Education the key to business survival

I recently grabbed the following two lines from a slide put up at a conference. The source was Gartner and industry data.

52% of Fortune 500 entries have churned since 2000, and the pace of churn is increasing.

By 2017 25% of organisations are at risk of losing their market position due to digital incompetence.

This is alarming as it means the people working for these companies are going to experience very volatile working conditions and in many cases will need to find new jobs that may or may not make use of their existing skills.

Tie this in with Malcolm Turnbull’s catch cry of we need to be an agile and innovative nation and we are in very exciting times. It is clear the drive is on for the technology leaders of the future right now.

Never before has ongoing education been as important as it is right now at every level in business. By this I mean that the labourers on the floor of closing automotive manufacturers need new skills to work in higher order jobs, possibly providing services into businesses or households or taking on higher value manufacturing tasks.

Meanwhile, at the very top of enterprise education is required to ensure that the executives of large organisations are taking advantage of technology to ensure their organisations are agile, productive and competitive in a rapidly changing global landscape.

It is time for them to update their education to be part of the agile world of fast innovation and the uptake of technology. Trends like off-shoring of jobs have been used to underpin cost reductions in business. However, that particular trend may have found its peak savings and be on the downward slope as the jobs that can be shifted have been, and off-shore workers are now commanding higher wages. So gains need to come from other areas of the business.

At every level between the factory floor and the enterprise leaders an education in how to be agile and innovative is required. Owners of SMEs face the same threats of being wiped out by smarter younger players who have grasped a new or more cost effective way of doing business.

In some cases big business will find a way to automate what they do and price smaller competitors out of the market and in other cases startups will grasp a new technology that gives them a strategic advantage or a better path to market.

The result is the same, when your margins are already low and the market moves down a price notch it may be too late to retool and chase your diminishing customers, you may just be wiped out before you can recover.

Technology is on a new drive of measurement and automation that will threaten more traditional jobs, while the new jobs being created are only likely to employ a very small percentage of the population. Internet of Things (IoT) is being hyped as the new frontier with trillions of dollars to be spent on new ways of measuring and then combining big data and analytics to drive results from those measurements.

Automation and robots are also becoming more sophisticated and will threaten traditional ways of doing things as controls and measures for machines improve.

Here in Australia where labour costs are still relatively high compared to our Asian neighbours we need to move fast to adopt and deploy these automated solutions to ensure we are able to compete for production costs on a global basis.

Free trade agreements are great for exporters of raw materials but they equally threaten our manufacturing sector who must lower the cost of labour to remain competitive. This creates new opportunities for the technologists and those who can make the machines work faster and cheaper.

 Australia with its highly educated population and great universities is well poised to be part of this automation revolution and create IP that can be sold to the rest of the world but it will not come without a degree of pain for those in low-level jobs.

We must re-train our nation to grasp opportunities in this new world where technology will be the difference between global leadership and failure.

Exciting times indeed. It is certainly an exciting time to have a team of technology experts for hire. We hope the government will be offering us some enticing training allowances to ensure our team of smart and capable technical people can remain at the forefront of the technology game to drive innovation for the SME sector we serve.

David Markus is the founder of Combo – the IT services company that is known for business IT that makes sense. How can we help?