One such example is the computerized fast food restaurant management system. This seems innocuous enough on the surface, but in fact has the most profound social and investment implications. 

In his wonderfully written free downloadable e-books Manna and Robotic Nation, Dr. Marshall Brain, a computer scientist, writes of a future that just became a lot more likely. In this world, in the first decade of the 21st century a fast food chain introduces a computerized management system. It’s called “Manna.”

The system monitors and manages everything happening in the restaurant. It makes sure food is prepared exactly when needed and served when hot. Patrons are happy because the quality of service improves. Owners are happy because waste is reduced and costs are minimized. Profits go up.

What of workers? First, they’re happy as well. They don’t have to deal with sometimes-emotional bosses whose decisions can be inconsistent. However, over time, the workers become little more than robotic extensions of the computer.

By continuously monitoring work activities second by second and developing precise performance statistics, eventually Manna knows when a worker is slacking — even a little bit. Breaks can be calibrated to the minute.

Could you imagine being managed like this? If you have a job, in all likelihood you perform it at a desk. What if a computer were monitoring your every keystroke, and able to use speech recognition to track every conversation? (While they can’t yet understand the meaning of speech, they do a fine job of converting speech into typed text, as Dragon Naturally Speaking 9.0 is doing for me right now.)

Over time, it gets worse for these workers. As robotic vision and tactile capabilities become evermore humanlike, more and more worker functions will be crowded out by robots. After all, the robots never call in sick, only make a mistake until their programming is corrected, never ask for a raise and precisely follow the computer manager’s instructions second by second.

Robots make ideal workers. But what of the displaced manual laborers?

The traditional argument goes that they can return to school, learn new skills and perform work with higher value added. Historically, that may have been true. The argument made by Dr. Brain — and increasingly supported by hard evidence — is that artificially intelligent robotic systems will be chasing these people right up the skill curve, in many cases faster than the people can cope.

He forecasts a world in a few decades in which half the American population is not only unemployed, but also permanently unemployable. (Of course, the same logic holds worldwide, even though it will take longer in Third World countries because human labor there is far cheaper.)

What then? He submits that the probable outcome is permanent “warehousing” of these unproductive people in cubicle apartments where their basic needs are met — but no more.

Given that this scenario comes to pass, it would be a logical extension of current national policy. However, there is an alternative discussed in the book. Essentially, under the alternative scenario, the vast productivity of artificially intelligent robotic systems frees up much of the population to go on permanent vacation.

Those whose work cannot be replaced by machines would be incredibly valuable. Such a person would earn the equivalent of thousands of dollars per hour in today’s currency, and could either amass a fortune doing so or work far fewer hours than he or she does today.

This may all seem strange and akin to science fiction. I know it did when I first wrote about it approximately two years ago. However, the first stage is now reality.

According to LiveScience, what I shall call “Manna 1.0” has now emerged from the labs of Carnegie Mellon into the workplace. This is a “kitchen production management computer system” manufactured by Hyperactive Technologies.

It is being used in Zaxby’s, a fast-food chain with 330 restaurants. Others are sure to follow, because it offers a competitive edge.

It’s called “Hyperactive Bob.” The system:

• Uses robotic vision to count cars and collect point-of-sale information
• Analyzes historical and current data about each restaurant, adjusting itself to the specific situation. (Reportedly, Hyperactive Technologies says Hyperactive Bob is better even than seasoned employees.)
• Tells employees which foods to cook to meet current and expected orders.

What does this mean in practical terms? First, note that the system not only reduces manual workers to cogs in an automated system but also replaces a layer of management. By removing this layer, it eliminates a promotion opportunity coveted by manual workers and changes their incentives.

That has social consequences beyond what I can address here, especially as it is sure to spread to other industries.

As the technological tidal wave continues to accelerate, we can expect systems such as Hyperactive Bob to proliferate. (Hyperactive Technologies is still private, and has serious venture capital backing. I’ll be watching for the IPO.)

There will be a radical shift over the next two decades as the labor force must adjust to the advent of artificially intelligent robotic systems. Thanks to the exponential rate of change associated with the technological tidal wave, the proliferation should be relatively slow over the next few years but accelerate rapidly.

Integrated robotic systems manufacturers and suppliers of components should become major growth industries. As I’ve written previously, South Korea has made a national commitment to becoming the world’s first “robotic nation.” This will only serve to accelerate the trend.

Apart from investment opportunities, the bottom line is that you should begin looking closely at how your personal livelihood and investment portfolio will be affected by a shift from relatively unskilled human labor to robotic labor over the next decade and beyond.

It’s coming, whether we’re prepared for it as a society or not.

To your profitable future,
Jonathan Kolber
November 26, 2007

P.S.: I hate to say I told you so… But, I told you so. I get a lot of criticism for some of my futurist ideas, especially in the investment world. Wall Street doesn’t like change. But who cares what they think? A small group of my readers took what I said and turned 203%, 288% and even 339% profits from some very underrated technologies.

Today, you have the chance to blow those numbers out of the water with this one medical breakthrough. It has the potential to give back 30 or even 60 times your money. But you have to hurry… No one knows exactly when it will take off.

Investing in the Robotic Nation was originally featured in the Penny Sleuth.