Human capital & the age of change: Constantin Gurdgiev at TEDxDublin
Summary
TLDRThe speaker discusses the profound transformation towards a human-centric economic and governance system, emphasizing the evolution of human capital from traditional educational and work experience metrics to more individualized attributes like creativity, innovation, and social skills. They highlight the shift in global human capital flows, the importance of attracting and retaining talent, and the emergence of a new economy where technology serves human capital, not the other way around. The future challenges the status quo, requiring a supportive infrastructure for human capital growth and retention.
Takeaways
- 🌟 The speaker discusses a profound transformation in human capital, emphasizing a shift towards human-centric systems in economic governance and production.
- 📚 Human capital is traditionally defined by tangibles like education and skills, but has evolved to include intangibles such as creativity, innovation capacity, and social-emotional skills.
- 🌐 The speaker's personal journey illustrates the shift from a narrow technical expertise to a broader, more adaptable set of skills, reflecting global patterns of human capital flow.
- 🔄 There's a change in the geographic distribution of human capital, with increased movement within and from 'southern' economies, and a reversal of traditional northward flows.
- 🏆 Ireland is highlighted as an economy that attracts and exports human capital, but struggles with retention, underscoring the importance of the distinction between attraction and retention.
- 🎓 Education systems are evolving, with a shift from MBAs to MFAs indicating a broadening scope of education, although still within a structured framework.
- 💡 The future of education is envisioned as enabling creativity and innovation, focusing on intrapreneurship and managing uncertainty, rather than just imparting knowledge.
- 📊 The speaker predicts a decentralization of decision-making and production processes, with technology serving as an enabler for human capital rather than a substitute.
- 🌐 The age of big data is giving way to an age of 'small data', focusing on granular, individual consumer understanding, moving away from treating people as mere data points.
- 📉 The diminishing role of physical and financial capital is observed, with a decline in the importance of technological investment as a growth contributor.
- 🚀 The future challenges the status quo, requiring new services, policies, and institutions that prioritize the care and nurturing of human capital across all economic structures.
Q & A
What is the main topic of the speaker's discussion?
-The main topic is the transformation towards a human-centric economic, governance, and production system, and how this change impacts the concept of human capital.
What does the speaker mean by 'human-centric systems'?
-Human-centric systems refer to economic and governance structures that prioritize human needs and abilities over machine-centric approaches.
How has the definition of human capital evolved over time according to the speaker?
-The definition of human capital has evolved from tangible factors like education and work experience to more intangible qualities such as creativity, innovation capacity, and social and emotional skills.
What is the significance of the shift from MBAs to MFAs in the speaker's alma mater?
-The shift signifies a broadening of the educational scope, moving away from narrow technical skills towards a more holistic and creative approach to education.
What does the speaker suggest about the future of education in relation to human capital?
-The speaker suggests that education will become more about enabling creativity and innovation, focusing on skills that allow individuals to manage uncertainty and exploit opportunities.
How is the geographic distribution of human capital changing, as mentioned in the script?
-The geographic distribution of human capital is changing with increased flows within the so-called 'South' economies and a reversal of traditional flows, with talent moving from the 'North' to emerging economies.
What is the speaker's view on the role of technology in the future economy?
-The speaker believes that technology will become an enabler of human capital rather than a substitute, leading to a more decentralized and human-centric economy.
What is the importance of the distinction between attracting and retaining human capital, as discussed by the speaker?
-The distinction is crucial because while attracting talent is important, the ability to retain that talent is what truly drives an economy's growth and innovation.
How does the speaker describe the transition from the age of machines to the age of technology?
-The transition involves a shift from physical, tangible machines to more abstract, disembodied technology that empowers individuals rather than replacing human labor.
What challenges does the speaker foresee for the future economy?
-The speaker foresees challenges in providing the right services, policies, and institutions that support and nurture human capital, as well as adapting to a more decentralized and innovative economy.
What changes does the speaker predict for the private sector in response to the human capital-centric economy?
-The private sector will need to change from hierarchical structures to more horizontal, enabling environments that foster creativity and risk-taking among employees, with changes in ownership and intellectual property concepts.
