Henry Ford famously made inexpensive cars and paid his workers enough so they could afford to buy those cars. Ford aimed for a sort of virtuous cycle, in which a growing business would support a prosperous customer base that could in turn help the business grow further.
In the century since Ford’s heyday American business leaders have largely abandoned this approach, but it’s beginning to creep back into the conversation. Writing in The Atlantic, law professor Michael Dorff argues that too often today’s mission-driven corporations wear their ideals on their sleeves — giving to charity, promoting sustainability initiatives — but fail to build their businesses around a fundamental commitment to the well-being of workers and the wider community, the way Ford at his best did. (He had some execrable traits, too.)
We’ve got a lot of work to do, and it’s not on the technology
Here in the Valley, we’d prefer our technology to be free of annoying social complexities. We’re extremely good at imagining a world where a particular innovation has won the day, but we’re also pretty talented at ignoring the messy transitions necessary to actually get there.
Our most current case in point is the autonomous vehicle. The received wisdom in the Valley is that the technology for self-driving cars is already here — we just have to wait a few years while the slowpokes in Washington get with the program. Within five years, we’ll all be autopiloted around — free to spend our otherwise unproductive driving time answering email, Snapchatting, or writing code.
Except, come on, there’s no way that’s gonna happen. Not in five years, anyway.
We’re building the Model 01, a hackable ergonomic keyboard with mechanical keyswitches, programmable RGB LEDs, opensource firmware, and a gorgeous hardwood enclosure. We expect to ship later this year. You can pre-order one today at https://shop.keyboard.io. The discount code “BOXOFCRAP” will take fifteen bucks off your order.
Last summer, we ran a pretty successful Kickstarter campaign for our first product, the Model 01 keyboard. Since then, we’ve been hard at work getting the first run of a few thousand keyboards manufactured. It’s been a bit more of an adventure than we’d expected, but things are proceeding apace.
Unsurprisingly, setting up manufacturing has meant that Jesse’s been spending…rather a lot of time in Shenzhen. Mostly, his days at the factory start at 9:30 AM and wrap up somewhere between 8 and 10 PM. But on Sundays, he’s been at loose ends. This trip, he decided to do something about that.
We’ve long been fascinated by the Huaqiangbei electronics market area of Shenzhen. (Hereafter, we’ll just call it HQB.) If you need some bit of electronics or a phone accessory, you can find it in HQB. There is an entire multi-floor shopping mall that sells nothing but phone cases. There’s one that specializes in smartwatches. There’s a mall that sells cellphones wholesale. There’s one just for surveillance cameras. And then there are the component markets. Need a chip? Or 250,000 chips? Somebody there can get them for you.
“If you want to receive something you’ve never had, you are going to have to do something you’ve never done.” — Chuck Hodges
In the late 1800’s, the United States was the dominant presence in the whaling industry. At $10mm — more than $20 billion in today’s dollars — it was the fifth largest sector of the US economy. Whales provided a source of energy (oil for lamps) and the basis of a number of luxuries (perfumes, umbrellas, etc.). Centered in Massachusetts, the industry was a major driver of employment and productivity.
The US’s dominance in whaling was largely due to innovation — larger/faster ships, better harpoons, improved winch technology for hoisting sails, and better compensation. The latter two innovations were especially interesting. The winch technology reduced the manpower needed on ship. Less sailors led to more profits and productivity. And the industry’s compensation model was one of the first true innovations in pay. Instead of an hourly or daily wage, the sailors were paid a percentage of what they brought back to shore. A true alignment of interests, driving higher productivity.
“If you aren’t genuinely pained by the risk involved in your strategic choices, it’s not much of a strategy.” — Reed Hastings
Enterprise software companies are facing unprecedented market pressure. With the emergence of cloud, digital, machine learning, and analytics (to name a few), the traditional business models, cash flows, and unit economics are under pressure. The results can be seen in some public stock prices (HDP, TDC, IMPV, etc.), and nearly everyone’s financials (flat to declining revenues in traditional spaces).
This is the second in a series to show why it’s so essential for all of us to understand the implications of exponential technologies, and why we’re hosting the SingularityU New Zealand Summit in November. The first was an introduction to exponential technology in comic form. This one’s a bit more intense. Enjoy!
I give a lot of presentations about exponential technology. Here’s a brief summary (feel free to skip ahead…):
The presentation is designed to be a shock-and-awe wake-up call about the nature of exponentially accelerating technology and its implications. In it, I quote a now-infamous figure from Frey and Osborne: 47 to 81% of jobs as we understand them could be under threat from technology within 20 years (acknowledging there are differences of opinion on this).
And then I show the crowd a recent headline: Apple’s Foxconn factory in China just fired 60,000 people and replaced them with robots.
It’s not easy to make social change with technology. There’s excitement around bringing “innovation” to social problems, which usually means bringing in ideas from the technology industry. But societies are more than software, and social enterprise doesn’t have the same economics as startups.
I knew all this going into my summer fellowship at Blue Ridge Labs, but my experience has given me a clearer idea of why. These are the themes that kept coming up for me after two months working with 16 other fellows on the problem of access to justice (A2J) for low-income New Yorkers.
If you’re of a certain age, the Kodak name evinces a simpler era — a time when taking a picture was a revelation, and photographs were precious — each exposure was finite, a “roll of film” only offered 24 or 36 shots, and it cost money (and time) to actually see your work developed. Selfies? Who had time for selfies?!
During that era, Kodak was Instagram, Apple, and Sony all rolled into one, a massive, 140,000-person icon of American capitalism. The company’s market cap peaked at $30 billion — huge for its time. But the relentless advances of digital drove Kodak to a humiliating bankruptcy in 2012, one that became emblematic of how large companies can fail to innovate.
“The obligation, and the self‑interest of every company is to build a robust society.”
Tim O’Reilly has made studying the near future his full-time job, despite the fact he’s also in charge of a major technology publishing business, a venture investment firm, and countless conferences and events, all of which bear his name. All of his endeavors spring from a relentless curiosity around what the “alpha geeks” are doing — he’s something of a technological dowser, always looking for the next spring of fresh thinking. I was honored to be Tim’s partner in the Web 2.0 Summit conference for nearly ten years, and during that time I came to not only appreciate his unique brand of thinking, but also his desire to truly push the tech industry forward.
Given that tech is now driving change across all sectors of the economy, it’s in no way surprising that over the past few years, Tim has turned his attention to a scope larger than technology itself — to government, policy, and the global economy. His Next:Economy Summit explores all these issues and more each Fall. For the third edition of the Shift Dialogs, Tim stopped by the Nasdaq studios and we riffed for nearly an hour. Below is an edited transcript of our conversation — you can watch the video, which is edited down for length, here as well.
You recently told me that technology is in a crisis of trust. Can you unpack that for me?