Corporations (and all organisations) are established based on a set of assumptions.
Market size, and market fit are accomodated with people, process and technology. Pretty simple.
The problem with AI, (and robotics) - is, all of the assumptions will change.
That’s not to say every company will fail. But a lot will.
The other interesting thing about organisations is - they BULLSHIT a lot (!)
You’ll never ever get a corporate leader showing vulnerability or empathy, or talking to their people about their fears of collapse.
It’s just not the way it’s done. They’ll hang on, and make excuses till the whole thing collapses.
There will however be signs. And this is what they’ll look like:
The organisation will start cutting jobs:
- They cut contractors first, then employers.
- They’ll put on hiring freezes, or make it more difficult to approve new positions.
- They’ll cancel graduate jobs.
- And all of this is happening now right around the world, particularly in white collar workforces.
They’ll start treating you like crap at work:
- They might remove the coffee machine.
- They might force you back to the office.
- They might otherwise just putting in place harsh performance review measures.
- And they may do all of the above, just to encourage attrition as then they don’t need to pay for redundancies.
The next trick is a ‘restructuring’ where:
- They’ll define new organisational units, and even new job roles.
- Then they force people to re-apply for their jobs.
- This could be for legitimate reasons - to shake the tree, or it could be just to get people to quit.
- During that process they might offer generous ‘voluntary redundancy’ packages to entire people to leave.
Corporate collapse, mergers or bankrupsy
- When its clear the model no longer works, they’ll move to this stage.
- In this world:
- Organisations will merge with other organisations
- Or they might be broken into smaller pieces aligned with other organisations
- Or they might be closed entirely.
Organisational failure is nothing new. The problem this time, is how much more accute it could be all at the same time
Let me explain.
Australia (and all western countries) are built up by a series of regulated monopolies.
They are large, risk based, and find change difficult at the best of times.
AI is something entirely more sinister, than people realise.
AI offers the capability to creatively disrupt what is.
The question you need to ask yourself is this:
- Is the status quo organisation, likely to creatively disrupt itself?
- Or is it a new company, with endless capital, technology, and a fresh way of thinking.
Think about it. The existing applications are bloated with legacy complexity.
- They are bureaucratic with a slew of rules and regulations to follow
- Their current leaders cut their teeth in the old world, not the new
- They have existing financial obligations and systems that are difficult to unwind, and shift
- They have large workforces set in their ways: These people won’t creatively disrupt themselves.
But then you think about it from a practical cost base perspective:
- The old companies carry debt and bonds at mass scale.
- Their cost to serve wasn’t created in an AI world.
- And the people that work for them don’t want to change.
Compare that to a new business:
- New leadership and capital.
- New cost base.
- People that are motivated to build a new world.
For this reason alone, the new business model is going to win out every time.
The practical limitation here is capital and access to sufficient capital to grow the businesses of tomorrow. Where is the capital? Not Australia. And not in government.
Which means we’re passengers now.
Conclusion
The lesson here is you need to keep an eye on the existing organisations (that are still feeding you BTW), but also keep your eyes on the horizon to understand the transformative opportunities that are likely coming.
And as you do this, there’s a number of practical things you can do to get ready for it:
- Develop adaptable skills: Focus on building capabilities that complement AI rather than compete with it. This includes critical thinking, creativity, emotional intelligence, and complex problem solving.
- Diversify your income streams: Reduce dependency on a single employer by developing side projects, freelance work, or investments that can sustain you through organisational changes.
- Stay alert to the warning signs: Monitor the indicators of organisational decline mentioned earlier - job cuts, workplace deterioration, restructuring - and have an exit strategy prepared.
- Build your network outside your current organisation: Connections across industries will be invaluable when navigating transitions between employers or career paths.
- Consider entrepreneurship or joining startups: New businesses built for the AI era may offer better long term prospects than established organisations resistant to change. At a minimum you might want to start learning the skills necessary to work well in that kind of environment as well, even if it’s just hobbies or side projects.
Basically, just get ready. We always talk about the bad stuff that could happen. But in any change there will also be immense opportunity. That’s what you need to keep your eyes on.