Content and Commerce: a big opportunity for Drupal

Last week Acquia announced a partnership with Magento. I wanted to use this opportunity to explain why I am excited about this. I also want to take a step back and share what I see is a big opportunity for both Drupal, Acquia and commerce platforms.

State of the commerce market

First, it is important to understand what is one of the most important market trends in online commerce: consumers are demanding better experiences when they shop online. In particular, commerce teams are looking to leverage vastly greater levels of content throughout the customer's shopping journey - editorials, lookbooks, tutorials, product demonstration videos, mood videos, testimonials, etc.

At the same time, commerce platforms have not added many tools for rich content management. Instead they have been investing in capabilities needed to compete in the commerce market; order management systems (OMS), omnichannel shopping (point of sale, mobile, desktop, kiosk, etc), improved product information management (PIM) and other vital commerce capabilities. The limited investment in content management capabilities has left merchants looking for better tools to take control of the customer experience, something that Drupal addresses extremely well.

To overcome the limitations that today's commerce platforms have with building content-rich shopping experiences, organizations want to integrate their commerce platform with a content management system (CMS). Depending on the situation, the combined solution is architected for either system to be "the glass", i.e. the driver of the shopping experience.

Lush.com is a nice example of a content-rich shopping experience built with Drupal and Drupal Commerce.

Drupal's unique advantage for commerce

Drupal is unique in its ability to easily integrate into ambitious commerce architectures in precisely the manner the brand prefers. We are seeing this first hand at Acquia. We have helped many customers implement a "Content for Commerce" strategy where Acquia products and Drupal were integrated with an existing commerce platform. Those integrations spanned commerce platforms including IBM WebSphere Commerce, Demandware, Oracle/ATG, SAP/hybris, Magento and even custom transaction platforms. Check out Quicken (Magento), Puma (Demandware), Motorola (Broadleaf Commerce), Tesla (custom to order a car, and Shopify to order accessories) as great examples of Drupal working with commerce platforms.

We've seen a variety of approaches to "Content for Commerce" but one thing that is clear is that a best-of-breed approach is preferred. The more complex demands may end up with IBM WebSphere Commerce or SAP/hybris. Less demanding requirements may be solved with Commerce Tools, Elastic Path or Drupal Commerce, while Magento historically has fit in between.

Additionally, having to rip and replace an existing commerce platform is not something most organizations aspire to do. This is true for smaller organizations who can't afford to replace their commerce platform, but also for large organizations who can't afford the business risk to forklift a complex commerce backend. Remember that commerce platforms have complex integrations with ERP systems, point-of-sales systems, CRM systems, warehousing systems, payment systems, marketplaces, product information systems, etc. It's often easier to add a content management system than to replace everything they have in place.

This year's "State of Retailing Online" series asked retailers and brands to prioritize their initiatives for the year. Just 16% of respondents prioritized a commerce re-platform project while 41-59% prioritized investments to evolve the customer experience including content development, responsive design and personalization. In other words, organizations are 3 times more likely to invest in improving the shopping experience than in switching commerce platforms.

The market trends, customer use cases and survey data make me believe that (1) there are hundreds of thousands of existing commerce sites that would prefer to have a better shopping experience and (2) that many of those organizations prefer to keep their commerce backend untouched while swapping out the shopping experience.

Acquia's near-term commerce strategy

There is a really strong case to be made for a best-of-breed approach where you choose and integrate the best software from different vendors. Countless point solutions exist that are optimized for narrow use cases (e.g. mobile commerce, marketplaces and industry specific solutions) as well as solutions optimized for different technology stacks (e.g. Reaction Commerce is JavaScript-based, Magento is PHP-based, Drupal Commerce is Drupal-based).

A big part of Acquia's commerce strategy is to focus on integrating Drupal with multiple commerce platforms, and to offer personalization through Lift. The partnership with Magento is an important part of this strategy, and one that will drive adoption of both Drupal and Magento.

There are over 250,000 commerce sites built with Magento and many of these organizations will want a better shopping experience. Furthermore, given the consolidation seen in the commerce platform space, there are few, proven enterprise solutions left on the market. This has increased the market opportunity for Magento and Drupal. Drupal and Magento are a natural fit; we share the same technology stack (PHP, MySQL) and we are both open source (albeit using different licenses). Last but not least, the market is pushing us to partner; we've seen strong demand for Drupal-Magento integration.

We're keen to partner with other commerce platforms as well. In fact, Acquia has existing partnerships with SAP/hybris, Demandware, Elastic Path and Commerce Tools.

