Novel-Coronavirus Pandemic will define the “Next-New-Normal” (3N Era) - Part 2

Part 1, Part 3

In 2015 I hit a point in my career and life where it was yielding diminishing returns on the marginal effort that I put into them. I am a person who loathes status-quo, while I love transformational change, but in reality, most change is evolutionary. I decided that I should do something different. I realized that for me to do things differently I should acquire new skills and sharpen the skills I already had. For this, I had to unlearn what I knew so that I can make room for new skills.

After some intense self-reflection, I realized that what got me here will not get me where I wanted to go. This led me to go back to the roots and I decided to go to B-school to learn stuff! After consulting my dad (@Murali) and advisors /influencers to seek guidance. I applied for Harvard, Stanford, Wharton, and Kellogg. I decided to do an Executive/MBA in Kellogg and it turned out to be the best decision in my life till now. Along the way decided to do a parallel MLA degree from Harvard Extension. I measure the effectiveness of my decisions not just by growth in monetary net-worth (though it is one of the important measures of personal success), but also growth in my personal net-worth (Knowledge + People) and my ability to pay it forward. I don’t want to bore you with my story, but the takeaway here is that, for us to get out of the status quo we have to change our traditional linear thinking (It’s methodical, sequential and focused.) “What got us here, Will not get us there”! by that I mean that we have to think in a non-linear manner (Harvard on non-leaner thinking) and most importantly “COUNTERINTUITIVELY”. Before I start to dig any further those curious minds out there who want to learn about non-linear thinking, I strongly suggest that you read about Type 1 and Type 2 thinking by Daniel Kahneman in his book Thinking, Fast and Slow. "Necessity is the mother of all innovation" and Novel-Coronavirus pandemic as it created a necessity at a global scale to get creative and innovative at every level. This will create Next-New-Normal were we will have to "Do more with less".

As a continuation of Part 1, this article discusses some trends, which I think will emerge with the COVID-19 pandemic. Some of these trends were already getting adopted, but the pandemic will change the pace of adoption/change at the speed of light and that could shape the Next-New-Normal post-pandemic. Remember some of these are purely “thought experiments”.

Assume that we will brave this pandemic in the next 12 months, I foresee that this will bring about tectonic shifts in the following areas:

The potential emergence of a new world order

For nearly the last 100 years the Capitalism of the United States of America has stood the test of time and its Dollar as the World's reserve currency. However, from the research I did, NO one reserve currency has been forever. On the other hand, investment in Gold, Silver, precious metals & stones, immovable assets, and paintings have been the sources of riches for centuries. Countries accumulate reserves of US dollars today because the US economy is the dominant player in global trade, is stable, and resilient (not robust), but the global economy is dynamic and market shares shift over time.

The POWER and SUPERIORITY do not always stay in one place, it shifts, be it in your home or the orgainzation that you work for or amongst nations of this world. The problem, however, is that when the power and superiority shifts it leaves behind dead bodies and deep scars in many and seldom it is a pleasure to experience. This is exactly what is happening in the global economy. There is a potential shift in power that will lead to the disruption of the global order. It was already predicted that the next decade will be scorched by the fight to gain power and superiority, except that this pandemic comes around only to make the race more intense. Democracy, as we know, is under attack by rising autocratic behaviors. Similarly, Communism as we know it is coming under threat from Socialism and Democracy creating a global geopolitical imbalance.

A notable power-shift is with changing composition of reserve currency in the IMF's Currency Composition of the Official Foreign Exchange Reserve (COFER). Since 2015 COFER has seen a constant increase in the composition of the Chinese Renminbi and the US Dollar composition has been reducing the same time. While the change in composition is still small, but the trend does indicate something.

The reserve currency status is given to the dominant and stable economy. Is the US the dominant and stable economy anymore? Look at the correlation of the Gold prices and US national debt. The fundamental relationship between the two goes to the heart of what's wrong with the debt-based fiat money system - US monetary system. When the Federal government borrows more and more dollars that are into existence and as the nation's banking system pumps those dollars through the global monetary system, it decreases the value of all the other dollars already being held by the rest of the world. This could include domestic and international private investors, central banks of other countries, financial institutions and large corporations. Research has suggested that countries that pursued austerity have seen an increase in their debt to GDP ratios. COVID-19 pandemic forced countries and organizations to undertake extreme austerity measures.

