The case for the death of cash by the hand of digital currencies

By

Recently I gave the opening keynote at the ATM and Branch Automation Seminar run by Payments Consulting Network.

In my keynote I spoke about the broader trends in technology, society, and business, and then looked at some of the uncertainties impacting ATMs and branches. Clearly one of the most important is the future of cash.

I noted that while I’m happy to predict the timing of the death of newspapers, I’m not prepared to make firm forecasts on the death of cash. The uncertainties are simply too big.

There are many payment mechanisms that are replacing cash, notably mobile wallets and contactless cards, and in many developed countries there is clear evidence that these are beginning to reduce demand for cash.

However this does not mean cash will die.

It is a useful futurist exercise to ask specifically why cash might be resilient and still be used for a long time to come. The more important reasons for people continuing to use cash include:

– Black market. Cash is the preferred means of payment for illegal activities. €1 million in €1,000 notes weighs just over 1kg. Beyond organized crime, the informal economy is often significant, with for example estimates of the share of Italy’s economy that is undeclared ranging as high as 50%.

– Personal anonymity. Many individuals engage in transactions that they don’t want their spouses, for instance, to be aware of, or simply don’t like what they do being tracked by banks, credit agencies, or anyone else.

– Concern about financial system. During the 2008-2009 global financial crisis cash issuance went up substantially, driven by fears that banks were not secure places to hold assets. It is interesting to note that in many countries the amount of cash issued continues to rise, while retail cash transactions start to decrease, suggesting an increasing role of cash as a store of value. As much as 60% of the cash float in Switzerland is in CHF1,000 notes, which are rarely used for purchases.

– Immediacy. Recipients of cash can use the funds immediately, leading to discounts for cash payment. Payment processing is getting faster, often to next-day, and in many countries there is a push for real-time payment processing, however the timeframe and scope for that is not clear.

– Habit. Many people are used to cash and like it.

These are indeed solid reasons for many people to like cash. This would seem to provide ample reason for cash to continue to exist indefinitely.

HOWEVER… it turns out that digital currencies such as Bitcoin have the potential to address almost all of these issues.

Bitcoin provides anonymous, immediate transactions. It is transacted entirely outside financial institutions.

Its existence and value is independent of governments that issue fiat currencies. As trust in governments’ financial situations erode, this suggests that people will seek to move away existing currencies.

The last few years’ experience suggest that Bitcoin is a solid, well-tested platform. If we start to get critical mass in acceptance of Bitcoin and well-designed mobile and web Bitcoin wallets it is absolutely possible for it to be a significant rival to cash for peer-to-peer payments.

On the point of habit, it is worth noting that people wanting something doesn’t mean that it will be available. Just as demand for printed newspapers doesn’t mean that there is an economic model for printing them, cash will only have value if people or shops still want to accept it.

Just as check processing systems are likely to be shut down as check usage drops to sufficiently low levels, if cash usage erodes enough, many retailers may not want to accept it and it may not be worth continuing to support as a payment mechanism.

There are however three major challenges for Bitcoin completely replacing cash.

– Volatility. If Bitcoin gathers greater acceptance, given there is a finite number of possible Bitcoins, there will undoubtedly be price overshooting as people join the system, and subsequent price adjustment. As a result, it is highly unlikely that Bitcoin prices will stablize for the foreseeable future. Since one of the major uses of cash is as a store of value outside of the financial system, Bitcoin will not meet those needs well.

– Ease of use. Buying, storing, and transacting Bitcoin can be complex and unwieldy. For broad-based uptake of Bitcoin extremely easy-to-use interfaces to the currency would be required.

– Government regulation. The Canadian tax office recently released a fact sheet on Bitcoin; other government agencies are beginning to grapple with the many implications of Bitcoin’s rapidly rising usage. It is possible that some governments will seek to effectively ban Bitcoin, or regulate it to a degree that makes it unattractive to many people. It can still be valuable to those who seek anonymity, however it could never be a de-facto currency if it is not within regulated use.

This is of course a very simple analysis, and there are many other issues to consider. However there remains a real case that cash could in fact die – or have very low levels of usage – before long. The very important reasons listed above for cash to continue could all be massively eroded by digital currencies.

In short, digital currencies such as Bitcoin MAY be enormously disruptive to cash and payments. The thought experiment is very useful, though uncertainties still abound.

Payments are at the heart of business and society, and it matters enormously if they fundamentally change. There are many other dimensions to the changing payments space, and I will be closely following its evolution.

