Horst Walther

My near philosophical musings about the world in general its problems and possible ways out.

2018-05-21

Europe, which Europe?

The European Union has yet to be created.


See https://www.washingtonpost.com/news/worldviews/wp/2016/06/20/the-rise-and-fall-of-europe-in-maps


Why Trump Can Safely Ignore Europe, Its Leaders readily condemn but never act” Jeremy Shapiro, Director of Research at the European Council on Foreign Relations, writes, on May 15, 2018 in Foreign Affairs. Does Shapiro just convey the usual Trumpish anti-European propaganda? Or does he rather pinpoint a symptom of European helplessness, its inability to find a common voice, its unwillingness to strike bold actions.

The image that lingers at the end is one of European powerlessness.“ the same author summarizes his opinion in the Financial Times.

America is no longer a reliable partner", German Chancellor Angela Merkel was quoted earlier and “Europe must plot its own course”.

You may ask if it ever was. I mean, whether it was ever a partnership or just the rule of a far superior hegemon: the gorilla as an equal partner of the rhesus macaque, but this is the less important part of the message. It'll soon be a thing of the past anyway.

So where is Europe now in the moment of need? Does it exist at all? Or is it just a phantom of wishful thinking? These three discouraging random quotes seem to reveal some deeper truth: There is no Europe – at least not in the sense of a player on the global stage. 

Despite all European treaties Europe is unable to act a single political entity: “The European Union is based on the rule of law. This means that every action taken by the EU is founded on treaties that have been approved voluntarily and democratically by all EU member countries.” 

The keyword here is “countries”. The EU is just a web of treaties, a loose association of stubbornly independent nation states that jealously and at all costs want to maintain their specific foreign policy profile and serve the vanities of their - in global comparison - local chiefs.

So it is not democratically legitimated by the “European people” in one direct step but rather so by the insertion of one more level of indirection. And exactly this one additional level causes nearly all the trouble. 

The underlying principle became known as the subsidiarity principle. It could well have been understood as an opening clause for the EU to become a more state like actor. In that sense however it has rather created adverse effects.  

It rather gives the impression, and everyone emphasizing the subsidiarity principle is confirming it, that acting as a single political entity is neither intended for the EU, nor would it be tolerated.

Is there no one opposing to this obviously dysfunctional set-up, or even taking steps? Well there are several movements – from grassroots to semi-official. Interestingly the majority of movements advocating more direct ways of democracy are inherently anti-European. 

To prove that European peoples are different and must never be lumped together in one legal Unit, they are capitalising on old & plain stereotypes like, France dines, Italy sings, Greece dances, Germany works and the British maintain their strange sense of humour. 

Survival obviously is not an option for them - besides that the argument is flawed in itself as it does not take the intra-state diversity into account with even peoples, nations or tribes not exactly being voluntarily part of the states. 

There is anyway there is a growing feeling among economists, political scientists and even national governments that the nation state is not necessarily the best scale on which to run our affairs. We should better recall that far from timeless, the nation state is a recent phenomenon.

Before the late 18th century there were no real nation states, says John Breuilly of the London School of Economics. If you travelled across Europe, no one asked for your passport at borders; neither passports nor borders as we know them existed. People had ethnic and cultural identities, but these didn’t really define the political entity they lived in.

So, the nation state being a comparatively young concept, is its time is over anyway? Not to say it took its rise by sheer luck. The nation state can surely be understood as the inescapable consequence of some underlying developments, first and foremost to mention the enhanced means of communication via print, audio & video broadcasting, like newspapers, telegraph, radio, TV and more. Another driving force was the need to cope with the rising complexities introduced by the rapid industrialisation during the 19th century. 

On one hand several local issues can better be dealt with on – yes – local level hinting toward a more medieval model of interacting sovereign city states. On the other hand the mounting problems, we are facing, if it will not be too late already, can only be dealt with on a far higher level. Worldwide would be required. European level is to be considered as the minimum.

There are indications that it will be again a combination of emerging new technologies and mounting outside pressure that will pave the way to overcome that obviously temporarily helpful construct of a nation state. 

Digital transformation being more than a buzzword has the potential to transform not only the business sector but entire societies and finally the way we will rule our “countries”, or how ever these supra national entities will be called by then. (“Let algorithms rule – not politicians!” is in the making).

On the other hand a new era of renewed great power politics is emerging, with a far right America going wild following the script of an obscure Californian think tank, based in Claremont. Its members are dedicated followers of the German philosopher Leo Strauss and deserve a closer look. 

But already now we should have sufficient insight to expect that the “unleashed giant” US will relentlessly use their power and cause much trouble around the world – world war scale conflicts included. The sovereignty of no single European state will remain unaffected in this imminent struggle of the global powers. 

There are several conceivable scenarios of becoming marginalised and vassals of either of the great powers, either receiving our directions from across the Atlantic, becoming Finlandized at best or even being crushed between the fighting giants. Not a single pleasant scenario among them. 

All this said and with no pleasant alternatives at hand, I like to state that I got the strong impression that time has come to finally build the European state. There will be not much time left to act. 

Let algorithms rule - not politicians!



This contribution is still work in progress.

So please stay tuned.It will be coming soon.

2018-05-09

Religion's role in law and governance

In a panel discussion on religion and governance during the 2017 U.S.-Islamic World Forum, Brookings Senior Fellow Shadi Hamid asked the rhetoric question: Is Islam inherently political? Hamid emphasized that all religions may be similar in their general objectives, but that they have different characteristics and metaphysical underpinnings—and that matters. Islam’s founding moment, for example, intertwined religious and political functions, and this shapes how many, if not most, Muslims view religion’s role in law and governance. This doesn’t mean it’s a bad thing in public life, he said.

From an enlightened European point of view however it is “a bad thing”, even a very bad one. Not keeping religion and stately affairs strictly separate is the antithesis to any liberal democratic society. As in the major organised religions men speak on behalf of their god, for which by the very nature of the matter no verifiable justification can be given, no credible democratic legitimation can be demonstrated.

A democratic legitimation however is the fundamental precondition of any effective political activity. Therefore religion’s role must not interfere with that of law and governance if we don’t want to allow rolling back the achievements in political and personal liberation and inclusive participation of the last three centuries.

There is an open conflict brewing since the very first inception of the ideas of enlightenment. Of course, as these were genuinely European ideas, the conflict is confined to Europe. Consequently it can only be well understood here. Nevertheless aggressive European expansion exported these ideas to various places in the world – however with expectable varying degrees of success during their implementation.

So, historically this conflict is not new to us. Rather it is an old story for which we, if not a solution, we but found a Modus Vivendi. First monarchs and other worldly rulers, later democratic societies and their lawmakers and law enforcers, eventually managed to curb the powers of religious leaders to a more or less tolerable level.

The struggle however is far from being over – even if this might be the dominating impression. Most European states missed the chance for a truly secular constitution. One might well co-exist with a tamed, almost castrated church, which is carefully limited in its rights and whose influence is closely monitored.

We should have no illusions about the generally perceived compatibility of our Christian churches with the values of the Enlightenment. After all, it was only with the Second Vatican Council that the Catholic Church was pulled its poison fangs. Only by then in 1962, under Pope John XXIII, the Roman Catholic Church declared its support for religious freedom in the civil societies and advocated an intensified dialogue with those of other faiths or non-believers.

With the advance of a younger and even more aggressive religion in the heart of Europe, whose very concept is inherently political, as innocently stated above by the renowned scholar Shadi Hamid, the incompleteness of the transitions of our European constitutions to define truly secular states becomes strikingly apparent and may even result in fatal consequences.