Looking at it differently, many countries will be left with significant amounts of public and corporate debt by the time they emerge out of the pandemic. The problem is that many of the economies are already sitting on historic levels of debt and due to prevailing pre-pandemic low-interest rates corporates are already highly leveraged. When the pandemic hit, many organizations exercised their line of credits and enacted austerity measures to deal with short-term liquidity. As the global shutdown prolongs the uncertainty will increase leading to a significant reduction of demand for goods and services. While there will be pent-up demand as the economy opens, but the problem will be that the demand will not be as high as the pre-pandemic expectations. Already the companies have borrowed and invested in the capacity, this capacity was considering pre-pandemic demand. Then the question is, who will pay for those debts because by the time the global economies stabilize the consumer behavior would have changed drastically, which in turn will cause an overcapacity problem due to reduced demand. This will create what is called the "Debt-spiral". Remember, that for this pandemic most healthcare system's resources at least in the US are being spent on uninsured patients and that means that someone has to pay for them. This will significantly add to the debt of the healthcare systems resulting in a potential bankruptcy. Asset intensive or high fixed cost industries like core manufacturing, infrastructure, public transportation, airlines, hospitality, construction & engineering, automobiles, oil & gas, power generation, real estate, etc., will fall victim to debt spirals. This time though governments cannot bail-out the world! I strongly believe that there is a renaissance waiting to happen, except we cannot predict in which sector, when, and how soon it will start. If by some magic let's say the COVID-19 pandemic disappears by end of Q3, 2020, it will leave behind an estimated $20 trillion in losses globally based on the projected $90 trillion GDP for 2020.

China is the largest holder of the US national debt in the international market. As of 2019 China and Japan collectively held over $2.11 trillion of the $21 trillion US national debt. China has been selling the debt recently and limiting its exposure to the dollar, making the dollar weaker. If China dumps the US debt, then it will significantly hurt the US dollar value and eventually could result in potentially dislodging of the US dollar and as the reserve currency, since the Yuan will appreciate in value. China will also get affected due to this, but they can recover sooner than the US. China's GDP is already higher than the US in PPP terms, so there is already a rightful challenger to the US economy's dominant status. India is not very behind! 

***My analysis of CHINA: I have deliberately left out the current issues prevailing China's transparency to the rest of the world regarding Novel-Coronavirus. The pieces of evidence are speculative. I will write about it soon after my research is completed. ***

The convergence of the real-life and virtual-life

With prolonged lockdowns, social distancing and the emergence of the Stay-At-Home economy, we will spend more and more time interacting digitally with the rest of the world. Be it Shop-online and deliver to a home or virtual learning or virtual working. Computer-driven digital task automation will augment the productivity drop due to virtual work. This will significantly affect how we socialize and potentially create a phase of Social psychological distress in society before it becomes normal, this phase will leave behind behavioral health issues at large in society. But again, mankind will evolve to adapt to the situation. In 2019 WHO estimated that more than 300 million people suffer from depression and anxiety globally and it costs the global economy an estimated $1 trillion each year in lost productivity.

Online education will become THE mode of learning

My best days were those when I was in school and college. I am sure many would share a similar feeling. However, with COVID-19, this may change for our kids and future generations. More than ever before this pandemic will imbed a fear of socialization in our deep subconscious mind for the current and next generation. With nearly 60% internet penetration globally, Virtual learning will be the most dominant form of learning creating Virtual talent. The world already embraced the mobile workforce, the Next-New-Normal will see the Virtual workforce becoming a dominant workforce. Many developing economies like India, Brazil, and Mexico already have a large population of the workforce who learn and earn online. The global education systems and the library system will undergo rapid Digitalization.

From an economic point of view, Education is one of the critical indicators of the growth and development of a country. Human capital is the "gears" in the economic engine. A better-educated workforce increases the return on R&D which means that the discoveries are more readily absorbed in the productive structure of the economy. In the end, more education equals more economic growth and better healthcare. An increase in education expenditure by 1% of GDP increases GDP growth by 0.9%.

