When reorganising my studio recently, I came across the report of a series of lectures and workshops at Gresham College, under the auspices of the Worshipful Company of Information Technologists, that were held more than two decades ago. I was interested to read the predictions and examine in my own mind, how these thoughts compare with actuality.
Looking at business over the past twenty years, I note some disappointments
The absence of systematic risk management of current and planned projects is another disappointment. The Bank of England Stress tests, introduced after the last financial crisis, are an important advance. But why have businesses behaved so recklessly and ignored any thought of potential dangers to their activities?
Too many businesses have paid lip service to the critical aspects of new technological advances and put their faith in the hands of other parties, outsourcing expertise (especially to Asia, India and China), whilst implementing wholly inadequate security and encryption systems. The exponential rise in hacking and financial fraud events since 2000, speaks for itself.
Too many people are travelling to unnecessary meetings, when systems like telepresence has been available for decades – one silver lining in the relentless sea of black which is the covid-19 pandemic, is that telepresence has come into its own, and we are likely to see a fundamental cange in the way in which people work.
Management of too many organisations is still in the hands of those people who think they know what is happening while the younger, imaginative and energetic people, who actually do know, remain blocked below. They quickly become frustrated and move on to other organisations or create their own company. The available talent has not been used effectively in these past decades. These people are our future.
I have been involved with this topic for more than 50 years, first as a scientist and then as a businessman working with the Boards of a number of companies (particularly in the UK). Many of these have been particularly myopic in showing more interest in maximising profits through existing working practices and infrastructure, than in determining in their contribution to a global problem, likely to have severe long term consequences to both their profitability and, more importantly, the continuation of life on earth.
The Doomsday Clock which was set at two minutes to midnight in January 2018, advanced to 100 seconds to midnight on the 23 January 2020, based on the increased threats to global stability.
Political failures and a crisis of leadership seem to pose the greatest threat to the planet. The flawed response to the covid-19 pandemic, an immediate threat, give scant hope for a coherent response to the longer term, existential threat of climate change.
The climate is changing rapidly and businesses must change their working practices and Infrastructure. What is required is the internalization of carbon externalities – with clear measurement and targets. This should be in operation now. Carbon Trading is not the answer.
Covid-19 has thrown the issue of Nationalism vs globalism into stark relief. This is the major challenge that will need to have been resolved to progress further. Reexamination of the business supply chains including approaches to outsourcing critical skills and knowledge is essential and all these elements should be part of risk analysis.
The success of the UK economy requires a more balanced business structure than at present. The City is a major international financial hub and this must continue. But financial services currently constitute 26% of the national economy, arguably too large a proportion compared to other nations. The City must work more to help the growth of non-finance businesses through investment and creation of technology hubs….so that they become at least 40% of the national economy by 2040.
Working practices must change drastically in the next few years. The effect of the pandemic has enabled people to work from home; an approach which many organisations have been reluctant to embrace for years. Staff have adapted with enthusiasm and have shown this approach works for all parties. We can expect this to be the way of working in the immediate future- if NASA can control its spacecraft by engineers working from home, then it is not too great a leap to suggest that the back office staff of insurance companies can follow their example.
Covid-19 raises questions as to whether many office functions even need to be in central London. A recent survey in the US found that 60% of people do not wish to return to office working. This is a killer issue not only for London but for all cities around the world. Staff, particularly those with families, are likely to want to live outside cities in properties with gardens. Will we see another wave of de-urbanisation similar to that seen in the 1970’s?
The rise in home working will impact on housing design as well – with a study becoming an essential feature, rather than a luxury in new developments. Broadband and telecommunications will become the fourth utility. This raises questions around broadband speed, and security – as those staff working at home will require infrastructure of a comparable standard to that available to offices. This is an issue which will need to be addressed nationally through regulation and, where necessary intervention. Key issues include liability for interruptions to service, access to broadband in rural areas and investment in key infrastructure.
All of this poses significant challenges to companies – how can you recruit, train and nurture staff in the culture of your organization, when the majority of your staff will never meet face to face? How do you inculcate organizational loyalty and implement effective management systems when your staff are dispersed? We need to remember that the 18-22 year olds now at school and university, will be the business leaders of 2040. They may be entering a world of work that is completely different from that that their managers entered a decade ago. The way in which their talent is nurtured will have a fundamental impact on the continuing wealth creation for London and the nation.
The future will be challenging for all businesses in the City of London and all over the UK.
Garry E Hunt is the former Head of Atmospheric Physics, Imperial College & past JPL/NASA Space Scientist, NED & Chairman, Liveryman Worshipful Company of Information Technologists