As technology transforms our economy, one trend is getting more and more attention: the prospect that it will increasingly automate the work that we human beings do. And it’s not just low skilled, manual labor that’s at risk – “knowledge” work like operational analytics and marketing is also being taken over by sophisticated artificial intelligence algorithms.

But other changes are also afoot, changes that could allow the human dimension of work to become more important. While it’s true that technology is taking over routine tasks from many workers, it is also reshaping many supply and demand trends that drive our global markets. It’s this second technology-driven shift that can prevent automation from eliminating jobs; but jobs will change.

How Technology Is Reshaping Markets

On the demand side, technology is providing customers with far more power than ever before – we have far more information about the options available to us and the ability to switch much more easily from one vendor to another if our needs are not being met. Many of us are also becoming more demanding – we are less and less willing to settle for standardized, mass market products when it is far easier to seek out the niche products that are tailored to our specific needs and context.

And, to add to the challenge for vendors, we are increasingly shifting from ownership to usage-based pricing models, paying only for the actual usage of the product or service, something that is made more feasible by technology that can monitor our usage. For example, using a small wireless device plugged into a car’s diagnostic port, some companies now allow consumers to pay for car insurance on a per-mile basis, making it economical for low-frequency drivers to be fully insured without subsidizing customers who drive more. As we reduce our spend on physical products, we are often shifting our attention and spend to meaningful experiences that enrich our lives.

Many of us are also using technology like ad-blockers to avoid being barraged with ads – rather than intercepting us to gain our attention, companies will need to provide so much value and assistance that we will seek them out. For example, one survey indicated that the use of ad-blockers among US Internet users had almost doubled between 2014 and 2018, reaching almost one third of the user base. The use of ad-blockers is just one signal of a much more fundamental trend: the erosion of trust in all our institutions – not just companies, but all institutions. Many increasingly believe that institutions are not serving our interests.

On the supply side, technology is generally helping to expand the array of product options while at the same time leading to compression of product life cycles. Technologies like additive manufacturing are often making it easier to produce highly tailored products at small scale. Where products still require large scale manufacturing facility, small product vendors can connect much more easily with large scale contract manufacturers and coordinate manufacturing activity at a distance. In addition, the proliferation of new product options and increasing information accessible to customers is contributing to compression of product life cycles as new products enter into the market more quickly to challenge previously successful products.

So, what’s the result? Standardized, mass market products and services are rapidly giving way to much more specialized, creative products and services in a growing array of markets. Rather than viewing us as indistinguishable “customers”, product and service vendors are increasingly realizing that we are each a unique person with distinctive and evolving needs and that their success will depend on understanding and addressing these needs. Rather than trying to intercept us with ads, they will need to become so helpful to us that word will spread and we will seek them out.

How This Will Change the Work We Do

As a consequence, the nature of work will likely undergo a profound transformation on two fronts. First, the machines will take over more and more of the routine tasks that defined work in a standardized, mass market product world. Second, the only way to create value in a more differentiated and rapidly changing product world will be to redefine work at a fundamental level to focus on distinctly human capabilities like curiosity, imagination, creativity, and emotional and social intelligence.

We’re generally going to see three different categories of work become more and more prominent in a rapidly changing economy. First, we will see more and more business for “creators”, people who can anticipate the rapidly evolving needs of individual customers and design and deliver creative and highly tailored products and services. In many respects, we will see the resurgence of craft businesses that are already emerging in areas like beer and chocolate. These craft businesses can enable more and more people to take their hobbies like woodwork and knitting and make a living from connecting with customers in a much deeper and lasting way.

Second, we will see a growing category of work for “composers” – people who deeply understand the aspirations and needs of small niches of customers and who can compose engaging and rewarding experiences for those people. This category will grow and become more and more rewarding as customers shift their focus from owning physical products to seeking out meaningful and memorable experiences. These experiences could range from tours of art galleries or gardens in a neighborhood to interactive experiences that help us to connect with others in richer and deeper ways. For example, a woodworker could host a gathering of woodworkers to share their experiences and gain inspiration from each other.

Finally, we will see a third category of work for “coaches” who will help customers achieve more of their potential in various domains. As an early indicator, we are seeing a growing number of “wellness” coaches who are helping us to stay well and improve our physical performance. But, as we seek to achieve more of our potential, we’re likely to see an expanding array of coaches in such diverse areas as dating and relationships, travel, entertainment, financial affairs and life-long learning. This coaching could also be in pursuits like gardening or helping people to express themselves more creatively through their attire or make-up.