A few years ago this perception may have been viewed as an extreme position or more bluntly as a kind of political paranoia. With the electoral successes of political retro-movements across the globe however, every liberal democrat with some respect for the achievements since the inception of enlightenment cannot be paranoid enough.

Not only that religious neutrality is far from being achieved globally, even in Europe, arguably the most secular region of the world, seven countries still have laws on the books dealing with blasphemy.

In Ireland, Malta, Poland, Greece, Italy, Russia and Denmark, it is still possible to face criminal charges for blasphemy, although in practice such prosecutions are rare and in most cases impossible due to constitutional guarantees on freedom of expression.

As another example of restorative ultra-conservative politics just recently the Bavarian Premier Markus Söder gave order to mount crosses or crucifixes in all public stately buildings. This move was sharply criticized even by head of the German Bishops' Conference as not helpful and an abuse of religious symbols for plain political purposes.

On one hand the brilliant German constitution expresses its strict neutrality towards religious affairs and no person is allowed to be discriminated due to his beliefs. On the other hand however, the jurisdiction of the Federal Constitutional Court has so far evaded a really clear consequence in cases, such as the famous crucifix ruling.

The renowned German lecturer of constitutional law, Horst Dreier, has recently published a book on this problem. It is currently only available in German and, admittedly, deals with these global issues in a very German context. I elaborated on it (but also in German) elsewhere before.

Horst Dreier warns against a neo-obscurantism that in the course of a worldwide retro movement even creeps into the otherwise so sober arguments of constitutionalists.

He devotes an entire chapter to a key state-law sentence which is indispensable for understanding the fragility of the free constitutional state and which has become known as the "Böckenförde Dilemma" .: "The liberal, secularized state lives on conditions that it itself cannot guarantee. ...”. This sentence expresses that the state rests on a foundation of values that it can influence but has not created itself. 

The Böckenförde dictum, however, points in the direction in which the main work ahead of us has to be done: to compose a set of basic values which underpins the fragile structure of the "secular constitutional state" with a stable and sustainable foundation, despite all the diversity of its people.

Today we foolishly accept the civil liberties for granted. Last year I even had an unsettling discussion with an otherwise lucid thinker, stating: “The classic liberalism, which fought for civil liberty, is done in the West - mission accomplished. Today we find that the Western lifestyle - SUV, diving in Bali, eating meat seven times a week – is destroying our planet.” Another participant added “In my humble opinion, classic liberalism, which was quite meritorious, essentially had its day 100 years ago. Since the end of the 19th century, the main challenges of modern people have been the collective regulation of social and economic problems.“ 

Besides some misconceptions about the nature of the liberal ideas (do be dealt with 
here later) I don't think classical liberalism is obsolete. 

In a few Western countries we may no longer have to fight for our civil liberties. This work was indeed done by our forefathers. It was them, who once won these freedoms in struggles against secular and religious authoritarian rulers. And quite a few gave their lives in devotion for these goals.

But today again we have to defend them, if we like to continue enjoying them. They are currently under attack from several sides – not least from the renewed attempts to intermingle the rational world of politics with the metaphysical world of religious beliefs.

My repeated reference to the early days of struggle for civil liberties hints us at the limitations of liberal societies: We must not allow intolerance to be tolerated. It cannot be the characteristic of an open and free society to give room to the enemies of civil liberties to eliminate the very same again.

No, quite to the opposite, we should stand up as we once did, when civil liberties had been “invented” some 300 years ago.

2018-05-06

Staat ohne Gott - Book Review

By the way, I'm writing this book review in German language as the book is written in German and it is about the German view on things, with many very German - terms.  The article could therefore not even be conceived in English. It would have to be laboriously translated, which anyway goes wrong most of the time. 

Übrigens schreibe ich diese Rezension ausnahmsweise auf Deutsch. Denn das Buch ist auf Deutsch geschrieben und es geht um die Deutsche Sicht auf die Dinge, mit vielen sehr Deutschen – Begriffen.  Der Beitrag könnte also gar nicht auf Englisch erdacht werden. Er müsste erst mühsam übersetzt werden. Und das geht eh meistens schief.

Nach einem Buch, wie diesem, Staat ohne Gott -Religion in der säkularen Moderne von Horst Dreier, hatte ich lange gesucht.

Der Bedarf kam während einer Diskussion auf, als ein Teilnehmer fragt, ob der Koran eigentlich mit dem Grundgesetz vereinbar wäre. So habe ich das Grundgesetz gelesen und den Koran – beides nicht gerade Nachttischlektüre - und jetzt also den namhaften Verfassungsjuristen Horst Dreier. 

Zwar sind in guter Verfassungsjuristenmanier ein größerer Teil der Seiten mit Fußnoten gefüllt. Ansonsten schreibt er aber für einen Vertreter der Akademia dieser Richtung erstaunlich lesbar. Entsprechend vermarktet es der Verlag auch nicht unter der juristischen Fachliteratur.

Vorweg schicken muss ich meine Anerkennung, dass sich der Autor als Jurist und amtierender Hochschulprofessor und dann auch noch öffentlichkeitsgeeignet an ein immer noch – oder vielleicht wieder - so heikles Thema wagt. 

Entsprechend vorsichtig und mit allerlei Disclaimern versehen, dass es hier in keinerlei Weise gegen irgendeine Religion gehe, nicht gegen deren öffentliche Betätigung und nicht gegen deren politische Teilnahme. Fast so, als drohe bei Blasphemie noch immer der Scheiterhaufen.

Dann folgen erst einmal ~ 40 Seiten Definition von Säkularisierung und verwandten Begriffen – mit wohlgemerkt fast 50% Fußnoten . Dadurch macht der Autor, wohl ungewollt, deutlich, dass dieser Begriff eigentlich nicht mehr alltagstauglich ist.

Ein sehr schönes Kapitel befasst sich kursorisch mit der Entwicklung der persönlichen Freiheiten allgemein und damit einhergehend der Religionsfreiheit in deutschen Landen vom Augsburger Religionsfrieden über den Westfälischen Frieden und weitere Zwischenstufen, wie das Preußische Landrecht bis zur Neuzeit – eine notwendige Auffrischung der Geschichtskenntnisse.

Nach dieser Vorbereitung kommt er zum eigentlichen Thema: Die von ihm geforderte Neutralität des Staates gegenüber Religionen und anderen sinnerklärenden Weltanschauungen. Dabei geht er zunächst auf vermeintliche Widersprüche im Grundgesetz selber und Ungereimtheiten in einigen Länderverfassungen ein. 

Anschließend betrachtet er einige spektakuläre Urteile wie das „Kruzifix-Urteil“ oder das „Kopftuch-Urteil“. Für mich persönlich tröstlich zu lesen, dass nicht nur mir damals einige der Urteilsbegründungen etwas hergeholt und verquer vorkamen.


Im weiteren Verlauf befasst sich der Autor mit allerlei neueren restaurativen Bewegungen, die der Verfassung die Vernunftgrundlage zu entziehen trachten und ihr statt dessen etwas irgendwie Heiliges / Sakrales unterjubeln wollen.  Streckenweise hat der Autor mein volles Mitgefühl, denn die umfangreichen Zitate lassen erahnen, durch welch voluminöse Werke voller verstiegener Ansichten und in verquaster Sprache formuliert, er sich mit wissenschaftlicher Akribie und demonstrativer Nachsicht hindurch gearbeitet hat. 

Dieser, im Gewand der gelehrten Rechtsphilosophie daherkommende, Neo-Obskurantismus, nach dem Motto ‚philosophisch ist, wenn möglichst keiner mehr versteht‘, fügt sich in eine zu beobachtende globale Retro-Bewegung ein. Müssten wir nicht eher all unsere Ratio zusammen nehmen, um die sich vor der wachsenden Menschheit auftürmenden aktuellen und abzeichnenden Probleme in den Griff zu bekommen?  Ich gehe da gerne mit dem Autor, dass hier statt religiöser Rechtswurzelmystik hier eher eine Prise ganz profaner kühler Rationalität angebracht wäre. 

