ICT

Peter Thiel: ICT offers low cost, green solution to metro area transportation, housing challenges

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Venture capitalist and PayPal founder Peter Thiel was recently interviewed on the Fox Business Network on the city of the future. Thiel talked about the two major shortcomings of today’s city as a situs for knowledge work concentrated in centralized metro commute-in offices: transportation and housing. Transportation systems – roads, highways and public transit – are “badly inadequate” in most metros, Thiel said, and housing costs are exorbitant. Both leave knowledge workers with two bad choices. “People need to have super long commutes or live in small apartments near the city centers where they have to spend all of their salaries on the apartments,” Thiel explained.

That’s where information and communications technology (ICT) can provide a workaround by allowing knowledge work to be dispersed outside of urban centers, according to Thiel. ICT solves the housing problem since it provides access to more affordable housing while at the same time eliminating the need for daily commute trips.

The idea isn’t new and has spawned years of debate despite the strong benefit in solving the housing and transportation challenge ever since Jack Nilles coined the term “telecommuting” in the 1970s. That debate continues to play out nearly two decades into the new century among organizations – ironically including ICT innovators like Yahoo, HP, Apple and IBM – that resist substituting ICT for transportation, fearing a geographically dispersed workforce won’t be as productive or collaborative as one co-located in a centralized, commute-in office setting. Thiel explains:

The ICT version (of transportation) people have talked about for decades is telecommuting. And so would there be some way so that you won’t need transportation at all, you could just do your work remotely. For a variety of reasons this has not worked over the last 30, 40 years people have been talking about it. The [perceived] problem generally is that people who work from their homes, they don’t work as hard. A lot of the value of work comes from talking to people in various ways.

However, Thiel notes management practices are changing to overcome those concerns that concentrate on managing the production and delivery of the work product. That focus necessarily forces a degree of diligence and collaboration to get the work done, he implies.

I think we’re starting to see more and more of this telecommuting in Silicon Valley and elsewhere where people are finding small teams of developers outside of Silicon Valley, there are ways to sort of bundle, put the work in certain packages that you allocate to different people. So I think maybe one of the end runs around the transportation system will be telecommuting. That’s a trend that’s underrated that’s worth exploring a lot more.

Michael Shear’s Rx for the increasingly congested commute and improved access to knowledge jobs

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The biggest challenges facing metro regions are transportation and traffic congestion, accessible well-paying employment opportunities and affordable housing. In the world of knowledge organizations, a closely related challenge is determining to what extent staff members will work in the centralized, commute-in office and which are “remote” workers who perform their job duties outside of the office, typically working from home.

Michael Shear of Strategic Office Networks LLC has a solution that addresses all of these for knowledge organizations and regional transportation planners: transitioning away from the centralized, commute-in office of the Industrial Age economy to a more decentralized structure that utilizes today’s advanced information and communications technologies (ICT) to bring the work to communities where knowledge workers live. Those technologies link Enterprise Centers® that serve as community-based workplaces for as little as a few dozen to several hundred employees working for major employers located throughout a metropolitan or regional area. These centers are the building blocks of what Shear terms Distributed Metropolitan Design®.

I interviewed Shear for the Last Rush Hour podcast in December 2015. Listen here.

Key to Shear’s concept is reframing how we think about transportation. With today’s robust ICT capabilities that make it possible to work from most anywhere and traffic congestion crippling many metro areas, the issue is no longer how to most efficiently transport knowledge workers to centralized commuter offices. It’s now about access to a workplace that meets the needs of both the worker and the employer organization.

Traditional transportation initiatives encourage commuters to use public transportation or carpool in specially designated highway lanes. Transportation planners plan more expressway lanes to accommodate the continued growth in commute transportation demand. That remedy has hit the wall as metro areas continue to struggle with commute congestion, particularly as knowledge workers are forced to select housing far from their offices that they can afford, adding to commute transportation demand. Meanwhile, highly compensated workers bid up the cost of housing in central metro areas, fostering a severe housing affordability crisis such as currently afflicting California.

