by Gregory Richards
In 1990, the three biggest companies in the US employed 1.2 million employees to generate a combined revenue of $250 million. In 2014, the 3 biggest companies in the US generated revenues of $247 billion with 137,000 employees. These 3 companies, all from Silicon Valley in San Francisco, generate approximately the same amount of revenue as the 1990 companies with 1,163,000 fewer employees. In case you hadn’t already guessed, the three biggest companies in 1990 were all in automotive manufacturing. While manufacturing will always be a significant part of the economy for both Canada and the US, with more technology being used to enhance human production, the types of skills needed by organizations will shift significantly in the future. Which jobs will grow and which will shrink? More importantly, what are educational institutions doing to prepare managers for the workplace of the future?
The World Economic Forum 2015 global survey of 371 Chief Human Resource Officers concluded that jobs in the following categories are likely to grow:
- education and training.
By contrast, jobs in manufacturing, construction, extraction, administration, entertainment, and legal services are likely to shrink. Many of the jobs that are likely to grow, however, will still need to be rethought. This rethinking must consider the rapid growth of artificial intelligence and machine learning. Artificial intelligence algorithms for example, can process financial analysis faster and more accurately than most humans. Software advances for computer-aided design allow for virtual experimentation and simulation, thus reducing the time and effort needed for the design.
The good news is that this theme of technology substituting human labour is not new; therefore we should be able to anticipate the managerial skills needed in the future. For example, throughout history, new technologies have driven changes in the supply of labour. As Carl Frey and Michael Osborne point out, deskilling was in fact the outcome of early inventions such as the assembly line and interchangeable parts. In other words, a production task that used be done by one craftsman could be done faster and more effectively by many workers each doing a small part of the job of the craftsman. Job specialization therefore required more workers with lower levels of skills.
The introduction of electricity, however, reversed the deskilling trend. Electricity permitted automation of some operations. Instead of many lower-skilled workers, fewer more highly-skilled workers were needed to ensure that the new machines did what they were supposed to do. This trend has continued with the growth of the digital economy. In fact, many see digitization as the “new electricity” because it is a general purpose asset that can be applied to many different types of tasks in an organization.
What happens to displaced workers? Well, in the past they would re-skill to fit into the new world of work. The same is happening now. But in addition, new jobs were created as technological shifts led to the creation of completely new businesses. Consider that companies such as Facebook, Google, Apple and Microsoft, were not possible before the computer age and the introduction of the Internet. With ongoing digitization, a similar process will occur: reskilling of labour and the growth of previously impossible new businesses.
The challenge for educational institutions is to anticipate and start to build skills now that will be needed in the future. MBA programs in particular, need to continually adjust courses to prepare managers for the digitized workplace of the future. What do these new managerial skills look like?
Consider leading the digital organization. What should a manager know about the use of data, machine learning and artificial intelligence? How should planning processes change to embrace a rapidly changing economy? How should a manager interact with employees who have “grown up digital”? What does the level of connectivity brought about by smartphones and social media channels mean for communication in organizations? What new opportunities for entrepreneurship exist given the mass connectivity of people and machines? While the basic functions of management (planning, leading, organizing) won’t change much in a digital world, the questions mentioned above suggest that the way in which many of the functions are carried out could change dramatically. The Telfer MBA program is aware of these changes and is continually adjusted to reflect this new world of work.
Telfer MBA Program
The Telfer MBA program is designed to connect you to course content that matters to employers in today’s competitive work environments. You can also personalize your learning to explore topics that matter uniquely to you. In addition, we share with you the close connections we’ve forged with the business community to help you build the networks you need to grow your career. Our out-of-class experiences hone the skills you’ve learned in class while creating lasting relationships with colleagues on whom you can count.