Interview with Alvin Toffler by James Daly

From the September 26, 2000 issue
 
James Daly

Business 2.0: When Future Shock was published in 1970, did you have any inkling that it would have the tremendous impact it did?
Alvin Toffler: Certainly not while Heidi and I were writing it. I think its success must be attributed to the fact that it was a serious book written in popular language. It’s for ordinary people. The first clue that the book was going to sell more than 10,000 copies came during some speaking engagements. We were traveling around to college and business audiences, and the responses were much more emotional than we anticipated. When you start talking about change, you hit people at a gut level. The system was going so fast as to become somewhat threatening and even now it’s going just as fast. In fact, the pace of life has sped up even further.
 
True. But we are incredibly adaptive. A generation on, haven’t we become accustomed to accelerated change?
I don’t think so. Change is not just a question of demanding faster reactions. It has to do with decision-making. In our present genetic form, we have certain limits on our ability to cope with this pace of rapid decision-making. That’s not only true for us as individuals, but it’s true for businesses, and congresses, and governments, and other institutions. When it comes to decision-making, we’re having a hard time keeping up. You can speed up the companies. You can speed up the machines. You can speed up the people. But there are a huge number of people who feel that the future is arriving so fast that they’re hanging on by their fingernails. That the world has become so fast that there isn’t time to think through the complexities of the decisions they need to make.
 
It used to be that access to information was good. Is that still true? Have we reached a point where too much information is not good?
Too much of anything is not good. Too much ice cream will kill you. I don’t think the issue is too much information. More important is decision overload. We believe that every person, or organization, can only make so many competent decisions in a given amount of time. Up until the point that we change our biology, there are some fixed limits on the speed by which we individually process information. However, there are enormously powerful tools by which we can extend the amount and extend the capacity of, for example, how information is organized. The simplest example is our telephone numbers. Why do they come in a grouping of three and four instead of just throwing all seven at you. It’s because you can’t remember seven very easily, but you can remember three and four. That’s a primitive example of what might be called chunking information. We can handle more information if we can chunk it, and we can chunk it at higher and higher levels of complexity, and we can employ better models of organizing information. If you have powerful models, you can just handle a lot more.
 
So the quality of our decisions goes down.
That’s it. I know some elected representatives who say they can’t assimilate all the information they need to make truly informed decisions, so their staff makes the decisions on most issues. To which I replied, "Exactly who elected your staff?" And this is typical. People are required to make decisions faster and faster without adequate decision support. And there is a dangerous mismatch between the amount of decision-making that you have to do, and information that’s available and the speed at which an answer is required. The information is out there, but in the wrong hands.

 

The people are smart but the institutions are dumb.
Exactly. You can have 535 saints and geniuses in the U.S. Congress and Senate and they would still make stupid decisions, because the decision-making process in the institution is obsolete.
 
How does that affect business?
There is a slightly odd notion in business today that things are moving so fast that strategy becomes an obsolete idea. That all you need is to be flexible or adaptable. Or as the current vocabulary puts it, "agile." This is a mistake. You cannot substitute agility for strategy. If you do not develop a strategy of your own, you become a part of someone else’s strategy. You, in fact, become reactive to external circumstances. The absence of strategy is fine if you don’t care where you’re going. If you’re traveling and you go to the airport and you don’t care where you’re going, then you don’t mind having the crowd push you towards some counter and taking whatever flight happens to be leaving at that point. Which means you don’t care whether you go to Pago Pago or Patagonia, and your baggage goes to Portland. Strategy is not only an invaluable concept, but an absolute necessity. But that does not mean that you fix a goal of five years into the future, like the Soviets used to employ in Moscow, and you march inexorably toward that goal. That was pretty dangerous.
 
So how do you do it? You need to have both a sequence of temporary strategies, and also have a process or some climate that makes that possible.
 
