High-tech Revolution

Y2K has now been relegated to a historical footnote, except perhaps for some of the legions who were working on the bug and for whom its passing had the consequence of unemployment. The use of the Internet for the holiday season’s shopping grew by more than 20 percent since 1998. The media is replete with Internet and technology-related articles. So why more here? Because a couple of related business projections provide a starting point for our contemplation of how the nature of business and kinds of employment in Northwest Arkansas might change during the next few years.

Unless you have spent the last year off meditating in some remote Tibetan cave, which no doubt could only be located by using the latest in GPS technology, you are aware of the growing impact of e-commerce. Business to consumer (B2C) transactions on the Internet are now projected to exceed $300 billion a year by 2003. Moreover, B2C will be eclipsed by business to business (B2B) transactions that are expected to exceed $1.3 trillion by that time.

Such growth surely must be good news. While many people are looking at it that way, there are at least hints of the cloud bearing this silver lining. Consider if you will, what is happening with our traditional neighborhood travel agents. Their industry appears to be caught in some kind of a death spiral. Increasing service charges to compensate for business lost to direct sales over the Internet are driving still more former patrons into the cool embrace of e-commerce. To search, Internet-enabled of course, for a live travel agent may become an exercise in futility in a scant few years.

I believe that these things portend the beginning of the end for large numbers of traditional business middlemen. Their jobs are vulnerable when they add no real value and are only providing service as an intermediary if that service can be provided at lower cost or more conveniently through electronic means. Immediate and significant direct cost savings will also drive these changes unless an unexpected new emphasis is given to the presence of a human in the loop. That could happen. We have all experienced the frustration of being endlessly shuttled around automated answering systems. Those telephonic robots may be good for controlling direct business costs, but they can be a real annoyance when you need a prompt and straight answer. Consumers might rise up and demand the responsiveness of a human intermediary.

Real estate agents, automobile showroom salesmen, health care transaction clerks, bank tellers, lawyers who are largely replicating boiler plate, distributor agents and sales representatives are typical of those whose traditional roles will be increasingly under pressure. These people would be well advised to consider whether their jobs are likely to survive and, if not, to explore what they can do to cope. The real biggie in public sector enterprises is education, but that is grist for another mill.

It would be beneficial if both our private and public sector movers and shakers could act proactively in anticipation of accelerating pace of technology-facilitated change. Their first concerns might be with overcoming complacency or with the need to relinquish the comfort of the status quo in order to confront the uncertain future. It should be clear, however, that what has been will not continue to be. Causing even more difficultly, what has been is rapidly becoming an ever-poorer guide as to what could be. The status quo is unlikely to cut it.

The square-footage of new brick-and-mortar enterprises should not continue as a central index of economic growth and prosperity. Perhaps, following the Dow-Jones precedent, we too should rethink how we quantify and track progress and include in our evaluation our investments in information technology infrastructure and other uses of technology.

What can we do to ensure a progressive and pro-active response to the challenges and opportunities that technology-induced change is thrusting upon us? There are a lot of changes in store for businesses and employees. For Arkansas to have a chance of improving its economic status and the well-being of its citizens, we urgently need more than a little out-of-the-box thinking, a willingness to try new things sooner rather than later, and true leadership. While Northwest Arkansas might be somewhat better off than most of the state, this is still a tall order.

R. R. Goforth is general manager of Beta-Rubicon LLC in Fayetteville.