Ein Kapitel behandelt den Gottesbezug und dessen Genese, der sich gleich in den ersten Satz der Präambel des Deutschen Grundgesetzes eingeschlichen hat. Auch bei dessen Lektüre wird deutlich, dass sich religiöse Bezüge an entscheidenden  Stellen wieder einschleichen, nachdem zunächst saubere Ansätze gewählt worden waren. So auch bei dem Deutschen Grundgesetz. Mit allerlei aberwitzigen Argumenten wurde hier versucht, dieser wichtigsten rationalen Staatsgrundlage ein irrationales Fundament unterzuschieben.  

Am Ende ist der Gottesbezug als „Demutsformel“ akzeptiert worden – in Wahrheit ein Kompromiss der Aufgeklärten mit den religiösen Ultras. Man muss also den Eindruck gewinnen, dass selbst Verfassungsrechtler nur mit der Drohung eines strafenden Gottes (warum eigentlich nicht eines Pantheons?)  ausreichend „Demut“ aufbringen, um nicht wieder autoritäre Grundregeln zu verfügen. Durch einige Pro-Gottesbezug-Argumente schimmert die Beschwichtigung durch, als „Demutsformel“ sei er jedenfalls unschädlich. Das wäre eine Lobpreisung von Hänsel und Gretel aber auch, ohne dass diese ernsthaft gefordert würde.

Das letzte Kapitel widmet sich einem einzigen fundamentalen rechtsphilosophischen Satz, der als „Böckenförde Diktum“ bekannt geworden ist: „Der freiheitliche, säkularisierte Staat lebt von Voraussetzungen, die er selbst nicht garantieren kann. …“. Dieser auch als „Böckenförde Dilemma“ bezeichnete Satz drückt aus, dass der Staat auf einem Wertefundament ruht, dass zwar beeinflussen kann, aber selber nicht geschaffen hat.  Ursprünglich als Abgrenzung gegenüber allen religiösen Tendenzen verstanden, wurde er bald als Einfallstor der etablierten Kirchen missbraucht, die wie selbstverständlich dieses Wertefundament für sich reklamierten;  in der unreflektierten Annahme: „Ja wer denn sonst?“

Gewiss müssen Behauptungen, die nicht bewiesen oder nicht beweisbar sind, schlicht geglaubt werden. Das ist bei religiösen Überzeugungen üblicherweise der Fall. Es geht hier ja gerade um das Spirituelle, Transzendentale, Metaphysische, das sich weiteren Erklärungen entzieht. Nur, weil hier alle Erklärungen enden, macht werden diese aber nicht automatisch zu der Kraft, die die Welt im Innersten zusammenhält.

Was hält einen freiheitlichen säkularen Staat also zusammen? Nationalismus, Zwang, Religion, … können es eben nicht sein. Es muss einen inneren Zusammenhalt geben, eine Inklusion, einen ethischen Grundkonsens geben, der dafür sorgt, dass sich die Gesellschaft auch als Gemeinschaft versteht.

Weder Böckenförde noch Horst Dreier geben hier eine Antwort auf diesen „Weckruf“.

Zurück zu der mir gestellten Frage, ob der Koran denn mit dem Deutschen Grundgesetz vereinbar ist, wird mir nach der Lektüre dieses Buches klar, warum ich im Grundgesetz selber keine Antwort darauf gefunden habe. Es verhält sich weitgehend religionsneutral. Nach einem Urteil des Bundesgerichtshofs toleriert das Grundgesetz auch Meinungen, die diesem entgegen wirken. Anders mag es mit religiös motivierten Handlungen aussehen. Diese könnten sehr wohl mit anderen, dort formulierten, Grundrechten  kollidieren.

Das Böckenförde-Diktum weist aber die Richtung in der die Hauptarbeit, die vor uns liegt, zu leisten ist: Ein Wertefundament zu schaffen, das diesem fragilen Gebilde „säkularer Rechtsstaat“ bei aller Diversität seines Staatsvolkes ein stabiles und nachhaltiges Fundament gibt.

Horst Dreier hat mit seinem Buch einen großen Bogen gespannt. Durch seine verständlichen Formulierungen ist er in der Lage, eine breite Leserschaft mit auf diese spannende Reise durch einen wichtigen Teil der Rechtsphilosophie zu nehmen.  Dabei hält er sich mit eigenen Wertungen neutral zurück, wenn man seine Neutralität und Neutralitätsforderung nicht bereits als Parteinahme sehen will. 

Ein Buch, das ich vorbehaltlos allen Interessierten zum Lesen empfehlen kann.

2018-04-01

Too late – we are too many already


The daily apocalypse in the Niger Delta
Recently I read a Bloomberg article, promising relief: “The Population Bomb Has Been Defused”.

Immediately afterwards I stumbled across a YouTube video on the devastation and ecological disaster in the Niger delta, depicting the pure apocalypse: An inhuman, predatory exploitative state and people who act in a suicidal way in the long term to survive in the short term, a region that is being devastated.

It involuntarily reminded me of a statement by science fiction author William Gibson: "The future is here. It is just not equally distributed“.

Perhaps a dystopian future has already begun here, and for other regions it yet bhas to come. In terms of the capacity of this planet we are probably already too many people on earth. As the Bloomberg author stated the population bomb has been defused and neither the British economic expert Thomas Malthus (~1700) nor the Stanford biologist Paul R. Ehrlich (1968) would have been right with their apocalyptic claims. The fertility of the people on this planet would decrease and everything would be fine: The population bomb can be declared to be defused.

But is that really the case? All statistics claim that we are getting better and better. Soon there would be no more problems. Other developments, however, which are also highly real, are not contained in them:
  1. Population growth continues, however, because a decline in fertility does not begin to have an effect until after a generation at the earliest. Nor does this happen to the same extent all over the world. While Japan, for example, is already on the right track, the population is growing explosively, especially in poor and already overpopulated regions. Examples are Angola or Burundi.

  2. The growing economic inequality of humanity, which will eventually destroy all social order. Several "tribes" already live side by side in the USA without any contact. Occasionally, they fight each other. This trend will intensify. It leads towards isolation tendencies. The globalisation of the 1990s is collapsing before our very eyes. It was never to be confused with fair world trade. Rather, it was used as an instrument of domination to implement hegemonic aspirations. Nevertheless, it has led to interdependence and promoted exchange. Thus, the hoped-for global community is falling apart into increasingly authoritarian power blocs and spheres of interest at a time when community action could perhaps still avert regional and global disasters. This hope now has gone.

  3. The consumption of resources increases parallel to population growth and exponentially with the praised prosperity. It is not only the often mentioned "rare earths" that could become scarce. Agricultural land cannot be increased at will either. A "green revolution" can probably only be repeated once or twice. The soils degrade, are exhausted. Even water for agriculture and human consumption is becoming a scarce commodity. They don't like to say it. But these resources are finite. They cannot be reproduced. Technical progress can still push the boundaries a little further, as can be seen from the example of the "peak oil" theory. However, this does not change the fundamental problem of finite resources.

  4. We are devastating our planet at an increasing rate. We hope that this will have no effect on the progress of the economic development, which we currently perceive as pleasing. A fatal error, I suppose. The rate of deforestation is accelerating more and more. Certain types of forests have now almost completely disappeared. Thousands of years old trees are logged, consumed and processed into garbage every day. Nobody allows them to grow back for thousands of years. Huge garbage patches are floating in the Pacific Ocean, which is already largely contaminated with radioactivity since the Fukushima accident. A large part of it reaches the deep sea, where it will stay at least for thousands of years. It is confused with food and eaten by sea birds, sea creatures feeding on plankton, beaked whales and many other animals. Entire animal species will become extinct as a result.

