A venture capital fund has "appointed" a computer algorithm to its board
The software tool analyzes financial trends to make investment recommendations in the life sciences sector
Study: Although many jobs are at risk of automation in the next two decades, management roles are among the most resilient
Most at risk are low-skilled roles that involve little interaction with others, and little creativity
It’s a common saying that one day all our jobs will be done by robots, but top executives may not have expected their position in the C-suite to be under threat so soon.
A Hong Kong venture capital fund recently appointed a computer algorithm to its board of directors, claiming to be the first company of its kind to give a machine an “equal vote” when it comes to investment decisions.
The firm, Deep Knowledge Ventures (DKV), which invests in companies researching treatments for age-related diseases and regenerative medicine, uses the algorithm to analyze financing trends to make investment recommendations in the life sciences sector.
“We were attracted to a software tool that could in large part automate due diligence and use historical data-sets to uncover trends that are not immediately obvious to humans surveying topline data,” said DKV senior partner Dmitry Kaminskiy when the company announced the board “appointment” in May.
Aging Analytics, the research agency that licensed the tool to DKV, expects other venture capital and investment funds to take up the technology.
But whether the move signals a new direction for the industry, as DKV suggests, remains to be seen.
Michael Osborne, an associate professor in machine learning at the University of Oxford, is skeptical.
Last year, Obsorne co-authored a study on the susceptibility of more than 700 different occupations to computerization.
His research showed that around 47% of jobs in the United States were at high risk of automation over the next twenty years.
But management occupations were among the least susceptible to automation, according to the findings.
“To be a fully functioning board member, you’d have to spend a lot of your time trying to reason with and arrive at understandings with other board members, and certainly the kind of algorithm that this particular company (DKV) is proposing won’t be able to do that,” Osborne said.
“Essentially, all I think they’re doing is using the predictions made by this algorithm as kind of a starting point for discussion on the board, which I think is a totally reasonable thing to do, but I think it’s a bit of a gimmick to call that an actual board member.”
The most at risk from automation
Like other occupations that the study found were fairly resistant to automation, management roles involve a degree of political maneuvering, interaction with other people, and an element of creativity in order to make intuitive decisions.
“Lower skilled occupations” were most at risk, such as telemarketers, tax preparers, and insurance appraisers.
“Distressingly,” said Osborne, “the kinds of jobs that are most at risk include those that have seen relatively high growth over the last decade or so.”
For example, sales jobs which have been threatened by the rise in online businesses like Amazon, or those in the service sector, where tablet devices might serve as ordering assistants in restaurants in the place of human waiters.
Even in sectors like manufacturing where the benefits of automation have long been recognized, efforts are being made to determine how machines can enhance the work of humans without replacing them.
Happier with a robot boss?
A recent study conducted by MIT’s Computer Science and Artificial Intelligence Lab set out to discover what level of autonomy between humans and robots carrying out routine assembly line tasks resulted in the most happy and productive workers.
Surprisingly, the researchers found that letting robots allocate tasks to humans was not only more efficient, it was actually preferred by workers.
Experts are divided over whether current technological changes will lead to greater levels of unemployment. Some believe new forms of labor will emerge more rapidly than technology will make others redundant.
“Historically, we haven’t actually seen a great deal of unemployment as a consequence of technological change,” said Osborne.
At the beginning of the 20th century in the U.S., about 40% of all employment was related to agriculture, he notes. At the end of the century that figure was less than 2%, “solely due to technological change.” Despite that radical transformation, the unemployment rate remained fairly stable at about 5%.
“But of course, that’s not an iron-clad law of economics and there have been a lot of people hypothesizing that the recent poor performance of markets might be due to the impact of technology,” Osborne said.
He remains “relatively optimistic” about the ability of new technologies to deliver new forms of employment.
“Some of the fastest growing jobs over the last couple of years have involved occupations that would have been unthinkable even five or ten years ago – things like social media interns, or Zumba instructors.”
The key question, according to Osborne, is whether we can find jobs that exploit technology but don’t necessarily require high degrees of skill.
“I think that question is unanswered and enormously important,” he said.