Philosophy of Digital Man and Digital Society - 2024
The Informatization of Management Systems as the Principal Driver of Digital Economy Development and Its Impact on Technological Processes
The Evolution of Philosophical Ideas from “Digital Humanities” to Digital Philosophy, Digital Economy, and Digital Management
The informatization of management systems as the principal driver of digital economy development and its impact on the evolution of technological processes holds significant relevance today in Western countries, having been a primary focus for several decades, and represents the main vector of advancement and urgent tasks in the field of information science. This vector serves as an effective means of perceiving clearly defined trends and objectives (such as Moore's Law) that shape the future trajectory of the digital economy, which, under conditions of informatization, should be programmed based on principles of frugality, inclusiveness, and balance.
In the late 1980s and early 1990s, the UNIX community emerged, within which software development became a collective endeavor. Revolutionary inventions (sensors, computers, and management technologies) drew increasing attention to the informatization of management systems in organizations as complex social organisms and systems. In this context, the development of information technology potential was established, along with the expansion of human capabilities, the establishment of effective levels, and the achievement of abundance through advancements in the food industry.
The algorithms implemented amid technological changes serve as supervisors of a new generation. Organizational leaders, politicians, and officials must primarily focus on the "adaptation function" of organizations, which algorithms are directed toward in the context of globalization, the technological revolution 4.0, and the industrial revolution 4.0, as outlined at the Davos Congress (2019). It is also essential to monitor the business rules generated by algorithms: Do they create opportunities for workers, or do they hinder them? Are algorithms perhaps designed solely to maximize organizational profits? Algorithms not only consolidate the intellectual capacities and solutions of individuals but also influence and expand them. The speed and scale of electronic networks often contribute to misinformation and irrational decision-making. Fortunately, since the 1990s, the conditions for abundance have emerged in a greater number of countries, as the secrets of how to produce sufficient food have been deciphered, transportation infrastructure has been developed, and in many nations, the phenomena of poverty and hunger have been addressed, facilitating a transition to a noospheric development of contemporary society, wherein ideals of reason, morality, and justice will prevail.
Thus far, the issue of informatization of management systems and decision-making in organizations has scarcely been raised in the formulation of its concepts. Little attention has been paid to the challenges of enhancing the effectiveness of managerial work through informatization (information systems) in new-generation organizations, while the impact of informatization on management activities and processes has been brought to the forefront for the first time. Meanwhile, the digital economy begins to take notice of the internet, and it is likely that the most significant economic effects and opportunities to address national and global problems lie therein. As Tim O'Reilly notes, “Previously, computers worked for people; now, conversely, predominantly, people work for computers. In the modern world, the leader of change is an algorithm.” Soon, computers will manage our finances, oversee our children, and govern our lives, assisting in food selection and delivery.
The influence of the internet and automation on the development of the digital economy has been substantial across every industry and sector, thus significant innovations will greatly enhance its efficiency, quality, and adherence to standards. The trend of automation provides tangible advantages in the form of reduced labor costs in the information segment of the digital economy and the realm of management.
The Growing Role and Importance of Information in Management Activities and Processes
The creation and processing of information within organizations increasingly engage a diverse array of individuals: managers, banking professionals, engineers, and human resources personnel. In light of the growing significance of information in management activities and processes, a crisis emerges within management, auditing, and personnel evaluation, necessitating enhanced efficiency in managerial tasks through informatization (information systems).
Therefore, the further development of the digital economy is contingent upon a transformation in information handling technologies, as traditional methods of processing information have long been exhausted. The computational power of ordinary computers has increased over the past 30 years, improving roughly every year and a half. This pattern is known as "Moore's Law." Intel's David House proposed that the technical parameters of organizations would double in power every eighteen months. Certain organizational tasks have become so complex over time that even the most advanced computers take excessively long to deliver accurate answers, resulting in crises that are already manifesting.
The internet constitutes a global network that has connected individuals and enabled information exchange. According to estimates from Internet-WorldStats.com, approximately 3.7 billion people used the internet in 2016. Today, the number of devices connected to the internet exceeds the human population, and by 2021, this figure is expected to reach around 50 billion. Discussions continue regarding security, privacy protection, social implications, and the effectiveness of these technologies, yet it appears that halting this momentum is impossible.
The Application of ICT in Organizations as a Source of Surplus Profit and Overcoming the Crisis of Management Control
The crisis of management control did not emerge today. D. Beniger, in his work "The Control Revolution," identifies the onset of the first crisis in American society during the 1980s. Overcoming this crisis posed a new challenge for that era, as management relied on hierarchical bureaucratic structures (modern bureaucracy) and market economic mechanisms (the theories of F. Taylor, A. Fayol, and M. Weber). For an extended period, a rational approach to management prevailed since the 1930s, characterized by orderliness and regulation in organizational activities and strict adherence to organizational and executive discipline. The advent of information and computer technologies into the realm of management systems and decision-making within modern organizations, auditing, and personnel evaluation represents an objective historical necessity and serves as a continuation of the post-industrial development of civilization.
The information revolution has significantly impacted all spheres of human activity, and the new challenges of science and technology necessitated appropriate information processing solutions. In developed countries, primary information resources require effective management of the economy, and the application of ICT in organizations is a source of surplus profit, albeit it may also lead to a crisis in management as a whole.
In industrially developed countries, the issue of applying ICT in organizations is strategic. In an information society, organizations must choose between reducing the need for additional information and increasing their capacity to process it. The only means to contend with the rising complexity and uncertainty is the advancement of information and communication technologies in the context of globalization.
