Networked digital economy: Transforming society at the ecosystem level
More from the Internet Governance Forum, Melbourne, October 2016
This session was moderated by Jim Minifie, Director of the Productivity Growth Program at the Grattan Institute. Panelists were Prof. Thas Nirmalathas, Professor of Electrical and Electronic Engineerint, The University of Melbourne; Caitlin Iles, entrepreneur and venture capitalist; Danielle Szetho, CEO of Fintech Australia; and Kelly Brough, Partner at EY.
Thas was the first speaker in this plenary and he outlined how the networked economy and exponential connectivity have radically changed society.
He gave us the following formula:
Digital + networked + automated (DNA) = technology DNA for new value creation
He said that convergence is driving the Internet of Things. The top areas for creating value are data to insights and collecting or trading data. There is a rising growth in clearing houses and portals. Open Innovation ecosystems are a permeable wall of innovation.
He warned that Australia's economic competitiveness is slipping and we need to embrace an innovation culture and mindset and build innovation capacity.
In answer to the question - how transformative is what we are going through now? Thas answered that the networks effect is driving innovation very rapidly, over very short periods of time and the rate of change is very fast. This is causing problems however as the rush to release the next thing is hitting the fundamental challenge of getting it right (eg Samsung)
Danielle Szetho said that the impact of the network economy is that the average life cycle used to be 75 years, it is now 25 years. The financial industry is seeing rapid change and there were 250 start-up fintech companies in Australia last year. There is an unprecedented scale of consumer adoption and it is an unusual period as complementary technologies that are maturing at the same time are coming together. In this industry, it is also interesting what is happening outside the banking sector, for example Facebook and WhatsApp are entering the payments market.
Technology is impacting every sector and causing disruptions to all industries including health care, government policy shifts, wearable devices. No industry is safe from disruption. In manufacturing IoT is able to capture data which is being used for insights resulting in less downtime.
Organisations might start in one area but very quickly move into other areas eg gogo started in taxis, and has now moved into payment systems. It is naive to think anyone is safe from this disruption.
In the education field for example, university degrees can't keep up and online learning products such as lynda.com are clearly disrupting education. In the health industry, legal structures need to be there and trusted.
The aim should be to match inside out disruption with outside in disruption.
In universities, there are new expectations about the impact of public investment. The conduits between university research and industry are driving value for start-ups from research from universities. It is important to support start-ups to focus on commercialisation - an universities needs to engage with industry better - currently they are too slow to respond and take too long.
Australia has well educated and creative people and many are thinking global from the start. Social innovation and environmentalists are strong in Australia. An example is Block chain - Australia could be really good at this and Standards Australia has been selected as secretariat for developing International standards for blockchain.
The impact on jobs was discussed and it was agreed that no one is predicting entire professions being automated. Human resilience and creativity will change and shift work in different ways. Many types of work are becoming obsolete but will be replaced by something else for example, social media advisors didn't exist 5 years ago. When processes are automated, eg autonomous vehicles, someone still has to monitor and service them.
The session ended with a debate on the definition of disruption. While someone quoted Clayton Christensen's theory of industry disruption by new technology or products and that low-end disruption must be simpler, cheaper or more convenient, most agreed that digital disruption means a complete change, not just evolving of what we have already and it is not about price point.