Conclusion

Global brands are seeing increased opportunity to sell direct to consumers and want to build content-rich shopping journeys, and merchants are looking for better tools to take control of the customer experience.

Most organizations prefer best of breed solutions. There are hundreds of thousands of existing commerce sites that would like to have more differentiation enabled by a stronger shopping experience, yet leave their commerce capabilities relatively untouched.

Drupal is a great fit. It's power and flexibility allow it to be molded to virtually any systems architecture, while vastly improving the content experience of both authors and customers along the shopping journey. I believe commerce is evolving to be the next massive use case for Drupal and I'm excited to partner with different commerce platforms.

Special thanks to Tom Erickson and Kelly O'Neill for their contributions to this blog post.

Setting higher standards for corporate contributions to Drupal

Last week I made a comment on Twitter that I'd like to see Pantheon contribute more to Drupal core. I wrote that in response to the announcement that Pantheon has raised a $30 million Series C. Pantheon has now raised $50 to $60 million dollars of working capital (depending on Industry Ventures' $8.5M) and is in a special class of companies. This is an amazing milestone. Though it wasn't meant that way, Pantheon and Acquia compete for business and my Tweet could be read as a cheap attack on a competitor, and so it resulted in a fair amount of criticism. Admittedly, Pantheon was neither the best nor the only example to single out. There are many companies that don't contribute to Drupal at all – and Pantheon does contribute to Drupal in a variety of ways such as sponsoring events and supporting the development of contributed modules. In hindsight, I recognize that my tweet was not one of my best, and for that I apologize.

Having said that, I'd like to reiterate something I've said before, in my remarks at DrupalCon Amsterdam and many times on this blog: I would like to see more companies contribute more to Drupal core – with the emphasis on "core". Drupal is now relied upon by many, and needs a strong base of commercial contributors. We have to build Drupal together. We need a bigger and more diverse base of organizations taking on both leadership and contribution.

Contribution to Drupal core is the most important type of contribution in terms of the impact it can make. It touches every aspect of Drupal and all users who depend on it. Long-term and full-time contribution to core is not within everyone's reach. It typically requires larger investment due to a variety of things: the complexity of the problems we are solving, our need for stringent security and the importance of having a rigorous review-process. So much is riding on Drupal for all of us today. While every module, theme, event and display of goodwill in our community is essential, contributions to core are quite possibly the hardest and most thankless, but also the most rewarding of all when it comes to Drupal's overall progress and success.

I believe we should have different expectations for different organizations based on their maturity, their funding, their profitability, how strategic Drupal is for them, etc. For example, sponsoring code sprints is an important form of contribution for small or mid-sized organizations. But for any organization that makes millions of dollars with Drupal, I would hope for more.

The real question that we have to answer is this: at what point should an organization meaningfully contribute to Drupal core? Some may say "never", and that is their Open Source right. But as Drupal's project lead it is also my right and responsibility to encourage those who benefit from Drupal to give back. It should not be taboo for our community to question organizations that don't pull their weight, or choose not to contribute at all.

For me, committing my workdays and nights to Drupal isn't the exhausting part of my job. It's dealing with criticism that comes from false or incomplete information, or tackling differences in ideals and beliefs. I've learned not to sweat the small stuff, but it's on important topics like giving back that my emotions and communication skills get tested. I will not apologize for encouraging organizations to contribute to Drupal core. It's a really important topic and one that I'm very passionate about. I feel good knowing that I'm pushing these conversations from inside the arena rather than from the sidelines, and for the benefit of the Drupal project at large.

Drupal is for ambitious digital experiences

What feelings does the name Drupal evoke? Perceptions vary from person to person; where one may describe it in positive terms as "powerful" and "flexible", another may describe it negatively as "complex". People describe Drupal differently not only as a result of their professional backgrounds, but also based on what they've heard and learned.

If you ask different people what Drupal is for, you'll get many different answers. This isn't a surprise because over the years, the answers to this fundamental question have evolved. Drupal started as a tool for hobbyists building community websites, but over time it has evolved to support large and sophisticated use cases.

Perception is everything

Perception is everything; it sets expectations and guides actions and inactions. We need to better communicate Drupal's identity, demonstrate its true value, and manage its perceptions and misconceptions. Words do lead to actions. Spending the time to capture what Drupal is for could energize and empower people to make better decisions when adopting, building and marketing Drupal.

Truth be told, I've been reluctant to define what Drupal is for, as it requires making trade-offs. I have feared that we would make the wrong choice or limit our growth. Over the years, it has become clear that not defining what Drupal is used for leaves more people confused even within our own community.