Let’s talk about some business strategy. For instance, getting first to market. With so much change already swirling through the consumer’s head, is that still important?
First is always a dangerous place to be by the nature of resistance to change. But I think being first can be turned into an advantage. Look at the concept of increasing returns. But that concept is not universal and doesn’t apply to every industry and every moment. These should not be thought of as universal laws of business. They apply to certain markets. What is frequently the case is that we hit upon some principle that works in telecom, for example, and then write about it and talk about it and develop a universally true axiom. One of the critical ideas that my wife and I introduced in Future Shock and developed in all of our subsequent work is, in fact, the idea that the society and the economy are increasingly differentiated and demassified. Companies are frequently more different than they are similar. That’s why I am skeptical about rules of business: ten rules, six rules, eight rules, whatever. There is a tendency among consultants and CEOs and others to universalize what should not be universalized. Which makes sense in a second-wave. mass production system, but makes less sense if there are customizing factors.
 
Today’s highly decentralized society is almost the opposite of what we thought the future was going to be like 50 years ago. Back then, it was groupthink and rigid central government and unthinking clones marching in lockstep. Now you’re describing an environment where the worker has more of the power. So I suppose the future ain’t what it used to be.
Exactly. The dominant assumptions about the future by geniuses such as Orwell and endless numbers of science fiction writers, sociologists, and other scholars and so on, was simple: More technology equals more massification. More technology equals more bureaucratization. We argued that one of the defining changes was a shift to increase diversity rather than uniformity.

We’re flooded with business books offering rules for everything from online marketing made easy to tips for customer acquisition. Partly they are a reaction to the incredible change. We want guidance in times of uncertainty. Should we ignore these books?
What criteria do you choose the rules applicable to you? Do you just take the latest book off the shelf? Kevin Kelly wrote a very fine book (New Rules for the New Economy ) and it’s a good book. A smart book. But it doesn’t apply to everyone, and I as a reader have to have the wit to recognize what may or may not apply to me. Perhaps a more fruitful approach is to not simply accept all these rules at face value but select which rules are applicable for your niche and then customize them.
 
Does the future have a bad reputation?
It depends upon what country and culture you’re in. In Europe, the future has a terrible reputation. Instead of a rational and critical response to genetic engineering, for instance, you have panic and stupidity masquerading as concern for the public and so forth. Europe is about to shoot itself in the brain, just as it has done previously. It shot itself in the brain by ignoring the whole IT revolution for years. Now, despite the fact that it has a powerful pharmaceutical base and chemical industries, it runs the risk of being completely sidelined again from the latest technological advances of the human race. That’s a deeply cultural thing. By contrast, the Japanese look to the future and are optimistic.
 
At the same time, the Japanese business culture does not exactly encourage entrepreneurialism, the way the United States does.
Yes, that’s absolutely correct. But it’s beneath the surface. Go to a bookstore in London and you’ll see endless rows of books on the history of British royalty or the Victorian garden or the Great Age of Elizabeth. In a Japanese bookstore, those books are about the future of transportation, the future of health, the future of urban development, and so forth. We Americans, on the other hand, tend to have no past and no future. We are what the advertisers in the ’60s called, on behalf of Pepsi, the Now Generation. We tend to be focused on the immediate. That’s where a lot of this notion that strategy is unimportant comes from.
 
Has the role of the customer changed?
The customer is now a participant in the production process. One way or another, we recruit customers to become our allies and in effect, co-producers. The customer now is what we call a prosumer. Years ago, you grew your own food, sewed your own clothes, built your own house. The Industrial Revolution split the producer from the consumer. The economic concept of production and consumption became two separate things. Now you make a car in Detroit and it’s bought and driven in California. The producers and consumers never met. What’s happening is a shift toward consumption in which the lines have blurred between producer and consumer or customer. The customer provides information as to what they want. Without that information, producers create a product that they can’t sell and no one wants. So in more and more complex technological industries, you have the joint teams working together–customer and supplier. The relationship with the customer to the producer is radically changed and enhanced by the Internet. The Internet does the following–say you bought a car and suddenly you discover you have a problem with the carburetor or some part of it, or something is wrong with it. Say something is not working. You take it back to the dealer and say fix it. The dealer tried to fix it, gave it back to you and it’s still broken. You send it back again and again. You’re getting angry, the dealer is getting angry, and no one is fixing it and you’re fighting with each other, and finally as a customer, you walk away helpless. Now you can go online. I say I just bought a year 2001 gizmo. Anyone else buy that? I’m having trouble with my X, Y, Z. How about you? Before you can say "litigation," you have 700 people with complaints and you’ve got a case, a product liability case, or some action of litigation.

