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NET PROFITS
September 7, 1998The NewsHour with Jim Lehrer Transcript |
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The Internet has greatly changed the way the world works. But what does it hold for the future of business? Following a report on one company's attempt to make it in cyberspace, Phil Ponce and guests discuss how the Internet has changed the face of business.
JIM LEHRER: More now on all of this in a discussion Phil Ponce recorded last week.
A RealAudio version of this segment is available.
NEWSHOUR LINKS:
September 7, 1998:
Paul Solman reports on the new breed of Internet entrepreneurs.
April 3, 1998:
Technology firms explore new ways to train much-needed hi-tech workers.
February 12, 1998:
The technology of movies and special effects boosts California's lagging economy.
July 4, 1997:
A special report on the state of Online Commerce.
July 1, 1997:
The Clinton administration releases its position on the growing electronic commerce arena.
December 25, 1996:
A report looking back at the much-hyped and much-maligned Internet.
Browse the NewsHour's coverage of the cyberspace and the economy.
OUTSIDE LINKS:
The U.S. Commerce Department's Technology Administration.
PHIL PONCE: I'm joined by Paul Saffo, a director at Institute for the Future. Based in Silicon Valley, it studies trends in technology and the workplace. Claudia Goldin is a professor of economics at Harvard, and David Roy is a senior ergonomics specialist with the Travelers Property Casualty Insurance Company. He gives companies advice on workplace safety. Welcome home. Mr. Saffo, what has been the impact of the Internet, of computers, of all this information technology on the workplace?
Impact of the Internet on the workplace.
PAUL SAFFO: Well, I think already it's say farewell to 9 to 5, thanks to computers and the globalization process they've helped bring, that nobody gets their work done between 9 and 5 anymore. And conversely, the line between business life and personal life has all but disappeared.
PHIL PONCE: And, as far as where people work, is that another field that's sort of changed?
PAUL SAFFO: Well, we're loosening the coupling between where we work and where we live. The workplace has really turned into a work space, where we still have places we occupy but this additional dimension of cyberspace, and so suddenly you discover that there are people who not only perhaps are working at home, but here in Silicon Valley we have people living halfway around the planet and electronically commuting into work every day to computer companies in San Jose.
PHIL PONCE: Now, Mr. Saffo, not everybody works for a computer company, obviously. What kind of jobs, what kind of fields have been most affected?
PAUL SAFFO: Well, the obvious ones. If you tend to work at a computer screen, you do certainly feel this. But I think the biggest impacts are the ones that are not instantly obvious. The introduction of computers tends to transform industries, so you suddenly discover - to pick a very random example-the advent of the World Wide Web and buying and selling on the Web has completely changed the used book business, which used to be this sleepy little business, and now all of a sudden people who have little used bookstores out on Cape Cod are selling their books all over the planet over the Internet.
PHIL PONCE: Is it safe to say, Mr. Saffo, that just about every industry, every field, most people have in some way or another been affected by all this technology?
PAUL SAFFO: I think so. I really think that, for the moment at least, the Internet has become the solvent that is leaching the glue out of our traditional business structures and the very structure of the workplace.
PHIL PONCE: You may it sound as if the Internet is hurting, the way you just put it.
PAUL SAFFO: No. I think it's a positive thing, but I think it was Socrates who observed that all great changes come with hidden curses. There's wonderful benefit in all of this, but with the benefit, comes tremendous uncertainty, and also some people will get hurt.
PHIL PONCE: Professor Goldin, what's happened in the past, benefits and detriments?
CLAUDIA GOLDIN: Well, I think that there were many different lessons in the past and there were benefits and detriments. And I'd like to go back to a period of time, a 20-year period of time, I think, of the IT revolution today --
PHIL PONCE: IT meaning?
CLAUDIA GOLDIN: Information technology, sorry, and the PC, the personal computer revolution being a 20-year period of time. So I'd like to go back - particularly since it's Labor Day and that's a historic day - to the period from 1905 to 1925. And if we go back then and we say, well, what happened to technology then, there were many different revolutions. There was the electricity revolution. And if you think information technology is a revolution, try unplugging everything in your home and see if you can use the Internet. There was also a communications revolution. It was the dawn of radio. And there was a transportation revolution. After all, there was the period of the mass production, the automobile, and there was also a revolution in the office, the first great office revolution. And all of these revolutions changed our lives as workers and as consumers. Most of them bettered our lives, but many people were displaced.
