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The License to Innovate

This is a guest blog by Stephen Edwards, Global Head of ICT Practice at Interel -- a PLUS partner

In response to the advent of new technology early in the 19th century, skilled English mill workers smashed the new weaving machines that were endangering their jobs and their working conditions.

The actions of the so-called Luddites ultimately proved fruitless – as a harsh response from factory owners and the authorities put down the revolt. Their 21st century equivalents might be more fortunate.

The rapid evolution of technology in the 21st century has led to new and exciting possibilities for consumers, something that is clear from YouGov’s study. Brands such as Uber and AirBnB have now entered the vernacular and to many, are indispensable.

But recent events also demonstrate a fundamental thing that these exciting, high-growth companies neglect at their peril: the need to constantly engage with government and the wider stakeholder community at all levels to safeguard their license to operate and, equally as important, innovate.

The below are just a few of the countless examples of industry losing the battles:

  • Uber not having its operator licence renewed in London.
  • UK Labour leader Jeremy Corbyn at his party’s conference vowing to address the negative impact of automation on the workplace.
  • AirBnB landlords subject to additional regulation and tax in New York, Paris, Barcelona, and many other cities.

Even the U.N. has got in on the act, launching a new centre to monitor developments in AI only this month and warning that the growth in AI could be “hazardous”  to human wellbeing, safety and security.

All are cautionary tales of the risk to a business’s bottom line of ignoring the concerns of government, employees and those industries left behind by technological change.

Tech companies need to be careful that the wave of populist enthusiasm that brought Trump to office in the U.S. and ejected the UK from the European Union does not also undermine their credibility with government. Firms need to respond – and be seen to respond – to public concerns. And they need to ensure that regulators are aware of the possibilities and limitations of technology to ensure that a lack of knowledge and understanding does not inadvertently put barriers in the way of growth.

Just as was the case with the Luddite movement, stakeholders fear for the future – whether it be dangers to their jobs, the growth of terrorist content online or public safety. Companies should be sensitive to these concerns – and as recent history demonstrates, they neglect them at their peril. They need to work hard to build and nurture positive reputations with government – something that Uber’s new CEO clearly appreciates.

There is a real risk that government could throw out the baby of innovation with the bath water – something that a careful approach to engagement and communication can safeguard against.