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Applying Information Technology in the race towards a sustainable future

I believe most (aspirant) BIM students are aware of the transformative power of Information Technology and the changes that are yet to come. If not, the six Information Strategy lectures have emphasised its importance and highlighted numerous innovative examples in which information, or information technology, played a key role. However, what annoyed me personally is that the majority of the examples handled in class were about companies employing information technology in order to realize profit maximisation. I am aware that we are enrolled in a Business Administration course, however I do think there are other innovative and more important examples in which information plays a key role. In this blog I would like to highlight some examples on how to harness information and information technology to fight one the biggest challenge today, climate change.

But first lets take a look at the how the IT sector itself is performing regarding energy usage and sustainability. In 2007, analyst Gartner released the statistic that the ICT sector was responsible for 2% of global carbon emissions and this figure has since been widely cited. In 2008, McKinsey has re-quantified the direct emissions from ICT products and services based on expected
 growth in the sector. ICT in their analysis includes PCs, telecoms networks and devices, printers and data centres. They projected as a low case scenario a compounded annual growth of 6% until 2020 in energy usage of the sector. This is not surprising given the advances of information technology, more and more electronic products entering households every year.

‘While the sector plans to significantly step up
t he energy efficiency of its products and
 services, ICT’s largest influence will be by 
enabling energy efficiencies in other sectors, an opportunity that could deliver carbon savings five times larger than the total emissions from the entire ICT sector in 2020’ McKinsey & Company

Apart from critically review the sustainability of the IT sector itself, it biggest role – not surprisingly – lies in improving (energy) efficiency in other sectors. According to McKinsey research, these are some of the biggest and most accessible opportunities;

– Smart motors
– Industrial process automation
– Dematerialization (reduce production of DVDs, paper)

– Smart logistics
– Private transport optimization
– Dematerialization (e-commerce, videoconferencing, teleworking)
– Efficient vehicles (plug-ins and smart cars)
– Traffic flow monitoring, planning
 and simulation

– Smart logistics
– Smart buildings (reduces warehousing space needed through reduction in inventory)
– Dematerialization (reduces energy used in the home through behavior change)

– Smart Grid
– Efficient generation of power
– Combined heat and power (CHP)

Together this can be summarized as the SMART transformation. This transformation will be enabled by information technology, mainly focusing on monitoring and optimization. There’s a big role to play here for students, for example that are enrolled in a(n) (Business) Information Management program. It might be less sexy, but not less important. And lets be honest, controlling product/price informedness in order to realize highest willingness-to-pay and directing trading down/out behavior is downright insignificant in the light of todays challenges. I hope this generates some new ideas, for example for a thesis subject. For more information on this matter I refer to the two main sources below.

McKinsey, Enabling the low carbon economy in the information age

BCG, The Role of ICT in Driving a Sustainable Future


How will Information Technology and Automation fundamentally reshape fundamentally the labour market and economies in the near future?

Fear for technology taking over jobs and leave people unemployed is nothing new. With the invention of the steam engine – for example – a vast amount of factory workers saw their fear become reality and got laid off. However new jobs emerged and economies kept growing. What’s different this time is that’s not muscles that are going to be replaced by machines, but brains. And that is predicted to have drastic, far-reaching consequences.

McKinsey acknowledges ‘the automation of knowledge work’. Researchers from Oxford University predict that ‘the coming wave of technological breakthroughs endangers up to 47% of total employment in the US’. The Boston Consulting Group foresees that ‘by 2025, up to a quarter of jobs will be replaced by either smart software or robots’. Zooming in, Deloitte claims that ‘2 to 3 million jobs in the Netherlands are endangered by technological advancements’. We’re not talking about the long-term future, let’s say 75 years from now. The forecast is that this will happen within 25 years.

Which jobs are on the line? Take for example ‘Cashiers, butchers, bakers, pharmacists, translators, drivers, architects, construction-workers, journalist, accountants, medical specialists, bartenders, administrative employees’. Here are some more detailed examples, some of which you might not been thinking off:

  • Call centre employees. IBM is working on a computer that’s about to replace entire call centres in the near future. I work in B2B sales via telephone there’s about 99.00% chance that will become an historic job. (Luckily we have chosen the right studies 😉 ) 
  • Finance and accounting professionals. The way accountants and finance professionals will do their job will change tremendously with increasing possibilities with IT solutions. And there won’t be enough work for everyone. The BBC offers an interactive tool (link below) from which I averaged all the different Finance and Accounting jobs, and there’s a 64% chance that they’ll lose their job to a computer. (Tell that to your MSc Finance and Investments roommate 😉 ).
  • Truck- and taxi drivers. With companies like Uber, Tesla, Google working on self-driving vehicles it is only a matter of time before they’re widely accepted and drivers will loose their jobs. To give you an idea of the scale: in the US there are up to 3.5 million drivers and 5.2 million additional people directly within the industry (BBC, 2015)
  • There’s technology that’s becoming more and more advanced. It is already possible to let a computer write a short article about a sports match, without people recognising the artificiality.
  • They examine en interpreter medical pictures (e.g. X-ray, echo, MRI). At the moment they’re among the best-paid medical specialists. However, various companies are working on advanced scanners that can do the same. Machines will do it better, and for a fraction of the money.

As said, work replaced by technology is something of all times (e.g. working horses, steam engines, the early computers). There will be new jobs replacing the old ones, as always. Besides, scientist agree that social interaction and creativity are human skills that are very difficult to replace with computers

What is different this time is that employment rates and productivity – the two were always closely correlated – are now growing in different directions. MIT professor Eric Brynjolfsson calls it ‘the great paradox of our era, productivity is at record levels, innovation has never been faster, and yet at the same time, we have a falling median income and we have fewer jobs. People are falling behind because technology is advancing so fast and our skills and organizations aren’t keeping up.’

As a result, economists, researchers and policy makers foresee a growing inequality. Slightly exaggerating their fear; they predict that the middle class will slowly disappear and a poor, largely unemployed lower class and a superrich, machine-controlling upper class will emerge. These are real and big challenges for society and global stability. Technology is often hailed as progress and a source for innovation, albeit value. But what if the value will only flow to a relative small part of the worlds – ever increasing – population?

What do you think are the consequences of technology breakthroughs for the coming 50 years? Are we really shifting towards a world in which wealth is fundamentally divided unequal? Or is everybody inevitably moving into the emerging IT/computer/robotic workforce? Or are we finally going to let the machines do the job and get our 8-hour-work-week? Please let me know in the comments below.