Guest article from BIG Honorary Chairman, Don Tapscott.

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What the C-Suite Needs to Know

Don Tapscott is co-founder and executive chairman of Blockchain Research Institute. On April 24-25 in Toronto, he will host the inaugural Blockchain Revolution Global, the world’s premier conference focused on blockchain in the enterprise. BIG members can receive a 25% discount for the conference when they register. If you’re a BIG Member, please contact us to get the discount code.

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What was the job with the most growth in 2018? Blockchain developer. According to the “LinkedIn 2018 Emerging Jobs Report,” demand for people with blockchain development skills was 33 times greater than in 2017, with the largest hiring growth in software engineering overall.[1] But who will lead them?

Across industries, enterprise executives are preparing their organizations for the transformative effects of blockchain technologies. Here’s the challenge: there is a dearth of leadership talent and business acumen, with companies in need of managers who communicate well, can motivate people, and will contribute to enterprise transformation. Many members of the C-suite already have the organizational skill set. But they lack insight into the blockchain revolution. Those interested in understanding the disruptive potential of distributed ledgers, smart contracts, and cryptoassets will set themselves apart from the average corporate officer.

Blockchain will bring about profound changes, not just in the nature of firms, but in how they are funded and managed, how they create value, and how they perform basic functions like marketing, hiring, and accounting. In some cases, algorithms will replace management altogether.

Because blockchain changes the deep structures and architecture of the enterprise, it will thereby transform our models of management and the roles of the C-suite. Vertical integration may make sense in some situations, but overall networks will become better structures for creating products, services, and value for stakeholders.

Chief executive officers already need to demonstrate that they “get it” and have taken it into account in their business planning. Corporations such as FedEx, Fujitsu, and IBM are already building out their expertise in the technology and associating their brands with its future. CEOs must be able to explain where their enterprise stands on blockchain, in a way that instills confidence in clients, investors, and suppliers.

Chief information officers and chief technology officers have always had to ensure that their organizations deployed the right technology at the right time. The Fourth Industrial Revolution centers not only on blockchain but also on machine learning, robotics, the Internet of Things, and even biotechnology. The demands on CIOs and CTOs within an organization will expand from implementing business strategy to formulating it so that it leverages this range of technologies. CIOs and CTOs will need to help their peers in the C-suite understand the potential impact of these technologies, recommend blockchain-focused MOOCs and conferences such as Blockchain Rev Global, and move them to action by sharing relevant use cases and suggesting pilot projects.

CIOs and CTOs can also begin cultivating the necessary skills, talent, and relationships, be they in-house or in the network. There is already a lack of expertise in smart contract coding and blockchain integration as well as a shortage of accomplished machine learning engineers and specialists in algorithms and artificial intelligence. Attending local blockchain meetups and participating in relevant consortia can help to make connections.

Human resources is another area that, when treated properly, can be a strategic asset, not a cost center. As firms move toward contingent labor and operate outside traditional organizational boundaries, the HR function grows more challenging. Blockchain-enabled platforms such as Spera for managing projects and independent contractors, and ProPay for encrypting and tokenizing payment data to reduce identity theft, will be a part of the transition.

In technology, compared with other sectors of the workforce, women hold only 25 percent of all computing jobs and people of color are underrepresented by 16 to 18 percent.[2] Yet diversity is critical to out-of-the-box thinking. When problem solving has deadlocked, a key question for chief human resources officers to ask is, “Do we have enough variety in the room or online?” The process of assembling and dispersing diverse talent can be far more effective and profitable than the traditional hiring-and-retaining model, if HR professionals learn how to leverage blockchain in finding the right people, negotiating all their contracts, implementing the terms, and coordinating their contributions.

Finally, we think the EU General Data Protection Regulation is just the beginning. Soon enough, companies will no longer be able to profile customers online by tracking their behavior. Work is underway to create secure digital identities that consumers can manage through blockchain-based “black boxes.” Everyone will be able to choose which data to share, with which enterprise, and at what price. We see a shift from “big data” to “private data,” obsolescing current data analytics practices.

Chief marketing officers will need to lead marketing and sales staff in finding better ways to engage customers. Some consumers may allow access to their data in exchange for freebies; others will charge companies a fee to license their data. But the quality of results will increase because companies will find their target audience with greater precision. The nature of the blockchain would prevent the Wells Fargo style of customer abuse.

The upside is an end to intermediary fees and institutional bias. Smart contracts will improve search engine optimization performance and price negotiation. Advertisers will know exactly which elements of their ad budgets delivered results. For example, the start-up Brave Software introduced what it calls a “basic attention token” or BAT and launched a free Web browser that blocks ads and cookies. Instead of paying Facebook or Google fees for ad exposure, brands pay end users directly for their attention.

We haven’t even touched on the role of the chief financial officer and the implications of blockchain on global trade and supply chain logistics. Suffice it to say that those executives who can discuss the potential of blockchain technology within an enterprise, will have greater value to organizations looking to lead the next era of digital economy.

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[1] Guy Berger, “LinkedIn 2018 Emerging Jobs Report,” LinkedIn Economic Graph, LinkedIn Corp., Microsoft, 13 Dec. 2018. economicgraph.linkedin.com/en-us/research/linkedin-2018-emerging-jobs-report, accessed 18 Jan. 2019.

[2] Open MIC Project, Breaking the Mold: Investing in Racial Diversity in Tech; A Report for Investors, February 2017; breakingthemold.openmic.org, accessed 28 Feb. 2018.