Using technology innovation to fight complexity

"We didn’t disrupt anything. We just expanded the possibilities,” says Jim McKelvey from payment company Square.

Don’t search for perfection, look for a problem that needs solving, serial entrepreneur Jim McKelvey tells CPA Congress.

Serial entrepreneur Jim McKelvey has made a career out of being unconventional, and he has no doubt that unconventionality is a very good way to handle the challenges coming down the road.

In his address to the CPA Congress in Melbourne, “Building Tech Capability to Fight Real World Complexity”, McKelvey outlines how different thinking has underpinned his business ventures.

“I can see the danger of being overwhelmed by technological change,” he says. “There are so many devices that offer multiple functions. I gave my father an iPad and he asked me what it did. Well, there was no simple answer. It could be a book, a phone, a camera, a television, a terminal, and so on and on. It is good that we have so many choices at our fingertips, but keeping up with it is a continual struggle.”

Although he trained as a computer engineer, McKelvey is also an artistic glassblower, and it was this that led him to one of his most successful ventures, payment company Square. A good friend and talented glassblower was unable to find a way to sell his works. When McKelvey investigated, he found that many small businesses and sole traders had similar problems with handling credit card transactions. In fact, small companies usually had to pay much more than large companies when handling and moving money.

Credit card payment solution merges technology and innovation

Square was developed as a hardware/software solution. It enables virtually anyone to accept credit card payments for their goods or services. A small hardware interface connected to a mobile phone handles the physical card interaction, and the cloud-based smartphone app and back-end software facilitate the cash extraction process. This has dramatically reduced the costs for small businesses and has also reaped solid rewards for Square.

McKelvey emphasises that this is not about technological disruption.

“It’s not disrupting the banking industry,” he says. “If you are looking for disruption opportunities you are not focusing on the right things. All the people who were processing credit cards before Square are still processing those credit cards. We didn’t disrupt anything. We just expanded the possibilities.”

Seeking simplicity from technology innovation

He acknowledges that many business advisers and writers talk about searching for opportunities, but he puts it the other way around, saying that the key is to look for problems that require solutions – and the simpler the solution, the better. 

McKelvey also rejects the dictum of searching for perfection. If you wait for a product to be absolutely perfect it will probably never get to market, he believes. A better course is to look for solutions that do the job effectively and are robust rather than very elegant.

“There is also a view – misplaced, in my opinion – that being the first into a market space is necessary,” he notes. 

“I believe it is more important to get the timing right and the product appropriate for the market. Facebook was not the first company into the social media space, for example.

There were others, but their names have been forgotten. Facebook focused on getting the formula right rather than speed.”

Despite his wariness about some aspects of the emerging technology, he sees it as an important way to generate possibilities. His “maker studio” allows anyone with a vision and a few dollars to build their dreams by providing access to over US$1 million of manufacturing tools and a supportive community. 

Another venture, the non-profit LaunchCode, teaches coding to anyone without charge, so they can claim a stake in the digital economy. LaunchCode has helped over 1000 people get jobs in the new economy over the past five years.

Upgrading job skills

McKelvey’s presentation was supplemented by a panel discussion, where he was joined by Matt Tindale, managing director, LinkedIn Australia and New Zealand, Jacquetta Griggs FCPA, CFO, Australian Industry Standards, and Dr Simon Eassom, executive general manager, education, CPA Australia, to discuss the future of work in the finance sector.

Tindale believes that the growth of AI and increasing automation of routine accounting functions are creating a skills gap. Employers are looking for people with consultative and creative skills, but the traditional education system is lagging. The useful life of many skills is only about two years.

Griggs agrees, emphasising the need for ongoing learning as part of career planning. New forms of education are needed, but they have to come from a trusted source. Micro-credentials linked to non-traditional learning methods such as short courses are more likely to be accepted by prospective employers if they are linked to a well-known brand.

Eassom says some large companies, dissatisfied with traditional educational methods, have begun to offer upskilling courses for their employees, with a focus on big data and data-related skills. However, even outside of this there is a need for short courses and educational platforms that allow people to select the skills they need to improve. 

Technology is already changing the process of recruitment, according to Tindale. Large platforms such as LinkedIn allow employers to find people of particular skills without using traditional methods. Generally, however, AI and related tools are not used to identify individuals, but to select a subset of people, with employers making the final decision.

McKelvey warns that the personal decision should be paramount and that great care should be taken when using AI tools in recruitment. The inherent conservatism of AI systems, which are usually based on experience, can easily disadvantage minorities.

He adds that another needed area of education is for executives and managers who are not always familiar with IT issues. “When the technology specialists start to talk, managers can easily lose the sense of what is being said,” he says. “They can be in the position of having to take the word of the tech people that something is not possible or can’t be done without more IT investments. That is a bad place to be, believe me. Courses to give managers and executives the ability to understand tech-speak are a very good idea.”


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