As the business world anticipates life beyond the Covid pandemic, it must learn to accept the vast and rapid change within the digital economy (AI, machine learning, robotics, big data, et al), and adapt more readily to it. There is now an urgent need to fully understand the evolving potential of the digital economy and to harness it to revitalise the way we work and do business―for economic benefit and society’s gain.
In one of two recent webinars for IEDP, Paul McDonagh-Smith, Senior Lecturer in Information Technology at the MIT Sloan School of Management, proposes a new mode of thinking and leading, that can help executives unlock the potential of the digital economy and build on the opportunities it presents. He argues that to understand our emerging reality―characterized by newly interrelating technologies—the focus should be as much on the human as on the machine. The key lies at the intersection between technology and human learning.
McDonagh-Smith describes his concept of ‘Algorithmic Business Thinking’ (ABT) as, “a series of interconnected insights, frameworks and models that enable you to break complex business challenges down into a series of smaller parts, work on them, and recombine them as opportunities.” There are multiple, useful applications for senior leaders to explore here, equally in the domains of problem-solving, decision-making, strategy execution, and more.
There are four cornerstones to the ABT concept:
- Decomposition: Breaking problems down into constituent parts for analysis.
- Pattern recognition: Finding similarities among small, decomposed parts to help solve larger, more complex problems.
- Abstraction: Filtering out the plethora of unnecessary data to focus on (or to ‘abstract’) the core issues.
- Algorithms: (In the context of ABT). A sequence of instructions for leveraging the evolving partnership between humans and machines.
The central paradox to understanding and leveraging the possibilities of the digital economy—reveals McDonagh-Smith—is that, “we don’t only need technological, AI, machine learning, or STEM type skills. We need a fundamental human-centricity―creativity, compassion, and above all a drive towards unity and unification.”
To date, he adds, “we have not caught up with the technology we are creating.” With the staggering advances being made in technology―take, for example, the $50 billion said to have been invested in AI projects last year—humans need to become more dynamic in addressing how they shape the digital economy. The key, as McDonagh-Smith sees it, will be to unite tech and non-tech functions in our organizations, and to embed that unification in a new leadership mindset. The sciences and humanities must be more closely linked—there needs to be consilience.
There is another layer to McDonagh-Smith’s concept—a complementary framework that he terms the ‘Double Helix’ structure, which demonstrates how closely human skills and technological skills must intertwine to succeed.
McDonagh-Smith’s Double Helix structure is about unity. “A twisted ladder, where the rungs are human-centric genes which hold the ladder together, unifying the physical and digital worlds.” He lists eight important genes—or rungs—or human capabilities, that are crucial to this unification, and holding and binding these distinct domains together. These are the eight (though he is researching others):
- Critical thinking
‘Creativity’ is clearly vital, to innovate new business models and launch new ideas, but others may be less self-explanatory. Real ‘Collaboration’, where similarities between parties are not overlapping and elements of risk are shared, is actually very hard and rarer than we think (as opposed to easy, risk-free collaboration). ‘Compassion’ for other humans, is necessary to ensure the new digital spaces we create show empathy for others with different perspectives. And ‘Consilience’, the reunification of the humanities and sciences, a term first cited by E.O. Wilson is, according to McDonagh-Smith, absolutely essential.
View a video recording of Paul McDonagh-Smith ‘Algorithmic Business Thinking: A Double Helix Structure for the Digital Economy’ webinar