Online education costs less to produce and deliver, it is the best way to educate the masses at a low cost. With AR/VR and AI technologies going mainstream, education content can deliver the same impact of classroom learning. AI-Enabled Hyperpersonalization engine can tailor a course and assessment for a student based on their natural capabilities. It can help the students find their strengths and weaknesses and help them focus on their strengths. Voice assistance can very well replace a teacher. With COVID- 19 since many are going to anyways be studying or working from home, they will decide to do more online learning than they have ever done in their life. For example, since I have more time in hand now, I am able to do a lot of research, complete my online Cybersecurity course, and provide advisory to strategy consulting firms, after my day job. Technologies such as Microsoft's Holoportation (Still being developed) will revolutionize how we will interact virtually giving the feeling of real presence. Online education can benefit first hand from these technologies.

Cybersecurity will become one of the top 3 priorities for business leaders worldwide

The pandemic has forced me, to become more dependent on the internet as desperate measures to earn my living, as social distancing, disrupts economic activity and everyday life globally, and more and more people become highly reliant on the internet, Cybersecurity will take precedence over the Physical security. In my last 10 years working in Cybersecurity space, I have learned that dependencies create vulnerabilities, and vulnerabilities motivate malicious attempts to exploit this sudden, unplanned societal shift online.

In Cyberspace anyone can take someone else's identity and thereby masquerading the true identity. This makes committing fraud easy and nearly untraceable in the cyberspace. Law enforcement officials report that criminals are, selling fake COVID-19 cures online, posing as intergovernmental or governmental health organizations in phishing emails, and inserting malware or ransomware into online resources tracking the pandemic. With more and more employees working from home, this creates several vulnerable points at the endpoints since most home networks are not adequately secured. The strength of the Organization's Cybersecurity defense is only as strong as the weakest link in its network, more unsecured home networks will weaken the overall cybersecurity posture of the organization. Business leaders should focus on creating a robust plan to protect against these vulnerabilities and most importantly educate the employees on these threats and emphasize how it will not only affects them personally but also the organization that they work for. After the COVID-19 pandemic outbreak, one of the Management Consulting firms had reached out to me to seek ideas on how to beef up endpoint security. Some of the ideas I shared with them are:

1. Educate employees about the importance of securing the home network.
2. Launch an initiative where the IT department reaches out to each and every employee and provide them personalized service and help them to configure their routers to secure them.
3. Tell them about PASSWORD security an why it should be difficult to guess. In 2019 AVAST's survey revealed that 83% of Americans used ineffective passwords that do not include all of the following when creating passwords: numbers, special characters, upper and lower case letters, and do not create passwords that are at least 10 characters long.
4. Since the Employees would use the same network to connect to their office network as the rest of the family members, kids could potentially cause vulnerabilities by inadvertently changing the network settings. Educate not just the employee on the importance of Cybersecurity, but also their family members.

Remember, employees and associates could either be your STRONGEST or WEAKEST defense of your Cybersecurity strategy. Cybersecurity technologies can help prevent or deter cyberattacks, but they cannot eliminate it because there is always some weakness somewhere in your network and there is an obscure cybercriminal out there who is waiting to exploit that weakness. After all, Cybersecurity is a NEGATIVE goal! (Think).

Human thinking capacity augmentation with Artificial Intelligence and Machine Learning

Humans are the biggest roadblock for the progress of human civilization - by that I mean, that every human being is limited with their thinking capacity. The brain can process only so much! if we have to solve a gravity problem then we have to look for help outside our brains which can give our brains more horsepower to make a decision rather than wasting its thinking capabilities in doing calculations. I recall one of my professors @Sandeep Kayastha, while teaching Statistics used to often say in the class "let the computer do the dirty work!".

The 1918 influenza pandemic caused by H1N1 virus with genes of avian origins was the most severe pandemic in recent history. It is estimated that about 500 million people of the world's population became infected with this virus. The number of deaths was estimated to be at least 50 million worldwide with about 675,000 occurring in the United States. A new strain of this virus recurred in 2009. CDC estimated there were 60.8 million cases, 274,000 hospitalizations, and 12,469 deaths in the United States. These are great data points that can be used to perform predictive simulations. However, the problem that persisted in '80s and '90s was that for doing large scale simulations using the historical data and applying machine-driven heuristics there wasn't a data processing system powerful enough, fast enough, and economical enough to predict the outcomes. But, with Machine Learning and Neural Network technologies, we can feed historical and real-time data and have the machines learn the prediction techniques and come up with potential scenarios that can be used to take targeted action with the highest probabilities of success.