Shear’s concept recognizes that organizations have substantial investments in existing office space. They often can’t quickly transition to an office-less virtual organization. Nor are many workers ready or able to work from a home office or wherever else they choose. Much of this reality drives the debate over the pros and cons of “remote” work and “telework.” With a distributed organizational structure, these terms become far less relevant. When staff need to be co-located for team meetings and project sprints requiring intense collaboration that can be accomplished in settings outside of dedicated central offices. Shear also argues that the most prevalent form of “casual” telework — where only some knowledge workers work from home a day or two per week or more infrequently — cannot make a significant impact on transportation demand and metro area congestion.

A primary challenge for Shear’s concept is determining the right size for the Enterprise Centers®. They provide supported office space in residential communities and must be sensitive to the character of those communities. They must be large enough to be economically efficient but can’t grow too large because they will then generate substantial commute trips from non-locals and objections from nearby residents, effectively becoming the big commute-in cube farms and sprawling parking lots they would replace. Their size would likely be a function of the housing density of the neighborhoods in which they are located. Larger facilities would serve higher density areas where knowledge workers live within walking or bicycling distance with smaller ones most suited to lower density neighborhoods and reached by those modes of transportation or short trips by automobile or public transportation.

Leverage ICT for rapid remedy to jobs vs. affordable housing imbalance in metro areas

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As I look out the window of my California Housing Finance Agency office in downtown Sacramento at 5 p.m. on a Wednesday, I see a lot of cars.Filled with public employees, teachers, nurses and construction workers, the cars aren’t going to nearby homes. They are lining up to jump on the freeway and drive to the distant homes their drivers can afford. These are middle-income, working families who can’t find housing in the region’s most important job center. And this isn’t just a Sacramento problem, it’s a California problem.

Source: Don’t neglect middle class in California’s housing crisis | The Sacramento Bee

Actually it’s not just a California problem. It’s present in many if not most metro areas. It will be an ongoing issue as long as knowledge industry jobs continue to be concentrated in metro centers where housing is costly, forcing knowledge workers to live elsewhere — often more than an hour away over congested highways — where housing is affordable.

Building more affordable housing in metro centers is far easier said than done and can take decades of political and regulatory wrangling. A far faster and less costly and complicated solution is leverage today’s information and communications technology (ICT) to bring knowledge work to the communities where knowledge workers live, working in home or satellite offices or co-working facilities.

Leveraging ICT doesn’t mean there are no infrastructure costs over the long term. The infrastructure for the 21st century is fiber optic cable. Dubbed the “Information Superhighway” by Al Gore, it should be given the same priority and funding as roads and highways were in the 20th, particularly to deploy it to outlying communities with the greatest need for telecommunications infrastructure modernization.

Believe it or not, commuting will get better — a few decades from now – San Francisco Chronicle

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Let’s start with the bad news. Commuting, that scourge of modern life, will not go away. Skip forward a few decades, and the Bay Area’s clogged roads won’t magically clear. Getting to work will still take time. But you may actually enjoy it. And you’ll have a few options that don’t exist today – some of which could radically change the way California grows. To start with, you probably won’t be doing the driving. Whether you’re in your own car, or in a shuttle van or bus with fellow commuters, the vehicles will drive themselves in most if not all circumstances. And they’ll be electrified, so no more choking exhaust.

Source: Believe it or not, commuting will get better — a few decades from now – San Francisco Chronicle

The problem with this prognostication is it assumes commuting to a centralized office setting will continue well into the 21st century. And along with it, the problem of moving enormous numbers of people over increasing distances so they arrive and depart their offices in a relatively short time window each day.

It’s an outdated 20th century analysis. It views commuting as a transportation problem when in fact commuting itself has been obsoleted in the present decade by the maturation and proliferation of information and communications technology (ICT). It’s no longer necessary to transport human bodies to perform knowledge work daily. ICT makes it possible for knowledge workers to do their work in the communities where they live rather than wasting uncompensated personal time every weekday commuting.

We don’t need to wait decades for electric cars to be perfected and automated public transit and hyperloops to be built. We have the solution today — right now — to end the needless bane of the daily commute.

Rethinking knowledge work

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Bosses acknowledge that remote workers don’t suffer from productivity problems. Research has found telecommuters who can work outside normal office hours and don’t have to spend time commuting often are more productive than their cubicle-bound counterparts. Rather, managers want their teams within view and are willing to trade some efficiency for the serendipity that office-based conversations might yield.