Outlines
🌐 Human-Centric Economic Transformation
The speaker introduces the concept of a human-centric economic and governance system, emphasizing the shift from machine-centric to human-centric models. The discussion begins with the definition of human capital, evolving from traditional measures like education and skills to more intangible attributes such as creativity, innovation, and social skills. The speaker shares personal experiences of this evolution, highlighting the changing nature of expertise and the global movement of human capital. The narrative points to a future where human capital is more significant than technological investment, with a focus on individual talents and entrepreneurial abilities.
🎓 Shifts in Human Capital Formation and Education
This paragraph delves into the transformation of human capital creation, particularly through the education system. The speaker notes a shift from the popularity of MBA degrees to MFA degrees, indicating a broadening scope of education. The focus is on the emergence of a diverse mosaic of knowledge and skills that enable creativity and innovation. The paragraph also touches on the need for education systems to foster intrapreneurship and risk management, preparing individuals to embrace uncertainty as opportunity. The speaker suggests that the future of education will be less about specific degrees and more about empowering individuals to innovate and adapt.
🔄 The Changing Landscape of Production and Consumption
The speaker discusses the blurring lines between producers and consumers, driven by technological advancements like 3D printing. This shift leads to a decentralization of decision-making and production processes, distributing risks across various entities. The importance of big data diminishes in favor of 'small data,' which offers a granular understanding of individual consumers. The speaker also addresses the decline in the significance of physical and financial capital, with a rise in the importance of human capital productivity. The paragraph highlights the changing contributions of different factors of production to economic growth, with a noted flattening of returns to capital and a rise in creative industries.
🛠️ The Future of Private and Public Sectors in Human Capital-Centric Economy
In the final paragraph, the speaker outlines the profound changes expected in the private and public sectors due to the rise of human capital-centric growth. The private sector must evolve from hierarchical structures to horizontal, enabling environments that foster employee creativity and risk-taking. The speaker suggests that ownership and intellectual property concepts will need to adapt to rapid innovation, with management roles transforming into supportive rather than directive functions. Although the public sector discussion is brief, the speaker emphasizes the need for services, policies, and institutions that nurture human capital, reflecting the necessity for societal and structural adaptation to these economic shifts.
Mindmap
Keywords
💡Human Capital
💡Innovation
💡Risk Management
💡Intrapreneurship
💡Social and Emotional Skills
💡Human-Centric Economy
💡Geographic Distribution of Human Capital
💡Total Factor Productivity
💡Debt Crisis
💡Creative Industries
💡Uncertainty Management
Highlights
Introduction to the transformation towards human-centric economic systems.
Defining human capital beyond traditional metrics to include creativity, innovative capacity, and risk attitudes.
The shift from formal education and technical skills to individualized human dimensions in human capital.
Emergence of social and emotional skills as important factors in human capital.
The changing global pattern of human capital flows, with more mobility within and from emerging economies.
Ireland's unique position in attracting and retaining human capital, highlighting its challenges.
The evolution of educational priorities from MBAs to broader degrees like MFAs.
Future of education focusing on enabling creativity and skills-based innovation.
The transition from risk management to uncertainty management in the economy.
Historical progression through ages of economic focus: land, construction, machinery, technology.
Upcoming era where technology empowers human capital rather than displacing it.
Merging of producer and consumer roles, leading to decentralized decision-making.
Decline in the importance of physical capital and technological investment in advanced economies.
Emerging markets following similar patterns of growth, emphasizing innovation and creativity.
The future focus on services and policies supporting human capital rather than physical infrastructure.
Transformation in private sector structures to enable creativity and risk-taking among employees.
Changes in intellectual property concepts and management roles in firms.
Anticipation of profound changes in public sector to support human capital-intensive growth.
Closing emphasis on the need to adapt to the upcoming human capital-centric economic future.
