What to expect from 2018...

One of my favourite consultancy firms, Fjord, have released their 2018 Fjord Trends. A great read for anyone looking to understand what the landscape could look like in 12 months’ time. The annual Trends report brought together more than 1,000 Fjordians, plus 85 clients from five continents, to produce this fine piece of work.

The theme of the report this year is, tension. Over the past year, we’ve seen a radical shift in many areas of our lives, whether it be political (Trump), economic (crypto) or social (media), we have all felt some degree of change, whether it be positive or negative. Through this shift, the concept of disagreement has become the new norm.

The current divide between opposing opinions is remarkable and sometimes overwhelming, leading to what each trend in the report was borne from; a shift, a disagreement, a collision or a definitive rift in ideas, digital versus physical, human versus machine, centralized versus decentralized, speed versus craft, automation versus control, traceability versus anonymity.

Here is my take on the seven trends. Hope you enjoy the read.

Physical fights back

Digital is no longer the centerpiece of brand experience. The emphasis is shifting onto how best to use digital as an invisible enabler of physical and sensory experiences. We are living in an ever connected world, with the prediction that connected devices will reach 75 billion by 2025. One reason for this has been the recent shift in the way we define the physical and sensory experiences. Until recently, the speaker/microphone, camera, screen and sensors were found together in PCs and mobile phones. Now, they are being pulled apart – the equivalent of dismantling a Swiss Army knife, separating its various tools and embedding each into a new entity. Think of Alexa – a repurposed microphone with new abilities and functionalities.

Digital has also become a lot more personal in the way it customizes the experience, service or product. Commentators call this o2o revolution (online-to-offline). o2o is where customers are identified in the online space then enticed via various tools – click and collect, for example – to transact in an offline environment. In the Asia-Pacific region, 88% of retailers plan to implement click and collect systems, according to one recent study. Alibaba, for example, recently invested US$1.25bn in Shanghai-based Chinese online food delivery service Ele.Me – a strategic move to strengthen its position in the o2o marketplace.

To capitalize on this new concept, organizations will have to restructure and develop new skills. Organizations will also need to ask themselves an important question: as digital becomes increasingly invisible, what does the future digital department or role of the head of digital look like?

Computers have eyes

The next trend is something straight out of Netflix's Black Mirror series. The ability for computers to read, comprehend and react to words has been around for some time. However with the amazing progress in AI, we can now do the same with images. In 2018, organizations will look to benefit from this powerful new source of data to create new digital services and products that add value and are truly compelling.

One example is how we use the camera phone. Google recently launched Clips – a digital camera without a display that takes pictures for you, using machine learning to recognize and learn faces, and look for interesting moments to record. Apple’s newest iPhone has the ability to unlock itself using facial recognition. In China, Alibaba is piloting facial recognition technology at 10,000 parcel pickup locations across Shanghai. In entertainment, Disney’s research arm is experimenting with facial recognition to gauge how an audience is responding to a movie. Cars are using intelligent cameras to assess their environment, process the data and respond accordingly – like a driver would.

The biggest difference in 2018 will come in the way that technology processes the data. Until now, the technology consumed the data and produced an output for us. In 2018 however, we’ll see computers processing information while reacting to the surrounding environment – using cognition and language skills to process information more like a person. Pretty neat right? Oh, and if you haven’t watched an episode of Black Mirror, please do yourself a favour and do so. I’d suggest season 3, episode 1.

Slaves to the algorithm

Three developments are ramping up to transform marketing in the year ahead: the rapid evolution of data-driven algorithms, the evolution of voice-enabled digital assistants and users’ growing trust in both. This will culminated in a “third space”, neither online nor brick-or-mortar, where consumers and brands will meet.

In 2018 this new space will be the voice controlled shopping marketplace. The challenge is this: when your customer has been seduced by the immediacy and fun factor of engaging with the likes of Alexa instead of directly with your brand, how do you reach that customer? Alexa and her rivals have in-built biases, so the key lies in finding ways around them.

As the machine learning that powers these algorithms continues to rapidly evolve, more personalized and preference-based services will emerge. However, as I mentioned earlier, there is bias built into the system. Amazon’s Alexa is more likely to recommend Amazon Prime products for first time orders. This makes it more difficult for any other brands to have their products included in Alexa’s search results – particularly lesser-known brands. In 2018 we’ll be introduced to the concept of the gatekeepers. Some organizations will be able to create gatekeeper algorithms, and their success will rely on their understanding of what different groups of their customer’s value best and want most from such services. Other organizations, however, will find that some gatekeeper algorithms have the power to limit their direct access to their customers. There’s a strong chance we will soon see a desensitized algorithm sitting in between an organization and its customers – one that does not notice things like visual branding efforts, celebrity endorsements or advertising campaigns. Being inherently empathetic beings, people are influenced by such things, but algorithms are not.

A machine’s search for meaning

The industrial revolution brought with it a tidal wave of fear for job security; the production line, typewriters and motorized vehicles were all going to change the game forever. In today’s world, that tidal wave is Artificial Intelligence (AI) and robots.

