MetricStream: Predictions for 2017 GRC space

French Caldwell

French Caldwell

By French Caldwell

Chief Evangelist, MetricStream

French Caldwell, Chief Evangelist at MetricStream, lists his predictions for 2017, including the growth of robotics, changes in the nation’s political mood, and other events that could change the GRC marketplace.

Robotics and artificial intelligence (AI) – While these promise to bring increased productivity and quality craftsmanship, next generation brings several possible risks:
Labor unrest – Sometimes this is looked at as the “Luddite Phenomenon.” However, the Luddites were the savvy technicians – their problem was not with automation of the looms, but rather with the fact that the benefits of increased productivity were not being shared with the loom operators through higher wages.

Reputational backlash – The public generally thinks technology is cool. If artificial intelligence and robots lead to higher unemployment as Elon Musk, CEO of SpaceX, recently predicted, customers may begin to criticize companies for switching entirely to “non-human” workers. Laid-off workers and politicians complain in the local paper and in TV news segments when families lose their income.

GRC & Fraud Software Journal: How do you manage backlash from automation and layoffs?

Caldwell: It is very difficult to manage backlash. One side says that robots and AI are putting people out of work. On the other hand, new and better paying jobs are being created through robotics and AI.

Both are true – the problem is that the person laid off is unlikely to have the skills and qualifications to take advantage of the new and better paying jobs, and it is a myth that they can be reskilled for these new jobs.

The best that can be hoped for is that the transition is gradual – but we are in a time of rapid technological transformation, so dislocation and disruption are unstoppable forces.

Cost – Robotics and AI are expensive, so big firms gain the most, but risk investing in the wrong automation. With so many AI solutions on the market, the big companies could easily pay hundreds of thousands of dollars for technology that does not live up to the hype. Smaller firms risk being left behind if they can’t afford robotics and AI.

Political power has already shifted, with the incoming President and his staff rejecting a broad swath of regulatory and environmental laws. We can expect to see a period of de-regulation, which sounds good for business, but it can also mean trouble for many businesses that make money managing regulatory requirements for companies.

Large banks, for instance, will continue to face interruption from financial technology firms and startups.

Furthermore, trust in large institutions is at an all-time low, but it could get even worse unless companies and industries become more attuned to shifts in public sentiment. For instance, reverting to careless environmental practices, reducing employee benefits and other unpopular but perhaps allowable behavior can cause bad publicity and harm brand.

GRC & Fraud Software Journal: How will shifts in regulatory laws create problems for companies? How can companies combat mistrust in their brand, or ensure the public views them favorably when they take advantage of looser regulations that no longer protect the public?

Caldwell: If we had social media and sites like change.org in the early 1900s, would the regulations to prevent tainted meat and dangerous drugs have ever emerged?  These days the public can take quicker action on new public issues than was possible in the past, and because of the rapid sharing of information companies are much more responsive to public perceptions.

mglass

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