Transcripts
thank you very much for coming to listen
to me I will take the next 15 minutes to
talk to you about something that is
close to your skin close to my skin
close to the future of our generation
and generations to come close to our
children's future and the future of
their children as well this is a
transformation that we are starting to
experience today so on a cusp of this
change some of it is present already now
everyday life and some wood is yet to
come
there is a profound transformation it's
the first time Humanity is moving
towards the systems of both economic
governance and economic production which
are human centric rather than machine
centric let me walk with you through
this journey very briefly so what the
hell is human about human capital to
begin with well we started defining
human capital we as an economist in the
society by very tangible definitions
which are hardly human really in their
nature first of all we looked at the
educational attainment and formal
education and skills both of those are
embedded in terms of the years and the
jobs years and education types of
education achieve indifferent towards we
later added things like work experience
that's how long we stayed in a
particular position and that somehow was
reflective of our human capital our
ability our potential as well later we
added less tangible things such as
aptitude to work attitude to work things
like that over the recent years we
started shifting towards more
individualized more human dimension of
human capital we started measuring and
started trying to reflect in our
assessment of human capital things like
creativity things like innovative
capacity of workers and individuals
things like risk attitudes attitudes
towards risk attitudes towards
interpreter ship abilities to manage
risk abilities to manage different forms
of enterpreneurship blend
intrapreneurship with everyday work and
so forth things are becoming very
complex here and very much not
measurable something very individualized
something very human
finally in more recent years we started
having things like social and emotional
skills ability to form networks social
networks ability to have empathy towards
other human
ability to hear what they are saying but
also ability to lead networks and
ability to carry them with us across
different geographies this is a very
interesting type of things but all of
those things if you kind of deep dig dig
deep into yourselves you will find out
that you actually not only have them
already but you also live in through
those changes as well those definitional
changes I'll give you a couple of my
personal examples of that journey as
well when in 1990 I moved from Moscow to
Los Angeles I was the Soviet expert par
excellence I had in my possession
certain technical skills which were
above the average I had in my possession
certain attainment of education not
quite a hell of a lot of it at the time
but still it was distinguishable enough
and it was technical enough and narrow
enough it was a classic expert type of
education was education in highly
technical skill physical sciences
theoretical fields as well over the
years myself evolved but also I saw the
world around me evolve as well we are
now living in the global pattern of
flows of skills and human capital and
those flows are no longer defined just
by narrow definitions of skills they are
defined instead by talents they defined
instead by the intrapreneurial abilities
and attitude towards entrepreneurship
they defined instead by ability to
innovate and even an interest to pursue
innovation as such what next you might
ask on this journey of human capital
well next we're going to witness the
change of geographic distribution of
human capital up until now the
traditional form of human capital flow
worldwide was from the so called
South in other words from the emerging
economies middle-income economies low
income economies towards the so-called
north the advanced economies and then
there was mobility of human capital
within North from one advanced economy
to another what we are witnessing today
is the increase in is the breakdown of
this pattern and it's reversal first of
all we're witnessing an amplification of
flows of human capital within the
southern again I use inverted commas
here economies especially the
middle-income economies for example
movement of human capital from Chile
into Argentina or from the Argentina
into South Africa and so forth but also
we were witnessing a movement of human
cab
from the north into the emerging
economies and middle middle-income
economies Ireland is at the forefront of
all of this as well we are the economy
which simultaneously attracts huge
numbers of human capital and at the same
time ships out of the economy huge
numbers of human capital and this is not
just a crisis related today as I stand
in front of you we rank as the economy
12th in the world in our ability to
attract key talent into the economy yet
we ranked 40th in the world in our
ability to retain that capital and
economy this is something crucial and
the distinction between the ability to
attract and retain in the human capital
is very important but before we get into
it let's look at another example as well
example which comes from the point of
formation of human capital point of
creation of human capital from education
system when I graduated from my alma
mater at that time the most popular
degree conferred by university at the
time was the MBA
it was the highest earning degree to
have it was the most desire than the
most competed for degree as well binding
me by the early notice the MBAs were
displaced in my alma mater in this area
by MFA's Masters of Fine Arts while the
movement from MBAs to Masters of Fine