  5. We are already amidst the "sixth extinction". Animal species are dying before our very eyes. Our children may be able to tell their grandchildren about rhinos, elephants and tigers, unless this will be banned as being politically incorrect. They will not be able to experience these animals any more due to unstoppable poaching. Others will disappear because there is no place on earth left for them to live. Many of them have not even become known to us. This is not a new trend. Even our ancestors literally ate to extinction species like the wholly mammoth, aurochs, great auk, moa, giant sloth, dodo, giant lemur and many other animal species. 10,000 years ago, humans accounted for 1% of the weight of vertebrates, the rest was wild. Today, wild animals account for only 1%. The other 99% are humans, our farm animals and our pets. It is only now that we have the means, and apparently also the determination, to treat remaining rest the same way.
I have not yet mentioned climate change and the dangers of nuclear war. The list could therefore be extended. However, the need for action is already sufficiently great. Perhaps with the exception of the Chinese, apparently no government worldwide seems to be willing to take appropriate measures to ensure the survival of mankind. The issue even is not seriously discussed among them. Rather, retro politics is being pursued, a return "to the swamps, to the swamps".

But the tasks ahead of us are not getting any smaller. “Jute instead of plastic" will not be sufficient. We tend to run out of recipes. I hesitate to give in to the hope that technology will magically come up with some unexpected salvation.

We may have missed the opportunity already for a soft landing as suggested by the Bloomberg article. It is probably already too late and we are already too many.

Population will have to shrink again. Presumably it will be not the 10 billion people predicted for 2050. Rather our planet may only sustainably host about one billion - if we haven’t already plundered it too much.

Maybe Paul Ehrlich wasn't so wrong. By the way, he also believes that a sustainable population counts less than 2 billion people. Otherwise in his opinion, "The collapse of civilization is almost certain within decades".

Horst Walther, Hamburg 2018-04-01
"An optimist in a doomed world"

2017-12-23

Banks need to morph into technology firms

And they have to do so at the pace of technology – not at the traditional banking pace.

This sounds provocative. And the legitimate question arises, if I do believe in it myself.

Well, it is an extreme position. Usually I am not advocating extreme positions. Life is colourful and multi-facetted. In reality you most often neither climb the steep slope on the right, nor on the left, but take some middle ground. But experience also tells us, that success is by no means guarantied, when you just conveniently follow a tradition.

Nevertheless everyone who had some exposure to dialectics, may know what powerful tool the spanning of the decision space between thesis and anti-thesis puts into our hands.

To illustrate the relevance of this discussion I like to add another potentially provoking statement:

“The golden times of banking are over”.

There is at least some evidence.
  • Low interest rates in the majority of the sufficiently banked countries lead to low profit margins for banks.
  • Tighter regulations on the other hand prevent them of falling victim to their own follies: taking higher risks than they could probably digest, when times become tougher.
  • FinTech-Start-ups carve profitable non- or lowly regulated niches out of the total banking scenario. At least they threaten to do so. That being sufficient to frighten the incumbents. They strike back by acquiring those intruders, hereby strangling them most often successfully.
  • And just recently the so called BigTech (Amazon, Apple, Facebook, Google, and the likes) are accused of taking advantage of the apparent technological gap within the banking sector. The attack may well not come through the front door as recent rumours imply: amazon is suspected of entering the insurance market. Most probably it will start offering insurance products which just complement their traditional business. But that may just be the start.
The list is by far not complete but sufficient already for our purposes.

How do the banks react?

Well, they develop strategies to cope with the challenges. Of course they have impressive full-blown machinery at hand. They just have to start it and give a meaningful direction and they will be unstoppable.

As I mentioned, they try to buy innovative FinTech start-ups in order to take advantage of their prototype products, knowledge or talent or to simple remove them from the scene.

They partner with BigTech firms to make use of their platforms and social network – hereby loosing direct customer contact and running risk to become reduced to a mere financial processor at the back end.

Or they just follow the beaten and proven path like always before being a late adopter of technologies and capitalising on their traditional strengths selling high margin banking products to their installed customer base by which they are accepted as a trusted partner.

Don’t they invest themselves into technology?

Yes they do. However …
  • Most of them stumble over their own feet. Their own management is their major weakness. More on this topic has been elaborated elsewhere.
  • A culture of distrust and no products to offer, which employees can burn for, discourages innovations rather than nurturing them.
  • Nowadays in times when due to diminishing margins money becomes tight, more and more projects are cancelled. If you don’t have sufficient capital for investments in your own future you may find yourself caught in a trap.
  • Many new developments lack a sound technical foundation. Throughout the years banks shied away from cleaning up the mess and streamlining their architecture to become ready for change. Instead technical debt piled up by not addressing root causes and fixing them but rather implementing work-arounds, which just added to the overall complexity in a suicidal way.

Missed opportunities

To give an example, about 90% of retail transactions in sub-Saharan Africa are cash based, while just 34% of adults have traditional bank accounts, according to the World Bank—suggesting tantalizing potential for investors.

More than 500 million Africans currently use mobile phones; according to GSMA’s 2016 annual report, that number will rise to 725 million by 2020, while 84 million have active mobile money accounts. That report also notes the use of mobile money in 31 African countries.

Mobile money transactions in sub-Saharan Africa could exceed $1.3 billion by 2019, according to data by the consulting firm Frost & Sullivan.

Major incumbent banks are not part of this new game. They simple disregard that region and channel as not attractive.

No problem is too big to address

Threatened by the outlook of a slow descent into oblivion at some point time desperation should be strong enough to trigger some major transformation. Major means that it should more resemble re-inventing the company than gradual change.

Let’s not forget that the financial sector deals with immaterial products: banking products, insurance products. They are intangible. Money too for the major part has lost tangibility – and will continue to do so. The customers are real however, made of flesh and blood with real down-to-earth needs. However even they prefer increasingly to interact electronically with their institutions.

Apart from strategic decisions and some innovative developments at the leading edge, there doesn’t seem to be much left, which could not be automated – but is not yet.

The looming potential competition, by the usual suspects like amazon, apple, google, … may have a comfortable customer base, powerful and efficient technology at hand. But they still have to cross the chasm to convert both into a profitable market. Banks and insurance institutions on the other hand (still) own the market with a respectable customer base. They however fall victim to a meanwhile potentially fatal misconception: “We are banks / insurance companies after all – not technology firms.

In the end those traditional money temples, which in terms of technology adoption are rather late adopters or even laggards, might indeed morph into technology firms. At least - if walked it fast enough - it looks like a path to survival – if not the only one.

2017-10-07

Religion’s role in law and governance

At a panel discussion on religion and governance during the 2017 U.S.-Islamic World Forum, Brookings Senior Fellow Shadi Hamid asked the rhetoric question: Is Islam inherently political? Hamid emphasized that all religions may be similar in their general objectives, but that they have different characteristics and metaphysical underpinnings—and that matters. Islam’s founding moment, for example, intertwined religious and political functions, and this shapes how many, if not most, Muslims view religion’s role in law and governance. This doesn’t mean it’s a bad thing in public life, he said.

From an enlightened European point of view however it is “a bad thing”, even a very bad one. Not keeping religion and stately affairs strictly separate is the antithesis to any liberal democratic society. As in the major organised religions men speak on behalf of their god, for which by the very nature of the matter no verifiable justification can be given, no credible democratic legitimation can be demonstrated.

