Current nonprofit sector research and recommendations for effective day-to-day practice from ASU faculty, staff, students, and the nonprofit and philanthropic community.
On Feb. 21, 2017, the transportation company Uber debuted a new self-driving car program in Tempe, Arizona. As of this writing, customers can now request a ride in one of these self-driving cars. Uber is not the only company debuting this newest innovation- Waymo, a Google subsidiary, and General Motors are both testing their own self-driving cars in the Phoenix area. Self-driving cars are not science fiction; they are a reality on Arizona roads today and will only continue to become more prevalent as technology reaches its full potential.
Self-driving cars are perhaps the most visible element of the “Fourth Industrial Revolution,” a term used to by some scholars to refer to the rapidly increasing use of automation, robotics, and artificial intelligence (AI) over the next two decades (Schwab, 2016). The Fourth Industrial Revolution will disrupt the US and world economy by simultaneously creating new economic growth and large-scale unemployment. Automation has the potential to reduce costs, increase productivity, and increase demand for some occupations, such as computer programmers. Yet, automation will replace millions of American jobs, leaving workers such as taxi or truck drivers out of work. “Rapid and accelerating digitization is likely to bring economic rather than environmental disruption, stemming from the fact that as computers get more powerful, companies have less need for some kinds of workers. Technological progress is going to leave behind some people, perhaps even a lot of people, as it races ahead” (Brynjolfsson and McAfee, 10-11).
One study has found that 47 percent of US jobs are at high risk of automation (Frey and Osborne, 2013). Job losses could amplify current trends of income inequality by automating many middle income jobs. These economic impacts create a set of challenges that will need to be grappled with in the near future.
Nonprofits are in a unique and vital position to seize the opportunities and solve the challenges of disrupting technology. Luckily, nonprofits already provide many of the programs that will be needed in the years to come, such as: educating students for the careers of the future, providing social services to unemployed persons, advocating for policy solutions and many other roles. Nonprofits also have the opportunity “to become thought leaders” (Zwick, C., personal communication, Mar. 20, 2017) and define what the effects of disrupting technology look like in our society. To successfully meet the challenge of a changing economy, nonprofit organizations will need to learn, plan and prepare now. This means conducting a process of needs assessment, community stakeholder consultation and strategic planning that considers the following four factors:
- Re-envisioning programs to be relevant and using technology creatively. All nonprofits will have to answer existential questions about many of their programs: Do their outputs and outcomes still make sense during the Fourth Industrial Revolution? This is a particularly relevant question for educational and workforce development nonprofits. However, it is also relevant for nonprofit missions that may be indirectly affected, such as safe driving organizations or worker’s rights groups. Nonprofits should consider how to incorporate disrupting technology into their program activities. Some technology use will be an obvious iteration on current program activities, where automation allows program activities to be carried on at lower cost and greater productivity. Alternatively, use of disruptive technology could fundamentally alter the design of a program, allowing the nonprofit to complete mission activities in a way which they could not do without this technology.
- Scaling programs appropriately. The Fourth Industrial Revolution has the potential to create hardships for millions of workers and families. If this happens, nonprofits will need to expand programs which provide a safety net for people in need. Nonprofits will need to plan to scale accordingly and should conduct a needs assessment now to forecast that growth. The use of automated technology can be part of a nonprofit’s scaling process as automation could allow for nonprofits to scale rapidly.
- Ensuring their financial stability. Fundamentally, the process of making programs relevant and scaling up programs will require significant financial investment from nonprofits. Nonprofits will need to increase revenues or find cost savings in order to make these investments. Automation may economically affect the donor base of nonprofits. Additionally, application of automation technology could provide new opportunities for nonprofit fundraising.
- Advocating for smart policies. Although nonprofits can be a vital leader during the Fourth Industrial Revolution, they cannot solve all challenges alone and will need to actively engage with government to succeed. Nonprofits can, and should, advocate for an expansion of funding grants and other sources of funding that will allow them to scale their services. Nonprofits should also advocate to the government for policy solutions to the new challenges of the Fourth Industrial Revolution, such as new legal frameworks and regulations for automation. Nonprofits may also want to consider exploring advocacy for more far-reaching policy changes. For example, universal basic income or a tax on robots have both been proposed by various CEOs of technology firms.
The Fourth Industrial Revolution will create new opportunities and challenges for society and the economy. New automation technologies will allow for increased productivity, lower costs and better products. However, they will create significant amounts of income inequality and social disruption as workers lose their jobs to cheaper, better machines. Nonprofits must be at the forefront of seizing these opportunities and solving these challenges. To prepare, nonprofits should conduct a needs assessment and consult with their stakeholders. During this process, nonprofits should consider re-envisioning programs and creatively using technology, scaling programs appropriately, ensuring financial sustainability and advocating for smart policies. By preparing now, nonprofits can lead the solutions to the Fourth Industrial Revolution.
Acker, R (2017). Five ways the Fourth Industrial Revolution will transform NGOs. Retrieved from: https://www.weforum.org/agenda/2017/01/the-top-five-ways-the-fourth-industrial-revolution-will-transform-social-good-organizations
AZ Central. (2017, Feb. 21). Uber self-driving cars arrive in Arizona in Tempe debut. AZ Central. Retrieved from: http://www.azcentral.com/story/money/business/tech/2017/02/21/uber-self-driving-cars-arrive-arizona-tempe-debut-scl/98208998/
Brynjolfsson, E. and McAfee, A. (2014). The Second Machine Age. New York: W. W. Norton & Company
Frey, C. and Osborne, M. (2013). The Future of Employment: How Susceptible Are Jobs to Computerization? Retrieved from:
Schwab, K. (2016). The Fourth Industrial Revolution: What It Means, How to Respond. Retrieved from: https://www.weforum.org/agenda/2016/01/the-fourth-industrial-revolution-what-it-means-and-how-to-respond
Weller, C. (2017, Feb. 13). Elon Musk doubles down on universal basic income. The Business Insider. Retrieved from: http://www.businessinsider.com/elon-musk-universal-basic-income-2017-2
Stanford Prescott is a graduate of the ASU Masters of Nonprofit Leadership and Management program. He completed his undergraduate studies at ASU, receiving a Bachelors of Sustainability and Certificate of Latin American Studies. Professionally, Stanford works as a community organizer for political issues and serves as a Governing Board Member for the Phoenix Union High School District.