Decision Making in the Digitalization Age: Who Decides?
“Ergonomics (or Human Factors) is the scientific discipline concerned with the understanding of interactions among humans and other elements of a system, and the profession that applies theory, principles, data and methods to design to optimize human well-being and overall system performance.”[i]
According to Gartner, “Digitalization is the use of digital technologies to change a business model and provide new revenue and value-producing opportunities; it is the process of moving to a digital business.”[ii]
The concept of the “Human—Machine Interface” is well established for Industrial Control Systems (ICS) and is the way the human being directs the machine. One wonders; however, if in the age of the Industrial Internet of Things (IIoT) whether this linear relationship is still true?
If the Behaviors of quasi-independent systems are different than that of an ICS, the R B C model suggests that in these new Conditions, the Relationships between the Humans and these new Machines (digital business) will be different as well. If this hypothesis is true, what are the implications going forward?
We routinely let machines make life and death decisions. Common examples include, airliner autopilots, automobile cruise control, and more recently the forthcoming self-driving cars. Moreover, medical procedures are increasingly automated. Boundless other instances exist as well.
When it is appropriate for the human to intercede in automated decision-making processes? What happens in a business setting if the human is wrong?
High Reliability Management
Management is evolutionary, not revolutionary. Each generation and business model builds on thousands of years of human experience.[i]
The current High Reliability Management (HRM) model seems to address these emerging decision problems well. The model consists of five traits:
- Sensitive to operations
- Reluctant to accept “simple” explanations for problems
- Preoccupation with failure
- Defer to expertise
- Are resilient
Applying these traits at the operational level allows the human to focus on the overall set of processes while allowing the machine to make its appropriate decisions. With supervisory expertise coupled with an understanding that failure happens, policy can be set that enables the human to intervene as necessary without career repercussions.
Moreover, IIoT is complex by nature and largely focuses on operational processes. Implicit is the need to respond quickly to events, i.e., resilience.
At the dawn of digitalization, management is already equipped with the tools to manage the largely automated enterprise. How these tools are deployed is the difference from adding shareholder value vs destroying it.
Do Intelligent Machines Have a Culture(s)?
Hollywood has long presented cyborgs and other robotics as human like. While we may be some years from truly independents machines, they do exhibit certain behaviors based on a given set of conditions. This generates a relationship with human administrators.
So, if organizational culture is the ‘way we do things,’ then one can surmise machines do have a culture (somewhat dependent on the human programmers). If this hypothesis is supported, then the era of digitalization must add one more culture to its multi-cultural engagement processes.
What is your Firm’s Decision Model in the Age of Digitalization?
For more information on Cross Cultural Engagement, check out our Cross Cultural Serious Game
Critical Mass: Value from the RBC Framework
Nuclear physicists define the term, “critical mass” as the amount of fissile material whereby a nuclear reaction is self-sustaining. From that original definition, the construct is further developed along societal and political terms as a function of the environment and number of adopters and their interdependencies that create enough of a consensus for individual actions that sustains an undertaking.
In 1996, the author published the first of several case studies on a societal interaction model based on the Relationships, Behavior and Conditions (RBC) construct among economic actors. Previously the model was only in the domain of academia.
This blog addresses contemporary issues from the RBC perspective and whether in the present state they are sustainable or not. Many readers may be familiar with the “Innovation Adoption Curve.” RBC seeks to enlighten the causality of behaviors that cause movement towards the critical mass that generates movement along this diffusion curve.
- Agility, Resiliency, Sustainability May 14, 2020
- Disrupting Disruption! May 11, 2020
- Tumultuous Decade: What’s Next for Oil & Gas? April 20, 2020
- A Funny Thing Happened on the Way to . . . Innovation! April 4, 2020
- Is Big Data Analysis Being Applied? March 24, 2020
Other Blogs by Dr. Shemwell
Dr. Shemwell is an author/contributor for the following 3rd party blogs.
So, You Want to be an Entrepreneur
Dr. Shemwell is a member of the Global Energy Mentors (GEM) Leadership Team. Every month he or one of his colleagues is posting timely tips to help entrepreneurs navigate the energy start up sector. Check out the Landing Page.
Governing Energy Blog
BTOES Insights is the content portal for Business Transformation & Operational Excellence opinions, reports & news. Dr. Shemwell is a contributor.
Consult 2050 connects organizations with a wide range of consultants all around the world. The firm operates an online marketplace for consultancy services.
Essays on Business and Information
This two volume set covers a series of newsletters and opinion pieces published circa 2002-2009, including Bug Lore–Lessons for the Online Economy that addressed real time systems vulnerabilities from Y2K (1998-99).
About the Author
Dr. Scott M. Shemwell has over 30 years technical and executive management experience primarily in the energy sector. He is the author of six books and has written extensively about the field of operations. Shemwell is the Managing Director of The Rapid Response Institute, a firm that focuses on providing its customers with solutions enabling Operational Excellence and regulatory compliance management. He has studied cultural interactions for more than 30 years—his dissertation; Cross Cultural Negotiations Between Japanese and American Businessmen: A Systems Analysis (Exploratory Study) is an early peer reviewed manuscript addressing the systemic structure of societal relationships.