With the development of IT technologies, the job market is being transformed, across all industry sectors. Automation of manual tasks is the most obvious change, but big data, blockchains and crowd funding may be the real game changers, enabling established and new players to bypass existing infrastructures… and even replacing jobs. Start-ups and newcomers seem to be the winners, but big companies can face the challenge raised by these technological disruptions with different strategies: either behave as startup themselves, collaborate with startups and use them as value pools, or develop tools of their own that they can then integrate into their own business models… What implications do these changes have on the job market? Which jobs and skills will become outdated, and which ones will become more wanted and valued? Will the changes impact up to the very executive committees?
New IT technologies open new doors: newcomers are now able to compete with big players
Big data is leading us to a period of great restructuring in which robots will take over human jobs. The computerization of processes will make each work unit more productive. Jobs will disappear, others will be created in this transformative process: the World Economic Forum estimates that “current trends could lead to a net employment impact of more than 5.1 million jobs lost to disruptive labor market changes over the period 2015–2020” and 2 million jobs will be created in computer sciences, mathematics, engineering and related fields.
Crowdfunding and blockchains are also set to transform the market. Essentially, a blockchain is a ledger of data blocks, which is supposedly incorruptible and can record anything. They allow for safe and encrypted data or money exchanges without centralization. Similarly, crowdfunding enables to fund new projects bypassing banks and other established institutions. Put together, the two technologies create new opportunities for new, emerging companies that are not backed by big players. Incidentally, big companies will need to scrutinize their small competitors more closely, and tightly collaborate with them.
For example, the startup Colony gathers experts from around the world around specific projects, and they are remunerated according to their contribution to the project. Human resources firms are set aside from the process. Ultimately, e-commerce and social networks programs based on the technology could follow suit and overtake eBay or other internet giants, with comparable, or even higher security standards.
This is not just the future: Coin Based, operating in the Bitcoin network, is available in over thirty countries, and has exchanged 3 billion dollars’ worth of bitcoins. Crowdfunding has a great impact on the market: it has already injected 65 billion dollars in the economics and created 270,000 jobs. How can other companies face up to the challenge?
How can already existing companies adapt their business models to the transition?
The first way big companies can face the challenge lain by startups is to collaborate with them. Different collaboration programs will deliver different benefits, among which: the rejuvenation of corporate culture, the innovation within big brands that may otherwise be too bureaucratic, the solving of business problems and the expansion to new markets. To reap the benefits, medium and big companies can offer tools or co-working places to startups, set up incubator programs or co-develop products with them. These ecosystems, based on open innovation, shorten project delivery time, enhance performance and financial benefits. Companies from Cisco and GE to Coca-Cola and Shell have already developed such value pools with great effectiveness.
Another strategy is to harness the source of the economic disruption and to embrace a disruptive new technology. NASDAQ-listed companies have invested 30 million dollars in Chain, a company that wants to generalize the use of blockchains for all sorts of transactions. Telco operator Orange believes that they will ease data transfer between operators, enhancing end-user experience. Intel, IBM, JPMorgan and Barclays are among the companies investing in this technology.
The second facet of this strategy is to invest in Big Data. In the midst of a crisis induced by the arrival of Uber in France, the French Government created an application enabling users to find easily a taxi driver. This application, a platform based on Big Data, makes the process faster but does not change the business model of taxis. Virtually any sector can benefit from the application of Big Data. The oil & gas industry, for example, can monitor its production and delivery, fixing any eventual leak in record times. Banks can approve loans in seconds leveraging market data in real time. Health professionals can access more data about their patients, and compare them with other similar profiles to determine the best treatment. Enterprises now have to choose between changing with the help of new technologies and disappearing.
Managerial and organizational challenges that lie ahead for companies are huge, as they need to adapt to the changing economic environment. At the heart of addressing these challenges, there is the question of how to use, store, protect data in a fast, efficient, cost-effective manner.
Some jobs will disappear, others will emerge: the law of creative destruction
The increasing use of Big Data and blockchains will literally force companies to reinvent themselves, and to adapt their business models to emerging needs and new tools at their disposal. In the process, some jobs will become irrelevant.
Let’s take an example. The government of Honduras will use a blockchain-based software conceived by Factom to build a record of land-titles – thus making the processes more secure, less subject to corruption and faster. By doing so, notaries and other public officials will be replaced by… IT professionals. In the banking sector, the wind of change is blowing: NASDAQ operators are already testing the use of blockchains on their private market. Ultimately, brokers will no longer be needed. The 21 year-old Russian-Canadian founder of the Ethereum blockchain has an even cheekier viewpoint: he believes that job losses will mainly concern “people who earn too much money for what they do”!
That said, the World Economic Forum estimated that data analysts will become “critically important to their industry by the year 2020”, based on responses from all industries. In other words, this change will be seen across all economic sectors, public and private alike.
The increase of sheer data mass will result in companies needing to know where their data is (especially in a hybrid cloud), secure them and ensure that they are always available. Data management functions will become increasingly critical to the very way we do business. Ultimately, data managers will have their rightful seat at C-Suite level.
According to a 2016 study by Deloitte on Data Analytics, 60% of companies understand the benefits that they can earn by leveraging Big Data. 43% think that data analysis should be conducted by a dedicated entity reporting directly to the CEO. 70% also believe that it is important to consolidate internal data and data generated via SoMe. Data resulting from connectivity leads to increased customer knowledge and, in turn, to the development of new services, the ability to introduce tailored loyalty programs and to recruit new partners. Beyond customer knowledge data helps to optimize products and solutions management. Data analysts will no longer just manage activities, but will also yield information that will bring unprecedented value. Two new roles will emerge: the Chief Data Officer (CDO), in charge of the overall data strategy and the Data Scientist, who creates intelligence and value from data, helping to bridge the gap with other roles within the business. According to Glassdoor, Data Scientist is the “best job” in 2016 which means more job openings, better salaries and career opportunities. This is confirmed in Deloitte’s survey, which shows that over 70% of businesses consider it important to reinforce the role of both the Data Scientist and the CDO even if their activities are not completely mapped out and standardized yet; which opens fascinating perspectives from an overall managerial standpoint.