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LETTER FROM THE EDITOR

The Exponential Explosion

I know what Mom’s going to say.

She was talking about a store she wanted to visit but she wasn’t sure it was open that day. Even as she turned to me, I already was pulling out my iPhone.

“Put that in your Funk & Wagnalls.”

That was a joke she came up with some time ago when I would look things up as we spoke. Many of us are used to doing that. Many a dinner with colleagues or friends is punctuated by the informal Google race — who can find the best answer fastest.

It seems more common the younger a person is. I attended a business editors’ conference several months ago where I ended up at a table of 20-something-year-old journalists. One person mentioned the app Nextdoor, and as she spoke, everybody at the table pulled out a phone. Initially, that seemed rude; but within moments they not only had found the app but had downloaded it and were already trading snark about their neighbors.

Last month in Venice, Calif., I noticed a young couple in a restaurant eating dinner and looking at their phones. Again, that seemed rude, until I realized they were talking to each other about what they were looking at. It is just a different way of interacting.

I used to be wistful about what we’re losing as we run along the accelerating pace of change. But I have come to understand that I had to leave my bag of expectations behind.

When I travel now, I pull out my phone to reserve a flight, book a hotel, request an Uber ride. Ten years ago, that was as science fiction as Buck Rogers. In fact, I now have a watch I can talk to.

I used to be on the late adopter slope of the technology curve, but there is not even a ledge on that side anymore. If you wait, something else comes along pretty quickly. And you lose the advantage of the moment.

This is life in our time of exponential change. That’s a phrase thrown around casually these days, but few realize the power of the exponent. One expression is the now-familiar Moore’s Law. Gordon Moore, co-founder of Intel, realized that the number of transistors per square inch would double about every year.

Doubling upon doubling is dizzying. We are at the point where we can no longer predict where technology will be in a few years.

Salim Ismail is an evangelist of exponents as the founding director of Singularity University, which studies and fosters disruptive change. He was once a vice president of Yahoo, leading a division dedicated to exploring and exploiting the most promising disruption. He found that mission impossible because Yahoo’s culture was built to reject change as much as a body’s immune system fights infection. That’s not peculiar to Yahoo. Pretty much every organization is built to withstand change rather than exploit it.

Ismail explained this at the LIMRA annual meeting last year, where he outlined what 10X change really means. One of his most striking examples was in the energy industry. The price-performance ratio of solar power doubles every 22 months, he said. That alone means that the United States can derive all its power from solar within two decades. Along the way, maybe even within five years, he said, utility companies will no longer exist.

But his bigger story has to do with the 20-plus technologies zooming along that trajectory. When they intersect, the combination produces vast change. Together, those advances are accelerating even faster. Artificial intelligence is just starting to use machine learning to create more AI.

The conventional wisdom says we are living in a time of incremental change — that the real technological shift occurred around the turn of the 20th century. Think of the changes between 1865 and 1920. At the end of the Civil War, we didn’t yet have the telephone, electric lights, cars, airplanes, passenger elevators, functional indoor plumbing, flush toilets and the list goes on. Life was dramatically different by the end of World War I.

When we compare 1965 to today, we don’t see the same vast change. Someone from the mid-’60s transported to today might be amazed but would probably still recognize most of what she is seeing as dramatic improvements to the objects she already knows, such as telephones, cars and TVs.

But that might not be true if she popped into 2030. We might even have a hard time adjusting. Because exponential change is happening in different technologies simultaneously, we can’t even predict what will happen. Just take the combination of AI, energy and drones and try to guess what that will bring. Already we are seeing drones designed to fly as swarms, where they execute precise, quick maneuvers without hitting each other.

These meteoric developments are changing life but not to everybody’s benefit. Those who are not keeping up will find themselves more the victims of technology rather than the beneficiaries.

We find that in our industry of insurance and financial advising. People who do not become comfortable with the internet, digital marketing and robotics will find themselves in a rapidly shrinking market.

That also goes for escalating standards of advising. I attended a Central Pennsylvania Financial Planning Association meeting recently featuring Michael Kitces, an advisor well-known for his blog and speaking engagements.

He spoke about Roth IRAs, which I’ve read quite a bit about. But his presentation that morning went miles beyond the usual Roth versus traditional IRA discussion. It was far more sophisticated than presentations I have typically seen at insurance events. This level of expertise is the future of advising.

But nobody gets there in a leap. The curve is too steep for that. We all have to be constantly learning and adopting technology as it unfolds for us.

We can’t let fear hold us back. Mom has her own iPhone, but she quickly gives up trying to learn how to use it, worried she will do something wrong on the phone. She instead asks me to look things up, if I’m around.

Of course I do the search for her, even as she sits there holding all the answers in her hand if she would only look.

Steven A. Morelli is editor-in-chief for InsuranceNewsNet. He has more than 25 years of experience as a reporter and editor for newspapers, magazines and insurance periodicals. Steve may be reached at [email protected] [email protected].


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