Source: Working From Home? The Boss Wants You Back in the Office

Although information and communications technology (ICT) has eliminated the need to commute to an centralized, commuter office (CCO) every work day, many organizations stubbornly cling to the old paradigm out of habit even as peak hour traffic congestion grows and makes it less practical and inaccessible.

Diane Mulcahy notes executive and human resources professionals contend the CCO supports team-building, culture and collaboration. That’s likely true. But it comes at a terrible personal cost to staff member wellness and work satisfaction, not to mention the cost of maintaining CCOs. It’s not a good and sustainable tradeoff and it’s time to acknowledge that circumstance.

Silicon Valley ICT companies adhere to the CCO model, building huge, high dollar corporate campuses and busing staff there daily from San Francisco over jammed freeways. In the larger scheme, to solve this problem requires rethinking knowledge work. To what extent does it have to be done face to face and what can be done without staff being co-located? If team members must be in close daily proximity over the course of a project, a brainstorming session or an agile sprint, might that be done on a temporary basis with team members housed in close proximity so they don’t have to commute? In this framework, the CCO is replaced by a conference or meeting facility, with knowledge workers spending most of their time working in their communities in home offices or satellite or co-working spaces.

The solution to traffic congestion has to come from the demand side since adding more freeway lanes or smart vehicles isn’t the answer. That will require knowledge and information economy organizations to rethink how they manage and allocate resources.

One Thing Silicon Valley Can’t Seem to Fix – The New York Times

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The built environment of the Valley does not reflect the innovation that’s driving the region’s stratospheric growth; it looks instead like the 1950s. Looking at aerial views of midcentury campuses like the Eero Saarinen-designed Bell Labs next to contemporary ones like Apple, it’s nearly impossible to tell the midcentury structures from the 21st-century ones. Designing job centers this way contributes mightily to the region’s ever-worsening traffic. If you found yourself stuck on Highway 101 between San Francisco and San Jose, you’d really see what Silicon Valley looks like for many. Building campuses on isolated suburban tracts guarantees long commutes, and this is one of the worst in the country.

Source: One Thing Silicon Valley Can’t Seem to Fix – The New York Times

Kudos to Allison Arieff of The New York Times for raising this issue as I have many times in this space. I’ve also noted the irony that Silicon Valley’s legendary information and communications technology (ICT) innovation has effectively obsoleted the 1950s centralized, commute-in office (CCO), yet the region remains mired in commute traffic.

As Silicon Valley tech pioneer Bill Davidow pointed out in his 2011 book Overconnected, those office complexes came about because the “killer app” of the 1950s was a combination of pavement (freeways), cheap gasoline and the automobile that made it possible to work in another location far from home. Now ICT allows knowledge work to be done anywhere, eliminating the need to move bodies over highways every work day to CCOs. That’s a real killer app for our time to slay commute traffic congestion — in Silicon Valley and other metro areas.

Dealing with the Sprawl Devil

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In the last seven years alone, 600,000 new residents have settled in the region. Alameda is the fastest growing of Bay Area counties. Here, 120,000 people found elbow room—and in many cases, vast suburban lawns, swimming pools, and multicar garages—between 2010 and 2015. The county is now home to more than 1.6 million people. Contra Costa County’s population jumped from 1 million to almost 1.1 million in the same five-year period. The city and county of San Francisco also grew, from 800,000 people in 2010 to about 870,000 today. But most of this population growth is taking place in suburban areas far from major centers of employment, according to a report released by the California Department of Finance in early May.

The suburban growth is driving traffic congestion to crisis levels as residents commute hours each day to and from work on the Bay Area’s overburdened roadways. Traffic is increasingly cited in polls as one of the top reasons that locals want to leave the area. While many towns and cities combat traffic by improving transit systems and supporting housing projects near bus and train stations, traffic is getting worse—and the housing boom in the remote suburbs is directly reversing progress by introducing tens of thousands more people into communities that can only be easily accessed by automobiles. “Sprawl creates traffic,” Devalcourt noted. “It’s designed to accommodate driving.”

