Trends in Technology
During the Baylor 2015 Leadership+Innovation Summit forum on technology, three distinguished panelists discussed current and projected trends in technology, related threats as well as opportunities, and what skills and strengths they look for in new hires. The forum, moderated by AT&T Adworks President Rick Welday, BBA '90, included BMC Software Chairman and CEO Bob Beauchamp, a Baylor parent and Board of Regents member; Splunk President, CEO and Chairman Godfrey Sullivan, BBA '76, who retired in November; and JetPay Payment Services Chairman and CEO Trent Voigt, BS '86.
At a glance, it's possible to think about technology as insular--an industry or a field unto itself. Like advertising, banking or consulting, a college graduate may choose to "go into tech." But the truth is that tech isn't just something happening in a vacuum. It is hemmed in everywhere we look. Today, a business--any business--lives or dies because of technology, no matter the industry or product. A two-sided coin, tech is a force equally creative and destructive, disrupting and re-engineering entire industries, year to year--an idea thoroughly illustrated in Mark Andreessen's well-known essay "Why Software is Eating the World," published in an August 2011 issue of the Wall Street Journal.
"What Andreessen was saying was that in fact people were underestimating the incredible innovation--that software is going to drive the vast majority of the business transformation and innovation that's going to happen," said Beauchamp, summarizing the WSJ article. "He cites the usual suspects: He cited the fact that Netflix had transformed an industry. Blockbuster was gone. Borders had been eaten by Amazon, which has now gone on to eat other things, and how each of those are changing entire business landscapes. iTunes, Spotify, Pandora, basically rewrote the entire record industry and the CD industry, just made it almost disappear in one respect, the whole distribution model. He was just laying the groundwork to say, 'You haven't seen anything yet.' The real disruption and the business transformation that's going to happen is going to be across every industry, and it's going to be equally disruptive--creative disruption. Every industry represented in this room is either going to be redesigned using software and innovation, or it will cease to exist."
Voigt, who founded JetPay Payment Services in 1999, has participated in the reinvention of payment--the way money changes hands. In the same way that we can now deposit a check using a phone, Voigt sees everything eventually revolving around the personal, mobile device, citing Square, the electronic credit card reader, and the virtual disappearance of Kodak due to the rapid evolution of cameras on mobile phones.
"The personal device, whatever it's going to be, is going to kind of control your whole destiny in the future, and software is the key," Voigt said, tying his thoughts back to Andreessen's. "Now I'm looking at technology and we're going smaller and smaller and smaller and faster. So we got the phones all the way down and then we said, 'Oh, that's too small,' and now we're sizing it back up. But, I think it's really simple: Your phone is becoming your personal computer. It's getting it small enough where the app is tight enough and it will fit in that device and not take up all the memory. My chairman had a really good comment: 'We just need to invent something that the people don't know they want, but once they have it they can't do without.' He was talking about the iPhone. I think there's going to be a bunch of those coming out with software."
If you're clever enough to hatch just such an idea--that thing people don't even know they want--cloud computing, the internet and mobile capability have made it easier than ever to take it to scale. As for established businesses, the inability to evolve with technology is certain failure. Business and technology are inextricable. In fact, according to Sullivan, at the end of the day every company is really just a software company.
"Uber gave us a better experience than we had before, and you would much rather get on your phone and know who’s coming and what their phone number is, where the car is on the map, how far away it is, as opposed to waiting for a taxi," Sullivan said. "How much simpler can an idea get? And yet, it's blowing up transportation around the world. Every company is just a software company. Just ask yourself of all the places that you shop, how many of them have '.com' after their name? Nordstrom is a brick-and-mortar store, but Nordstrom.com is probably doing more than half of their volume."
After graduating from Baylor, Sullivan moved to California to work for burgeoning Apple Computer. His former employer, Splunk, while shy of a household name, happens to be a world leader in software used for gathering and analyzing machine-generated big data. The efficiency of this kind of "operational intelligence" gathering determines whether a business grows or fails, and the implications for the realm of security are legion. In fact, all three panelists at the forum agreed that as technology continues to evolve at break-neck pace, security is the biggest threat to businesses and the individual, and big data is the greatest ally.
"Every company is this far away from a breach that would be reputation-damaging, that takes years to recover from and millions and millions of dollars to repair," Sullivan said. "I think all of you who are running businesses, you just have to take for granted right now that you've already been breached. The bad guys are inside the walls. They’re in your system somewhere, and you better have those really smart security guys who know how to go deep into that information cycle and look for it."
Tasked with staying out in front of these and other threats are chief technology and chief information officers whose jobs are arguably the most difficult in the world.
"Their landscape changes at a rate and pace that is faster than even what we're talking about because they’re responsible to lead that innovation, and they’re usually responsible to also take three percent of their budget down every year or something to feed the machine," Beauchamp said. "It's really, really hard for them to do. In general, great CIOs that I've experienced are people that are heavily networked. They have people they can call on. They network with other CIOs. They share information with each other. One of the things that great CIOs and CTOs do is they surround themselves with innovative thinkers and people that are pushing the envelope, and they don’t get stuck because this industry is changing so fast."
The advent of social media and countless messaging applications on phones and in the workplace leaves a company and its employees more vulnerable than ever.