Arts was the broadening of education
scope because the degree is much broader
itself at the same time it still
retained this hierarchical silent
bounded structure of formal education it
is still an MFA it is still about fine
arts it's not about physics it's not
about engineering it's not about writing
code it is still defined what's next you
might ask next for education is the
creation of kaleidoscopic mosaics of
knowledge skills knowledge and skills
acting as enablement rather than the
final end in itself in terms of what
defines our human capital and in
particularly the knowledge and skills
we're looking for will be enabling the
if you want creativity and skills based
innovation innovation which is anchored
in our narrow knowledge and yet at the
same time is broad enough to encompass
new categories of knowledge as well
intrapreneurship will come to the
forefront of education system as well
you can't take
educate entrepreneurs but what you can
do is you can enable them you can give
them the tools to manage uncertainty to
look at the world from the point of view
of any uncertainty present in an
opportunity that sense in our education
system currently does not do at all
not just in Ireland anywhere else
experientially risk taken is another
dimension as well ability to translate
day-to-day observations and experiences
into opportunities and taking the risk
on those opportunities where the risk is
simultaneously is managed and exploited
is something again we don't teach people
in our schools at all this age of change
this movement to the human capital
centric economy where human capital
becomes mostly the most important factor
of production is a new age and yet the
process of change itself is not tapped
new for us we've lived through it as
humanity before not in our memory as
human beings but it's collective
humanity we've had the age of land which
lasted tens of millenia when the main
productive factor in the economy the
source of all productivity growth the
source of wealth was agricultural land
and later the land of the state that
gave way to the age of bricks and mortar
the age of construction we started
building aqueducts roads communication
systems and sewers cities in modern
capacity utilities we built that
culminated in us building trade links as
well the age of brings in more to the
age of construction he way to age of
physical technology the Machine first
powered by steam then powered by the
combustion engine increasing complexity
but ultimately one and the same the age
of machine naturally gave way to the age
of pure technology which we inhabit
today this is disembodied technology
that is not necessarily machine behind
Google but Google is nothing more than a
technology does Google empower us who do
we empower Google this is a very big
question because this is a
differentiator between the age of tech
the age of machine and the age that the
weights are in the age of tech and in
the age of the machine labor and fit and
human capital was substituted for by the
technology in other words technology was
there to displace labor parts of human
capital with very high level of skill
was there to help or enable the
machinery and the technology to do that
task but only parts at the same time in
that age there was a very clear
separation and a now age today there is
still a very clear separation between
the producers who hold the power supply
of goods and services and consumers
could technically demand those goods and
services the two sets are completely
distinct despite the fact that consumers
also employees of the firm's this is why
the firm's have to go to
ever-lengthening late in terms of trying
to understand what consumers demand we
live today in the age of pure data
mining the big data whereby we trying to
extract the signals about the large
pools of consumers out of
ever-increasing pools of information
this is the age of the Machine this is
the age of the technology in that age
risk is concentrated in the enterprise
in each firm the bigger the firm the
more the concentration that is ground
that firm and as a result of that
management evolved to become nothing
more than risk management structure the
firm itself manages risks in the future
all of that is going to go away it will
change it will change dramatically
technology will become enabler of human
capital rather than the other way around
in addition toward consumers will become
one and the same with producers we
already see in the cusp of that change
in the 3d printer and as consumers
become one in the same with producers
the power producer to supply the
uniqueness of producer the vertical
structure of the producer as the
dominant player and supply will start
dissipating as well as that happens what
happens then the big date doesn't matter
anymore what matters a small data
granular understanding of each
individual consumer down to their level
down to our human level away from us as
the blob on the screen in terms of the
data points and towards us as a human
being with our face with our preferences
with our feelings without desires what
else is going to happen although that
leads this merger producer and consumer
is going to lead to the decentralization
of the decision making and optimization
of the production processes that means
that risks are no longer concentrated in
one location but rather distributed
today across the different entities both
consumers and producers who wanted the
same and who nearly atomistic what
happens then no longer there is need
forest management because risks are not
concentrated so is the result of that
what we are moving towards is the
uncertainty management or mining of
uncertainty to extract the opportunities
out of it what else is there
well markers of this change are with us
