This statement by Sir Karl Popper (Book Preface: In Search of a Better World, 1984) is one of the countless wisdoms he produced during his life. One devoted to understanding how problem solving and the correction of errors are two of the most important human activities for survival and progress. These behaviors are leading on one side to democracy (def., ‘government which can be removed without violence’) and on the other side to scientific progress, in that we remain doubtful about the theories we have, refute them when they turn out wrong, and critically adopt better ones when we conceive them.
During the past years, many of us interested in international business have been engaged in understanding how an ever-changing world creates new opportunities and challenges for internationally active firms. Besides investigating the fabrics from which institutional environments are woven and how people socialized within them interact with others, we have more recently started to pay more attention to extra-institutional changes, in particular to technological progress and the effects given trajectories might generate when technologies and industries converge. The buzzwords are well known: Industrie 4.0, digitalization, automation, robotics, internet of things and artificial intelligence.
These developments, and what they might entail, are received with mixed emotions. Technology can bring us closer to the dream that machines will do most of the (undesirable) work, giving us time to spend on more meaningful things (e.g. going skiing or engaging in creative work), while at the same time it creates enormous uncertainties regarding how we may make a living in the future. We know from previous industrial revolutions that in the long run they contributed substantially to more wealth for everyone, not only the richest 10%, but at the same time we are aware that we do not see the horses anymore which used to be the productive forces in agriculture. Consequently, the uncertainties revolve around the nature and speed of structural changes. Whose competencies and capabilities will we need? And who has to consider their options – both individuals and firms? What are the qualities of humans that cannot be substituted? What are bases of the competitive advantages local and international firms can build their survival on?
In a world of IoT, automation, digitalization, AI and robotics it is easy to imagine that competitive forces drive standardization, for instance in the form of few technologies concentrated in a handful of players, capable of extracting themselves from the regulating institutions that try to limit their influence. However, these platforms may create a business environment that churns out standard products, services and solutions, which tend towards zero level gross margins, or, in other words, create commodities through disruptive innovations. What are the qualities of humans that technology is unlikely to replace any time soon? How can they become the foundation of future innovation and value creation for firms in their competitive settings?
Through numerous discussions about the future with our BSc, MSc and PhD students (e.g. GIM), with our executive MBA program participants, and with experts involved in the TSE Laboratory of Business Disruption Research, we begin to see how a positive future looks like. It is a future where human creativity pushes us to think beyond the extrapolated trends, where social Sensemaking in communities is generating unforeseeable outcomes, and where empathy and emotions allow us to not only find some of the multiple equilibria in complex problems, but also direct us towards desirable ones that require preferences and human values.
Global Innovation Management Master’s Programme: http://www.utu.fi/en/units/tse/units/international_business/GIM/Pages/home.aspx
Turku School of Economics Executive Education and Development: www.utu.fi/exe
Laboratory of Business Disruption Research: http://disrupt.utu.fi/
Peter Zettinig
University Research Fellow, Docent
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