Why software is like water, and what it means for global leadership

Staff members of the Beijing Municipal Environmental Protection Monitoring Center work in a monitoring room of the air quality forecast and warning center in Beijing, China, May 21, 2015.

'Software does not eliminate jobs, rather it transfers them' Image: REUTERS/Kim Kyung-Hoon

Michael Gregoire
Digital Member, CA Technologies
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This article is part of: World Economic Forum Annual Meeting

When we think of global leadership, we think of economic, social, environmental and political capabilities. Software’s role in virtually all aspects of leadership is so acute that it must be part of the equation for both individuals and states to compete in the new digital world.

When I think about the effect of software, I equate it to water. Both are basic necessities. Both defy borders and generally go where they want to go. Both need to be protected and both need to be understood. They are critical resources that will always be central to success, and it is readily apparent when either is absent. We easily understand what it is like to be thirsty, and many are finding out what it is like to be digitally unaware. Both are extremely uncomfortable.

'Software is the international language'

While global events and realities continue to grow in complexity, it is equally true that this world is now smaller than ever. My expertise is not particularly well-suited to analyze all the unfolding challenges in our ever changing economic, social, environmental and political realities, but I can respond to the shrinking size of the world in one word: software.

Software is the international language. It allows us to do everything from receiving instantaneous news out of Syria to hailing a ride in the rain via our smartphones. Both of these examples and more are accomplished by software.

The theme for this year’s World Economic Forum Annual Meeting is particularly timely and relevant. We need Responsive and Responsible Leadership as we all play witness to an earlier call by the Forum: the advent of the Fourth Industrial Revolution, as the lines are blurred between the physical, digital, and biological spheres.

For countries to survive and thrive in this era, software needs to play a central role. Agriculture, basic manufacturing, education, food production, and water filtration all require software to work well at scale. For companies and economies, software is key to sensing change and reacting to it. For example, Ethiopia has done tremendous work over the past few years driving down poverty and food insecurity as a result of their ambitious and tech-fueled strategy of policy commitments and integrated programs around agricultural development.

'Software transfers jobs'

Software does not eliminate jobs, rather it transfers them to another entry point in the industrial or value equation. There will never be enough software engineers to meet demand. With hundreds of thousands of open software and engineering jobs worldwide, the appetite for workers with STEM skills is seemingly boundless. The bottom line is that when there is greater demand, there are more jobs. Software drives that demand. Making software work gets other people working.

Look at Uber as a current example. There are more professional drivers on the road today than ever before. Uber’s application actually converted a car from being something that costs money to something that makes money. Some drive full time and some use the app to help make ends meet. For others, owning a car is too expensive, but they are willing to pay for rides in small increments. A mature market has been established and people are working—all because of software. The looming likelihood of self-driving cars promises more disruption down the road, with some seeing a shrinking job count while others maintain jobs will again shift to opportunities like call centers.

Car-sharing app Uber on a smartphone next to a taxi sign Image: REUTERS/Sergio Perez

When ATMs – software-driven banking – first began to appear, people predicted that banking and banking jobs would shrink. But the opposite occurred, and in fact the financial services industry supports more jobs today than it did before ATMs existed. The dawn of ATMs freed banks to do things such as open more branches with leaner staffs while maintaining a net positive on jobs.

Software is positively supporting jobs across the globe. In Africa, even the act of matching an existing job with a potential candidate was a vexing and persistent problem. However, mobile phone penetration, which has doubled over the past two years, gave people – employers and job hunters – access to the Internet in an unprecedented way. Now many of the unemployed and underemployed can identify and obtain decent working opportunities by simply using their phones.

The software that powers the Internet also breathed whole new life into niche retailers. Stores that sell comic books—or virtually any collectible or specialty item—saw their customer base explode worldwide. The introduction of a tremendous amount of potential consumers enabled these types of businesses to become more aggressive and do things like expand or increase staff. The Internet literally reaffirmed and reinvigorated an entire variety of small businesses and created more jobs.

For even more proof, look at the exact opposite of the niche retailer: Amazon. Amazon creates jobs up and down their supply chain. There are a number of more complex jobs in logistics and operations, but also an incredible amount of other kinds of jobs from delivery drivers, to the people who make the boxes - the list goes on and on.

Leadership of every stripe needs to be incredibly responsive and responsible as the Fourth Industrial Revolution takes hold. To properly face the challenges, our children will need to be steeped early in math and sciences, which serve as the building blocks for engineering. The jobs and requirements for the present and the future will need trained people to realize the true potential of software. That is a priority.

While water remains a basic human need, the ability to create a Nimbostratus cloud in a lab remains elusive. However, we can control and prepare for the present and future opportunities in software. When harnessed, software will take us anywhere that our minds and creativity map out, while quite likely saving the world along the way.

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The views expressed in this article are those of the author alone and not the World Economic Forum.

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