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MIT Sloan School of Management | Office of Communications
+ THREE INSIGHTS FOR THE WEEK
April 25 – May 1, 2021
1. Companies in the midst of digital transformation should aim to create and track three types of value, according to a new research briefing from the MIT Center for Information Systems Research.
- Value from operations. Companies can benefit from digitizing business operations through reduced costs and increased efficiency and speed. Examples include developing modular components, automating processes, and becoming more agile.
- Value from customers. Firms can create increased revenue from customers through cross-selling — selling different things to an existing customer — and new offerings. Companies also benefit from increased “customer stickiness” as digital initiatives allow firms to expand their knowledge about customers and offer them more choices.
- Value from ecosystems. Companies create digital ecosystems by partnering with others to offer customers a single go-to destination. Value comes from digital connections and access to ecosystem data, the researchers wrote, noting that firms in their study were about 30% effective, on average, at creating value from ecosystems.
2. Uber and Instacart come to mind when people think of on-demand workers. Less well-known are the “ghost workers” of the digital economy — the human labor that powers modern artificial intelligence systems.
The MIT Initiative on the Digital Economy recently hosted a seminar with Microsoft senior principal researcher Siddharth Suri, co-author of “Ghost Work: How to Stop Silicon Valley from Building a New Global Underclass.” Suri detailed the inequities faced by the often unseen workers who ensure the accuracy and appropriateness of online content — testing algorithms, moderating content, detecting spam, checking web search results, editing pages, and more.
Suri noted that increasingly such tasks are sourced, managed, delivered, and billed through platform networks like Mechanical Turk, the widely used task-hiring platform first developed by Amazon in 2005 when it needed temporary labor to help tag online content.
While digital gig work offers the flexibility some workers value, the potential for exploitation remains, Suri said. A 2018 research paper led by Kotaro Hara of Carnegie Mellon University found the median hourly wages for this type of “crowd work” to be approximately $2, with only 4% of workers earning more than $7.25 per hour.
3. There weren’t many women at Lockheed Martin when Julia Wada was beginning her career there as a mechanical engineer, but she distinctly remembers one strong female leader who was widely admired.
“What stood out for me is that she wasn’t trying to be like the men, or anyone else. She let me see early on in my career that authentic female leadership was not just normal, but a strength,” Wada, SM ’90, said.
In a recent Q&A, Wada, now group vice president of corporate strategy and innovation at Toyota Financial Services, spoke about bias issues and how to scale progress throughout the industry.
“Times have changed in the auto industry. At Toyota, three of our 10 North American vehicle plants are run by women, including the largest in Kentucky. I’m part of a 10-person executive committee at Toyota Financial Services, and four of us are women,” Wada said.
“I’ve seen a real shift from a ‘you’re on your own’ culture to women supporting other women and, more recently, male allyship as well. This broader recognition of the role we all play to lift up women is the key to scaling.”