A democratic legitimation however is the fundamental precondition of any political activity. Therefore religion’s role must not interfere with law and governance if we don’t want to allow rolling back the achievements in political and personal liberation and inclusive participation of the last three centuries.

There is an open conflict brewing since the very first inception of the ideas of enlightenment. Of course, as these were genuinely European ideas, the conflict in confined to Europe. Consequently it can only be well understood there. Nevertheless aggressive European expansion exported these ideas to various places in the world – however with likewise varying degrees of success during their implementation.

So, historically this conflict is not new to us. Rather it is an old story for which we, if not a solution, we but found a Modus Vivendi. First worldly monarchs and rulers, later democratic societies and their lawmakers and law enforcers, eventually managed to curb the powers of religious leaders to a more or less tolerable level.

The struggle however is far from being over – even if this might be the dominating impression. Most European states missed the chance for a truly secular constitution. One might well co-exist with a tamed, almost castrated church, which is carefully limited in its rights and whose influence is closely monitored.

With a younger and even more aggressive religion, whose very concept is inherently political, as innocently stated above by Shadi Hamid, the incompleteness of your transitions to secular states may bloodily fire back.

We have to relearn, what we obviously forgot: Religion and politics are a deadly mixture. And it is reality already. We have to understand, that we already are sitting on a ticking time bomb.

2017-09-09

First the model


On the role of modelling and simulation as an integral part of any digital transformation

Once upon a time

In my earlier days, when I was advocating the use of roles, or their dynamic equivalents, business rules (in combination with business attributes), I once ran into an enlightening discussion.

In an experts panels on an Identity conference I heard one of the experts state: "What sense does role modelling make, if, whenever we complete an organisations role model and are about to implement it, the organisation has changes considerably meanwhile."

Well "that's real life" we were tempted to say. But wait a minute! Can this really be true? I had to remember a second quotation from the same event "Roles are the DNA of an organisation”.

O.k. if you consider any commercial endeavour as a mild form of barely ordered chaos, if you run a company merely ad hoc, and role modelling is considered as imposing an unnecessarily rigid structure on top of a highly volatile ecosystem, that reinvents itself at every very moment - ok, in this case forget about any modelling up front.
  • Introducing roles for process design or access control requires a certain process maturity – or it will fail.

The model driven corporation

But what, when it comes to automation? In order to automate an organisation you need to express it in a formal way, so that it can be processed by machines or - more often - in a blended fashion by machines and humans. You need to formally document your policies & rules, processes and roles in a complete, consistent and transparently executable way. Only then the processes can be repeatedly run by those above mentioned processors.

Considering this scenario, how can the organisation have changed while the role model is still controversially discussed? No way! The roles are the organisation, not just its mere documentation, or at least an important part of it.

This fundamental shift in perception of the importance of modelling becomes a vital precondition for any sufficiently complex organisation undergoing a digital transformation.

By gradually replacing human processors by automated actors the entire corporation turns into a hyper-system of interacting subsystems. The actors might perform simple, straightforward and deterministic activities or make use of heuristics, like deep learning based systems are doing.

The Behaviour of such ecosystems is hard to predict. They need to be tested carefully after changes having been applied and before releasing them into the wild. Otherwise unwanted effects might mount and result in cascading damages.
  • Better don’t trust a model – unless it is sufficiently verified. 

Simulation of complex systems

However test cases to be fed into the system consist of input data and expected results. Of these the latter may be hard to determine in such complex systems. So testing will rather morph into simulation.

Simulation hereby is understood as „Process of designing a model of a real system and conducting experiments with this model for the purpose either of understanding the behaviour of the system and its underlying causes or of evaluating various designs of an artificial system or strategies for the operation of the system[1]. Well a bit lengthy, seems to be correct however.

You feed in typical scenarios from everyday life or from some anticipated or even exceptional situations. For example if you run a seasonal business you may simulate low and high season, including bottle necks, cash flow minima and many more. For risk assessments you may generate a sufficient high numbers of random events to let some rare risks materialise. Robustness checks may be performed by some kind of perturbation calculation including a realistic number of cataclysmic events like strikes, political unrest, climate change effects or even regional wars. Adequate staffing, effects of fluctuations, diseases, might they be seasonal or epidemic, holiday seasons, labour market elasticity are just a few examples. The model will give reasonable answers to these vital questions.
  • The digitally transformed corporation will be a model driven corporation.

Optimisation, the next logical step

Meanwhile the need for simulation has become widely recognized. There is however more to benefit from simulation than just avoiding traps and adding robustness. When running several simulations while varying the input parameters the desired outcome can be optimized.  Variation of input parameters  have to follow a strategy of course, in order to minimise the simulation steps.

There are several optimisation strategies in use for different purposes following different paradigms. The most robust ones follow evolutionary strategies.

Of course all enthusiasm for these powerful tools should not make us forget the potential pitfalls involved. Insights like these: "A model is a model is a model is a model"[2] or "Essentially, all models are wrong, but some are useful"[3] may remind us, that the model represents a stripped down version of reality only. We however regard it as the higher risk however to bypass the use of modelling, simulation and optimisation before transforming a whole business by applying leading edge digital technologies.
  • But first you have to start with a model.

References


[1] As defined by R. E. Shannon in the seventies of the last century (Shannon, R. E.: Systems Simulation: The Art and Science, Prentice-Hall, Englewood Cliffs, NJ, 1975.
[2] Dierk Raabe referencing  Rosenblueth, A.; Wiener, N.: The Role of Models in Science, in: Philosophy of Science, Vol. 12, No. 4 (October 1945), S. 316-321 (http:/www.jstor.org/stable/184253).
[3] Box, G. E. P.; Draper, N. R.: Empirical Model Building and Response Surfaces, John Wiley & Sons, New York, NY, 1987.

2017-09-03

Wahlkampf, wie retro!

Jetzt treten sie wieder an, die von  Unwissenden arglos „Matatoren“ genannten. Sie schlagen heftig mit ihren Schwertern auf die Schilde - symbolisch gesprochen. Dabei veranstalten sie einen Höllenlärm – bisweilen ganz real. Den Saal mit aufpeitschenden Reden zu kochen bringen, In TV-Duellen in niederster US-Manier den Gegner in die Knie zwingen, auf Markplätzen den Volkstribun geben – das ist alles so entsetzlich retro. Da steht immer der starke Führer als Speerspitze in der Schlachtreihe, einer der nach Macht strebt. Gefragt sind Anspruch, Auftreten, Redegewandtheit, Strategie und Taktik. Man beschimpft sich gegenseitig, wie Boxer vor dem Duell. Gelegentlich gilt das auch für das Niveau der Rede.

Mit politischem Inhalt hat das zunächst herzlich wenig zu tun. Der kommt zumeist auch in deutlich bescheidenerem Gewande daher. Er muss auch nicht erst in den letzten Wochen vor der Wahl ausgepackt werden. Die Parteien hatten satte vier Jahre Zeit, ihn zu formulieren, zu schleifen und bekannt zu machen. Regierungsparteien hatten sogar die Chance sie - im Rahmen eventueller Koalitionszwänge – in die Wirklichkeit umzusetzen. Stattdessen sollen dem unschlüssigen Volk eingängige Versprechen in einer Hau-ruck Kampagne „verkauft“ werden, wie ein neues Waschmittel. Zählt vielleicht für den Erfolg am Ende noch das höhere Werbe-Budget?

