HACT's Chief Executive Matt Leach asks if housing providers are ready to take advantage of the opportunities and meet the challenges arising from the rapid pace of technological change and digital innovation currently redefining business and society.
Last year Google launched with some fanfare the £1m Google “Deep Learning Neural Network” –a network of computers configured in ways which made it capable of learning and responding in ways that mimic the human brain. Rather endearingly, it chose to showcase the new machine by setting it the task of identifying videos on Youtube in which cats appeared. This week the creator of Google’s Artifical Brain, Andrew Ng published a paper which set out how the same capabilities could now be achieved with just £20k of off the shelf kit.
Over the last 3 decades, we have seen the large scale transfer of manufacturing capacity from western economies (notably the UK’s) to the far east, to take advantage of low land values and cheap labour (which more than offset the tariffs and transport costs associated with shipping manufactured goods back to the west). Earlier this year, a US-based start-up launched the Baxter Robot, a manufacturing robot capable of automating many basic manufacturing processes. This in itself isn’t surprising; anyone familiar with the Citroen Picasso advert of a few years ago will know what these machines look like and can do.
The difference is in the price – the Baxter Robot will retail for less than £15k, perhaps 10% of the previous price point for this sort of technology. The next generation of these cheap and adaptable robots may lead to a massive reappraisal of the economics and location of manufacturing facilities, perhaps increasing the likelihood that the stuff we consume will be built close to our homes rather than halfway across the world.
In the meantime, globally there were more activations of Android phones than live births over the course of the last year. Performance artists are 3D printing your faces using discarded fragments of your DNA. And drones have moved on from blowing up suspected terrorists in rural Pakistan to disrupting mail delivery services in our cities and (alledgedly, though it may just be a PR stunt…) delivering pizza.
We are living in what leading technology-focused academic and writer Vivek Wadwha has called the “Age of Acceleration” – an era in which advances in technology are changing who we are, what we are, how economies and societies function. And where institutions – government and business are struggling to adapt and cope with the current (and accelerating) pace of change. Critically, even where they are publicly embracing the potential of new technology, it is rare to see much consideration of the longer term implications of the changes they may bring about.
If Baxter-type robots enable large scale manufacturing to return to western economies, there will be a range of pay-offs, not least in decreased environmental costs associated with large scale global transport. But we would be kidding outselves if we expected them to bring jobs back with them. The implication of a robot that can work 24/7 and costs less than the annual wage of a minimum wage worker may bring as many positives as negatives, particularly for those workers whose only asset is their own physical capacity.
And if increasingly affordable and sophisticated data capture and machine learning enable businesses to interpret and respond to customer need on the basis of advanced analytics, rather than professional insight, both public and professional services are likely to be transformed, and it may not just be the working class who find their place in the workplace threatened.
At the same time, technology will increasingly enable the delivery of cheaper, more bespoked, responsive and disintermediated services to customers across the private sector – just look at what Hailo has done to taxi services in London in little more than a year. As customer expectations are changed and shaped by their experience in the marketplace, it is likely they will become increasingly frustrated with conventional politics and public services which are unable to keep up.
So what does that mean for housing providers, some still midway through getting people broadbanded at a time when mobile technology has already largely displaced the traditional computer?
In the short term it means housing prioritising re-engineering their businesses to become more agile and responsive in the face of what will be an increasingly demanding customer-base, expecting a different style of service and new ways of working and engagement. That is – at its heart - about challenging organisational expectations and cultures to ensure they are ready and able to respond to a future in which everything is different. Orbit’s work with NixonMcInnes is a good example of an organisation starting to embark on this journey. At a time of regulatory and welfare reform and ongoing economic turmoil, it would be tempting to put it off; but given the speed with which the “age of acceleration” is moving forward, change needs to start now.
In the medium term, it means moving from a reliance on IT systems as a backbone to the business to a focus on technology as a source of innovative solutions at the front line. Long term contracts for cross-business information management systems are likely to prove a false economy if they tie providers into systems and processes incapable of meeting what will be a transformed technological, social and business environment in five years time. Those who open up their business and business systems to take advantage of (or indeed develop) low cost/low overhead apps capable of easily integrating with existing infrastructure, whilst taking advantage of the latest advances in technology will be better able to respond to the rapidly changing potential offered by digital innovation. HACT has contributed its own entries into that space, with the Community Insight web-based open data/GIS tool and a soon to be launched mobile-enabled customer insight/sentiment app; but there are others emerging: housing providers interested in new approaches to tackling ASB may want to check out the latest developments coming out of the fast growing Facewatch - a start-up that emerged from out of Gordon’s Wine Bar round the back of Charing Cross Station is already transforming how crime is detected and solved by the police, using crowdsourcing combined with advance facial recognition technology.
It also means getting on top of data. Up until now, data has been poorly managed and used in the housing sector (a point I’ll be making in a forthcoming article for July’s edition of Housing and Technology magazine). Where it has been used to inform and drive business decisions, it has often focused on benchmarking exercises largely defined by external (and historic) regulatory expectations. Looking forward, housing providers need to revolutionise how they collect, manage and relate to data. Gathering more and better data on customers, levering maximum value from existing data sets, and making use of the rapid advances in analytic technologies to drive insights that will enable them to deliver better, more targeted services, and generate resource savings whilst more effectively meeting customer needs and expectations. I'm massively excited that HACT is currently gearing up to launch a major new initiative in this space in the near future...
Finally, there is a need to start planning seriously for the longer (but not that longer) term. A few years ago, the focus of longer term scenario planning for many public services was around environmental issues, and in particular climate change. The impact of ever greater workforce automation and large scale (and disruptive) deployment of machine learning-enabled digital technology is likely to become apparent within not much more than the next 5-10 years, well within the long term planning horizons of most housing providers. Potential change scenarios that take account of the disruptive economic, social and cultural effects (both positive and negative) of these developments now urgently need to be built into any serious medium to long term housing provider business plans.
In an age of acceleration, it is important housing does not get left behind.
HACT will be publishing a pamphlet on the wider challenges and opportunities for the housing sector offered by the rapid changes taking place in digital technologies in the autumn.