For example, because Drupal evolved from a simple tool for hobbyists to a more powerful digital experience platform, many people believe that Drupal is now "for the enterprise". While I agree that Drupal is a great fit for the enterprise, I personally never loved that categorization. It's not just large organizations that use Drupal. Individuals, small startups, universities, museums and non-profits can be equally ambitious in what they'd like to accomplish and Drupal can be an incredible solution for them.

Defining what Drupal is for

Rather than using "for the enterprise", I thought "for ambitious digital experiences" was a good phrase to describe what people can build using Drupal. I say "digital experiences" because I don't want to confine this definition to traditional browser-based websites. As I've stated in my Drupalcon New Orleans keynote, Drupal is used to power mobile applications, digital kiosks, conversational user experiences, and more. Today I really wanted to focus on the word "ambitious".

"Ambitious" is a good word because it aligns with the flexibility, scalability, speed and creative freedom that Drupal provides. Drupal projects may be ambitious because of the sheer scale (e.g. The Weather Channel), their security requirements (e.g. The White House), the number of sites (e.g. Johnson & Johnson manages thousands of Drupal sites), or specialized requirements of the project (e.g. the New York MTA powering digital kiosks with Drupal). Organizations are turning to Drupal because it gives them greater flexibility, better usability, deeper integrations, and faster innovation. Not all Drupal projects need these features on day one -- or needs to know about them -- but it is good to have them in case you need them later on.

"Ambitious" also aligns with our community's culture. Our industry is in constant change (responsive design, web services, social media, IoT), and we never look away. Drupal 8 was a very ambitious release; a reboot that took one-third of Drupal's lifespan to complete, but maneuvered Drupal to the right place for the future that is now coming. I have always believed that the Drupal community is ambitious, and believe that attitude remains strong in our community.

Last but not least, our adopters are also ambitious. They are using Drupal to transform their organizations digitally, leaving established business models and old business processes in the dust.

I like the position that Drupal is ambitious. Stating that Drupal is for ambitious digital experiences however is only a start. It only gives a taste of Drupal's objectives, scope, target audience and advantages. I think we'd benefit from being much more clear. I'm curious to know how you feel about the term "for ambitious digital experiences" versus "for the enterprise" versus not specifying anything. Let me know in the comments so we can figure out how to collectively change the perception of Drupal.

PS: I'm borrowing the term "ambitious" from the Ember.js community. They use the term in their tagline and slogan on their main page.

Microsoft buys LinkedIn: the value of data

In my latest SXSW talk, I showed a graphic of each of the major technology giants to demonstrate how much of our user data each company owned.

Microsoft linkedin data

I said they won't stop until they know everything about us. Microsoft just bought LinkedIn, so here is what happened:

Microsoft linkedin data

By acquiring the world's largest professional social network, Microsoft gets immediate access to data from more than 433 million LinkedIn members. Microsoft fills out the "social graph" and "interests" circles. There is speculation over what Microsoft will do with LinkedIn over time, but here is what I think is most likely:

  • With LinkedIn, Microsoft could build out its Microsoft Dynamics CRM business to reinvent the sales and marketing process, helping the company compete more directly with SalesForce.
  • LinkedIn could allow Microsoft to implement a "Log in with LinkedIn" system similar to Facebook Connect. Microsoft could turn LinkedIn profiles into a cross-platform business identity to better compete with Google and Facebook.
  • LinkedIn could allow Microsoft to build out Cortana, a workplace-tailored digital assistant. One scenario Microsoft referenced was walking into a meeting and getting a snapshot of each attendee based on his or her LinkedIn profile. This capability will allow Microsoft to better compete against virtual assistants like Google Now, Apple Siri and Amazon Echo.
  • LinkedIn could be integrated in applications like Outlook, Skype, Office, and even Windows itself. Buying LinkedIn helps Microsoft limit how Facebook and Google are starting to get into business applications.

Data is eating the world

In the past I wrote that data, not software, is eating the world. The real value in technology comes less and less from software and more and more from data. As most businesses are moving applications into the cloud, a lot of software is becoming free, IT infrastructure is becoming a metered utility, and data is what is really makes or breaks business results. Here is one excerpt from my post: "As value shifts from software to the ability to leverage data, companies will have to rethink their businesses. In the next decade, data-driven, personalized experiences will continue to accelerate, and development efforts will shift towards using contextual data.". This statement is certainly true in Microsoft / LinkedIn's case.

Microsoft linkedin graphs
Source: Microsoft.