Source: Dealing with the Sprawl Devil

The San Francisco Bay Area Paradox I’ve frequently referenced on this blog continues to build.  The region — an Information and Communications Technology innovator — remains mired in a 20th century, post World War II Industrial Age mindset and the consequent paralysis of ever growing commute traffic congestion. Much of it generated by knowledge workers unnecessarily commuting to centralized office spaces elsewhere in the sprawling region when ICT makes it possible to work in the communities where they live.

The continuing commuting paradox of the S.F. Bay Area, stuck in the 20th Century

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Eighty percent of jobs in the Bay Area are concentrated in suburban fringes with little access to regional rail, and three-quarters of Bay Area workers drive alone to work as a result, the study’s authors note.The report highlights a seeming irony: Despite pioneering innovations in their products and work spaces, they house their lava lamps and free cafes in suburban corporate campuses with seas of parking lots. It’s a form of office that took shape in the middle of the 20th century. Google, Apple and Facebook’s offices are all more than 3 miles from the nearest rail station.This isn’t going to be good for the companies’ economic vitality in the long run, said Allison Arieff, SPUR’s editorial director. “Something’s gotta give.”

Source: Study calls on big tech companies to move closer to transit – San Francisco Chronicle

The paradox of the San Francisco Bay Area continues. The Chronicle’s Nicholas Cheng points out the irony of companies that innovated information and communications technology (ICT) advances that have made the centralized, commute-in office spaces of the previous century all but obsolete, yet continue to cling to the outdated pattern. And as SPUR’s Allison Arieff says, the current state of affairs is unsustainable. There is only so much real estate, highway lanes, parking spaces and public transit capacity to work with. ICT provides far more capacity to move the products of knowledge and information work than transportation infrastructure can to move bodies every work day.

Bay Area commuters back taxes to pay to improve road, transit – SFGate

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Bay Area residents have grown so exasperated by worsening traffic and the paucity of government money to make things better that they’re willing to tax themselves to pay for a regional program of improvements.That’s according to a poll released Friday, just two days after Gov. Jerry Brown and Democratic state legislators announced a transportation funding plan that would boost fuel taxes and vehicle registration fees for $52 billion in road and public-transportation improvements. Two years in the works, the plan would deliver much-needed funding for transportation but still leave many needs unfunded.

Source: Bay Area commuters back taxes to pay to improve road, transit – SFGate

Those long suffering commuters have a much lower cost solution thanks to the ingenuity of the Bay Area’s information technology companies. And it’s already available to them without the need for new taxes. Knowledge workers can utilize ICT to work at home and in their communities instead of getting into their cars and onto crowded freeways to drive to an office.

As management guru Peter Drucker sagely asked, “What is the point of spending such huge sums to bring a 200-pound body downtown when all you want of it is its eight-and-a-half-pound brain?”

SF Bay Area paradox: 21st century ICT leader chokes on 20th century rush hour traffic

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“Congestion is having a dramatic impact on the quality of life in the Bay Area,” said Jim Wunderman, CEO of the Bay Area Council, a business lobbying group active in transportation issues. According to the study, drivers in the San Francisco area, which includes the inner East Bay, the Peninsula and the South Bay, wasted 83 hours sitting or creeping along in traffic in 2016. Last year’s survey, which used a different methodology, ranked San Francisco second in the nation, tied with Washington, but behind Los Angeles. Bay Area drivers in 2015 wasted 75 hours in traffic. Congestion causes San Francisco-area drivers $1,996 a year per person in wasted time, Inrix concluded, compared with a national average of $1,400. […] Bob Pishue, Inrix’s senior economist and study co-author, said San Francisco’s congestion during the morning and evening commutes is the worst in the nation, particularly on city streets. In the Bay Area, Wunderman said, the long, slow commutes combined with the rising cost of housing are starting to drive away some job seekers and could have the same effect on employers. “I hear anecdotally from companies all the time about problems with people getting to their jobs,” Wunderman said.

Source: SF traffic ranks as 4th worst in world

This puzzling paradox continues. The San Francisco Bay Area and nearby Silicon Valley are home to many of the world’s information and communications technology (ICT) leaders. But the region continues to function as if it were 1965 when everyone commuted to the office because there was no Internet yet and all the tools knowledge workers needed to do their jobs were still at the office. And that none of the innovations its companies have created exist, tools that have decentralized knowledge work and the centralized, commute-in office, effectively obsoleting daily commute trips that are choking its streets and highways.