Innovation versus Technology

In the next 4 editions, I’ll be expanding on the why of this newsletter series. Part 2 (this one) is about technology and why it’s a big part of the series.

A machine is any device that makes work easier. This is the definition I was taught in secondary school, if I’m not misremembering.

One of the most obvious correlations we can draw from the last century is between economic growth and machines (aka technology). Since value underpins economic growth, technology, in a simplistic causal sense, must breed value.

To paraphrase, technology is essentially a harbinger of economic growth and transformation. Hence, the four industrial revolutions were ushered in by new types of machinery that make human lives easier and more productive. Or did I mean innovation is the harbinger…?

We are supposedly in the middle (or at the beginning, depending on your POV) of the fourth industrial revolution, which is centred around digital and could potentially “raise global income levels and improve the quality of life for populations around the world” (WEF). But then, what is technology, and how do you build it, bearing in mind that not all technology is valued the same, and not all technology is digital. Can GMCs* predict the trajectory of value and then build towards that? And really, aren’t we talking about innovation here?

Before we dive headfirst into trying to duke it out in the AI race with well-established superpowers, here are some things to think on:

• Industrial revolutions are undergirded by innovation – new (simpler, faster) ways of doing things, new ideas or products. Technological discoveries and inventions often serve as the vehicles that deliver innovation.

• Techno-solutionism, the idea that technology is the silver bullet that can (and will) solve all of humanity’s challenges, is an incomplete worldview. In many ways, it is a double-edged sword and has gotten us to where we are today. Think fossil extraction, plastics, etc. Google “AI risks”.

• Although it is comforting to believe that if technological innovation got us here, it can get us there (wherever “there” may be), innovation focused on sustainability and resilience must come first (i.e. the horse before the cart of technology).

However, let’s return to the correlation between technology and economic growth and examine a straightforward measure of economic growth - Gross Domestic Product (GDP). Yes, many say it’s not the best measure, but for the sake of this post, let’s go with it.

Source: How to Calculate GDP (Investing Answers) - Excuse the blurry image, but it is a great illustration

This newsletter will focus on two variables of the equation above:

1. Personal consumption: Economic empowerment and mobility for the labour market. For example, India (1 and 2).

2. Exports: As it relates to theories around the rise of the Asian Tigers and as laid out in this paper about export-oriented innovation (more on this later).

I sat in an AI Governance roundtable a couple weeks ago, looked around and noticed I didn’t have any lookalikes. Considering said roundtable was in the U.K., that makes sense. However, if AI and similar frontier technologies are the machinery of the present and future, GMCs need to understand and strategically tap into value and supply chains yesterday.

There are two types of people in the world – innovation builders and innovation consumers. To solve for emergent scale, GMCs need to flip the geopolitical, historical, and economic script on their consumerism.

On to scale! There's also a Substack. Join me.

* GMCs, aka the Global South or whichever moniker you, your team, or organisation uses (I’m not (yet) as fussed about the labels as some of my dearest friends are), make up 88% of the world’s population, i.e. 6 billion people.