Futurists and local economic development

Futurists use a forward-looking philosophy to chart their organisations’ strategies. They are not so caught in the here and now. Rather they imagine and then mobilise people towards a future that does not yet exist. It means you can not yet plan for it, you first have to imagine it. Futurists are not caught up like most of us with trying to make what we have to work better, nor are the plugging gaps. They force us to think about completely new architectures of technology, social arrangements and capabilities.

Elon Musk and Jeff Bezos are considered global futurists. Many of the near emergent technologies, like driver-less cars or advances in artificial intellegence were hard to imagine just a decade or two ago, now they seem to be around the corner. Yet, cities, business and governments are still planning with a short term cycle, mainly using what exists or what is lacking as guiding their decisions.

A lot of emphasis here in South Africa are placed on data, prioritising left behind areas and dealing with social integration. Every now and then I wonder if we are not simply getting better at preparing for the past? You know, that one that will never come back? What if the very industries that we have now will not be viable in just a few years? What if the cities and towns that emerged around old industries are no longer viable or sustainable?

This morning I read about New York hiring a futurist to help them imagine and plan for the future on a CNN site.

“In an unlikely move for a city, New York is also hiring a senior futurist to gather insights on possible cultural, economic and environmental changes ahead”

Wow, imagine we could do that here in South Africa? I know we have a long list of problems that require our immediate attention, but should we not set aside some time to also imagine the longer term future? That way, bureaucrats and technocrats can develop better models and designs that can be presented to politicians and citizens. More important, we can get more designers, engineers, scientists and business people mobilised to think about and design for a future that is imminent.

“New York’s latest efforts are designed to be proactive, rather than reactive”

From my perspective, most of our companies and local governments are not ready for what is coming. We are all caught with trying to cope with what is and what should have been done. Then our local political climate sucks a lot of energy from our economy, resulting in resource rich companies growing while all the rest is holding up their breaths, waiting for something to happen.

I know this sounds negative, but with the digital revolution in manufacturing, and the rapidly integration of fast numbers of enterprises into the networked knowledge economy, I see many of our industries falling behind. Not all companies, but many. I often ask my students to imagine the following:

  • What does the future of local economies, secondary cities and the currently unemployed in South Africa look like?
  • What are technologies that we can expect to have a profound change on our country in the medium to longer term? What does this demand from our institutions, policies and businessess?
  • Can we get more people involved in thinking about the long term future?
  • How do we shift from a low skills labour intensive economy towards a knowledge economy without leaving millions behind?
  • What do we have to equip our students and children with to empower them to shift with the times and prepare for this future?

We have so many priorities that we have to address at the same time. Perhaps while we are running on this treadmill we need to also think further into the future.

Just thinking out loud!

The photo at the top of this post was during a Local Economic Development study tour I led to Germany together with Frank Waeltring in 2009. The tour group was a diverse range of senior government officials and the objective was to learn about Germany’s experience with economic change, industrial change and cooperation between many different stakeholders in a decentralised way.

 

Preparing for a different manufacturing future

In Africa, we face the challenge of a manufacturing sector that often manufactures products in low volumes. In a country like South Africa, we manufacture a wide range of products but often at low scale. Even our manufacturers that manufacture in larger volumes are still small compared to European or Asian competitors. In some parts of Africa we are further challenged by not having very sophisticated domestic demand in many sectors. When demanding customers are far away it becomes much more difficult to be innovative and well informed of what is possible and what can be done to exceed or at least meet the demands of customers.

But I can sense an important change taking place. I am frequently visiting manufacturers that are becoming much more knowledge intensive. They are smaller and more flexible than their more established competitors, and they combine different skills sets, technology platforms and knowledge bases.

In a forthcoming paper [1] that I co-authored with Garth Williams of the Department of Science and Technology and Prof. Deon de Beer (Vaal University of Technology), we offered the following definition of Advanced Manufacturing.

Advanced manufacturing is an approach that

  • Depends on the use and integration of information, knowledge, state of the art equipment, precision tooling, automation, computation, software, modelling and simulation, sensing and networking;
  • Makes use of cutting edge materials, new industrial platform technologies [2], emerging physical or biological scientific capabilities [3] and green manufacturing philosophies; and/or
  • Uses a high degree of design and highly skilled people (including scientific skills) from different disciplines and in a multidisciplinary manner.

We also argue that Advanced Manufacturing includes a combination of the following.

  • Product innovation: Making new products emerging out of new advanced technologies (including processing technologies).
  • Process innovation: New methods of making existing products (goods or services).
  • Organizational innovation or business model innovation: Combining new or old knowledge and technologies with traditional factors of production [4] in non-traditional fields or disciplines in unique configurations.

