Decentralisation — The way Ahead.
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The beginning of this decade 2020–30 already has been a tumultuous one, with COVID19, throwing things in disarray. A lot has been written on how enterprises would change, would focus on Working remotely when possible, how automation is going to change, how operations and expenses are changing. One of the caveats we tend to miss is that we are basing all of this on the existing model, that the companies have a central board room deciding these changes.
I believe that this decade is going to cement the method of decentralisation. This article I discuss how we have come about this change and why it turn out to be a good thing for all.
I had spoken about this in early 2020, even before COVID19 hit us.
It was a warm summer in 2015, when I started studying the nature of Blockchain, and the initial hype that it carried, there was a lot of promise for enterprise software to change radically, governments would adopt it en-masse. It has happened, but not lived up to the hype. These were the first struggles of the world in understanding how Blockchain and Bitcoin(and related technologies is going to change massively). Fast forward to winter of 2020, we experienced decentralisation not only in the sense of virtual currency but also people. Let me list down some of the things which is propelling the decentralisation model.
a. Knowledge Working moving massively to decentralised model: Not only software companies have gone to working remotely model, investment banking, financial sector, hell even Judicial courts are passing judgement online. (Hope not death sentences). Such a massive shift in mindset, is leading to a different model. If not Work From Home, people would definitely gravitate towards lower expense areas physically.
b. Lower expense models: With pressures on Cash Flows to remain competitive, one of the areas of massive cost cutting is operational expense. Travel is going to happen but more in bubbles of locality. Real Estate spaces are undergoing a transformation model of letting workers (at-least of the knowledge kind), to work from anywhere. Major companies are moving capital assets from fixed locations to a more distributed approach across the country.
c. Automation: What about non-knowledge workers, how are things for them? There is a ton of automation coming up, with the networks of 5G getting upgraded everywhere, factory floors are going to be sensorised like crazy, the robot revolution is upon us, not in a way of terminators, but proliferation on the factory floor. This decade is also going to see a massive shift in the automobile industry. The FSD (Full Self Driving) capability, which Elon Musk is gunning towards, is first going to hit the enterprise space, in logistics and delivery. With the combination of AI and increased bandwidths (5G, Starlink ) etc.. we are going to see a boom in automation. Human factor is going to be only for extreme cases.
d. Local & Hyperlocal: I’ve been eating tangerines that are produced in another part of the world. This was only possible due to massive globalisation. This form of globalisation has lead to geopolitical power shifts massively. The only way to reset this power shift is if things are going local, hyperlocal and sustainable. With the increased automation and efficiency creation in operational expenses, it only makes sense to go local. News modes of agriculture is going to crop up, based on local conditions. Governmental units have changed massively, from India saying ‘Make in India’, to Brexit, to now Eastern EU Participants not heeding to Belgium on the vaccination priorities and drives. We are seeing a massive geopolitical shift in self-care first.
e. Climate Agenda: Climate change is finally recognized in a strong way by all countries. The Green Deal is now a big deal. If Climate change has to occur, one has to clean up their homes in a more sustainable way first. This drives to the point of Local and Hyperlocal changes. The pressure by all nations to change policies and programs for climate change is going to change models of national operations massively. Before nations can go global with the changes, they need to effect the change in a decentralised mode first.
So why are these factors important for me?
I work for an enterprise software company. One of the major changes, we will see in technology and how softwares are being built and consumed is based on the above mentioned points.
* We are going to see collaboration software being integrated into Enterprises. The first outcome of this is the combination of SAP and Microsoft Teams coming together.
* Software being developed from remote parts is going to become true, as 5G and Starlink and similar networks come online. Of course there is a negative effect too. During the transition period to such models, the current leadership not knowing how to to trust and handle employees are going to be policing more too.
* A new breed of leaders in the tech industry are going to emerge. These leaders will think different about employees, will bring in new business models, and micro/nano efficiency as we will be able to measure everything. (eg.. Can we peg a cost of a Sales Order right down to the last cent, and see if it is really profitable?)
* Open Source would become the way and the need of the hour. Software and tech are such beasts, that if we do not create things which benefit the world, and create them openly such that everyone can use, we would see a misuse of it very easily. Think if AI algorithms are confined to one company/one nation. This would lead to rouge situations very easily. This scenario has been played out in the past in Bio-Weapons. And the reason we have not seen proliferation of bio-weapons (though cheap to produce and practically open source), is the pressure from all the players to be safe. A similar situation is going to happen in the AI space, it has to be open source and the community of players (companies and nations), would ensure no one goes rouge.
In summary one must remember that the pendulum always swings, and in this case with reducing frequency. All these decades, it had been globalisation, now is the era of decentralisation. The frequency of going back to globalisation would be much more faster this time around.
