3 Crucial Tips for Entrepreneurs to Survive the Robot Invasion

The Industries of the Future
The Industries of the Future

Are robots going to put you out of a job?  What should you do about it?  Alec Ross recently came out with a book titled “The Industries of the Future” where he writes about the coming disruption due to robots and artificial intelligence that got me wondering “what does this mean for entrepreneurs and woodworkers?”  Will robots replace us all?  Let’s take a look.  I’ll give you three entrepreneur strategies to survive the robot invasion based on some of the prognostications in Ross’ book.

#1 Make Your Own Job

Some folks may think the widespread adoption of robots is in some far-off future, but Ross says “Japan already leads the world in robotics, operating 310,000 of the 1.4 million industrial robots in existence across the world.”  As you can see, the robots are already here and there will only be more.  We’d all better think very carefully about the career we have or the career we want, because it may not exist in the future.  For example, about a year ago I went on a trip to Japan.  My buddy and I went to a restaurant to grab a bite and when we walked in there was a kiosk facing the door with large buttons with pictures of entrees on them.  We picked what looked good, plopped in our yen, and the machine spit out a ticket.  We sat down and a few minutes later, a human delivered our food.  There were only two staff in the entire restaurant:  the food-deliverer and the cook.  That restaurant model already exists in other countries and is on its way to the United States.  All those workers at McDonalds and Burger King may be soon be gone.

Ross talks about this move to automate:  “Boiled down to economic terms, the choice between employing humans versus buying and operating robots involves a trade-off in terms of expenditures.  Human labor involves very little ‘capex’ or capital expenditures–up-front payments for things like building, machinery, and equipment–but high ‘opex,’ or operational expenditures, the day-to-day costs such as salary and employee benefits.  Robots come with a diametrically opposed cost structure:  their up-front capital costs are hight, but their operating costs are minor–robots don’t get a salary.  As the capex of robots continues to go down, the opex of humans becomes comparatively more expensive and therefore less attractive for employers.”  Almost every business today is doing the cost/benefit analysis of whether to make those capital expenditures comparing the cost of humans versus robots.  As the cost of robots come down, more humans will be replaced.

It is clear that many of traditional jobs will be going away, which is all the more reason to start preparing for the robotpocalypse.  Ross writes “How much harder will it be to get a first job?  How about a second?”  One of the ways is to make your own job, as Mo Johnson did at Better Display Cases, Lawrence Colby did in writing his first book, or some of the other entrepreneurs did that we are about to profile in this blog.  Mo and Lawrence are each earning some good $$$ because they decided to make their own jobs, but that requires some solid planning and execution.

I recently ran across an article in Popular Woodworking that is another great example of creating your own job and is also a good model for people transitioning out of the military.  The story (click here for link) called “End Grain:  Marine Corps to Shop Floor,” talks about Grant Burger’s journey from Marine to full time craftsman.  Grant knew he was getting out of the military and created his own job, by using his education benefits to attend a furniture making school in Boston.  Now he is selling rocking chairs that cost more than $2000 each and are absolutely beautiful.  To see some of his work, check out Grant’s blog here.

This automated, robotic future is not something to fear, but is a fertile playground of opportunity for the entrepreneur, as we’ll see below.

#2 Go Microentrepreneur With The Codification of Money, Markets, and Trust

“But the codification of money, markets, payments, and trust is the next big inflection point in the history of financial services.  Understanding what it means for your and your business will be important regardless of whether you are a plumber or the CEO of a fortune 500 company.”  Entrepreneurs need to embrace these changes or run the risk of being left behind.  Ross goes on to profile Square, the company that created the attachment you can use with a tablet to swipe and process credit cards:  “From its inception, Square has been about enabling the kind of small-scale transactions…Its approach has been to try to eliminate the costs and complication of standard credit card transactions.”  This creates a tremendous opportunity for woodworkers, or any craftsman, for that matter.  Many of my fellow woodworkers sell their pieces at arts and crafts fairs.  With tools like Square, any entrepreneur can charge a sale anywhere at any time, such as at craft fairs.

“Square and its competitors are trying to reduce friction in the marketplace.   They are trying to dial down the complication and the tens of billions of dollars spent in the form off credit card fees, exchange fees, or the cost of lost transactions…”  As we wrote about in our post on Clausewitz, entrepreneurs are continually trying to overcome friction, and companies like Square will only help.  The CEO of Square “believes that Square is part of a larger trend refocusing the economy toward bottom-up innovation.  He explains, “one of the reasons we started this company, from a personal standpoint, is this trend toward more local experiences.  So I think the fabric of the neighborhood and how online is pointing to more offline local experiences is a very, very interesting trend.”  As we wrote about in our posts on Community and the post on Reflections artisans can thrive in this environment.

“Anyone can pick up a device they already own and suddenly become a powerful commerce engine in that particular area.”  This could also be useful for entrepreneurs involved in services such as Uber drivers or freelancers doing work on sites like TaskRabbit.  Ross goes on to say “But as with other mass infrastructure deployments, like railroads in the 19th century, the full potential of the network is borne out only when other entrepreneurs layer their creativity and commerce on top of it.”  He also says   “I think of the sharing economy as a way of making a market out of anything and a micro entrepreneur out of anybody.”

It is the golden age of entrepreneurship.  Let’s take a look at the third tip to survive the robot invasion.

#3 Go Local, Then Global

Robots will thrive where there are many automated, repetitive tasks.  Even as artificial intelligence gets smarter, there will be opportunities for entrepreneurs.  “With coded markets available to even the smallest vendors, a trend has arisen that pushes economic transactions away from physical stores or hotels and toward individual people, as they connect either locally or online.”  Today, any one of us can process credit card transactions using companies like Square, as mentioned above.  This is incredibly freeing and allows anyone, anywhere to process payments.  Along those lines, Ross writes:  “Though the world’s major cities are fueling the global economy, one does not need to be in an alpha city to succeed.  In fact, Internet technology allows people to be almost anywhere and operate a successful business.”  An entrepreneur couple I’ve mentioned previously (see Pure Living for Life) runs a blog, YouTube channel, Instagram presence, Twitter presence, etc. profiling their move to off the grid living.  They started on a bare piece of land in Idaho, but technology allowed them to create this multimedia presence to document their off grid journey.  Come to think of it, if they have Internet are they off grid???  They started local and are now global.

Another concrete example of this starting local then going global is one of my favorite woodworkers, Marc Spagnuolo, The Wood Whisperer.  Marc started locally building commissioned furniture, but then realized the amazing potential of the Internet.  He started teaching fellow woodworkers via his blog, then videos on his website.  He now has a global empire and operates globally via his blog, videos, DVDs, etc.  Woodcraft Magazine just ran a great profile of him.  Check out the article here.

This concept of starting local then going global has been a good model for Traughber Design.  We started custom woodworking locally and the blog is now read around the world, in 33 countries at last count..  It’s interesting to look at the metrics and see what far-flung countries are reading it.

We’ve covered a lot of ground today.  Follow these three keys and you’ll be well on your way to surviving the robot invasion:

#1 Make Your Own Job
#2 Go Microentrepreneur With The Codification of Money, Markets, and Trust
#3 Go Local, Then Global

 

 

2 thoughts on “3 Crucial Tips for Entrepreneurs to Survive the Robot Invasion”

Leave a Reply

Your email address will not be published. Required fields are marked *