already don't have to look far just look
at for example the contribution of
different factors of production that
exist in the economy towards economic
growth we have two sets of knowledge out
of this emerging the first step comes
from the advanced economies for the last
30 years or so what we've been
witnessing in the advanced economies is
the acceleration in total factor
productivity growth in human capital
productivity growth and simultaneous D
acceleration or decline in the
importance of physical capital and
technological investment that's right
technological investment in the age of
tech is declining the importance as the
contributor to growth as well what else
we are witnessing we're witnessing as a
result of the diminishing role of
physical capital the diminution of the
role of financial capital and debt in
particular hey hello we're at the
biggest epicenter of the debt crisis in
the world today this is the outcome of
change of the transition from one age to
another age of leverage is over for us
in advanced economies at the same time
creative industries the creative
contribution to the GDP growth
the innovative factor contribution the
factor of the creativity and design
arising and the importance interestingly
enough with the lag of about 20 or so
years exactly the same pattern is
happening in the middle-income and
emerging markets as well they are
catching up with stem following exactly
the same pattern of evolution as well
what the witness in there we're
witnessing near the flattening of the
returns to capital they're still high it
still pays to invest in physical capital
in those economies but the rate at which
they are rising has slowed down it's
flattened out next thing is going to
turn down what else we're witnessing as
well the age of leverage is nearing its
peak in those economies debt levels are
rising
not yet fully exhausted but they will be
soon or later we know that more
importantly what we're witnessing in
those economies is not the previous mode
of development whereby you produce more
and more of commoditized low-margin
goods at higher volumes the so-called
big China factories model of development
is disappearing as well from their
geographies they are going in the same
direction we travel in the negative
faster than we got there in the first
place that direction is infusing more
innovation component more design
component more indigenous creativity
component into their products and
services and developing new platforms
for launching of their businesses from
new forms of banking to new forms of
healthcare provision the economies which
we think as developing economies are now
at our heels at the top of our
distribution such as cardiac surgery for
example in India which has been supplied
to patients in the United States and in
Germany and the United Kingdom or the
banking services in Asia which are
displacing and removing through their
technological if you want capability and
through their ability to reach the
better customers and in a better way
serve them they displace in our own
banks currently as we speak so the
future is challenging the future changes
always challenge and it's the main
challenge - it is of course - the status
quo the difference in the current
challenge is that unlike in the previous
years we no longer need to provide the
platform of financial infrastructure and
physical infrastructure for something
that is coming next instead we have to
provide a platform of services and
policies and institutions which will
create an overarching concept of care
for human capital here is embodied in
creation of human capital attraction of
human capital ability of the economy to
retain that human capital and to enable
it as well this change is profound
across all of the structures of the
economy I will talk just about two of
them the private sector in the public
sector but there are also very
significant behavioral implications and
behave and also design implications the
way we live implication social
implications as well output in the
private sector the objective is for
making private sector and private
services in
tickler to become the enabler of human
capital how do we do that that means
that the firm will have to change
fundamentally from being a hierarchical
vertical structure whereby the
management serves the ownership into the
structure which actually is like a lob
horizontally distributed it rather
enables the creativity and risk taken of
the employees the ownership structure
will have to change with the firm
structure simply because their own is no
longer will be able to control fully the
entire production instead they will be
co-owners in the key intellectual
property that is being held by them
together with their employees
intellectual property concept will
change as well in a rapid pace of
innovation and creativity it's no longer
will make any sense to patent things and
copyright them you will not have time so
the change in structure of the ownership
will have to accommodate for it
management will have to drop out from
making any strategic decisions in the
future
currently management is a strategic
decision-making tool in the firm and
also the enactment tool for that
strategy into the production that will
have to add it will have to end in the
management will have to become nothing
more than a mechanic's standing on the
side of Formula one racetrack waiting
for the car to break down with tools at
the ready I will skip through the public
sector change simply because I have run
out of time as predictably academics do
human capital intensive growth is upon
us
it is common don't take it wrong it is
time for us to change for that future
like it or not
you
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