The merits of global trade have been a hot-button issue in US politics over the past few years. A major part of the president’s campaign was criticism of global trade due to its impact on the American middle class, leading to headlines like, “Will Donald Trump mean the end of global trade?” and “Trump’s policies are provoking a global trade war.”
However, politics isn’t the only force that determines the currents of global trade. Technology also plays a role, and an increasingly influential one. Whether it’s new printer types, like 3D printing, the threat that automation poses to low-skilled jobs, or the latest consumer gadget trends, these technologies have ramifications on people, processes, and trade. 3D printing is a prime example of a hot, and admittedly nascent, technology that has day-to-day and big-picture implications for industry leaders and office IT pros alike.
Take shelter from the global trade wipeout
According to Wohlers Associates, which publishes annual reports about the 3D printing industry, 3D printing is expected to generate over $21 billion in worldwide revenue. The disruptive impact of 3D printing will be felt across industries—including medicine, military, construction, and food. Imagine 3D printing “complex biomimetic hands” for amputees—sounds incredible, right?
The emergence of new printer types is something to be celebrated, but those innovations can also lead to unexpected, ancillary consequences. In September 2017, global financial institution ING published a report stating that growth in 3D printing could wipe out almost one-quarter of cross-border trade by 2060.
“3D printing is still in its infancy. For now, it has very little effect on cross-border trade,” wrote Raoul Leering, ING’s Head of International Trade Analysis. “This will change once high-speed 3D printing makes mass production with 3D printers economically viable. The first technical steps have already been taken.”
3D printers require far less labor to manufacture products and will ultimately reduce the need for developed countries to import goods from low-wage countries. If, as some experts predict, 3D printing assumes a 50 percent share of manufacturing over the next 20 years, a tremendous portion of world trade could be eliminated, starting with the automotive industry, industrial machinery, and consumer products.
Know this: Nothing is simple
It’s these types of overarching, long-term ramifications that can get lost in early excitement about new technologies. It’s the responsibility of industry leaders to push their business forward and embrace opportunities for efficiency, but it’s also their responsibility to consider the ripple effects of those choices. These decisions aren’t made in a vacuum.
That said, no one can predict the future, and not all experts agree that new printer types and 3D printing will kill global trade. In a recent article published by the World Economic Forum, authors Wolfgang Lehmacher and Martin Schwemmer wrote about how sports brand Adidas’s use of 3D printing shortened the traditional one-year production cycle, reducing lead times by 66 percent on average. This reduces inventory waste by enabling retailers to place orders based on sales and lets suppliers deliver what’s needed. Accelerated manufacturing helps compensate for potential declines in trade.
But a short and fast supply chain isn’t the only consideration to keep in mind. There are many other factors at play, including geopolitical risks, the availability of skilled workers, the quality of infrastructure, tax considerations, the cost of land and energy, and the time and effort to obtain licenses.
“The capacity to manage change and complexity is limited,” say Lehmacher and Schwemmer. “Changes can have huge implications—the workforce needs to be taken into account, and assets might not have been written off or amortized yet. Management needs time and energy to keep its focus on customers and markets and ensure the stability and smooth continuation of the business. Fragmentation has its limits.”
Please enter, the robot will see you now
These questions don’t just face industry leaders—they also face IT pros who’re making decisions about office innovations. How will new technologies that reduce the need for human labor impact people and processes in the workplace?
For example, “chatbots” are now sophisticated enough that they can fulfill the needs of customer service departments, and phone centers could soon become a thing of the past. While bots won’t replace humans entirely, they will reduce the number of customer service employees a company needs on its team. Technology could also replace recruiters by using machine learning and AI to analyze job applicants and match the right candidates to the right roles.
These types of buying decisions from IT pros have real-world impacts, but of course, nothing is ever simple. While innovations have the potential to eliminate human jobs, replace manual processes, and decrease trade, they can also compensate for those reductions by creating opportunities in other ways. Innovation can create new products and expand their demand, which leads less to an elimination of labor than a reallocation.
Take the customer service industry: Bots will never provide the same emotional connection and empathy a human can, and in taking on a greater share of “high-urgency” situations during support interactions, they free up humans to handle the “high-emotion” situations. You can also think back to the example of 3D printing: Could it make trade more regional and less global? Yes, but markets will adapt.
“We shouldn’t see this as a negative for the world economy,” Leering writes. “It’s a shift, it’s a change, and it will, in the end, make products cheaper and boost purchasing power, which will be a positive for economic growth.”