Unbequeme Wahrheiten werden dabei gerne im stillschweigenden, parteiübergreifenden Konsens der „politischen Mitte“ ausgeklammert. Damit wollen die etablierten Parteien mit Regierungschance ihre Wählerschaft nicht verschrecken. Das tun dafür die Outlaws am linken und am rechten Rand. Wer Tabuthemen aufspüren will, darf gerne einmal rechts hineinhören – nicht jedoch bei den „End-Lösungen“. Wer bissige, aber kluge Kommentare vorzieht, ist links ganz gut bedient – weniger bei deren praktischer Wirksamkeit. Links, rechts – wird damit eigentlich noch der richtige Diskursraum aufgespannt? Können wir mit solchen vergangenheitsbezogenen, tief verschanzten Positionen eigentlich den Herausforderungen der Zukunft begegnen?

Wie wollen wir denn mit der digitalen Transformation unserer Gesellschaften umgehen, wenn Kollege KI unsere tradierten Jobs besser und billiger ausfüllen kann? Haben wir auch Themen jenseits von Ausländermaut und Rentenaltersobergrenze? Was ist denn mit Flüchtlingsströmen, Massenmigration, clash of civilisations, Überbevölkerung, wachsender Ungleichheit der gesellschaftlichen Gruppen, Endlichkeit der Ressourcen, zusammenbrechenden ökonomischen und ökologischen Systemen, Wirtschaftstheorien ohne Wachstumsprämisse, …? Jenseits der Stammtische gibt es ausreichend spannende Themen, über die es sich lohnt angstfrei und ruhig, aber ernsthaft zu diskutieren, sie prinzipientreu anzugehen, ohne gleich mit vorschnellen Lösung auftrumpfen zu wollen.

Wieso eigentlich Wahlkampf? Was hat denn wählen mit kämpfen zu tun? Ich will gar keine besiegten politischen Gegner auf dem Felde der Ehre erschlagen zurückgelassen sehen. Diese ganze kriegslüsterne Rhetorik ist doch völlig fehl am Platz. Wir sind auch nicht in einem Fußballspiel zum Abreagieren und heiser Brüllen. Es geht um die richtigen Weichenstellungen für unsere Zukunft. 

Aber vielleicht sind die Weichen auch schon gestellt und wir wissen es nur noch nicht. Wenn Kollege KI in Zukunft vielleicht Arzt oder Rechtsanwalt sein kann, dann sollte es doch eine Kleinigkeit sein, auch den Job des Politikers durch Algorithmen übernehmen zu lassen.

 Wenn wir uns die aktuell zur Wahl stehenden Alternativen ansehen, können wir nur hoffen, dass diese Übernahme noch rechtzeitig stattfindet – gewissermaßen als childhoods end.

2017-08-14

GDPR & Digital Transformation - What do they have in common?

At first sight nothing – you would say, except perhaps that both of them, the General Data Protections Regulation and the change imperative digital transformation, are currently hot topics in the public professional debate. And I would even agree – at least at first sight.

When digging a bit deeper into the very nature of both concepts, the necessary preconditions, the resulting effects, we might feel compelled to paint a different picture. There might even be a common layer of overarching or underlying principles both concepts need to follow in order to be successfully implemented.

Digital Transformation

Much has been written about this fashionable term – not least by myself. So I will spare you elaborating at length and in depth about this topic. Let’s just focus on some characteristics to be further discussed in the course of this article.

Here we define digital transformation being a transformation of a business aiming at a competitive advantage in its market by profoundly making use of latest digital technology.

By latest technology we mean such, which has sufficiently matured to be seriously considered with acceptable risk as a foundation for the new transformed business.

Like in the past this approach rarely results in re-inventing the business totally, rather more often than not it boils down to the automation of processes, previously done manually.

Nevertheless meanwhile some change has occurred, some kind of the often cited transition from quantity to quality:
  • Artificial intelligence, belittled for many years as a lab only technology, has grown up,
  • Advanced analytics, mature enough now for in-process decision taking,
  • Connecting ordinary “things” to the internet broadens the range of processes to automate
  • and some more
… have meanwhile evolved into powerful tools.

By automating most of the operational layer, making most of the management layer obsolete, adding a new breed of change agents instead, and requiring a much more technology aware strategy process, nevertheless the entire corporation may hereby undergo a fundamental transformation.

GDPR

The General Data Protection Regulation (GDPR) apparently is quite a different story.

The GDPR intends to strengthen and unify data protection for individuals within the European Union. It also addresses the export of personal data outside the EU. Citizens and residents benefit by getting back control over their personal data. For international business the unification of the regulation within the EU is a welcome side effect as it simplifies the regulatory environment.

The GDPR is driven by some major underlying Principles relating to processing of personal data as expressed in its Article 5: lawfulness, fairness and transparency, purpose limitation, accuracy, storage limitation, integrity and confidentiality, accountability.

While this sound fine and most of us might intuitively agree to it, for enterprises there is reason to be concerned, as the regulation opens a new compliance frontier. Some of its requirements represent rather new concepts like: 'privacy by design' and 'privacy by default', the right to data portability on request of the data subjects, explicit consent, minimal data, or the right to be forgotten, just to name a few .

Hence to comply with the regulation will require changes and enhancements deep in the practiced processes and implemented data structures. In addition regular risk assessments, called Data Protection Impact Assessments (DPIA) in GDPR, will become mandatory once you deal with ‘high risks’, e.g. sensitive personal data. Doubts are justified that both can be achieved within the few months left. But rather it may need years of maturing, at least when starting form a low level of process maturity – which can safely be assumed in the majority of cases.

The volume of the resulting activities too may not be neglectable as a recent OliverWyman survey of 1,500 British consumers, revealed that as many as half of the respondents said they were already leaning toward reclaiming their information.

Regarding the requirement to report a data breach to the supervisory authority within 72 hours, a recent survey illustrates this statement as it found that only 2% of responding companies actually appeared to be compliant, although almost half (48%) of the respondents reported that they were.

In most cases this discrepancy is not due to unwillingness but due to severe deficits in the mere underpinnings. Most often no data encryption is applied by default, may it be structure retaining (pseudonymisation or tokenisation) or not. No company-wide and cross-process identity concept implemented, no role-based or attribute based access management, no executable security policies are in place.

From the regulators perspective these all are elements of ordinary housekeeping which have to be in place to comply with GDPR. And as well they are a necessary precondition for any digital transformation.

GDPR may drive digital transformation. Why so? Let’s randomly take one of the requirements as a small however important example: As mentioned above GDPR obliges companies to report data violations within 72 hours. If they cannot prove that the data were encrypted and the private keys have been sufficiently protected, they will face a severe fine. As traditionally reliable end-to-end data encryption whether it is "at rest" or "in flight" was difficult to achieve and rather costly, new solutions need to be put in place: new processes, new software and most probably even new, specialized hardware. This might further drive the move towards cloud solutions, which in the end will turn out to offer a higher security than in-house solutions.

Thus we here have an example of GDPR paving the way for a further digital transformation, as vulnerabilities due to insufficient IT security measures are the major concerns, withholding the transformation towards truly digital corporations.

Data portability and the right to be forgotten also are examples where the data architecture has to follow a holistic identity concept. It has to include all kinds of stakeholders like customers, vendors and all parts of the workforce – not just employees, hereby inflating the data volume by several orders of magnitude.

Additionally the relationship to planned, on-going and past business activities and of legal obligations must be reflected here to be able to determine the purpose for which the data are actually held for and to effortlessly decide if the and be safely deleted.

The necessary defragmentation of the underlying data architecture and the explicit expression of relationships which to date are often only implicitly stated in no-related documents, too can be welcomed as an enabler for further automation

Conclusion

With only a few months to go GDPR seems to be by far more urgent to be taken serious than any digital transformation. This impression is strongly supported by the looming penalties of up to 4% of annual global turnover or €20 Million (whichever is greater).

