You may, like me, have got inured to seeing headlines saying that quantum computers or quantum networks are “one step closer”.  This at the same time as others claim that such things are mirages, while yet others claim that they are not necessarily mirages but are perhaps 25 years away.

But if any such announcement does in fact relate to something that is one step closer, then one step closer to what exactly?

And one step, maybe yes, but one step which is how small or how big?

Moreover, one step out of how many steps of that size necessary to get to the goal?!

And what is the goal, anyway?

In the absence of answers to such basic questions, all announcements of the sort mentioned above are simply hype.

To become more than hype, we need first of all an agreed definition of what would constitute a “fully functioning quantum computer” or a “minimally functioning quantum internet”.

The fact is that researchers are pursuing different routes towards ill-defined goals, and they prefer to keep the goal ill-defined, lest their route to that “goal” be somehow compromised.

And it is of course true that defined goals can get in the way of greater goals.

Nevertheless, progress can be made if we define the goals now, and revise them say every 3 months or every month or even every minute if progress is being made at such speed as to necessitate a “growth” in the definition(s).

So who wants to take the initiative towards setting up a group to acceptably define a “fully-functioning quantum computer” or even a “minimally-functioning quantum computer”?

And, of course, ditto for a quantum internet.

PHOTO BY Steve Jurvetson from Menlo Park, USA; CC BY 2.0, https://commons.wikimedia.org/w/index.php?curid=71232867

Companies need to have an overview of the implications of the arrival of quantum technologies.

This is my attempt at summing up my work on all this so far:

1. SECURITY: The largest companies as well as governments are working on protecting themselves from quantum disruption of existing security systems – whether they are working as efficiently and effectively as they should is a different question! But it is not clear to me that less-large companies are doing much to prepare for quantum disruption of their existing security systems. Whether your company is large or not-so-large, if you need (free) help with this matter, in terms of an outline of the sorts of things your company can do, drop me an email and I will send it to you for no charge and no obligation: prabhusguptara@gmail.com

2. PRODUCTS: The largest telecoms companies and other large providers would have been expected to have got into the field by now, but (so far) there are only a very few companies that are involved – for good reasons, as well as not-so-good reasons. What that means is that less-large companies (if they have the will, and a 5-10 year horizon) can get into the field for a relatively small budget.

3. SERVICES: Very few companies are offering services in the field of quantum technologies, so this is also a field which companies (large and not-so-large) can start eyeing, if they have a 3-5 year horizon.

4. INVESTORS: quantum technologies are a field about which you certainly do *NOT* need to inform yourself if you are a short-term investor. I expect those who are NOT short-term investors to include governments, large companies, pension funds, reinsurance and insurance companies, but also *individual* investment analysts if they expect to work, of if their investment horizon is, beyond the next 3 to 5 years

5. EXECUTIVE DEVELOPMENT: If quantum computing is not already part of your curriculum, then you are programming your organisation for obsolescence in something like 5 years. If you want to avoid such obsolescence, do ensure that you include at least the following: the basics of quantum physics, an update on the current state of development in quantum technologies, and a discussion of the implications for your company.

6. RECRUITMENT INTERVIEWS: Do you already establish whether ALL potential recruits (including those who are intended NOT to work in IT) are at least somewhat up to date on quantum technologies? If not, do ensure that your company trains everyone involved with recruitment for your company both in the minimum they need to know, and for the best ways of checking on the level of knowledge and awareness of potential recruits.

7. TRAINING: Are basic modules on quantum technologies (quantum physics, and an update on the current state of development in quantum technologies) included in your training programmes for every recruit? Let me emphasise that that includes not only everyone working, and expected to work, *in* IT, but also everyone working, and expected to work, *outside* IT.

8. BUSINESS PROCESSES: Though some companies have indeed worked out the security-related implications of quantum technologies for each business process, I am concerned that very few seem to have done thought through the implications for each business process itself. The least your company can do is some scenario-planning in the light of developments in quantum technologies, given that it will probably take your company at least 3-5 years to implement changes in key business processes.

9. GOVERNANCE: There is huge discussion about relatively unimportant things like diversity in Boards, when essential developments such as AI and quantum technologies are being ignored. Adequate attention at Board level means asking at least the following:

9a. Do Board members have regular briefings (at least once a year) on latest developments in what I call “horizon technologies”? These include quantum technology and AI, though of course companies in different fields need to keep other specific business-portfolio-relevant “horizon technologies” on their radar.

9b. Has the Board created a mechanism for ensuring that there is an up to date dashboard of the portfolio of technologies in the company which are fully-integrated, those which are partially-integrated, those which are experimentally-integrated, those which are being evaluated for integration, and those which are being watched on the horizon? Is the key person responsible for each of these named, with at least 3 successors in line for each? Are the budgets for each of these adequate?