 

How technology is enabling the humanity of organizations

By

After my recent opening keynote at the SAP Australia User Group Summit on Leadership in Enterprise Technology, I did a video interview for Inside SAP magazine, shown below.

The full transcript of the interview is available on our new publication CIO of the Future.
Read more →

The future of technology in health care

By

Recently I gave a keynote speech on The Future of Technology in Aged Care at the Aged Care Association Annual Congress. I took the audience on a big-picture journey into where aged care is going, which went down very well between the many high-detail presentations at the conference.
Below is a brief snapshot of the five key ideas that I presented:

1. Telemedicine

Health care is being transformed by connectivity. This ranges from simple applications such as monitoring medical data through to remote surgery, bringing the skills of the best doctors anywhere in the world. Accenture’s Online Medicine Cabinet is an example of how patients and the elderly can have their health monitored from home, and their medications managed effectively. Now robots such as the one in the video above can visit patients or do rounds in the ward, linking them directly by video to doctors or nurses.

2. Care robots

Japan is in the vanguard in using robots in aged care, being at the most pointed confluence globally of a rapidly aging population and a lack of health care workers. Increasingly the basic work and functions – both at aged care institutions and in people’s homes – will be performed by robots, or in some cases, such as in the video above, by people assisted by robots or exoskeletons.

3. Emotional robots

We will become increasingly emotionally engaged with robots. Paro the seal robot, which I first wrote about in 2004, is being used to help the elderly, people with Alzheimers and schizophrenia, and sick children. The first video above shows Paro being used in therapy, including of a Japanese Prime Minister. The second video reports on a recent study by St Louis University which showed that the robotic dog Aibo was as helpful as a real dog in helping seniors to feel good and engage with the world around them.

4. Connecting

While younger people have tended to take up social networks more than the elderly, most people underestimate how many old people are engaged in online communication with their family and peers. Over two years ago, 18% of Americans over 65 had shared content online, with photo sharing common in this demographic. The key thing that will allow elderly people to engage in technology is easier interfaces. As shown in this video, new interfaces such as that on the iPhone make access to technology far easier. We can expect social networks for the aged to grow rapidly, for example the Grandparents Network described at the Online Social Networking and Business Collaboration conference.

5. Getting better

Technology should not just ameliorate our problems, it should make us better. Technology, including games, can help us to keep our minds alert and engaged, which has been demonstrated to delay dementia. Beyond this, a whole array of new technologies will give us more possibilities as humans, especially in enabling our thoughts to get things done.

What is the future of Learning & Development department?

By

Recently I gave the keynote for the first breakfast seminar run by CADRE, a leading elearning design company, for senior executives of its clients. The topic of my presentation was The Future of Learning, giving a big picture view to kick off their series.

This is a brief description of my presentation:

Challenges for organizations are mounting from intense global competition, empowered consumers, and generational shifts. At the same time, building more effective learning is becoming central to achieving organizational success. This session will use a rich array of examples to look at:
• The driving forces shaping learning in organizations
• What the successful organizations of the future will look like
• Learning in a social network world: the new opportunities
• The context of learning: personalized, mobile, relevant
• Creating the future of learning: key action steps

At the conclusion of my presentation I got the audience to break into groups of 5-6 and assigned them discussion questions.

One of the questions I posed was ‘What is the future of the L&D department?’
Read more →

The future of information infrastructure

By

Recently I gave the opening keynote on The Future of Information Infrastructure at the Implementing Information Infrastructure Symposium.

CIO magazine did a nice article titled IIIS: Big Data driving new trends which reviews my keynote and the one immediately after from Steve Duplessie, one of the world’s top analysts on data and storage. It says:

Speaking at the event, co-hosted by Storage Networking Industry Association A/NZ and Computerworld Australia, strategy advisor, author and futurist, Ross Dawson, said “reality mining” — the gathering of data based on the activities of people in a given environment — was a major trend to emerge out of, and contributor to, Big Data.

“If you look at an office environment there is an extraordinary amount of data to look at. For example, what gestures people are making, where are they looking, what conversations are they having, how much are they smiling when they speak to each other?” he said.

“You can literally get terabytes of data out of just a few hours of this. That data is being collected to drive productivity; to design new ways to enhance collaboration and create value inside organisations.”

Read more →

Six radical visions for the future of health

By

[See more information on Ross Dawson’s keynote topic Shaping the Future of Healthcare]

Recently I gave the closing presentation at the National Medicine Symposium, rounding out deep discussion over several days on how to get better use of medicines. I developed six radical ideas that could be part of the future of health. The intention was to be provocative rather than rigorous, generating new ways of thinking about how healthcare may evolve.