Lagging behind the competition however is not much less of a threat. Market dynamics has increased considerably. While in the recent past it took about 20 years for a company to reach sufficient size for a considerable market visibility, today it can well happen after one year. Meanwhile the corporate average life span has shrunk to about 12 years. These numbers might give an impression that by missing the train in the realm of digital transformation might come with penalties in a similar order of magnitude.

There is definitely no time to loose. The good news however is: Doing both is not exactly double the work. There are several commonalities and reason to assume substantial synergies, when addressing both of them.

And by the way: Both have to be done anyway.

Further readings and references …

2017-07-28

Inherently unsustainable

Intro

It should be common sense today that mankind is doomed unless it restricts itself to a sustaining way of reproducing its livelihood. Instead that’s still theory in esoteric circles. What it means in practice is neither well understood nor even seriously attempted to be implemented.

Some romantics seriously advocate for a simple ‘back to the roots’, meaning to operate in our forefathers’ style. They however leave it unclear to the audience how to feed the exponentially growing number of hungry mouths. Of course it could be possible to step back in time – provided the population size is reduced accordingly. But how? By a new plague, by war by deliberate genocide? There is no pleasant scenario in sight.

A more likely scenario is that we will hit the often predicted 10 billion heads mark by ~ 2050, leaving no room for romanticism. This world will definitely be different from what we know today. But how could it look like? How will we live by then? How will life feel?

Let’s consider some parts of our life, of our environment and discuss them one by one.

Fishing & hunting 

Fishing & hunting for food or leisure surely are surely archaic traits. Our fore-forefathers had very good reasons to give up hunting and gathering as a means to maintain their subsistence. It was a hard life with an unpredictable outcome. And in many cases – if not in all - it was unsustainable.

Now that we take a closer and unbiased look to the ecological impact of the Neolithics and even earlier economies, more and more evidence pops up that many species of the Pleistocene mega fauna not just went extinct but was driven extinct. It took Neolithic hunters in the northern tundra of Europe and Asia about 30.000 years to slaughter huge numbers of mammoths to their final disappearance, the Maori about 500 years to eradicate the giant Moa.

And so did nearly all indigenous peoples all over the continents, be it Australia, South America or Europe. Here we noble savages cleared the almost the entire continent of all larger animals on land, on the sea shore, in open water and even in the air. The US strives to follow us under the new Alt-Right government, headed by Donald Trump. The most devastating effects, of course were unfolded on larger or smaller islands, like Madagascar, Mauritius, New Guinea, New Zeeland and even worse on smaller pacific islands.

Nothing will stop the human race to continue following its preferred game. By 2050 the sixth extinction will not only be in full swing. It will be nearly over by then with Africa too cleared of all major animals, not to speak of Asia or the Americas. Oceans will be emptied, poisoned and littered up to a near “Soylent Green (1973)” scenario. It will be all devoured by the ever growing, ever hungry human masses.

So hunting and fishing will not just be banned. It will be pointless anyway.

Agriculture

Is a highly industrialized agriculture to be considered as a solution? Nope, not really. This point however needs some discussion as there is the apparent paradox of statistically provable betterment of the earth’s population’s food provision and the limited and even shrinking available arable land.

Agriculture, as we know it, even today ranges on the lower end of mankind’s cultural development.

The number of humans on this planet is expected to hit 9.7 billion by 2050, and crop demand is predicted to increase by 100 to 110 percent of 2005 levels over the same period. At the same time, the Intergovernmental Panel on Climate Change predicts that changing weather patterns will almost certainly have a negative impact on crop yields.

Traditional plant breeding approaches have managed to achieve impressive increases in crop yield in the past. But the process is laborious and can take decades to develop improved varieties. More recent genetically modified (GM) crops have resulted in further improvements by transplanting genes from one organism to another. A further big step forward will be made possible through the introduction of gene-editing tools. They will make it possible to precisely edit the native DNA of organisms with the potential to dramatically increase crop yields.

Not all will appreciate to be nourished with this kind of ‘Frankenstein food’. More importantly the resistance may target unwanted side effects on zombie plants escaping into the (remaining) wild and unfolding devastating effects there. But will we have a choice, once we are so many?

Anyway agriculture, be it traditional or hyper progressive will not keep up with the exponential population growth. That’s an old Malthusian prediction, which seemingly was falsified since his times. Technical progress and abundant natural resources at hand had provided for some relief - and for some more centuries for the party to go on.

No, food production must be fully industrialized. Biotechnical food production in mega industrial complexes will be based on processing of fast growing algae, bacteria, archaea or yeasts. Alien ecosystems, like found today around “black smokers” in the deep sea may serve as templates to be imitated. Or we make better use of fossil fuels and gases by feeding them to methanotrophic bacteria or some strains of Pseudomonadaceae, which currently account for biodegradation of crude oil and water mixtures. Properly processes, packaged and re-branded it will be no less disgusting that may of the current food fakes. The consumption of “Natural Food” derived from traditional sources will be the privilege of small elites.

Natural resource consumption 

Cutting trees, which took (in some cases much) more than a human life to grow, to be channeled into the industrial or private consumption, just to be turned into waste in a matter of a few years only, can of course no longer be tolerated. Anyway only a few trees of considerable age will be left in highly protected area. And protection means that they need to have life guards which have to shoot first before asking questions. As wood in general will be expensive, very expensive, and comparable only to African Blackwood, Sandalwood, Ebony or Agar Wood today, it will be immediately looted otherwise.

But there is a broader picture of the non-sustainable consumption of natural resources to be taken into consideration.

In 2013 the TRUECOST initiative made an attempt to estimate in monetary terms the financial risk from natural capital that is currently unpriced, across specific business sectors at a regional level, and through supply chains.

 By estimating the true costs to their revenues and expressing it in a single factor they found striking differences like e.g. …

  • Cole power generation in eastern Asia (1.0), 
  • Cole power generation in northern America (1.3), 
  • Rice farming Southern Asia (3.6), 
  • Wheat farming in Southern America (8.4), 
  • Cattle ranching and farming in South America (18.8). 

Hence they rightly concluded that in high impact regions sectors don't generate sufficient profit to cover their environmental impacts. Therefore if unpriced natural capital costs are internalized, a large proportion would have to be passed on to consumers. The risk to agricultural commodity prices is particularly striking, where the natural capital cost is universally higher than the revenue of the sectors.

This leaves the impression that the day may come rather sooner than later when will experience a sharp price hike of goods, which are considered cheap now. Unfortunately those are goods covering mankind’s very basic daily necessities.

Living conditions

With reaching ~ 10 billion people competing for space on this planet by 2050, most people will be living cram mend into ~400 densely populated mega cities. The urbanization rate will be ~ 80%. The 10 biggest of them will inhabit 30 to 50 million citizens. The number of mega cities could however well be smaller, with the world's biggest cities merging into 'mega-regions'. This concentration will be encouraged by government, as being seen as the only way to provide some decent infrastructure to them.

The keeping of domestic animals in the city, and where else will the people live, will be banished as an irresponsible resource-consumption, and, of course, also as a cruelty to animals. Anyway we will be crammed together on much less private space than today.

Of course technology will help. With ubiquitous electronics at hand many of today’s physical things will become virtual and stored on neglectable space – however not all. So we all will have to forcibly declutter our lives, practicing a new physical minimalism. The mess will become virtual.

Procreation

Most importantly the basic human right for uncontrolled procreation will be no more. Such policy should have been in place for about half a century already. Only China applied it so far on large scale through its one child policy.

Some countries may rather collapse or prefer to engage in suicidal wars than executing such policy. Others may find the tight living conditions dictating them some procreational restrain. Nurturing offspring will be seen more of a burden for the planet than a benefit. And of course we may encounter administrative restrictions to discourage reproduction.

So growth will eventually flatten out. To ensure a meaningful and joyful life in a healthy environment it will be by far too late however.

