Job Disruption Due To Digitalization: Myths And Legends

Myths and legends abound when speaking about the jobs of the future or the lack thereof.  One common (fed by social media) claim during the 2016 US presidential election was that laid off or redundant journalists and coal miners were advised to “Learn to Code.”  In other words, retooling older Knowledge, Skills and Abilities (KSA) into future workplace requirements such as software development.[i]

There is no question that the media and mineral extraction segments are undergoing profound and disruptive change.  However, are expectations that mid-career individuals will successfully transition to an entirely new set of KSAs well founded?

In his 1942 book, Capitalism, Socialism and Democracy, the Austrian economist Joseph Schumpeter (1883-1950) wrote; “The opening up of new markets, foreign or domestic, and the organizational development from the craft shop to such concerns as U.S. Steel illustrate the same process of industrial mutation—if I may use that biological term—that incessantly revolutionizes the economic structure from within, incessantly destroying the old one, incessantly creating a new one.  This process of Creative Destruction (italics added) is the essential fact about capitalism.”[ii]

Referring to the transformation of the then economy from one of many independent ‘job shops’ to the rise of enterprises such as US Steel and Ford Motor Company, Schumpeter cited an ongoing process dating back throughout human history.

Fundamental anthropological nature is not likely to dramatically change.  Certainly not in the current technological frenzy of accelerated ‘dog years.’  Therefore, this old—new ‘normal’ is inherent to the digitalization transformation as well as subsequent renovations to future paradigms.

Refurbishing the Workforce

It is unlikely that the majority or even many journalists and coal miners will become software programmers.  What is more likely is these Subject Matter Experts (SME) can morph into ‘users’ of new workflows, enabling tools and associated data feeds.

However, what if a sector completely disappears? Analogies abound including the over cited Buggy Whip Manufacturer metaphor.

By one account, in 1890 there were approximately 13,000 businesses in the ‘wagon and carriage’ sector.  As the horse drawn transportation model gave way to internal combustion engine technology, those organizations that effectively made the transformation did not see themselves as in the transportation business but in the technology business.[iii]

It is important to note that during this period (early 20th Century) Information Technology (IT) did not exist in its current form.  Computing of that day included punch card weaving looms and Difference Engine theory.[iv]

In the day, technology transformation was rooted in the core competency of forward-looking firms.  Today, we see this same process unfolding, i.e., Shale Oil development and production.

Additionally, most accountants made the transition from the old ‘accounting green sheets’ to current spreadsheets and their derivative Dashboards.  Today’s knowledge worker in oilfields and other sectors can make the same transition.

Finally, Xerox also made the same mistake as many carriage manufacturers.  Considering themselves a photo copier company they missed the personal computer revolution even though much of the technology they developed for copy machines was directly applicable to this then infant sector.

Future Business Models

Pundits are captivated by today’s and future need for Data Scientists.  Often dubbed the ‘engineer of the future,’ this individual is said to lead the Digitalization revolution.[v]

Not so fast.  A torrent of data from the Industrial Internet of Things (IIoT) needs to be interpreted by knowledgeable entities. Even if that decision making entity is non-human, a human SME must have some oversight.  The current issue with Boeing Max 8 aircraft is but one example. A common model for this Digitalization process is the IT-OT Framework.  This is the convergence of Information Technology with the Operational Technology required to run field operations, i.e., the business.

Several years ago, the IT centric research firm, Gartner prognosticated that, “With IT and OT converging, the scope of CIO authority may cater to the needs of planning and coordinating a new generation of operational technologies alongside existing information- and administration-focused IT systems.”[vi]

One can argue that with a new IT-OT organizational culture, the Chief Information Officer might not be the best individual to drive this framework.  More likely, line management, i.e., Chief Operating Officer, will be responsible for profitable revenue generated using this business model.

Career Proofing

When the automobile supplanted horse drawn conveyance, the organizations and individuals that knew how to manufacture and distribute ball bearings, wheels, carriage interiors, etc. were well positioned to make the transition to the new technology.  Those focused on animal centric products and services, i.e., stables were less well situated.

This pundit first set foot on a drilling rig in 1974. Much as changed in the intervening period and clearly the work processes of a young wireline engineer of that era are different than  contemporary protocols/procedures.  Technology has changed dramatically, yet the expertise necessary to safely and timely assess the viability of an oil well is similar in many ways.

Transitioning journalists, coal miners and oilfield personnel to coders is not capitalizing on the highest and best value those individuals can offer society.  Humanity does not need as many blacksmiths pounding horseshoes and other forged metallic objects as in 1890.  However, those who are knowledgeable about material science are in high demand today.

Visions of hordes of unemployable former oilfield, miners, journalists and other laborers are probably overstated.  Nevertheless, individuals do have to take charge of their careers, stay current in their field, and develop the agility to adjust to change.  Creative Destruction is ongoing and those in the labor force must develop the ability to manage it accordingly.

Famed immunologist, Louis Pasteur is credited with saying, “Chance favors the prepared mind.”  By preparation he meant years of training, hard work and even failures that are learning experiences grooming individuals for their future successes.[vii]

There is no reason for anyone to be left behind in the era of digitalization.

About the Author

Scott S. has over 30 years technical and executive management experience primarily in the energy sector.  He is the author of six books and has written extensively about the field of operations.  Scott is the Managing Director of The Rapid Response Institute, a firm that focuses on providing its customers with solutions enabling Operational Excellence and regulatory compliance management.

He has studied cultural interactions for more than 30 years—his dissertation; Cross Cultural Negotiations Between Japanese and American Businessmen: A Systems Analysis (Exploratory Study) is an early peer reviewed manuscript addressing the systemic structure of societal relationships.  This game is now an online Serious Game.