"One of our competitors is out of business today because one of their employees had an instant messenger running, downloaded something on instant messenger, which went right into and started uploading the credit card numbers from their database," said Voigt, whose company, JetPay Services, stores around 100 million credit card numbers in its database on any given day. "So they had 'socially engineered' her, became friends with her, then talked with her on instant messenger every day, and then sent her something. The company knew they had been hacked, but they couldn't figure it out. So, I think that's one of the biggest pieces of the puzzle. It's not just 'Oh, I have a firewall around it.' It's the person behind the firewall that's going to be your problem."
The battle for maximal security, or at least securing minimal fallout in the wake of a breach, raises questions. What is big data? How does it improve a company's security posture, and at what cost?
"We live in the world of a document or a web page, but every time you go on your mobile device and you click on a URL, it fires off stacks of data that's down under the hood called log files and other types of things," Sullivan said. "It's how you authenticate in the systems; it's how your IP address travels; when you choose a product on a site, it fires off to a whole series of systems, and that’s the new generation of data being analyzed. A tangible example: a major financial institution calls me up not too long ago and says, 'Hey, we just saved millions this quarter because we were using Splunk to analyze wire transfer fraud.' It turns out, you can watch the steps on the logs--two failed logins followed by a successful login, followed by a seven-figure wire transfer is not a good pattern. You don't have to be an engineer to get that one. There are teams of people in the fraud group at the financial institution who are watching those movements. But with the world of big data, it means the financial institution has access to real-time analytics of all of the data that's under the hood that you and I never see as just end users. We think of big data as 'machine-generated.' We do have to give up some privacy. I would just tell you if you're concerned about privacy, that horse has already left the barn. Just forget about that."
For those feeling vulnerable, Sullivan did have some words of advice: change your password every 90 days; use two-factor authentication wherever possible; and open email using iOS, Apple's mobile operating system.
"Ninety percent of all attacks come through someone sending you an email that contains something bad in it--in a PDF attachment or an Excel file," he said. "Open your email with your iPad because iOS has the best container for blowing up all that stuff. If you are susceptible to that, open all your email with an iPad, and you'll know who you can trust and who you don't."
In the world of big data, companies like Splunk are gathering information via the obvious means (e.g., URL hits, ATM use and credit card purchases), and some not-so-obvious. The variety of data-gathering tools and devices that interact - the "internet of things" - will continue to explode in the coming years, affecting any number of industries, including healthcare, aerospace, defense and advertising.
"Carnegie Mellon and a few other universities are working on cameras that actually watch your pupils as you read and as you walk down the street," Beauchamp said. "In front of a major department store, if 100 percent of young women who appear to have means look at the blue dress instead of the red dress, a message will be sent to the stores to swap the dresses out of the windows all over the country. They're also doing demographics; they can try to figure out your age, your ability to pay, all these other things. A few years from now, this is going to be well-established, and we'll have passed this."
Sullivan said there are countless use-cases for the "internet of things," saying the public will see solutions that previously could not have been imagined.
"It's all good," Sullivan said. "It will mostly be industry-specific. What the airlines want to do will be different than what healthcare will do versus military. But the theme is the same. And for all the job destruction that's going on there because of software eating things, there's another wave of positions being created, which are all the people who can do analytics on this next generation of data. It's a huge, huge opportunity for employment."
Jobs will be destroyed and created in nearly equal numbers as innovation progreses, leaving great swaths of workers unemployed. Those with more training in emerging technologies fill newly created positions. Beauchamp expects to see this increasingly with the advent of automation.
"There is a risk to society of great job destruction if we don't think now about how we're going to implement this incredible ability to automate everything," Beauchamp said. "I mean just autonomous cars, which I absolutely believe are going to be all over us in the next two decades at the most, there's $200 million (in) automobile insurance premiums that go away. There are 6 million jobs lost--just drivers--because of autonomous cars. That's just one technology. I think Baylor particularly because of its special place, because of its faith-based approach to it, could bring together the concept of technology and automation and think through the ethics--like we have medical ethics now--a technology ethics. How should we roll this stuff out? Because we're coming to a point where you can do it if you imagine it. The question is should we and how do we counteract that with economic incentives and policy; because like it or not, there's government policy that's going to be part of this as well in order to avoid some big dislocation that happens so fast that it creates a vacuum and the air claps shut, which could happen."
No matter their discipline, Baylor students will need to demonstrate some footing in tech as they begin applying and interviewing for jobs. On the flip side, tech people--engineers, computer science majors and the like--will need to demonstrate some business acumen in order to maximize success.
Voigt studied computer engineering at Baylor, but he did himself an enormous favor by pursuing his elective credits in business.
"It gave me a distinct advantage," he said. "Not only could I do the engineering side, but I could understand the business side. I wasn't as good as the business graduates, but I would understand it. I could read financials. I could do all that. There are those specified degrees and those people are just going to go in their cubicle, and they're going to program and put out great software. But to go beyond just a salary, you’ve got to have business skills. If you don't have the skill set, you can only go so high, and then you’re kind of maxed out."
Sullivan said the days of simply pursuing a business track degree are over. "Now what I need are people who have business logic skills, but also have just enough technology background, just enough in terms of programming languages, just a little bit of engineering," he said. "That blended brain is really hard to find. But, also, you don't want a security practitioner who has just come out of an accounting class. You want somebody who actually understands how to get under the hood and do some work. It's not just STEM [science, technology, engineering and math]. That's a part of the equation, but you also need to have communication skills and business logic, and understand business impact. It’s not technology or something else now; it's technology embedded into everything else."