one that has access and understanding of emerging technology, and one that is cut out from any engagement of technology other than as a consumer.  I think we'll see a lot of innovation around education and training people to become more adept at the development of AI and ML, user experience solutions to simplify the interface to AI and ML, and methods to learn to use AI and ML more effectively.

Whole Product

Finally, there is the "whole product" model to consider.  Many of these emerging technologies are used by scientists, technologists and early adopters.  As fans of Geoffrey Moore know, that market represents only 10-15% of the total market - the larger segments are in the early majority.  As the title of his book indicates, these technologies need to "cross the chasm" from technologists and early adopters to the early majority of customers.  What the early majority wants are complete products, easy to use, with plenty of support.  Thus, creating the whole product for AI, ML, robotics and other technologies creates an entirely new industry and valuable opportunity.  AI and ML will need to leave the back office and the lab and become everyday products used by people everywhere, and to do that, those products and technologies will need to consider user experience, support, interface management and a host of other challenges that technologists skip over.  Why do you think there are so many LinkedIn posts about how to create useful prompts for ChatGPT/

Will we see it as an opportunity or a challenge?

Innovation is about to unfold in ways we cannot appreciate, due to the stacking of proven technologies to lead to greater computing advances.  Further, a host of people leaving larger companies will be starting their own companies, creating a range of experiments that will pay out over the latter half of 2023 and into 2024.  Emerging AI, robotics and other technologies will feel like an assault on existing jobs and industries, and a wave of protectionism is likely, but ultimately futile if past is any indication.  We will need to ask ourselves:  is all this change an opportunity or a challenge?

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posted by Jeffrey Phillips at 5:33 AM


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