If this deal shows us anything, it's about the value of user data. Microsoft paid more than $60 per registered LinkedIn user. The $26.2 billion price tag values LinkedIn at about 91 times earnings, and about 7 percent of Microsoft's market cap. This is a very bold acquisition. You could argue that this is too hefty a price tag for LinkedIn, but this deal is symbolic of Microsoft rethinking its business strategy to be more data and context-centric. Microsoft sees that the future for them is about data and I don't disagree with that. While I believe acquiring LinkedIn is a right strategic move for Microsoft, I'm torn over whether or not Microsoft overpaid for LinkedIn. Maybe we'll look back on this acquisition five years from now and find that it wasn't so crazy, after all.

Demandware acquisition heats up the customer experience market

The battle for the marketing cloud just got way more interesting. This week, Salesforce announced its acquisition of Demandware for $2.8B in cash. It will enable Salesforce to offer a "Commerce Cloud" alongside its sales and marketing solutions.

The large platform companies like Oracle and Adobe are trying to own the digital customer experience market from top to bottom by acquiring and integrating together tools for marketing, commerce, customer support, analytics, mobile apps, and more. Oracle's acquisition of Eloqua, SAP's acquisition of hybris and Salesforce's acquisitions of ExactTarget were earlier indicators of market players consolidating SaaS apps for customer experience onto their platforms.

In my view, the Demandware acquisition is an interesting strategic move for Salesforce that aligns them more closely as a competitor to marketing stack mega-vendors such as Adobe, Oracle and IBM. Adding a commerce solution to its suite, makes it easier for Salesforce's customers to build an integrated experience and see what their customers are buying. There are advantages to integrated solutions that have a single system of record about the customer. The Demandware acquisition also makes sense from a technology point of view; there just aren't many Java-based commerce platforms that are purely SaaS-based, that can operate at scale, and that are for sale.

However, we've also seen this movie before. When big companies acquire smaller, innovative companies, over time the innovation goes away in favor of integration. Big companies can't innovate fast enough, and the suite lock-in only benefits the vendor.

There is a really strong case to be made for a best-of-breed approach where you choose and integrate the best software from different vendors. This is a market that literally changes too much and too fast for any organization to buy into a single mega-platform. From my experience talking to hundreds of customer organizations, most prefer an open platform that integrates different solutions and acts as an orchestration hub. An open platform ultimately presents more freedom for customers to build the exact experiences they want. Open Source solutions, like Drupal, that have thousands of integrations, allow organizations to build these experiences in less time, with a lower overall total cost of ownership, more flexibility and faster innovation.

Adobe clearly missed out on buying Demandware, after it missed out on buying Hybris years ago. Demandware would have fit in Adobe's strategy and technology stack. Now Adobe might be the only mega-platform that doesn't have an embedded commerce capability. More interestingly, there don't appear to be large independent commerce operators left to buy.

I continue to believe there is a great opportunity for new independent commerce platforms, especially now Salesforce and Demandware will spend the next year or two figuring out the inevitable challenges of integrating their complex software solutions. I'd love to see more commerce platforms emerge, especially those with a modern micro-services based architecture, and an Open Source license and innovation model.

Video: Can we save the open web?

In March, I did a presentation at SxSW that asked the audience a question I've been thinking about a lot lately: "Can we save the open web?".

The web is centralizing around a handful of large companies that control what we see, limit creative freedom, and capture a lot of information about us. I worry that we risk losing the serendipity, creativity and decentralization that made the open web great.

While there are no easy answers to this question, the presentation started a good discussion about the future of the open web, the role of algorithms in society, and how we might be able to take back control of our personal information.

I'm going to use my blog to continue the conversation about the open web, since it impacts the future of Drupal. I'm including the video and slides (PDF, 76 MB) of my SxSW presentation below, as well as an overview of what I discussed.

Here are the key ideas I discussed in my presentation, along with a few questions to discuss in the comments.

Idea 1: An FDA-like organization to provide oversight for algorithms. While an "FDA" in and of itself may not be the most ideal solution, algorithms are nearly everywhere in society and are beginning to impact life-or-death decisions. I gave the example of an algorithm for a self-driving car having to decide whether to save the driver or hit a pedestrian crossing the street. There are many other life-or-death examples of how unregulated technology could impact people in the future, and I believe this is an issue we need to begin thinking about now. What do you suggest we do to make the use of algorithms fair and trustworthy?

