Disruption or Displacement?
Disruption or displacement? It’s been a debate for decades, however, the speed and sheer force of either are more prominent now than ever.
There is valid concern about job displacement when industries are disrupted by technology and automation. The fear generally being that automation and AI will replace human jobs, triggering massive unemployment, and deepen our socioeconomic divides. The coal mining industry is an oft-cited example of this debate. The economies of communities across states like Pennsylvania, Kentucky, Ohio, and West Virginia were fully dependent upon the existence of the industry. In the 1900s, nearly 700,000 Americans worked in this industry. Today, that number is closer to 50,000. Technology’s role in the disruption of coal mining is evident in our ability to develop renewable energy sources (i.e., solar, wind). It has also played a role in saving many lives that have historically been lost due to the hazardous work conditions.Automation and remote-controlled equipment allow for safer and faster mining, and virtual reality allows workers to demo an explosive detonation before ever lighting a fuse.
There are non-technology factors that disrupted the industry, too, and this is a very important point. Market impacts such as decreased demand and competitive pricing of natural gas, regulatory changes such as the Clean Air Act combined with technological advancements to create a perfect storm. This example is not unique, nor is it indecipherable. It also does not have to be the outcome each time disruption occurs. At its center, disruption is change, and we handle change best when we are prepared. The coal industry’s massive job loss was not actually because of technology, or the regulations, or the market impacts. It was our own failure to adapt our workers to the evolution of work.
It is up to us to recognize when the pattern of disruption is developing so we may implement actionable strategies to ensure our experienced, dedicated, talented workers are not left behind. Industry disruption should not be synonymous with job displacement. While we become inspired by innovations and eagerly embrace new technologies it is essential that the same inspiration and eagerness is used to elevate employees’ capabilities and tasks. At a time when so many of us seek to find more meaning in our work, technology actually opens that door for us. I asked Lisa Wardlaw, digital insurance strategist and former Farmer’s Insurance executive what she thought of technology and job displacement. “Humans will always be in the loop - full stop. The nature of our roles, however, will definitely transform with vast advancements in technology, including the cost and democratization of these capabilities.”
Industries at risk of disruption can position their business and their people to ride the disruption wave instead of being swallowed by it. And in case there’s any question, the insurance industry is at risk. The patterns are before us: product distribution occurring in ways significantly different than what infrastructure is built for. Administration and wellness platforms displacing the customer-carrier relationship. The continued prevalence of legacy software and EDI files restraining our industry from providing customers with a modern, accurate, real-time experience. “This is a good thing,” says Wardlaw. “We should be focused less on what will be replaced and instead focus on the new norm, which will be jobs that have less routine and preparation time and more engaged/focused time. As such, one of the core aspects I have been working on for large-scale digital transformation projects has been how to create sustainable engagement roles that have limited mental breaks. This will radically transform our roles and how we structure our days. I conceptually think of this as moving from being a general practitioner (as a doctor) to becoming a brain surgeon in terms of focus and precision cognitively.”
I think Lisa has the right idea. When organizations look to digital capabilities as a replacement of FTEs - in my experience - they find themselves buried under insurmountable technical debt and suffering from a personality disorder. Are we an insurance company or a tech platform? I would challenge, “Can one not be the other”?
Janthana Kaenprakhamroy, CEO of Tapoly, is proof that those two things can co-exist. Her UK-based company provides on-demand casualty and health coverages for the gig and sharing economies. “Upskilling is a crucial process that can bring benefits to individuals and society as a whole. By acquiring new skills and knowledge in the latest technologies, individuals can remain competitive, relevant, and satisfied in their careers all while making significant contributions to the insurance industry.”
We cannot stop disruption, but we can end unnecessary displacement - and that should be accounted for in your growth strategy. Innovation and progress ahead must spur creative thinking within. That will be the difference between companies who ride the wave or get swallowed up.