PHIL PONCE: Professor Goldin, how do those changes compare to the change predicted or anticipated by the current changes? I mean, were those more dramatic, are you saying, than the ones we're experiencing now?
CLAUDIA GOLDIN: I would say that they were at least as dramatic and probably even more dramatic. It's very, very difficult to say whether one is more dramatic than the other. I was computing the diffusion of the radio versus the diffusion of the Internet. The Internet has diffused enormously. The latest statistics show that 30 percent of Americans over the age of 16 have plugged into the Internet in the last three months. And that began, of course, at a much, much lower rate ten years ago, and even three years ago, while radio diffused at approximately the same rate.
PHIL PONCE: Mr. Roy, looking at people who maybe have what, a traditional workplace, where you go to an office for a certain period of time, how has the physical environment been affected by this technology?
Computers impact on the physical environment of the workplace.
DAVID ROY: Well, the physical environment has been affected tremendously. We really have to look at the paradigm of the seated worker and the fact that the typists of the 1950's used a manual keyboard to actually input the characters into the keyboard and then used the manual return, and when they were finished with a document get up and actually file it. And the computer operator today can do most of these tasks, including dictionary checks and spell checks, and synonyms and antonyms right from the computer, and so we see that technology is drawing us to be really sedentary in front of the computer. And we have to balance those demands with the human capabilities, so although I do believe strongly that the information technology will be a benefit, we must consider the human in the design of the workplace, the work space, and the task itself.
PHIL PONCE: And a point of clarification. Your specialty is ergonomics. What is that?
DAVID ROY: Ergonomics is the science of fitting the task to the person. It's really - it's really balancing the human capabilities with task demands. And if you can in your mind look at the old triple balance where you have work demands on one side and human capabilities on the other, we really have to look at that carefully. And I think that's a major point of consideration for this discussion.
PHIL PONCE: And joining us now is Charley Richardson, who's the director of the technology and work program at the University of Massachusetts - Lowell. That's a center that looks at how technology affects the work force. Mr. Richardson, what are employees being called upon to do with this new technology that they weren't called upon to do in the past?
CHARLEY RICHARDSON: Well, new technology is changing the very nature of work in literally hundreds of different ways. People - jobs are less secure; they're more movable. People are being monitored all the time on their work -- in their work. People are having to learn new skills constantly. It creates a certain amount of stress or a great deal of stress in the workplace.
PHIL PONCE: Amplify on the stress business. What is causing the stress?
CHARLEY RICHARDSON: Well, there are a number of things that cause the stress. One is that the demands that are placed on people because the technology is sort of constantly watching what they do, the demands that are placed on people just creates a great deal more stress. They have less ability to balance their work throughout the day, and instead of turning in a certain amount of work at the end of the day, they are now being watched, you know, by the minute in terms of how much work they produce. It just - it raises the stress level. I always tell people to think about what it's like to drive with a police officer right behind you. It changes your relaxation, your stress level as you drive.
PHIL PONCE: Mr. Richardson, one of the things that technology is presumably supposed to do is to help people be "more productive." Are people being more productive?
CHARLEY RICHARDSON: Well, I think in a lot of cases people are being more productive. The problem is that if you're more productive, than there probably is a need for less of you. And that means that people -- jobs are less secure. People are losing their jobs as jobs are being automated. I mean, give you an example. There used to be somebody that came around and read your electric meter or your water meter. That was a job that people used to get in to higher paying in those companies. Now a van drives by your house at 35 miles an hour and reads every meter on your street. Now we have one or two people doing jobs that used to be done by thirty or forty people.
PHIL PONCE: Mr. Saffo, your take on the level of stress and the resultant productivity.
PAUL SAFFO: The danger with computers is that oftentimes the temptation is there to do things with them that just may not make sense at a human level. We do have today the equivalent of factory labor jobs of the last century, and those are tele-operators sitting at computer terminals, taking phone calls, having every key stroke monitored, having their breaks monitored. It's an intellectual tiger cage that I don't think anyone would really want to be in.