Here are brief summaries of the six visions I presented:

1. Complete data.

future of health

Image source: Toto

The amount of information that we have about the health of an individual could become comprehensive, generating terabytes of data from just one person. Bathrooms that monitor not just what we excrete but also analyze our skin color and tone as we look in the mirror are just the beginning. Images and sensors could record everything we eat and all medicines we take, providing far better analysis on the effectiveness of drugs. Odor is a highly data-intensive yet effective way to identify maladies. We could build virtually complete data sets of our health on a second by second basis.

2. Personalized medicine

health futurist

In a world in which individual genomes can be sequenced, we can not only identify which drug will be most effective for the individual, but potentially also synthesize pharmaceuticals for one specific person. While the cost will be high, some will be prepared to pay and there will be pressure for insurers to bear the cost.

3. Radical life extension

health trends

The trend for over two centuries is that for every decade that passes, life expectancy in developed countries increases by two years. If this varies, it is most likely to the upside, severely aggravating the existing aging of the population. The implications for healthcare would include not just new treatments, but a massive increase in aged care support.

4. Robot help

Robots and artificial intelligence will have manifold roles in future healthcare, including avatar doctors, exoskeletons for nurses, and automated surgery. One of the most important tools will be emotional robots that can demonstrate empathy and help patients in their recovery.

5. Modular R&D

pharma R&D

The current pharmaceutical research and development chain is broken in many ways, driven by creating blockbuster drugs and rapidly running out of steam. There is an opportunity to break down R&D into discrete components from discovery through to clinical trials and regulatory approval, each of which is funded separately. If effective profit-share mechanisms can be created, risk will be distributed and there could be a flourishing of drugs developed for smaller markets. Innocentive, originally founded by Eli Lilly, is just the first step in distributed pharma innovation.

6. Self-serve pharma

Image credit: C-Ali

Patients now have massive medical information available, and they have the time and incentive to do research into what would be relevant to them. Why not throw out drug regulation, and leave people to make their own choices if they want? Most would rely on doctors, but others would self-medicate, usually extremely well. The world of self-serve pharma has already begun. How far will it go?

Keynote speech – The future of local government

By

Recently Australian futurist Ross Dawson gave a keynote speech on ‘Creating the future of local government’ at the Local Government Association of Tasmania‘s annual conference. On the occasion of its 100th anniversary, the association wanted to look forward to the future.

The current issue of the association’s magazine, LGAT News, contains a write-up of his insightful keynote speech:

“In a defining era for government globally, councils are in the front-line of changes and challenges and are best placed to take the lead in turning these challenges into opportunities.” This was the message to Tasmanian councils from leading business futurist, Ross Dawson, in his keynote address to conference delegates.

Mr. Dawson said among the prominent trends were the rapid ageing of our communities, particularly in regional areas, changing patterns to work enabled by communications technologies, heightened expectations of service and a widespread desire to ensure our society is sustainable. “Councils need to address these shifts in their organizational structures, from attracting and inspiring talented younger workers, to making the knowledge and expertise of their most experienced staff available beyond their retirement,” Mr. Dawson said.

“The ability to collaborate easily and effectively is now fundamental for any organization and one of the biggest opportunities is for councils to get their communities truly involved in their day-to-day thinking, Around the world, forward-thinking local councils are creating powerful ways for their residents to participate, contribute, and to have genuine conversations across their communities on the issues that really matter to them. Tapping into the ideas and energy of local residents can help to generate better outcomes than ever before,” he said.

“Elected representatives could also benefit greatly from understanding the current dramatic shift in how people communicated with their peers and friends. Those who can participate genuinely in the new flow of online conversation will be best positioned to have their voices heard and views supported,” he said.

“The vital role played by Local Government will grow even more important in the decades ahead as greater value is placed on peoples’ local communities. Local Government is the closest tier of government to the people and is central to creating a prosperous world for our citizens. It just needs to recognize and effectively respond to the inexorable forces of change,” Mr. Dawson concluded.

Contact keynote speaker on future of local government Contact

Energize your event with leading futurist and keynote speaker Ross Dawson’s compelling and inspirational presentations that leave audiences stimulated. Contact Ross Dawson’s office today to discuss the precise keynote topic and title that will best meet your requirements.