In this age of unceasing change, what happens to brand loyalty?
When you speed up the rate of change, your relationships tend to become more temporary. It could be your relationship to people. You know more and more people temporarily. You know them, they come into your life, they go out of your life, and you have on the average shorter and shorter relationships. You have shorter relationships with organizations, because the organization you’re in changes constantly, it’s not the same organization. So I think there is no likelihood of long-term brand loyalty. Attempts to expand the brand, such as what Amazon is doing, will in fact weaken the credibility attached to the brand.
 
This would be a strong argument for brand, no? Brand is perceived as truth, is perceived as reliability.
Yes, but fundamentally we’re still having shorter and shorter relationships with ideas, because ideas become obsolete more and more frequently. Information becomes perishable. So you’re constantly processing more and more, and you’ve got more and more temporary images and models in your head. Your relationships with place become more temporary because we’re more mobile, etc. So we have argued that as relationships in general become more temporary, loyalty to brand also is undercut.
 
Are you an optimist?
Yes, but in most cases, there are all kinds of really scary implications in this as well. One of them is what I call the end of truth. The technologies of deception are increasing more rapidly than the technologies of verification. Now we have really powerful tools for deceiving one another.
 
Which do you think is more important now: information or misinformation?
Remember that misinformation is simply a subset of information. And it’s not all pernicious. What do you call knowledge that’s no longer accurate or true? Obsolete knowledge? I call it "ignorage." There is an enormous amount of it around. It’s something people believe, it may be a fact or a process, that is no longer correct.
 
For instance?
Look at our schools. Our education system is a second-rate, factory-style organization pumping out obsolete information in obsolete ways. And it’s not just that they haven’t gotten the science books updated. They are simply not connected to the future of the kids they’re responsible for. All education springs from some image of the future. It springs from some implicit assumptions about what the future holds. When your kid comes home and says "Why do I need to learn algebra?" you don’t say, "Because our forefathers learned it." You tell them that you’ll need it in the future. That assumes you know what the future has to hold. You’ll need algebra, or you’ll need marketing, or something. That presupposes that the parents and the curricula designers and the educators are making a set of assumptions about what the society, the colony of the world, is going to be like. If the model that you have in your head is of a smokestack, assembly-line economy, then you’re preparing the kids perfectly for that, as you’ve been doing for the past century or more. You’re treating them like raw material. You’re subjecting them to routine processing–totally deindividualized, mass-produced, without much care for the individual child. Moreover, you are giving the child repetitive work to do in preparation for a lifetime of repetitive work in the factories and factory-style offices that the kid is going to spend his life in. So for the past 100 to 150 years, we were more or less accurately sealing in the future of the kids.
 
Now we’re lying to the kids, because this process doesn’t map onto what the kids are going to find when they get out the door. When I worked in the factory, if the boss knew I was reading a book on company time, I would be canned, instantaneously. I figured out a way to do my job faster and I could steal a couple of minutes to read. But he didn’t want my head. He wanted my muscles. Now we’re going to want employees who are contractors or individuals working with us who innovate, imagine, think, challenge.
 