2017-07-19

Digital Confusion

This contribution has first appeared in the 25 years anniversary newsletter of the Project Consult some weeks ago.

Expected surprise

During my professional career I came across many new terms and buzzwords, sold by clever representatives of the huge consulting machineries. Most were short lived, some made it to the top of the charts for a decent period, few survived.

As we don’t yet experience the end of all times, there is no reason, why this continuous stream of verbal invention should finally run dry. So a few years ago the inevitable happened and first "digitisation" arrived, followed by "digital transformation".

Plenty of literature suddenly popped up, urging the frightened public, not to fall behind but in a way make use of these new imperatives and aggressively disrupt the market. No one however dared to do the hard dirty work of explaining what it means, how it differs from things done in the past and why it suddenly became important.

What the hell was going on here?

So eventually I went to an event where the agenda promised to provide some insight. Well, I was able to gain some understanding, however other than expected. Let me take just three random examples:

Customer orientation

Forget about technology”, one speaker proclaimed in an emphatic provocative manner. “It’s all about serving the customer.” The latter certainly has never been more true. In fact it has been true all the time. And didn’t I ride that wave myself, some 25 years ago? An eternal truth can hardly be considered the new driving force.

But isn’t there indeed some new enabling technology at hand, making a further automation possible, which was hard to achieve before? Even if we leave leading edge technologies like deep learning, Internet of Things (IoT), autonomous robotics and the like aside, steady development gave us predictive analytics, in-process operational data warehouses, cheap sensors combined with big data technologies. Rigorously applied to even existing business models they may unfold dramatic effects already – well, and should be harnessed to serve good old customer orientation.

Salvation by superman

Another speaker outlined the characteristics of the fashionable new function of the CDO, The chief digital officer. After summing up all the desirable characteristics of this multifaceted personality he had described some kind of superhero not to be found among us mortal muggles – certainly not for the salary of a middle to upper management position.

For those, who are not familiar with tribal rites of large corporations, I like to explain a common habit. If new and challenging problems arise on corporate level, which could neither be ignored nor annihilated through a onetime bold & swift strike by top management, but needs long and tedious work on several levels of the hierarchy, we use to assign this task to a new responsibility. By this mechanism special corporate functions like e.g. the Quality Manager (although “quality is everybody’s job”), the Risk Manager (although conscious risk taking is the prime entrepreneurial task of top management) or finally the digital Officer was born.

This doesn’t mean that such new role is per se useless. If part of a corporate wide campaign he figuratively can be seen as the figurehead of the ongoing transformation coordinating the various activities and driving the transformation program forward. Backed by C-level power and support, even success can be achieved.

More often than not however, he just impersonates C-Levels excuse, its unwillingness to take serious steps but instead position a well-paid incarnation of false promises as a scapegoat on a prominent position.

The innovators dilemma

Permanently reinventing your business a third speaker vigorously demanded of those in power. Hey great, that’s the right spirit, exciting! But shortly review the typical behaviour of the C-suite members of the dinosaur corporations, the alpha males, those vain egomaniac rulers, who run their empires by fear. Will notorious creativity suppressors employ creative destruction to reinvent themselves? Will they start with a blank sheet of paper to escape the innovators dilemma? History however tells us otherwise.

As management Guru Gary Hamel once pointedly put it, implementing radical innovation in large corporation reminded him to “teaching dogs to stand on their hind legs. The moment you turn your back, the dog is on all fours again because it has quadruped DNA, not biped DNA.” Obviously it rarely works like that; rather the attackers come from below. Once they emerge from the dark as tiny flickering points on your radar screen it may probably be too late already. Then you are encircled already and may face a stiff uphill battle – just to be defeated. Not creative, but just plain destruction.

The fatal lapsus

In a weary moment I dared to ask a question: “How does this all differ from the past? Haven’t we done this all before already?” And then hell broke loose – I bitterly regretted outing myself being so naïve. I really shouldn’t have said that.

Magic transformation

And then it came: transformation, where suddenly all the magic happens. Here the usual suspects paraded before our inner eyes: AirBnB, Uber, Amazon … Impressive indeed. But didn’t these enterprises start new digital business models from scratch in a seemingly well settled industry sector, rather than re-inventing a traditional business, maybe even with material goods to be shippedat the end of the value chain?

And didn’t the elite of the top level advisors throughout all these years promise to transform your business in order to cope with current, past and future challenges? I remember my own exiting time at Nolan, Norton & Co., some 30 years ago, where we crafted elaborate processes for the transformation of businesses by the proper use of the then latest information technology. But, what a pity, we did not call it digital transformation. Otherwise, who knows, I could even claim copyright on the term 😥

Cargo cult

Well, eventually I had to understand that if digital transformation ought to be the Holy Grail of strategy, management, information technology … and of course, consulting, it simply must not be the same old story from 20 years ago, which we just cleverly or reluctantly managed to avoid in favour of the short term bottom line and with less headache involved. No CIO will stimulate enthusiasm by proclaiming that he plans to finally do his homework. The old smelly stuff has to be repackaged, rebranded, labelled new and – well – perfumed to overcome its musty odour. To make the task complete the new shiny gift is embedded into an aura of an all-disrupting next big thing, something like the “Great Leap Forward” (which by the way failed miserably). There is always the temptation to celebrate some cargo cult around new promising terms.

The book

Eventually I came across a preview of my old friend Wolfgang Keller’s and co-authors’s  Michael Kunz and Hermann Ladner brand new book, not surprisingly called “digital transformation”. As they are brave men, they took up the fight with the monster, trying to shed some light on his dark matter, bringing some order to the crude. Did they succeed? Hard to say. The rise of buzzwords is a collectively emerging phenomenon, best understood in the light of complexity theory – if at all. There is no owner, no author, no final senior authority to for all time settle the dispute.

Wolfgang and his co-authors at least approached the topic systematically, came up with some decent and plausible definitions and classifications and covered some related side topics like business models, ecosystems and the like.

Of course he too could not withstand to discuss one or the other posterchild of the scene like those mentioned above. It wouldn’t be Wolfgang however, if it didn’t reveal some interesting and maybe lesser known facts about those corporations. Regarding the assumed mission to create a positive attitude towards the topic, these examples rather backfired. Quite the opposite, I took it as discouraging for established players in traditional businesses.

So, not surprisingly, among the more interesting passages is his foray on technical debts as a very common barrier to any bold and swift strategic action, be it (digital) transformation, mergers or acquisitions. Here he touches an often neglected however nevertheless essential aspect of the discussion.

Besides that it is a nice book, conveying tons of information, worth reading, even if you were exposed to all that before.

The insight

As an essential takeaway of this intellectual ramble tacitly the conclusion matured in my mind about what digital transformation is in essence. Digital Transformation is first and foremost a transformation. It should be a bit more than just doing the anyway necessary homework, i.e. not piling up technical debts. It can even end up in re-inventing your whole business. Of course, as in any strategic change activity contemporary technology should be employed. The technology is constantly evolving, appears in new shape each year at an even accelerating pace. The transformation process hasn’t changed at all.

Aside

During a short coffee break, while attending the above mentioned event, I had a discussion with one of the attendees about my heretical contribution.

You are right”, he said “It might not be all new. However what did not exist in the past is the new challenge by technology literate consumers. They demand business processes as seamless and easy as a post on Facebook. They don’t feel the least compassion with the obvious difficulties of the large market incumbents, to keep up with the pace of technology. 

If the user Experience does not live up to expectation set by the daily iPhone use, consumers will eventually abandon the whole product. 

The world became consumer driven. Agile consumers now chase the complacent corporate world – and some may go over the cliff soon.”

This is what’s new.”

Thus he spoke – hmmm, food for thought.