Idea 2: Open standards that will allow for information-sharing across sites and applications. Closed platforms like Facebook and Google are winning because they're able to deliver a superior user experience driven by massive amounts of data and compute power. For the vast majority of people, ease-of-use will trump most concerns around privacy and control. I believe we need to create a set of open standards that enable drastically better information-sharing and integration between websites and applications so independent websites can offer user experiences that meet or exceeds that of the large platforms. How can the Drupal community help solve this problem?

Idea 3: A personal information broker that allows people more control over their data. In the past, I've written about the idea for a personal information broker that will give people control over how, where and for how long their data is used, across every single interaction on the web. This is no small feat. An audience member asked an interesting question about who will build this personal information broker -- whether it will be a private company, a government, an NGO, or a non-profit organization? I'm not really sure I have the answer, but I am optimistic that we can figure that out. I wish I had the resources to build this myself as I believe this will be a critical building block for the web. What do you think is the best way forward?

Ultimately, we should be building the web that we want to use, and that we want our children to be using for decades to come. It's time to start to rethink the foundations, before it's too late. If we can move any of these ideas forward in a meaningful way, they will impact billions of people, and billions more in the future.

Can we save the open web?

The web felt very different fifteen years ago, when I founded Drupal. Just 7 percent of the population had internet access, there were only around 20 million websites, and Google was a small, private company. Facebook, Twitter, and other household tech names were years away from being founded. In these early days, the web felt like a free space that belonged to everyone. No one company dominated as an access point or controlled what users saw. This is what I call the "open web".

But the internet has changed drastically over the last decade. It's become a more closed web. Rather than a decentralized and open landscape, many people today primarily interact with a handful of large platform companies online, such as Google or Facebook. To many users, Facebook and Google aren't part of the internet -- they are the internet.

I worry that some of these platforms will make us lose the original integrity and freedom of the open web. While the closed web has succeeded in ease-of-use and reach, it raises a lot of questions about how much control individuals have over their own experiences. And, as people generate data from more and more devices and interactions, this lack of control could get very personal, very quickly, without anyone's consent. So I've thought through a few potential ideas to bring back the good things about the open web. These ideas are by no means comprehensive; I believe we need to try a variety of approaches before we find one that really works.

Double-edged sword

It's undeniable that companies like Google and Facebook have made the web much easier to use and helped bring billions online. They've provided a forum for people to connect and share information, and they've had a huge impact on human rights and civil liberties. These are many things for which we should applaud them.

But their scale is also concerning. For example, Chinese messaging service Wechat (which is somewhat like Twitter) recently used its popularity to limit market choice. The company banned access to Uber to drive more business to their own ride-hailing service. Meanwhile, Facebook engineered limited web access in developing economies with its Free Basics service. Touted in India and other emerging markets as a solution to help underserved citizens come online, Free Basics allows viewers access to only a handful of pre-approved websites (including, of course, Facebook). India recently banned Free Basics and similar services, claiming that these restricted web offerings violated the essential rules of net neutrality.

Algorithmic oversight

Beyond market control, the algorithms powering these platforms can wade into murky waters. According to a recent study from the American Institute for Behavioral Research and Technology, information displayed in Google could shift voting preferences for undecided voters by 20 percent or more -- all without their knowledge. Considering how narrow the results of many elections can become, this margin is significant. In many ways, Google controls what information people see, and any bias, intentional or not, has a potential impact on society.

In the future, data and algorithms will power even more grave decisions. For example, code will decide whether a self-driving car stops for an oncoming bus or runs into pedestrians.

It's possible that we're reaching the point where we need oversight for consumer-facing algorithms. Perhaps it's time to consider creating an oversight committee. Similar to how the FDA monitors the quality and safety of food and drugs, this regulatory body could audit algorithms. Recently, I spoke at Harvard's Berkman Center for the Internet and Society, where attendees also suggested a global "Consumer Reports" style organization that would "review" the results of different company's algorithms, giving consumers more choice and transparency.

Gaining control of our personal data

But algorithmic oversight is not enough. In numbers by the billions, people are using free and convenient services, often without a clear understanding of how and where their data is being used. Many times, this data is shared and exchanged between services, to the point where people don't know what's safe anymore. It's an unfair trade-off.

I believe that consumers should have some level of control over how their data is shared with external sites and services; in fact, they should be able to opt into nearly everything they share if they want to. If a consumer wants to share her shoe size and color preferences with every shopping website, her experience with the web could become more personal, with her consent. Imagine a way to manage how our information is used across the entire web, not just within a single platform. That sort of power in the hands of the people could help the open web gain an edge on the hyper-personalized, easy-to-use "closed" web.