I am very proud that our definition of advanced manufacturing was also taken up by the Department of Trade and Industry in their next Industrial Policy Action Plan (IPAP) 2014/15-2016/2017.

The implication is that our technology development, technology transfer and education programmes need to change in order to be better able to equip and support manufacturers. Manufacturers increasingly need to be able to manage multidisciplinary teams using different technologies. These manufacturers must not only be able to learn fast from the market around them, they must be harness and pro-actively develop new combinations of knowledge within their enterprise. Existing or potential manufacturers must also think differently about manufacturing. Smaller factories, using more modern equipment in a flexible way is now a competitive advantage. The entry costs for starting a small manufacturing enterprise has never been so low. For instance, the cost of an automated electronics surface mount production line has come down by more than 70% in less than 10 years. Additive manufacturing allows tooling and products to be developed in parallel, but also makes it possible to develop new products very fast.

Where do South Africa enterprises learn to become more knowledge intensive at the moment? The answer is: At European Trade Shows. If you are a manufacturer or a potential entrepreneur, start saving up. There are many excellent trade shows throughout the year.

Which Meso-organisations offers the best examples, technology demonstration and training on this? Again, European Universities, Technology Transfer centres and universities. (The US and Canada also provide brilliant services, but it is much harder to access for us). If you cannot find a local expert or academics to help you, reach up to Europe.

What do we have to do? Think of ways to get as many of our entrepreneurs curious or interested in the newer technologies available, and learn from our (larger) competitors. Also, we have to get our universities to be more involved in technology adaptation and participating in new research areas. The academia should focus less on publishing in journals and get involved in real research collaboration that gives our industries (exporting) opportunities and that at the same time address unique needs in our domestic markets.

Oh, and by the way. Start reading up on the “internet of things”. Maybe my next post should focus on that.

 

Notes:

[1]  Our paper will be presented at the International Conference on Manufacturing-Led Growth for Employment and Equality in Johannesburg on the 20th and 21st of May. The paper is titled “Advanced Manufacturing and Jobs in South Africa: An Examination of Perceptions and Trends”.

[2] Such platforms have multiple commercial applications, e.g. composite materials, and exhibit high spill-over effects.

[3] E.g. nanotechnology, biotechnology, chemistry and biology.

[4] Labour, materials, capital goods, energy, etc.

 

Twelve business ideas that are changing the world – Link

Here is a link to a 12 episode series published by the Times and the Times Online. In the series, they interview 13 influential business figures from a wide range of sectors as they explain an idea that they think is fundementally changing the way we do business today. Although some episodes were published as long ago as 2007, most are still relevant and though provoking. The Times now charge for their content, so I found that these episodes sometimes download from Podcast Directory, and at other times don’t….

Here are the direct links to the episodes:

1. Medicine in the developing world

Innovative partnerships are crucial to overcoming diseases like malaria, which, as well as their devastating cost in human terms, are hampering the economic progress of developing nations

2. Government as a business

A strong and efficient public sector is fundamental to the strength of any society, and governments can draw lessons from the private sector

3. Micro finance and its role in 3rd world poverty relief

The provision of financial services in the developing world is a crucial means of ensuring sustainable economic growth and lifting people out of poverty

4. Private equity modern entrepreneurship

Sir Ronald Cohen, Founding Partner and Executive Chairman, Apax Partners Worldwide. Successful entrepreneurship and the importance of the private equity industry in the British economy

5. Vacating HQ: how social innovation is redefining the corporate world

Ben Verwaayen, CEO, BT: Technology is changing the way we do business, bringing the world’s best talents together

6. The flexibility of industry’s new access to capital

Sir David Walker. Author, the Walker Report into private equity. Tuning the balance between transparency and secrecy in the world’s most private industry

7. The business of engineering

Engineering has changed the world and can continue to do so, but first it must change its own fate

8. The evolution of the equity market

From their origins in the seventeenth century, today’s high-tech stock exchanges are playing a crucial role in global economic development and are at the heart of the globalisation story

9. The day corporates gained responsibility: the chief executive’s view

How companies turned the inevitable into the profitable

10. The day the corporates gained responsibility: the investors view

11. New world order

The global marketplace for skills is revolutionising business and communities – but where will it lead?

12: The democratisation of information

Jay Adelson, Founder and Chief Executive, Digg. The internet is changing the way we access and share information, and it gives us all a voice

13: Powering the future

Britain must reinvent its attitude to energy if it is to meet the challenges of climate change and fuel inequality

I hope that you are able to download these episodes.