InnovationStartup general interest

The coming legislative, political and philosophical challenges

By March 18, 2013 3 Comments

There is an interesting article by Om Malik on GigamOM today about disgruntled Uber drivers and how they represent the thin end of the wedge of a change in labour relations. It seems these Uber drivers were dropped from Uber because they weren’t highly rated. It is easy to say that good service should be valued and hence this is fair enough, and I think that is the dominant narrative here, but the employment regime has shifted for these drivers reducing their job security and making them vulnerable to user feedback in a way that they weren’t before.

Om’s point is that there are an increasing number of Uber-like companies with on demand workforces that could also get disgruntled and that as a society we need to figure out what constitutes acceptable practice in this new world.

The same point can be made about the current battle raging between privacy advocates and big online advertising companies like Google and Facebook. As a society we need to figure out what constitutes acceptable practice for the harvesting and use of personal data for advertising purposes.

In both these debates there is much to be gained from getting it right and much to lost by getting it wrong. Regarding on demand workforces, on the one hand the promise of better utilisation of assets held out by Uber and other similar companies offers big productivity gains, but on the other hand we risk a wave of labour unrest. Regarding privacy, on the one hand using data to make advertising more effective can reduce waste freeing up money to spend on producing better content, whilst on the other abusing privacy risks undermining consumer trust and destroying long term value.

All of this leads me to the killer quote from the GigaOM article:

the challenges of the connected future are less technical and more legislative, political and philosophical

The article doesn’t offer any solutions, and I can sympathise with that. There is no answer that is ‘right’ in any fundamental sense, so all we have are ideas about what will be ‘best’, but best for me might not be best for you – e.g. if you are an Uber shareholder and I am an Uber cab driver. However, I think we might be able use the lens of efficiency or productivity improvement to judge which of these ideas of ‘best’ might in fact be best for society overall. These are complex questions and solutions will necessarily be both piecemeal and complex, but if we navigate towards solutions that unlock value then there should be many more winners than losers overall.

One of the reasons all of this is difficult is that technology is moving very fast whilst political and philosophical norms emerge slowly and legislation is best characterised as being a slow moving and blunt instrument.

For startups to be successful over the long term in this environment they need to win in the court of public opinion as well as in the market place. The best way to do that is to build products that people love and to try and act in the interests of all of your stakeholders, be they customers, employees, or an on-demand workforce. There is a bit of a tendency at the moment to treat on-demand workers as a flexible resource to be used and abused at will. I’m now wondering how sustainable that will be.