In order for a consumer-based, opt-in data sharing system described above to work, the entire web needs to unite around a series of common standards. This idea in and of itself is daunting, but some information-sharing standards like OAuth have shown us that it can be done. People want the web to be convenient and easy-to-use. Website creators want to be discovered. We need to find a way to match user preferences and desires with information throughout the open web. I believe that collaboration and open standards could be a great way to decentralize power and control on the web.

Why does this matter?

The web will only expand into more aspects of our lives. It will continue to change every industry, every company, and every life on the planet. The web we build today will be the foundation for generations to come. It's crucial we get this right. Do we want the experiences of the next billion web users to be defined by open values of transparency and choice, or the siloed and opaque convenience of the walled garden giants dominating today?

I believe we can achieve a balance between companies' ability to grow, profit and innovate, while still championing consumer privacy, freedom and choice. Thinking critically and acting now will ensure the web's open future for everyone.

(I originally wrote this blog post as a guest article for The Daily Dot. I also gave a talk yesterday at SXSW on a similar topic, and will share the slides along with a recording of my talk when it becomes available in a couple of weeks.)

Should we prioritize technological advances?

This blog post is co-authored with Devesh Raj, Senior Vice President and Head of Strategy and Planning at Comcast-NBCU. Devesh and I are friends and both Young Global Leader at the World Economic Forum. In this blog post we share some of our observations and thoughts after attending the World Economic Forum's annual meeting in Davos.

This year's World Economic Forum Annual Meeting in Davos focused on the Fourth Industrial Revolution, a term coined by Klaus Schwab to describe the new generation of technological advances – sensors, robotics, artificial intelligence, 3D printing, precision medicine – coming together to define the next wave of progress.

These new technologies have the potential to transform our lives. Beyond sci-fi like scenarios – such as each of us having our own personal R2-D2, summoning our Batmobile, or colonizing Mars – these advances also have the potential to solve many real-world problems. With more intelligent, automated technology, we could generate renewable energy, address climate change, connect billions of people to the internet, develop affordable housing solutions and cure chronic diseases.

These advances are not far into the future. A recent report on Technology Tipping Points and Societal Impact anticipates many such moments of inflection within our lifetimes – in fact, we may see major advances in transportation, artificial intelligence, and new payment technology as soon as the next decade. Yet, somewhat surprisingly, much of the discussion in Davos last month focused on the negative impacts of these technologies, rather than their positive potential.


The average year that each tipping point is expected to occur. Source: WEF report.
2018 2021 2022 2023 2024 2025 2026
- Storage for all - Robots and services - The Internet of Things
- Wearable internet
- 3D printing and manufacturing
- Implantable technologies
- Big Data for decisions
- Vision as the new interface
- Our digital presence
- Governments and the block chain
- A supercomputer in your pocket
- Ubiquitous computing
- 3D printing and human health
- The connected home
- 3D printing and consumer products
- AI and white-collar jobs
- The sharing economy
- Driverless cars
- AI and decision-making
- Smart cities

One consistent, fearful theme was the potential for job losses. As automation continues to replace manufacturing or blue collar jobs, artificial intelligence will subsequently do the same for skilled, white collar jobs in banking, law or medicine. Estimates as to the impact this will have on jobs vary, but many prognostications in Davos suggested a depressive impact on the global economy. While it's true that technological leaps have often eliminated older, human-powered methods of doing things, many in Davos also recognized that advances in technology create new jobs, most of which we can't even dream of today. For example, the invention of the airplane created hundreds of thousands of jobs, from pilots, to stewards, to airport personnel, to international agents and more prognostications not to mention the transformative economic impact of billions of people traveling vast distances in a short span of time.

A second concern at Davos was growing inequality in the world between "digital haves" and "have-nots". This was reflected both as a challenge among nations – developed vs. developing – but also an issue for specific socio-economic groups within individual nations, some of which arguably are still not past the second or third industrial revolution. What does 3D printing or precision medicine do, for example, for rural parts of India and Africa that still don't have reliable electricity, while urban centers in those same countries race towards an era of smart, automated living?

A third common concern (particularly driven by robotics and artificial intelligence) was the "dehumanization" of our lives. There was a case for a renewed emphasis on qualities that make us uniquely human – empathy, sensitivity, creativity and inspiration.

Another issue centered on the ethical and moral challenges of many advances. Some conversations at Davos discussed the dangerous potential of eugenics-like scenarios in medicine, enabled by advances such as CRISPR/Cas9. On the flip side, could machines make positive decisions regarding human lives, such as a self-driving car making a choice between hitting a pedestrian or sacrificing its passenger?