Recently we all have been hearing about the re-opening of the US economy in the media. While there have been lots of chatter in the primary media about the opening of the economy, there is not much-supporting probabilistic evidence that is shown to the public on the "what-if" scenarios if the economy is opened. MIT recently trained a machine learning model to accurately predict the spread of COVID-19. In fact, the model was able to predict the April 20th as the date by when "halting of infections" would occur (this article was authored a day before). Behind the scenes, the Machined Learning and A.I. systems in several private labs have been working hard to find an effective deterrent to stop the spread of the Novel-Coronavirus. In my research, I came across 5 companies that are using AI to fight COVID-19 pandemic,

• A Hong Kong-based Insilico Medicine jumped into the field using their AI platform for drug discovery. Instead of seeking to re-purpose available drugs, the team used an AI-based drug discovery platform to generate tens of thousands of novel molecules with the potential to bind a specific SARS-CoV-2 protein and block the virus’s ability to replicate. The company is actively investigating drugs that might improve the immune systems of the elderly—so an older individual might respond to SARS-CoV-2 infection as a younger person does, with milder symptoms and faster recovery—and drugs to help restore lung function after infection.
• A British AI -startup Benevolent AI published in The Lancet identifying approved drugs that might block the viral replication process of SARS-CoV-2. They used a large repository of medical information, including data extracted from the scientific literature by machine learning, the company’s AI system identified compounds that effectively block a cellular pathway that appears to allow the virus into cells to make more virus particles.
• In February 2020, scientists at South Korea-based Deargen used a deep learning-based model called MT-DTI. This model uses simplified chemical sequences, rather than 2D or 3D molecular structures, to predict how strongly a molecule of interest will bind to a target protein. The model predicted that of available FDA-approved antiviral drugs, the HIV medication atazanavir is the most likely to bind and block a prominent protein on the outside of SARS-CoV-2, the virus that causes COVID-19. It also identified three other antivirals that might bind the virus.
• SRI International and AI company Iktos in Paris announced a strategic alliance to discover and develop new anti-viral therapies. Iktos’s deep learning model designs virtual novel molecules while SRI’s SynFini automated synthetic chemistry platform figures out the best way to make a molecule.

Just as the U.S. government significantly invested to put Neil Armstrong and others on the moon by 1969 – $152 billion in today’s dollars, similar funding in Artificial Intelligence technology could prove to be game-changer for our nation’s battered health care system.

What's next.... Part 3

Thank you for taking the time out to read this article. Do not hesitate to leave comments, good, bad, or ugly, but share it.

One thing about the extra time in hand is that we should have a plan to use it. I am using it to theorize future learning from the present circumstances. After all, as a technology leader, my job is to think about what next while keeping the present running. Here is a brief overview of what I will be covering in part 3 of this series of articles on Next-New-Normal.

1. Privacy in the age of pandemic – Contact tracing, Corporate spying, Personal health data at risk, and data breaches.
2. Sustainability will be a priority board room discussion – Perhaps this is the first time in a century that the economic activities across the globe have slowed down significantly. Scientists are rapidly collecting mountains of data to see how climate change will be impacted. In fact, I believe that post-pandemic we will have hard evidence to show how the change in human activities will create positive climate change. This will then be used to drive global environmental policies. Business leaders should plan to anticipate such changes and figure out what it means for their business operations.
3. The rapid adoption of Blockchain platform across the supply chain to track, trace, and establish transparency in handling transactions – Purely out of my personal passion to learn new technology, I have been researching Blockchain since its inception in 2011 as a platform for Cryptocurrency. No country can just shut down trade with another country, because of the Epidiamological nature of the COVID-19, the global supply chain will need tighter control and transparency in the way the transactions will happen in the supply chain in the future. Blockchain’s unique architecture (Decentralized, Distributed, Immutability, Tokenization, Encryption), positions itself as an effective catalyst for establishing a safe, secure, and transparent supply chain.
4. The business model evolution - As indicated in Part 1 of this article, the COVID-19 pandemic will significantly influence current business models will evolve to have features of the self-service capabilities, touchless processes, humanless interaction, cashless transactions, and hyper-automation.
5. Change in the pattern of Utilities and Energy consumption - For the first time in modern history, there is a shift in the demand pattern of electricity consumption. The sudden pandemic shock resulting in a jarring economic shift has resulted in storefronts, sports arenas, and office buildings in dark in many cities. Homes are becoming the center of our activity ?— and for many of us, our work. This is causing sudden shifts in the way we consume energy. We’ve seen it play out in China, France, and Italy.

Stay tuned for the Part-3...