What is the role of unions in this age of the knowledge worker and the free agent?
The unions have gone from approximately 18 million members down to 13 million. Any company that lost that much of its market would be basically out of business or would have been bought by someone else or restructured. Now, I want to strongly emphasize that unions have social functions, they’re not just economic machines. But if you look at them temporarily as a business, they’re in the business of taking in dues and using them for all kinds of purposes. And I still believe that where you have large numbers of workers, second-wave mass industries up against a big company, they do need protection, but fewer and fewer workers in the American economy fit into that model. They have not figured out how to organize knowledge workers very well. So the union model is increasingly obsolete.
 
Is there a digital divide?
Yes, but it will change because it is strongly in the interest of business to get as many people on to the Net as possible. Companies want to send bills to everyone. If you took an old-fashioned, sort of Marxist line, going back 50 or 100 years, it would be that the elites don’t want the poor to have access to all of this communication power. The fact is, they do. The reason the telephone spread was precisely that–business needed it to do business and to compete, and it needed ways of reaching its own people and potential customers and so on. So it encouraged this process. In fact, the people who tried to prevent the spread of the telephone were frequently dictators like a Stalin, who were afraid, who forbid people to talk to one another. But it’s in the interest of so-called powerful forces in our society to universalize the Net as much as possible.
 
The Net can be used to help break the back of poverty. It is true that there are parts of the world where you don’t have electricity, where you don’t have clean water to drink, where the poverty is so tremendous that there are preconditions that need to be met before you can even begin to think about connecting to the Net. But given wireless, satellite, and new forms of energy, given all the things that we think are coming down the line, we think you’re going to find connectedness turning up in places that would have been thought impossible. An example is a Peruvian village where the villages are connected online, they’re selling products to New York, and they’ve tripled the village income. A few years ago, we were in Denver having dinner with some friends and they served us a fruit for dessert. The fruit was absolutely delicious. I asked what they called it and they told us, and I said boy, where can I find that back home? And they laughed and said, you can’t. You can’t buy that anywhere in the United States because it’s only grown in a tiny little area just outside Bogotá because of the climatic environment and so forth.
 
The power of the Net allows it. The reason you couldn’t do this in the past is that people in Bogotá did not know a potential market existed outside of Denver, and the people in Denver didn’t know that fruit existed. That set us thinking that there may be many products like that, which are produced in very small quantities. You could not feed the American market with this fruit, but why couldn’t you sell it to a small Denver suburb?
 
This is what I call "microtrade." I imagine that with the power of the Net, we will literally discover millions of micromarkets, that we will generate huge amounts of microtrade, that this will have and could have an enormously beneficial effect on just tens of thousands of villagers and millions of people around the world.
 
What comes after the Web?
(Pause) Web-bio.
 
Web-bio?
I’ve just made up the name, so don’t be too hard on me. It’s the linking of the Web with biology. Until now, information technology has influenced biotech. From this point on, biotech begins to influence information technology and it’s inevitable to me that we’re going to see all kinds of strange fusions of the two.
 
What’s on the other side of this giving up of biologic controls?
I don’t know. I’m speculating, and it’ll be reduced to science fiction. But on the other hand, we are living yesterday’s science fiction. We are speculating about some day we would not only, as we said in Future Shock, have the capability of, to some degree, predesigning children before they’re born, but one could imagine people requesting all kinds of strange capabilities. I’d like my child to be able to smell as sensitively as our dog does, or to see, or to respond to some kinetic movement the way a frog does, and have expanded capabilities. All of this sounds insane and terribly frightening, and surely, our society is in no way morally or intellectually ready for any of this, but I think in terms of technology, essentially, most bets are off.
 
Since the publication of the book, is there anything that has truly surprised you?
How long it took for some of these ideas to penetrate. Twenty or thirty years. The irony is we began talking about things like the importance of understanding and managing transience in our business world. But no one began to pay attention to it, even after Future Shock with its enormous impact, until you began to see substantial layoffs in the ’80s, all the big companies began laying off tens of thousands of employees. Then the idea began to just begin to seep in that something was happening. Too often, these ideas can creep up on you and the ground has shifted beneath your feet. But you were too complacent to notice.