By Phil Keil
The feature topic of this issue of Civil & Structural Engineer is both timely and important. Most engineering firms in business today are notoriously slow to adopt digital technology and, in fact, most industries have difficulty adapting to technological transformations. Few leaders would disagree with the fact that business today is driven by data and smart algorithms. The problem is the difficulty in which those leaders can predict the impact of such technologies in order to plan for organizational change. It is easier to pursue digital evolution or incrementalism than it is to lead true digital transformation. The focus, in large part, has been on using technology to cut costs, or worse, cut jobs. In fact, the past few recessions have seen a significant increase in labor replacing automation across industries. The challenge therefore is, how do you reimagine what you do for the new era of AI-powered competition?
Many firms have begun to shift their culture towards something that should be very intuitive for them. It is a set of principles that has been collectively known as design thinking and reimagining the client experience. Most firms are also beginning to recognize that aggressive integration of digital technologies is critical to remain competitive. Research conducted by Accenture Research shows that the top 10 percent of early adopters of digital technologies have grown at twice the rate of the bottom 25 percent, and that they are using cloud systems over legacy systems to enable adoption. This means there is a lot of opportunity for firms in our industry to differentiate themselves through aggressive investment in advancing their competitive advantage through technology. So, what is your firm doing to access, power, and train the next generation to implement natural language processing tools, quantum computing solutions, and the other advancements?
One of the emerging technologies that will arguably have the biggest impact to the industry within the next 10 years, and is simultaneously not being discussed widely, is quantum computing. I’ll put aside my traumatic flashbacks from when I took quantum physics for my undergraduate physics degree, because, well, this is important. Quantum physics has already changed our lives by way of advancements such as the laser and transistor. The recent progress has put us on the brink of a second quantum revolution. This one in particular is within quantum computing and communication. Current estimates predict the quantum computing market will surpass the $65 billion mark by 2030.
At the risk of oversimplifying it, quantum computers rely on a fundamental property of quantum particles which can be a powerful resource – uncertainty. While it sounds unnerving at first, it allows for some pretty incredible outcomes. At the level of individual quantum particles, think electrons or photons, it is impossible to determine every property (position and momentum) of the particle at any given moment in time. For Breaking Bad fans, this is the Heisenberg Uncertainty Principal – a different Heisenberg though. Therefore, in the quantum world we use the language of probability, rather than certainty. Classical computers rely on binary digits (bits) of 0s and 1s, quantum bits (qubits), however, have some likelihood of being a 1 or some likelihood of being a 0 at the same time.
The revolutionary idea behind quantum information processing lies precisely in the fuzzy in-between “superposition” of 0 and 1. It provides new, and far more powerful, ways to communicate and process data. To provide some perspective, quantum computers would be able to solve problems that are currently impossible with traditional computers or would take them a billion years to solve. Remember IBM’s Deep Blue defeated chess champion, Garry Kasparov in 1997? It had an advantage because it examined 200 million possible moves each second. A quantum machine would be able to calculate 1 trillion moves per second! For math nerds like me, here is a link to another article that dives deeper, but is still accessible. Anyway, the point is, one of the clearest applications is for solving complex optimization tasks and performing fast searches of unsorted data. For those of you in transportation, solutions like “Traffic Signal Optimization on a Square Lattice using the D-Wave Quantum Annealer” research being done at Cornell University.
The takeaway then, is that leaders in our space need to develop strategy tools for a shifting landscape. It is time to reinvent the way companies develop strategy due to the defining characteristic of turbulence in today’s business environment. Demographic shifts, technology, regulatory restructuring, environmental pressures, and more have forced us to continually reexamine the competitive landscape. With the increasing rapidity with which this is occurring, the old cadences that firm leaders followed of quarterly or even yearly planning sessions should be dead in favor of a much more fluid and frequent process. Moreover, the traditional strategy tools are static categories and representations (Porter’s five forces, maps, blue ocean thinking) that can only tell us about the past environment in a two-dimensional field. They also assume that an industry is well defined, has a fixed set of competitors, and a fixed set of clients. The variables that are increasingly dynamic are the very ones that these models hold constant. Even some of the more sophisticated tools like game theory deliver mixed results. We must, then, be able to describe and understand the underlying logic and return to the true power of well crafted, purpose driven, mission and vision statements to help guide us. This will be the topic of my next Zweig Letter article.
One of the most powerful things that Zweig Group recently did to elevate the industry and address this problem is to form a strategic partnership with OnStrategy to exclusively provide the AEC industry with a proprietary strategy development and management software application as well as process management best practices. This enables companies to more easily coordinate and manage implementation, reporting, and updating of strategic planning. Partnering with OnStrategy provides our clients with a better, more effective way to ensure strategy becomes a living and thriving part of the organization. It gives users tremendous capabilities in managing strategy, sharing performance, and creating alignment and accountability. Never before has the strategic plan had the brawn as it does through this app. It not only solves a challenge for our clients but provides a necessary tool to quickly adapt to market shifts and drive a culture of performance. We will be presenting together during Zweig Group’s Annual ElevateAEC Conference on the topic of “Emerging Shifts Leaders are Making to Adapt Strategy During Market Uncertainty.”
My final question to you is simply a restatement of where we began. How are you doing to reimagine what you do for the new era of AI powered competition? There will be uncertainty with new companies and technologies vying for dominant design in the next 10-30 years. It isn’t as important as it once was to be the one creating the software innovation for a competitive advantage, but to be the one that can effectively choose, implement, and use the emerging technology that has been developed. Define some criteria to intelligently embrace and implement these systems into your enterprise. Below are a few questions to assist you in determining which technology to integrate into your strategic plan.
- How does the solution fit into your existing environment?
- How does the business benefit (even if I cannot show ROI yet)?
- Who in my organization will use it?
- Does my staff have the expertise to manage the change?
- How will the technology affect my clients?
- What are the risks?
- Can I test the solution as a pilot program without significant business disruption or cost?
- Will the solution scale to the entire enterprise?
Now that the questions have been asked, it is sometimes necessary to make revolutionary shifts to your firm which will inevitably cause disruption. Change is hard for any organization but must be embraced. Think deeply about why your firm exists and what value you truly provide. In the end, for your firm to continue, all of this must be part of the plan.
Phil Keil is director of Strategy Consulting, Zweig Group. Contact him at firstname.lastname@example.org.