9c. How does the Board currently benchmark against key competitors the company’s level as revealed by the dashboard?

9d. Is the dashboard regularly vetted (at least every 6 months) by a qualified external board of experts?

9e. Is “technology-competence” adequately defined for members of the Board, members of the top Executive Committee, other senior executives, mid-level executives, and tech professionals? Are these definitions regularly vetted (at least every 6 months) by a qualified external board of experts? Are Board members and other members of the company regularly assessed in relation to the definitions of competence required at those levels? Are proper incentives in place to encourage company executives to keep up with the increasing levels of competence required? Are appropriate training and development opportunities in place?

I’ve probably missed at least one or two things in my summary and overview above.

Happy to have corrections/ amendments/ additions/ caveats/ questions. Best via an email to me: prabhusguptara@gmail.com

THE PROSPECTS FOR 2019 – AND THE NEED FOR AN INDEX OF THE GLOBAL ECONOMIC IMPACT OF NEW TECHNOLOGY

It is clear to every intelligent observer that, in the next 12 months, global economic growth is highly uncertain, dependent as growth always is on two factors (investment and  productivity), which can be characeterised at present in the following way:

INVESTMENT

Right now, the gap between returns-on-cash and returns-on-equity has narrowed to the point that many investors have moved to cash.

In the immediately-foreseeable future:

EUROPE faces financial tightening and raised risks because of talk of an end to quantitative easing from the ECB, along with developments in Italy, and the UK’s Brexit now utterly mindbending “non-drama”.

INDIA is a stumbling horse, mainly because it is unclear how the current ruling party (which has been extraordinarily beneficial to its friends) will fare in the 2019 national elections.

CHINA’s government does seem willing to provide further stimulus … to slow down the deceleration of the economy, but not to enable any acceleration of it – at least, that is the only conclusion one can reach given the smoke puffs that emerge occasionally from Beijing: it is impossible to tell what China will do next or even to know what is really going on in the Chinese economy.

By contrast, the situation in the USA is relatively clear: The fiscal stimulus last year effected a short-term kick in the pants whose effect will dissipate over the next few months, and the outcome of the mid-year elections makes more of that sort of stimulus unlikely in the near future: very few American leaders are likely to supprort the inevitable widening of the deficit that will result.

Sooooo … as far as I can see, a recession in earnings will presage a decline in the real economy – pending (or, rather, when that follows!) productivity growth through the widespread application of new technologies.

PRODUCTIVITY

if the prospects of growth due to investment appear poor in 2018, what about the prospects of growth due to increased productivity by the deployment of new technologies?

This is certainly a huge potential growth-ally, given most really impressive new technologies (e.g. AI and robotics, with quantum computing further away) remain merely on the threshold in most areas of business.

How then are you and I to have any sense of how fast – and perhaps even more important, how effectively – new technologies are being adopted?!

Well, there isn’t really any way of doing so at all, at present,

All we have are substantively meaningless charts such as the one at the head of this blog.

Why is that one “substantively meaningless” in terms of any useful indication of productivity increase for the economy as a whole?

First because it doesn’t indicate anything for the globe as a whole, or even for global regions, on indeed even for nations as a whole… because its rating of countries is on the basis of the “the share of Fintech users in the digitally active population”!

The “digitally active population” is ill-defined (is a child of 5 “digitally active”? Is a grandmother of 90 who use her computer only to skype her family “digitally active?).

Not everyone who is “digitally active” is also financially active (and that can mean anything upwards from “occasionally uses a bank or other debit or credit card”!)

In any case, even if 100% of the whole population of a country used fintech, that wouldn’t amount to much if the country concerned were, say, Afghanistan or Zimbabwe.

That is why we urgently need not merely indices such as we currently have, of “fintech adoption”, but a more fully thought-through “Global Index of New Technology Economic Impact” or #IndexOfNewTechGlobalImpact

None of the existing Productivity Indexes (Divisia, Geometric, Malmquist, Solow, Tornqvist, Translog…) do a good enough job of precisely what is needed in the context I have laid out above.

What should an adequate new Index do? It should assess the full impact on the global economy of productivity increases by the adoption of the newest technologies (including but probably not limited to AI, robotics, and quantum computing).  Initially, the Index will need to sector after sector, before moving to become genuinely global.  Perhaps start with Financial Services, then go on to Logistics, then Manufacturing, and so on.

At present, I can’t find a sufficient number of people interested in creating such an Index.

All offers of collaboration are welcome.