The Rise of “Digital Dichotomy” in Asia Pacific

The Rise of “Digital Dichotomy” in Asia Pacific

By Manish Bahl, Senior Director, Center for the Future of Work, Cognizant

Although the digital revolution is 70 years old (the first general-purpose computer, ENIAC, was launched in 1946), the “digital” revolution is only kicking into high gear now. The rapid rise of digital technologies, from analytics to artificial intelligence and the Internet of Things (IoT), is changing how companies and people work and create value. Asia Pacific businesses are investing more in digital than their counterparts around the world — and unlocking far greater rewards. In the years leading up to 2018, digital transformation will put US$5.9 trillion in revenue up for grabs for companies across industries in the region. The “Digital Asia” opportunity is equivalent to seven times the combined revenues currently generated by S&P 500 companies in Asia Pacific.

In spite of all the promises that digital offers, there is a rise of “digital dichotomy” among Asia Pacific businesses — bullish versus fearful — which poses the biggest threat to digital’s future in the region.

The Fear of Automation

Automation is a disruptive force that is transforming every industry, raising profound questions about the work that people do and the future relationship between man and machine. Headlines such as “robots will steal your job” can breed uncertainty and even hysteria about the changes digital can bring. 

According to recent research, Asia Pacific executives are reluctant to leverage machines to augment job effectiveness as they feel less positive about what digital means for the future of their jobs. While approximately 66% of executives surveyed did not feel that new technologies could protect them from being replaced by a bot, 98% had a moderate or significant concern that technology will take jobs from people they care about (and maybe theirs). In fact, Asia Pacific executives surveyed are less than half as likely as their global peers to believe that digital will help them collaborate more effectively (and gain a career advantage). Strikingly, only 21% believe digital will give them a personal career advantage and improve their job satisfaction.

Moreover, the services sector jobs that were largely immune during the last stage of globalization are now at risk — thanks to advancements in robotics and high-end engineering. As a result, Asian leaders believe that they must acquire technical skills to stay competitive, as well as work harder, and for more hours, to beat the “bots.” We believe this view reflects cultural sentiments. In many Asian organizations, the pervading belief is that if you are not spending at least 12 hours a day at work, you are not productive.

Relax! We’ve Been Here Before

Fear is an inevitable consequence associated with anything new and unfamiliar. When the “information highway” opened back in the early 1990s, it caused a wave of fear over eroding data privacy and control, intrusion and hacking. In spite of all the concerns about companies tracking our information online, few people swore off the Internet entirely. Instead, smartphones and social media have become permanent fixtures in many of our lives. All new technologies introduce new risks, but they rarely halt the broad adoption of game-changing innovations. Once they are assimilated, we stop blaming those technologies for their perceived downside. However, we have yet to reach this assimilation stage with advanced automation.

Rote tasks — which still represent a substantial proportion of most people’s day-to-day work — will morph into the machine, freeing up time and energy to ask better questions, craft better directions and generate more impactful innovation. This does not lead directly to large-scale reductions in the number of people needed to “do” work, which is a widespread meme in today’s zeitgeist around artificial intelligence (AI) and robots.

The World Economic Forum estimates there will be as many as four new roles for each redundant role in ASEAN alone because of digital, putting the region in a far more positive position than other areas of the world in which technological change may result in net losses to jobs. Machines may help improve productivity, but they aren’t producing the ideas that move businesses forward. Instead, machines can extend the activities individuals do well for greater efficiencies. In short, in the future, people need to work in tandem with machines to help their organizations succeed.

Just as tools shaped work 200 years ago (a farrier’s work was shaped by a hammer and an anvil) and continue to do so today (a quantitative analyst’s work is shaped by computing devices and software), our new tools will continue to reshape our work for the future. Intelligent machines will only increase our quality of life, serving civilization as either equals or grateful partners. The fear around digital signals a tremendous opportunity for Asia Pacific business leaders to innovate and change technology perceptions. Leaders that fail to invest in digitization due to fear will inflate counterproductive perceptions and encourage decisions that are detrimental to business.