Firms must embrace disruptive technology

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Disruptive technologyHere’s a story that’s vogue. It illustrates how disruptive technologies affect company success and the working lives of managers, employees and the self-employed.

Some forty years ago the Licenced Taxi Drivers Association (LTDA), a major group representing many of London’s black cab drivers, let a contract on the Marconi Company. This was for a revolutionary way of managing calls for a taxi from the man-in-the-street.

The Marconi solution had an LTDA radio operator reading out customer requests, like a cattle-market auctioneer, to drivers listening for work on their two-way radios. Drivers used a dial and button to bid for the job by signalling their time of arrival at the fare. The shortest bid time got the work.

The Marconi system was not widely adopted by cabbies.

Some twenty years ago, Radio Taxis London (RTL), another black cab cooperative, introduced a bespoke system using state of the art mobile data services, the forerunner of today’s smartphone. This system allowed black cab users to order a black cab by phone. The cab was dispatched by a central dispatcher and the customer paid over the air using a credit card.

Again, the system was not widely adopted by cabbies.

Fast-forward to 2015 and introduce ubiquitous public cellular coverage, a proliferation of smartphones, secure online payment by credit card and a network of satellites providing a global positioning system.

The man-in-the-street can now make a request for a ‘taxi’ via an Uber app from the kerbside. The locations of all Uber private hire vehicles are known to a central Uber computer. The nearest Uber private hire vehicle arrives at the kerb-side and picks up the passenger. The passenger arranges credit card payment via an Uber server.

The Uber system is efficient and embraces the best of 2015 technology. But London’s cabbies are up in arms at the way such disruptive technology, combined with the audacity of the Uber Company, will deprive them of a living.

Messages for companies

LTDA and RTL are cooperatives providing umbrella services like mobile communications to black cabs. Cabbies remain self-employed, providing their own regulation-standard black cab. Nonetheless, both LTDA and RTL behave as firms with a management and a workforce.

For whatever reason, neither was successful in taking cabbies with them on their drive for efficiency and technology introduction.

Image how different it would have been if each innovation had been adopted by all cabbies when it became available. Hailing a cab from the kerbside by wireless and paying by credit card would have evolved until the age of the app. LTDA and RTL would likely have merged to form London’s answer to Uber. Then Uber would have been a British firm exporting its technology to the US rather than the other way round.

And cabbies would not now have their livelihood threatened so suddenly.

Firms must realise that in the technology adoption ‘race’, if they don’t take the opportunities, some other firm will. Some entrepreneur somewhere will link several technologies to form a disruptive solution that wipes out conventional ways of working. Firms must embrace disruptive technology.

The penalty for not embracing technological advances to innovate new solutions is eventual demise.

Messages for employees

London’s black cab drivers have enjoyed a long period of income protection through tight regulation in their favour.

They argue that they have to learn ‘The Knowledge’, a mental model of London held in the cabbies’ brains. This is 2015! Who holds that sort of data in their heads today? That’s what we have computers for!

The Knowledge was a competitive advantage, protecting the cabbies’ jobs when computers were big and slow. Today, this data can be stored in a pimple-sized chip and accessed by voice enquiry in milliseconds.

Currently, The Knowledge is a form of restrictive practice, to be retained by cabbies at all costs in order to keep competitors out of the market. The mandatory use of a taximeter and the famous black-cab vehicle style are also forms of restrictive practice. All are built into Transport for London regulation.

Contact us: +44 0(01444 810454, +44 (0)203 700 3014Now, the situation is made complicated by the employment status of cabbies. Cabbies are mostly self-employed. But self-employed or employed, all workers must embrace change in their industry and career. Indeed there’s a strong argument that the self-employed should invest more in securing their jobs than their employed cousins. At least those in employment may expect their employer to invest too. The trouble with being self-employed is that a conscious decision is needed to divert funds to personal development, and that competes badly with lifestyle options.

There’s a famous saying by Louis Pasteur, the French scientist, that “chance favours only the prepared mind”. He concluded this from his groundbreaking work in scientific discovery. The taxi scenario outlined above offered several chances – several opportunities. Arguably, cabbies and their management were not mentally prepared.

If employees and the self-employed are to take anything from this, it is that they must ‘prepare their minds’ for change. They must see change as advantageous. But to do so, they themselves must keep up through reading and study. They must be engaged with the industry and market of their chosen career. They must prepare their minds.

The major barrier to this essential personal investment is that it competes with foreign holidays, villas in exotic locations and the everyday trappings of societal status. Mostly status wins.

If materialism always wins over personal advancement and preparedness, workers can’t ever complain when the wind changes.


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