Predicting which jobs will be disrupted

Parents everywhere are wondering about the career choices that they should encourage their children to pursue.  While some careers are already badly disrupted, others seem to be flying.  How do you tell which activities will be valued in the decades ahead?

Depending on your country, the legal profession is a good example of the different impacts of disruption.  Lawyers are not going out of business, but legal firms are experiencing unprecedented pressure on their rates.  What is most interesting is that those who are dedicated to arguing in court (barristers in countries such as the UK or Australia) have the greatest success in charging a premium while those who are responsible for advising through legal processes seem to be the most affected by the downward pressure on rates.

This is a microcosm of the challenges and opportunities facing accountants, architects, technologists, management consultants and so many other professions.  Disruption is no longer a theory about the future, it is with us now and the situation is getting worse for so many incumbent professions while other, often closely related, jobs seem to be immune.

There are some consistent themes to those roles that are protected and those that are most disrupted.  For all of the talk of new technology, it is traditional economic principles of supply and demand which are at play, the role of the internet has been to free-up some of the friction in the system and allow these dynamics to come to the fore.

I’ve argued for a long time that the internet allows small business and individuals to compete with big companies.  There are a number of mechanisms, but the most prolific is the rise of aggregation platforms.  These platforms allow different groups to offer their spare or primary capacity in new and interesting ways.  We are seeing this with taxis, accommodation, designers, lawyers and management consultants.  New providers are appearing all of the time.

Platforms allow a number of small market participants to offer an integrated service.  Drivers offer a global service through Uber and accommodation owners combine through Airbnb.  Both of these are services that lend themselves to commoditisation and standardisation so will tend to reduce in unit cost.  This leads us to three rules to use to determine which jobs are most at risk.

Rule #1: Commoditisation even of personal or highly technical skills

Platforms support commoditisation of otherwise individualised services such as driving or private accommodation.  Similarly, many of the activities of design, medical diagnostics and legal advice are turning out to be relatively easy to break into units of work, which can be distributed and disrupted.

One of the assumptions that many have on the future of IT is that it is being offshored and outsourced.  In fact, this is an early example of the trend that skills that can be defined in a standardised way that can be disrupted.  However, that does not necessarily mean that all IT can be defined in standard units of work, meaning that much, if not most, of the profession is less prone to disruption.

Rule #2: Skills where the outcome is incremental

Consumers of services will pay a small premium for a great experience.  If the bill is high, however, the premium they will pay for the same outcome with a slightly better service is only small.

For instance, most people choose their builder based on price even if they know that they will have to manage the process closely.  Many of these same people will choose an architect based on their creative talents rather than price because the difference between two architects is an entirely different building.  However, where the building is a standard shape or configuration, architects have a hard time pitching their wares against each other or even against less qualified designers.

This rule explains why legal professionals who mount the argument in court are less subject to the commoditisation of their services than those who provide legal advice on the process.  While the legal process is relatively defined, even a small difference in the quality of the court appearance can make the difference between winning and losing.

Leadership is a really good example of a unique skill where stakeholders are prepared to pay a premium given that each decision has a ripple and long-lasting effect.  CEOs are unlikely to receive a pay cut anytime soon!

Rule #3: Deep knowledge is no protection

It used to be that having narrow but deep knowledge of a topic was likely to protect your job.  Where the first generation of knowledge systems could codify simple processes and provide access to knowledge, the current generation of cognitive analytics can replicate the process of applying complex knowledge assets to similar but different problems based on patterns of previous responses.

Not only is this disrupting those who solve customer problems and provide complex advice, it is increasingly threatening medical professionals who interpret images as well as legal and tax experts who interpret tax legislation.

So what is safe?

The reverse of each of these rules is similarly true.  I’ve argued before that your insight might protect your job.  The careers that are most likely to attract a premium in the future have: skills which are difficult to commoditise or involve complex integration; roles where there is a binary outcome for a small difference in capability; and activities that require insight rather than knowledge.

Unfortunately, the jobs that most of us do today have elements that lend themselves to disruption but also activities that are more likely to garner a premium.  The exciting thing is that it is the latter that are usually the most fun.  I’m an optimist, I think the business of tomorrow will recombine the most interesting elements of today’s jobs and open up even more interesting careers for the next generation.

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Category: Enterprise2.0
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