Digitalisation
Earlier this week, I got my hands on Richard Hamming’s book, The art of doing science an engineering (published 1996). While reading, I came across this fascinating insight into the digitalisation of society.
Society is steadily moving from a material goods society to an information service society. At the time of the American Revolution, say 1780 or so, over 90% of the people were essentially farmers—now farmers are a very small percent of workers. Similarly, before WW-II most workers were in factories—now less than half are there. In 1993, there were more people in Government (excluding the military), than there were in manufacturing!
What will the situation be in 2020? As a guess I would say less than 25% of the people in the civilian work force will be handling things, the rest will be handling information in some form or other. In making a movie or a TV program you are making not so much a thing, though of course it does have a material form, as you are organising information. Information is, of course, stored in a material form, say a book (the essence of a book is information), but information is not a material good to be consumed like food, a house, clothes, an automobile, or an airplane ride for transportation.
The insight got me thinking, and made me ask; what other material goods that are in the form of information are not entirely digitised?
To which the answer I had then was; meetings, education, health (workouts, yoga) and recreational activities. Most of these are already digitised to some extent, but not entirely until recently.
I mean, the COVID-19 has required a lot of activities to be conducted online. The analysts in a recent McKinsey report declared that;
We are witnessing what will surely be remembered as a historic deployment of remote work and digital access to services across every domain.
Indeed recent data show that we have vaulted five years forward in consumer and business digital adoption in a matter of around eight weeks.
It’s almost been three months or more depending on where you stay since we got into these unusual times, and there’s no easy escape from it, at least not until we figure out a vaccine. If we are going to live with it, many firms have to change the way they manage the business, and it looks like conducting them online is the only way out and is confirmed.
If you don’t, the incidents usually will force you to do so. Which is why I think we’ll see an even more digitalisation of businesses going forward and here’s why I believe COVID-19 is going to influence some of these decisions.
Physical space
In the best-case scenario, it seems we might take at least a year or more to find a proper vaccine to diagnose the COVID virus fully. Until then, one of the only proven strategies to be away from this virus is by practicing social distancing. It’s already a mandatory rule in many countries.
In that case;
Compliance with social-distancing measures seem likely to require more space per worker for many months. That will give companies a reason to encourage some workers to stay away some or all of the time while not changing the demand for office space much.
Centres of excellence - Covid-19 challenges New York’s future
With more space per worker in the office, it forces the rest to work from home, and the only way to keep everyone connected and run business is by digitising processes. We can expect more firms to go remote to some extent and create innovative ways to conduct business activities digitally.
Behaviour
“In a moment of crisis, minds too can change quickly. You can have bitter arguments with your siblings for years, but when some emergency occurs, you suddenly discover a hidden reservoir of trust and amity, and you rush to help one another.”
Yuval Noah Harari: the world after coronavirus
To my knowledge, I think COVID-19 is the only catastrophic event that has impacted everyone on this small planet equally since the birth of the internet. Almost every country had a positive case and went into lockdown.
Everyone has a certain degree of empathy towards the pain it can cause and are ready to try new habits that can keep them safer, including those they always refused. This mindset anchors a suitable environment to scale ideas that work in specific geographies and domains. It’s why everyone can make sense of remote work, online education, and eCommerce these days.
We’ve seen a lot of developing nations and some old businesses adapt to these new forms of work, education, and commerce, and failed to keep up with it for different reasons, but not anymore because it’s the only way you can be involved and be safe.
Who knows it might end up being the new norm by the time we figure out a vaccine in a year and see a lot of business activity happening on the internet than the material world. If it does, it changes the dynamics of the world and instantly puts your talent on a global marketplace, and you’ll compete with everyone.