Chapter 20: Prospects for the New Century

In 1879, Thomas Edison invented the carbon filament incandescent light bulb. Two years later, he unveiled another invention—the central generating station—that would make widespread usage of the electric light bulb possible. The great American inventor thus ushered in the electrical age. But as the economic historian Paul David has shown, it would take another forty years for electricity to have a significant impact on the overall economy. Though visionary engineers had extolled the potential of electricity as early as the turn of the century, it was not until the 1920s that all the necessary factors were in place for this new technology to be productively used on a large scale. One of the important developments, for instance, was the replacement of bulky centralized sources of steam power in factories by numerous small electric motors, which, in turn, allowed radical simplifications of factory floor designs. Once that point was reached, U.S. industry enjoyed an unprecedented jump in productivity, one that continued for nearly a half-century (David 1990, 2000).

In the case of electricity, nearly a half-century was required for a transforming new technology to have its first significant impact. Once that impact was felt, however, it turned out to be a sustained one, lasting another half-century. The story of electricity is a useful one to recall when contemplating the likely progress of the information technology-induced changes we are now living through. The changes we describe in this volume won't be completed in a year, or a decade. Instead, successive waves of change will continue to sweep through firm after firm, industry after industry, for many years to come.

One of the most effective ways to approach this period of change will be with an experimental, inventive attitude. Lots of new ideas will emerge and get tested in the continually evolving environment. Some will work the first time they're tried; many won't. In retrospect, we'll be able to look back on the winners and see a logic behind their success. But that logic will remain elusive in the maelstrom of uncertainty in which the bets will have to be placed.

Navigating through a turbulent time of this sort will require the imagination to see new possibilities, the willingness to try new things, the flexibility to improvise along the way, and the ability to learn from experience. Most of all, however, making wise choices in this uncertain environment will require a deep sense of what we want in the first place—for ourselves, our organizations, and our societies.

History has given us an unusual opportunity to make choices today that will lay the foundations for a new organizational era tomorrow. We hope this book can help us all make those choices as creatively, as intelligently—and as wisely—as we possibly can.

References

David, Paul. 1990. The Dynamo and the Computer: An Historical Perspective on the Modern Productivity Paradox. American Economic Review 80 (May): 355–361.

David, Paul. 2000. Understanding Digital Technology's Evolution and the Path of Measured Productivity Growth: Present and Future in the Mirror of the Past. In Understanding the Digital Economy, edited by Erik Brynjolfsson and Brian Kahin. Cambridge, Mass: MIT Press.