One could argue some of these concerns are overblown Luddism. But in some ways, it doesn't matter – the march of technological progress is inevitable, as it has always been. Certainly, no one at Davos suggested slowing down the pace of technological advancement. The gist of the discussions was that we should figure out how to avoid, or address, the negative, unintended consequences of these changes.

We believe there is a major challenge with the Fourth Industrial Revolution that didn't get adequate attention in Davos – the issue of prioritization.

To date, the technological innovation that has driven the Fourth Industrial Revolution is shaped by the commercial prospects of small or large firms in the market. After all, one definition of "innovation" is the commercial application of invention. As an example, investment in alternative energy R&D fluctuates depending on oil prices, just as demand for hybrid or electric vehicles become more or less attractive depending on gasoline prices.

What if, instead of being driven solely by commercial returns, we could focus the Fourth Industrial Revolution more directly on the big problems our world faces? What if we could prioritize technological advances that have the most beneficial impact to society?

The world has recently defined its problems very clearly in a set of 17 Sustainable Development Goals (Wikipedia), also known as the Global Goals, that were adopted by all countries last year to "end poverty, protect the planet and ensure prosperity for all". The goals cover poverty, hunger and food security, health, education, energy, and water and sanitation – to name a few. A successor list to the earlier Millennium Development Goals, the Sustainable Development Goals get quite specific.

Take Goal 3 as an example: "Ensure healthy lives and promote well-being for all at all ages". This goal is linked to 12 targets, including these top three:

  • By 2030: reduce the global maternal mortality ratio to less than 70 per 100,000 live births.
  • By 2030: end preventable deaths of newborns and children under 5 years of age, with all countries aiming to reduce neonatal mortality to at least as low as 12 per 1,000 live births and under-5 mortality to at least as low as 25 per 1,000 live births.
  • By 2030: end the epidemics of AIDS, tuberculosis, malaria and neglected tropical diseases and combat hepatitis, water-borne diseases and other communicable diseases.

Of course, technological advancement is not the only solution to all Sustainable Development Goals – there is much more to do – but it is likely one of the major contributors.

As the world thinks through how to harness the Fourth Industrial Revolution, we think it is worth questioning which technologies we should be prioritizing to meet these Sustainable Development Goals. How do we draft policies and create economic incentives to encourage the right types of technology advances? What should governments and the private sector do differently to focus technology on addressing these goals? How do we direct the energy and creativity of millions of entrepreneurs towards improving the state of the world?

The world's innovation system is powerful and has generally worked well. However, it could use a guiding hand to nudge it in a direction that will benefit the planet beyond the incentives of commercial returns. Expanding our criteria for importance to solving areas of global need is not an inherently anti-capitalist idea. But it is one that would channel capitalism in the best direction for humanity as a whole. That, we hope, is the real agenda initiated by the focus in Davos on the Fourth Industrial Revolution, which the world will seek to address in the coming year.

Fast tracking life-saving innovations

Last week, a member of my family died in a car accident. Jasper was on his way home and was hit by a taxi. He fought for his life, but died the next day. Jasper was only 16 years old. I was at Davos and at one point I had to step out of the conference to cry. Five years ago, another family member died after she was hit by a truck when crossing the road.

It's hard to see a tragedy like this juxtaposed against a conference filled with people talking about improving the state of the world. These personal losses make me want to fast-forward to a time in the future where self-driving cars are normal, and life-saving innovations don't have as much regulatory red tape to cut through before they can have an impact. It's frustrating that we may have the right technology in sight today, but aren't making it available, especially when people's lives are at stake.

Imagine two busses full of people crashing, killing everyone on board, every single day. That is how many people die on America's roads every day. In fact, more people are killed by cars than guns, but I don't see anyone calling for a ban on automobiles. Car accidents (and traffic jams) are almost always the result of human error. It is estimated that self-driving cars could reduce deaths on the road by 90%. That is almost 30,000 lives saved each year in the US alone. The life-saving estimates for driverless cars are on par with the efficacy of modern vaccines. I hope my children, now ages 6 and 8, will never need a driver's license and can grow up in a world with driverless cars.

The self-driving car isn't as far off as you might think but is still being held back by government regulators. Delayed technology isn't limited to self-driving cars. Life-saving innovations in healthcare are often held back by regulatory requirements. The challenge of climate change could be addressed faster if the regulatory uncertainty around solar and wind power permits and policies were reduced. The self-serving interest of lobbying groups focused on maintaining the status quo for industries like Big Oil make it harder for alternative energies to gain momentum.