In 2018 organizations will stop talking about it and start designing for this change, by coming to terms with how to enable people and machines to get the best out of each other. A Harvard-based team recently devised an AI method that could identify cancer cells with 92% accuracy. In their experiment, pathologists beat the machines by achieving 96% accuracy. When they worked together, however, the combined forces of human pathologists and AI accurately identified 99.5% of cancerous biopsies, brilliantly showing how AI and people are at their best when they collaborate. Humanoid robots Pepper and Nao, made by Japanese company Softbank Robotics, have recently been trialed in two Singapore preschools. The robots helped teachers by asking children questions about a story they had just heard, prompting them to select answers on the screen. Again, the idea is to complement, not to replace. In a recent global study,

Accenture identified new job categories – Trainers, Explainers and Sustainers – where humans will complement the tasks performed by cognitive technology, created by the rise of AI-enabled machines.

For me, it’s not a matter of fewer jobs for humans but rather, different ones. Corporate culture is vitally important to get right, should an organisation wish to go down the AI route. They will have to ensure that they gear the new culture toward meaningful work and constant learning (a platform like Degreed). Looking ahead, at least 45% of what people are currently paid to do is open to automation. If it happens, this shift will converge with the dominant culture of millennials in the workplace. A Fidelity study showed millennials would take a pay cut of US$7,600 if they could find a more purposeful work or a better culture elsewhere.

In transparency we trust

Authenticity, one human virtue that will become harder and harder to judge in an ever technological and digital world. Reason being, it will become almost impossible to identify the origin of information and who has had a hand in changing it. If we dig deeper, the real issue is then trust. Fjord suggest that, organizations will need to shift their emphasis from “touch points” to “trust points” when carving out market differentiation.

But how can I trust what I read, see and hear? One potential answer is the blockchain.

Quickly; the blockchain is a shared, decentralized, secure database which enables any system or device connected to a network – for example, a file server, a computer or a printer – to be connected to it. Each entry on that database is a block. No entry can be changed retrospectively, and unlike a conventional database, the chain of blocks is connected without a single organization officially designated to administer and oversee it.

I am sure you have all by now heard of Bitcoin by now, the cryptocurrency that swept 2017 away. Well, Bitcoin uses blockchain technology. One big hurdle that face organisations that want to implement blockchain, is how to ensure their customers understand what it is, and how it’s used in their circumstances. In the public sector, Microsoft, Accenture, Fjord and Avanade recently worked with ID2020 to develop a global ID system powered by blockchain for use by 1.1bn people in distressed situations without ID to create a legal and permanent identity.

In my opinion, 2018 will be the year of the blockchain.

The ethics economy

As mentioned in the opening paragraph, the theme for this year’s report is tension. You doesn’t have to look very far to understand that the playing fields have changed forever. Organizations have started to take political stances on issues of general concern and, in 2018, this will grow more commonplace. Locally we have the likes of Sygnia voicing their concerns of the relationships of the Gupta’s and the president. In the US, Apple’s CEO Tim Cook campaigned for gay marriage, where historically US corporate leaders keeping their political views to themselves.

I’d like to share one quote from him quickly that really stuck with me “People should have values, companies are nothing more than a collection of people. So, by extension, all companies should have values. As a CEO, I think one of your responsibilities is to decide what the values of your company are, and lead accordingly.”

Inaction in 2018 could be the downfall of a brand or company. We have seen more and more instances where customers have demanded brands do the right thing – quickly owning up when they make a mistake or been associated with the wrong group or individual.

Just as disagreement is the new norm, so too is public scrutiny. We are all a critic, a believer, a supporter or a hater, thanks to social media. Organisations that do not note this will suffer in 2018. Social media has become a volatile and intimidating platform where brands can respond to current affairs. It’s time for organisations to be part of the moral fibre of the human network, no longer being reactive to situations or mishaps, but rather proactive voices on debates that will change the customer’s lives. It won’t be easy though as the problems will be deep and complex at times.

Design outside the lines

In 2017 design thinking was taken to the next level. The majority of consultancy firms I worked with and those of colleagues, embraced this way of thinking in their projects.

However, in 2018 the design discipline will be challenged by three forces: the proliferation of design thinking, the demand for products to be scaled fast, and the potential of emerging technology. These three forces sometimes work against each other, let me explain.

Agile. Another buzz word in 2017. As much as I see much value in the concept, the inherent need for speed that comes with Agile is crippling the creativity aspect of the design process. Some commentators call this “flat design”. A trend that generates end products that lack originality, heart, soul and passion. Such shortcomings are the direct result of favouring a template approach to design rather than drafting as a true craftsman would. Organizations must understand that design thinking is at its most valuable when combined with design doing and supported by a strong design culture.

It is also crucial that organisations understand that as technology evolves, continual learning becomes non-negotiable. Product and service design today will be different from tomorrow. A client’s needs will also not be the same tomorrow as it was today. Does this mean organisations need to change and adopt all the time to these changes? If it wants to remain relevant and market leading, the simple answer is, yes.

For more info on Fjord, go to their website https://www.fjordnet.com/