Future of customer service – Marketing futurist Ross Dawson

By

Recently marketing futurist Ross Dawson gave a keynote speech on the ‘The future of customer service’ at KANA Connect in Las Vegas.

In his keynote he packed in a wide-ranging view on where customer service is going, including the impact of connectivity, the rise of new channels, where value will reside in relationships, and what supports the integration and integrity that will be at the heart of successful customer service.

Following is a brief extract of the content Dawson covered in his keynote speech.

marketing futurist

Back in 1999 Evans and Wurster in their book Blown to Bits said that the trade-off between richness and reach had disappeared. That wasn’t true. Today the trade-off between what I prefer to call Relationship Strength and Efficiency is eroding, but still exists. The challenge today is to continue to push out against that trade-off, while recognizing that it will never entirely disappear.

A large part of the path forward is in using technologies. There are three categories of channels for customer service:

Presence: There is no substitute for people being physically present in the same place, which allows them to sit down together, converse, relate as humans, and discover more about each other. Shop fronts and meetings will always have their place in customer interaction, however increasingly physical venues will also incorporate other media for accessing customer service.

Human connectivity: The majority of customer service is provided by people, connected to customers via communication technologies. This includes voice, however now includes email, chat, video, and social media.

Automated: Beginning from Interactive Voice Response (IVR), technology is now providing automated interaction using instant messaging, avatars, intelligent voice interaction, and a range of new technologies using the cutting edge of artificial intelligence.

For different industries, countries, customer segments, and companies there will be very distinct issues.

– Physical presence in branches or stores may still be important in some cases, but its role is usually eroding.

– Human connectivity is rising in importance, not least with social media becoming a significant channel for customer service. Quality people are still required, however richer interaction through a variety of means including and beyond telepresence can create far stronger relationships.

– Automation is still a frontier in truly being able to build rather than erode customer relationships, however intelligent implementations are moving into that territory.

Across these categories of customer service channels, there are of course key issues in selecting appropriate channels, and where appropriate migrating or guiding customers to the right portfolio of channels.

Not surprisingly in a world of channel proliferation, things are getting more complex rather than easier. However those companies that can use technologies to push out the trade-off between efficiency and relationship strength will undoubtedly lead their industries.

Contact keynote speaker on future of local government Contact

Energize your event with leading futurist and keynote speaker Ross Dawson’s compelling and inspirational presentations that leave audiences stimulated. Contact Ross Dawson’s office today to discuss the precise keynote topic and title that will best meet your requirements.

5 fundamentals for presenting to executive teams about the future

By

By Ross Dawson

This year I am very frequently speaking to top executive teams about the future of business. These presentations are often scheduled during strategy offsites or as part of leadership development programs. Sometimes these are full-day workshops; more often I have 45-90 minutes to work with.

My objective is to stimulate executives to think beyond the everyday, get new ideas, and develop an optimistic mindset about the challenges and opportunities afforded by the extraordinary pace of change today. Many clients want their executives to take the attitude of Embracing the Future, one of my most popular speaking topics.

Given the brief time I often have to create lasting energy and initiatives, these are some of the approaches I find most effective.

Use industry and in-house examples. During my briefing I uncover situations and stories that are currently most discussed in the organization. I always use industry examples but it is also valuable to identify issues that executives can recognize as their own.

Create participation. I often structure my time into two or three brief presentations, each followed by custom-prepared discussion topics or case studies. Engaging with key questions during the session makes it far more likely that those conversations will continue.

Balance awe and inspiration. These days it is easy to blow people away describing the extraordinary things that are happening in domains such as online sharing, genomics, robotics, and augmented reality. It is good to help people understand quite how fast things are changing, however that can easily become daunting. The emphasis must be on the actions that can create opportunities and build success.

Demonstrate that new thinking is necessary. Talk is cheap. Giving clear case studies of the how companies are successfully embracing new approaches helps to shift attitudes. In a recent session on the future of business I did for a corporate leadership group, real-life examples led to genuine discussion on how to change the organization.

Create an appetite for thinking about the future. There is massive value for organizations to think in a clear way about the future and how they can build their success. However for most companies their interest extends as far as hearing from a business futurist. It is important to help companies understand how they can build broader initiatives to drive long-term thinking and strategy.

Contact keynote speaker on future of local government Contact

Energize your event with leading futurist and keynote speaker Ross Dawson’s compelling and inspirational presentations that leave audiences stimulated. Contact Ross Dawson’s office today to discuss the precise keynote topic and title that will best meet your requirements.