What’s the result? Less and less work done by humans will be in the routine tasks that define most work today. In part, this will be because machines will be able to perform this work far better than we humans can. But a much more compelling reason will be because this work will be less and less relevant to what businesses will need to create value as customers generally become more demanding and their needs shift. The focus of work will shift to activity that draws on the far more human capabilities that machines will find much more challenging to replicate.

The truth is that we humans have an insatiable set of needs. As soon as our most basic needs for food and shelter are met, we generally begin to raise our sights and look for ways to achieve more and more of our potential as human beings. And here’s the wonderful truth: the needs that allow us to achieve more and more of our potential as human beings will likely be precisely the ones that drive the evolution of work in ways that also enable us to achieve more and more of our potential in our work. The emerging opportunities may not require college degrees, but they will require passion and a desire to connect with others in richer and more meaningful ways.

There’s little doubt that this transition will be challenging – it will force us to question some of our most basic assumptions about work and business. For example, companies will need to shift from viewing employees as a cost to recognizing them as an asset capable of creating ever expanding value. They will need to challenge the prevailing efficiency mindset and embrace a mindset that focuses on accelerating learning to address the rapidly evolving needs of customers.

But the bottom line is that technology is unleashing market forces that can reward those who address these challenges and marginalize those who ignore them.

And, far from depriving us of work and squashing our humanity, technology can provide us with the opportunity to focus on work and activities that will help us to achieve more and more of our potential. What better service could technology provide?

About the Author:

John Hagel is founder and co-chairman of the Center for the Edge at Deloitte and author of a number of best-selling business books.

This article is one in a series related to the 10th Global Peter Drucker Forum, with the theme management. the human dimension, taking place on November 29 & 30, 2018 in Vienna, Austria #GPDF18

This article first appeared in the Drucker Forum Series in Harvard Business Review

But the very model of organizing a business is becoming increasingly challenged by what I call the Big Shift — long-term forces, such as the rise of digital technology infrastructures, that are reshaping the global business landscape. For evidence of the magnitude of the challenge, we only need to look at the long-term collapse of return on assets for all the U.S.’s public companies: From 1965 to today, return on assets has declined by 75%.

What is to be done? If we are to thrive and harness the enormous potential of the Big Shift, we will all need to mobilize to create the entrepreneurial society, as Peter Drucker anticipated many decades ago. In the process, we must all become entrepreneurs.

But first, let’s step back and reassess what we mean by entrepreneur. In the public mind, entrepreneurs have been reduced to young people who want to create world-changing businesses that can quickly reach $1 billion or more in market value — the fabled unicorns.

But is that all there is? Maybe we need to expand what “entrepreneur” means. A more useful definition might be someone who sees an opportunity to create value and is willing to take a risk to capitalize on that opportunity; some elements of this are opportunity spotting, risk taking, and value creation.

In a world that is increasingly shaped by exponential changes in technology, new opportunities are arising at an ever more rapid rate. But risk also increases because of accelerating change and increasing uncertainty. What we need are entrepreneurs who are willing and able to cope with those risks and to see and harness the opportunities on the other side.

While some of these opportunities may evolve into unicorns, we shouldn’t unduly focus on them. Today many product businesses are fragmenting as the means of production become more broadly affordable and accessible and as platform businesses emerge to help connect these product businesses with customers around the world. We are already seeing this in digital realms such as music, video, and application software. New technologies such as 3D printing and biosynthesis are likely to expand this trend into physical product businesses.

For entrepreneurs, this is an opportunity to make a comfortable living for themselves, and perhaps a small team of people, by designing and commercializing products that are targeted to the specific needs of small groups of customers. Fragmentation suggests that unicorns will become rarer and rarer in many product businesses, and may even become an extinct species. But the entrepreneurs attracted into these niche businesses will nonetheless be creating value for customers and for themselves. Why shouldn’t we embrace and encourage them?

And let’s not just talk about entrepreneurs in developed economies. A key to accelerating the growth of developing economies will be the ability to encourage more and more entrepreneurs throughout these countries, both in growing cities and in rural areas. While they may not be unicorn entrepreneurs, they can create value in their neighborhoods and perhaps beyond.