Regulators need to frame their jobs differently; they need to ask how they can facilitate and enable emerging disruptive innovations, rather than maintain existing systems. Their job should focus more on removing any barriers that prevent disruptions from having a faster impact. If they do this job well, some established institutions will fail. In some cases, economic sacrifices by the incumbents should be of lesser concern than advancing social health and safety for the benefit of society. I'm less concerned about technology destroying jobs, and more concerned about our children not being able to benefit from available technical advances that improve their lives. We should realize that opportunities for long-term economic growth come with short-term disruption or temporary pain.

Losing family members in fatal accidents makes one think about what could have been done. I'm often asked how one can create a "Silicon Valley" model elsewhere in the world. I may have an answer. If you want to out-"Silicon Valley" Silicon Valley, create a region with a regulatory environment that supports prompt, responsible innovation to drive the adoption and iteration of new technologies. A region where people can responsibly launch self-driving cars, fast-track healthcare and address climate change. A region where long-term advantages are valued more than short-term disadvantages. Such a region would attract capital and entrepreneurs, and would be much better for our children.

Algorithms rule our lives, so who should rule them?

Volkswagen's recent emissions scandal highlighted the power that algorithms wield over our everyday lives. As technology advances and more everyday objects are driven almost entirely by software, it's become clear that we need a better way to catch cheating software and keep people safe.

A solution could be to model regulation of the software industry after the US Food and Drug Administration's oversight of the food and drug industry. The parallels are closer than you might think.

The case for tighter regulation

When Volkswagen was exposed for programming its emissions-control software to fool environmental regulators, many people called for more transparency and oversight over the technology.

One option discussed by the software community was to open-source the code behind these testing algorithms. This would be a welcome step forward, as it would let people audit the source code and see how the code is changed over time. But this step alone would not solve the problem of cheating software. After all, there is no guarantee that Volkswagen would actually use the unmodified open-sourced code.

Open-sourcing code would also fail to address other potential dangers. Politico reported earlier this year that Google's algorithms could influence the outcomes of presidential elections, since some candidates could be featured more prominently in its search results.

Research by the American Institute for Behavioral Research and Technology has also shown that Google search results could shift voting preferences by 20% or more (up to 80% in certain demographic groups). This could potentially flip the margins of voting elections worldwide. But since Google's private algorithm is a core part of its competitive advantage, open-sourcing it is not likely to be an option.

The same problem applies to the algorithms used in DNA testing, breathalyzer tests and facial recognition software. Many defense attorneys have requested access to the source code for these tools to verify the algorithms' accuracy. But in many cases, these requests are denied, since the companies that produce the proprietary criminal justice algorithms fear a threat to their businesses' bottom line. Yet clearly we need some way to ensure the accuracy of software that could put people behind bars.

What we can learn from the FDA

So how exactly could software take a regulatory page from the FDA in the United States? Before the 20th century, the government made several attempts to regulate food and medicine, but abuse within the system was still rampant. Food contamination caused widespread illness and death, particularly within the meatpacking industry.

Meanwhile, the rise of new medicines and vaccines promised to eradicate diseases, including smallpox. But for every innovation, there seemed to be an equal amount of extortion by companies making false medical claims or failing to disclose ingredients. The reporting of journalists like Upton Sinclair made it abundantly clear by the early 1900s that the government needed to intervene to protect people and establish quality standards.

In 1906, President Theodore Roosevelt signed the Food and Drug Act into law, which prevented false advertising claims, set sanitation standards, and served as a watchdog for companies that could cause harm to consumers' welfare. These first rules and regulations served as a foundation for our modern-day FDA, which is critical to ensuring that products are safe for consumers.

The FDA could be a good baseline model for software regulation in the US and countries around the world, which have parallel FDA organizations including the European Medicines Agency, Health Canada, and the China Food and Drug Administration.

Just as the FDA ensures that major pharmaceutical companies aren't lying about the claims they make for drugs, there should be a similar regulator for software to ensure that car companies are not cheating customers and destroying the environment in the process. And just as companies need to disclose food ingredients to prevent people from ingesting poison, companies like Google should be required to provide some level of guarantee that they won't intentionally manipulate search results that could shape public opinion.

It's still relatively early days when it comes to discovering the true impact of algorithms in consumers' lives. But we should establish standards to prevent abuse sooner rather than later. With technology already affecting society on a large scale, we need to address emerging ethical issues head-on.

(I originally wrote this blog post as a guest article for Quartz.)

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