PHIL PONCE: Professor Goldin, how did people in the past adjust to the stresses of new technology?
CLAUDIA GOLDIN: Well, in the past, like today, there were many changes. And the best way to adjust is to remain flexible. In an ever-changing world, the object is to be able to change, that employability is the best thing, that what people who did who survived was that they got skills that could be used with the next wave of technology. Let me say that there has always been technological change. There has always been displacement. I really don't think we're going through anything that is unprecedented and unheralded in history.
PHIL PONCE: Mr. Saffo, do you see what some people are calling technophobia, the fact that some folks may be intimidated by this new technology?
A growing technophobia?
PAUL SAFFO: There is growing technophobia. Part of it, I think, is Mark Twain's observation, I'm all for progress; it's change I object to. But I'm afraid a big part of it is the fault of the computer industry, that David's business, ergonomics, has had too little attention paid to it. And for the most part, we're building inferior machines that are too difficult to use, that don't suit tasks well and don't suit people well. So what we see as technophobia may just be a very rationale reaction by people who are frustrated by the inferior equipment.
PHIL PONCE: Mr. Roy, you're in touch with people in the workplace. You encounter them presumably in your work. Do you get a sense that people are happier now than they used to be, before they had all these technological tools, or are they less happy?
DAVID ROY: It's really a function of the corporate environment. We've heard a few of the other speakers mention electronic monitoring, and that certainly is a cause of great distress for some people at organizations that do monitor their employees. I think the real challenge is going to be how do we design these jobs and use technology as a tool to enhance human performance. And really the way to do that is to go back to, you know, what is the function of the human being? And really the human is in the center of all of this. It is not an afterthought. And I'll give you an example. We were doing some work for one of our clients, a large financial institution with 100,000 employees. They bought $13 million worth of computer technologies that included 19 inch monitors. That equipment was in a warehouse ready to be installed when they found out that the computer did not fit on the desk. That is an example of when two departments don't speak in an organization. Now imagine the impact if the human isn't considered in that equation as well.
PHIL PONCE: Mr. Saffo, speaking of communication, are people actually communicating more with each other, or is it a different kind of communication? Is it as satisfying a kind of communication?
PAUL SAFFO: Well, I think the jury is out. The fact that people are using so much of this technology and communicating so much over the Internet means it is satisfying some sort of need, and especially the work being done out of the office is entirely voluntary. But I think it's a good thing.
PHIL PONCE: Professor Goldin, in the past, has there been a lag time between the time that an innovative technology is developed and the time - the time in which the work force can really take advantage or be comfortable with it?
CLAUDIA GOLDIN: There certainly is. And we have heard for the past 15 years computers are everywhere. And then the response is by many -- but where are they in the productivity numbers, because we have had a productivity slump for a fairly long period of time.
PHIL PONCE: So you're saying productivity is down now?
CLAUDIA GOLDIN: Productivity has been relatively low since 1973. In the past two years productivity has increased, but we're still not at the levels that we were at over the long-term before 1973. But we do have a very interesting piece of history. If we go back to the period of time that I just referred to, which was the electricity revolution - it could have been said in the nineteen teens electricity is all over the place, but it's not in the productivity numbers. By the 1920's it was in the productivity numbers.
PHIL PONCE: So you're saying that it can take a while, but the productivity wave makes itself evident?
CLAUDIA GOLDIN: That's right. And some of it just has to do, as one of the panelists said, in how we use technology, in technology itself. These products have their own life cycle. When we first got mass produced cars, you didn't put a key in the ignition and turn it to start it. You had to work very hard to start it.
The workplace of the future?
PAUL SAFFO: Well, the computers are going to become steadily less visible. The big boxes on the desk are going to start to disappear. The desks will stay, but people will spend less time at those desks. The devices are going to diffuse much farther out into the workplace than they have so far. Ten years from now we'll look back at amazement to think that anybody in the late 1990s thought that computers were important at all compared to what lay ahead.
PHIL PONCE: Well, I thank you all for joining us on this Labor Day. Thanks a lot.
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