Of course, not everyone will be working independently or in small companies. We’ll still have very large companies where network effects and economies of scale or scope continue to support the concentration of economic activity. Won’t the employee society persist in those places?

Well, not exactly. Here’s the thing. In a world of accelerating change and growing uncertainty, even the largest companies may need to reframe work. The “employee” mindset — that is, the notion of just showing up to do a predefined set of tasks until leadership tells you otherwise — just isn’t cutting it anymore. What we need are entrepreneurs in every part of the organization, people who are relentlessly focused on identifying new opportunities to create even more value and are willing to assume the risks required to address those opportunities. In short, we will need to move from scalable efficiency to scalable learning, where everyone is driven by the need to learn faster and accelerate performance improvement.

As Peter Drucker has noted, entrepreneurial management practices are fundamentally different from employee management practices, requiring large-scale transformation of our existing enterprises. The challenge is that top-down, big-bang approaches to organizational transformation rarely succeed. Instead, the most powerful way to achieve transformation is by scaling at the edge — a part of the company that today is relatively modest in terms of revenue and profit but which, because of the exponential forces at work in our economy and society, has the potential to grow into the new core of the company. Who can do all this? Why, entrepreneurs, of course.

And, by the way, the need for entrepreneurs is not limited to commercial enterprises. All of our institutions will likely need to cultivate and encourage entrepreneurs throughout their ranks — NGOs, schools and government agencies. Which of those institutions doesn’t feel increasing pressure to find new opportunities to create and deliver value to its stakeholders?

There’s a compounding dynamic that’s being set in motion as we begin this transition to an entrepreneurial society. The more successful we are in generating entrepreneurs in our society, the more dynamic our world will likely become, and the faster it will change, creating a need for even more entrepreneurs. Those who remain wedded to the outmoded practices of the employee society will suffer.

The accelerating pace of change and growing uncertainty has spawned a backlash by established interests, who, in a quest for stability, seek to confine and constrain entrepreneurs into small corners, where they pose little threat to large, established institutions. But this is ultimately a futile effort. Make no mistake about it: We’re on the cusp of a Big Shift from an employee society to an entrepreneurial one, as Peter Drucker so perceptively predicted. The forces driving it are too big, too inexorable to turn back.

That might be frightening to employees, but it’s exciting to entrepreneurs.

About the author:

John Hagel III is Founder and Chairman of the Deloitte Center for the Edge, a research center based in Silicon Valley. A long-time resident of Silicon Valley, he is also a compulsive writer, having written 7 books. His latest, with John Seely Brown and Lang Davison, is The Power of Pull: How Small Moves, Smartly Made, Can Set Big Things in Motion.

Here’s another paradox: the rise and spread of industrial society was at one level a product of that powerful imagination and yet that very same society has been on a quest to limit and contain that imagination. Our industrial society embraces scalable efficiency. It thrives on predictability and reliability and views imagination with some ambivalence – it drives innovation, but on the other hand undermines predictability and reliability.

As if that weren’t enough, there’s a third paradox: digital technology has intensified the quest for scalable efficiency and undermined our humanity while at the same time opening up the possibility of a new renaissance of the imagination that can help us to recapture our humanity.

Let me explain.

Digital technology indeed has a dark side – a dark side that is intrinsic to the technology. The dark side is mounting performance pressure that comes in three different forms – intensifying competition, accelerating pace of change and the increased likelihood of extreme events that disrupt our best laid plans and predictions. In part, these extreme events surface because we have turned over decision-making to our globally connected machines. For example, at least part of the increasing price volatility in stock markets is driven by automated trading that instantaneously responds to the latest event, without leaving any time for reflection. On the other hand, these extreme events also surface because global connectivity makes it far easier to scale initiatives than ever before, especially through the development of platform businesses that harness network effects.

We all are experiencing that mounting performance pressure as individuals and institutions. As examples of this mounting pressure, my analysis in the Shift Index shows that return on assets for all public companies in the United States has declined by 75 percent since 1965 and companies that manage to make it into the top quartile of ROA performance topple out of that position at an accelerating rate.

The dark side leads to very understandable human psychological reactions. We magnify perception of risk and discount perception of reward. We shorten our time horizons. We tend to adopt a “zero sum” view of the world – it’s a “you win, I lose” world. We therefore find it increasingly difficult to trust each other and our trust erodes – just look at all the surveys showing deteriorating trust in all of our major institutions.  These natural psychological reactions are in many cases amplified by the isolation that we experience as we begin to interact more with machines than with each other.

While understandable, these psychological reactions are highly dysfunctional, creating a vicious cycle of steadily increasing performance pressure and stress. We tend to become even more conscious of our imperfections, weaknesses and mistakes and determined to hide them from others, in the fear that they will create vulnerability that others will exploit. In that kind of world, we tend to suppress our imagination and stay within our comfort zone, looking for narrow ways to squeeze out that next increment of performance improvement, hoping that we can at least make it to the next quarter. In other words, we suppress our humanity and look longingly at the efficiency and reliability of the machines around us. We tighten our focus on the computer generated data and analytics that offer the promise of greater efficiency within the world as we know it.

But does it have to be that way? The very same technology that is generating this mounting performance pressure also provides us with the platforms and tools to re-awaken our imagination and overcome the cognitive biases that keep us confined within the practices of the past. We can harness the powerful processing power of computers to help us imagine, visualize and explore worlds that go far beyond anything we have experienced to date. We can use sophisticated analytic tools to test and refine what we have imagined so that these new worlds can become even more fertile seedbeds of possibility and potential.  We can then harness computing power to imagine and design the products and services that will begin to make these imagined worlds a reality.

As our imagination revives, we’ll begin to find ways to transcend our imperfections, weaknesses and mistakes.  They are indeed part of being human, and should be acknowledged as challenges that we all face, but they should never be allowed to stand in the way of the imagination that can help us to achieve more and more of our potential.  In fact, digital technology can provide effective tools to help us compensate for our imperfections, weaknesses and mistakes. As one example, we are able to deploy experimentation platforms that simulate environments and allow us to test new approaches before deploying them in the real world.

Done right, we can unleash a virtuous cycle. The more we succeed in overcoming our imperfections, weaknesses and mistakes, the more willing we are to imagine more boldly and the more boldly we imagine, the more motivation we have to address and overcome our limitations

But the first requirement is to step back and reflect on what makes us uniquely human and what the consequences might be if we surrender our humanity to the mounting performance pressure that we are all experiencing. We need to understand that the choice is ours – that there is nothing inevitable about the trajectory that we are on. If we choose to re-claim our humanity, we can take the very same technology that is squeezing the humanity out of us and re-focus it on ways to reinforce and amplify our humanity. We can create worlds that were previously unimaginable and that will allow our humanity to flourish.

If we choose this path, the mounting performance pressure that we experience today can be transformed into excitement as we begin to see the opportunity to create new worlds that open up new potential and possibility.

It will be up to us to ultimately determine how we use that digital technology. Will we use it to narrowly squeeze out all inefficiency in the work we do? Or will we use it to catalyze and amplify the imagination that makes us uniquely human and that could identify entirely new avenues to create fundamentally new sources of value?

About the author:

John Hagel is Founder and Chairman of the Deloitte Center for the Edge, a research center based in Silicon Valley. A long-time resident of Silicon Valley, he is also a compulsive writer, having written 7 books, including his most recent – The Power of Pull.

Throughout his life, Peter Drucker strived to understand the increasing complexity of business and society and, most importantly, the implications for how we can continue to create and deliver value in the face of complexity. I have long been influenced by Drucker’s work. In the 1960s and 1970s, he was already anticipating some of the implications of the Big Shift just beginning to emerge: the transition to an information economy, the centrality of knowledge work, and the transformative impact of digital technology on all types of work.

Around that time, two forces coincided, each amplifying the disruptive capacity of the other. First, the deployment of the digital microprocessor and packet-switched networking marked the beginning of the rise of the digital infrastructure that would eventually span the globe, driven by exponential performance improvements in computing, storage, and bandwidth technologies. Digital technology unfolded on top of a second force that had been building for a few decades: a global movement in public policy towards economic liberalization which was systematically reducing barriers to the movement of goods, money, people, and ideas across the boundaries of nations and industries.

The combination of these two forces created enormous opportunities but also enormous challenges. They have systematically and significantly eroded barriers to entry and movement on a global scale. The result is relentlessly mounting performance pressure. Evidence of this pressure is starkly captured in the return on assets (ROA) for all public companies in the US since 1965. Over this period, there has been a sustained and dramatic erosion in performance: ROA has collapsed by 75 percent.

The full blog post can be found at: http://blogs.hbr.org/cs/2013/06/how_drucker_thought_about_comp.html