ICT as the Primary Potential of Organizations and a Factor for Effectiveness in Information Provision and Services
ICT represents the primary potential of an organization, enabling it to advance to a level of competitiveness by leveraging it as a strategic resource and establishing an effective information system (IS). Indeed, the optimal information strategy within an organization is one in which management directs technology, rather than the reverse. The emergence and rapid proliferation of new information technologies have necessitated a reassessment of strategic tactics in competitive organizational practices. Analysis indicates that constant changes in operational conditions require a reorientation of production, pricing policies, and give rise to the concept of "uncertainty." Cognitive capabilities for information processing among managers have gradually become severely constrained; thus, it is imperative to intensively employ creative digital technologies across all spheres of societal activity.
Thus, organizations have found themselves choosing between reducing the need for additional information, achieved through lowered standards and compliance, and diminishing their capacity to process information. However, the lowering of standards inevitably leads to a decline in competitiveness. Therefore, the only means to overcome the growing complexity and uncertainty amid the limitations of the assimilative capabilities of the planetary ecosystem is the development of the digital sector, which compels us to contemplate the physical limits of humanity's economic growth and to shift towards sustainable development in contemporary society.
Consequently, the use of appropriate software has made it possible to analyze information and base market forecasts on it, which is regarded as a breakthrough in the realm of digital management. To meet the needs of the digital economy, specialized information systems (IS) have been created, aimed at providing information and information services.
Recently, organizations have begun to integrate their information systems with those of suppliers to automatically order raw materials and parts at the needed times. Sensors on production lines can alert to issues and defer maintenance if the machines are functioning correctly. International companies like Bosch or Airbus can share information with their factories from any location, rectify shortcomings, and disseminate knowledge on a global scale.
Information as a Principal Independent Value of Organizations
Over time, information has come to be regarded as an independent value through which it became possible to analyze data and make forecasts regarding the state of affairs, viewed as a breakthrough in digital management. To satisfy organizational needs, corresponding information systems have been developed, whose purpose is to provide information and information services. M. Earl distinguishes the process of implementing information technologies in auditing and assessing information management in organizations into the era of data processing and the era of information technologies.
The era of data processing (1960s-1970s) is characterized by a focus on technical issues, the resolution of tactical tasks, and the operational support of digital systems. In contrast, the era of ICT is characterized by a focus on addressing the strategic challenges of societal digitization. ICT have emerged as a potential source for the development of digitalization, which is an exponential growth process akin to the doubling of products that generates substantial figures. "Today, it makes no sense to speak of growth with unqualified approval or condemnation. Instead, we must ask: Growth of what? For whom? At what cost? Paid by whom? What constitutes genuine need, and what is the simplest and most effective way to satisfy it? How much is 'enough'?" ask Meadows Donella, Randers Jorgen, and Meadows Dennis in their work The Limits to Growth: 30 Years Later.
Information on the Possibilities of Utilizing ICT as a Direction for Digitalization Development
The development of a coherent concept regarding the sequential goals and tasks of an organization, the establishment of digital management, and informing management about the strategic use of ICT and the training of IS managers is essential. The emergence and rapid dissemination of new information technologies have necessitated a reevaluation of the strategies and tactics of organizations in the competitive arena. Analysis indicates that the constant changes in operational conditions required a reorientation of production, pricing policy, and gave rise to the concept of "uncertainty." The cognitive capacities for processing information among managers have gradually become severely constrained.
Thus, organizations have begun to choose between reducing the need for additional information, achieved through lowered standards and compliance, and diminishing their capacity to process information. However, the lowering of standards inevitably leads to a decline in competitiveness. Hence, the only means to overcome the growing complexity and uncertainty amid the limitations of the assimilative capabilities of the planetary ecosystem is the development of the digital sector, which compels us to contemplate the physical limits of humanity's economic growth.
Consequently, the use of appropriate software has made it possible to analyze information and base market forecasts on it, regarded as a breakthrough in the field of digital management. To meet the needs of the digital industry, specialized information systems have been created, aimed at providing information and information services. Recently, organizations have begun to integrate their information systems with those of suppliers to automatically order raw materials and parts at the necessary times. Sensors on production lines can alert to problems and defer maintenance checks if everything is in order with the machines. International companies such as Bosch or Airbus can share information with their factories from any location, rectify deficiencies, and disseminate knowledge on a global scale.
Next-Generation Organizations as Network Platforms
Next-generation organizations, like Uber or Lyft, can be described as network platforms that provide services in the real world. These platforms are transforming the operational principles of small enterprises in accordance with the realities of the 21st century. Just as electronic commerce once transformed the retail market, network platforms have restructured taxi and limousine services: from a network of small companies to a network of private individuals, where software replaces intermediaries by providing additional resources.
Nevertheless, most algorithmic systems directing the operations of next-generation organizations and determining the nature of the digital economy were developed with the assumption that machines or technologies neglect human interests, leaving "the human being outside the anthropological foundations of its development." It is tempting to blame technology for the challenges that plague periods of economic transformation; however, humans themselves are responsible for the problems and also for finding solutions.
Next-generation network organizations utilizing technologies and algorithms significantly reduce the vast hierarchical system of managers (or supplier firms). In its stead arises a more or less egalitarian network based on algorithms, reputation systems, and market dynamics. Few in the world, including among Japanese lean manufacturers, have grasped an essential characteristic of lean systems. They are most effective, of the highest quality, and most flexible when all activities, from product development to automobile assembly, are concentrated in one place. Next-generation network organizations rely on their own network of clients who oversee service quality. Simple, decentralized systems open more possibilities than centralized, complex ones.
The term "adaptive function" originates from genetic adaptation. It is a method of artificial intelligence: modeling the development of computer programs in accordance with evolutionary biology. An algorithm focused on small programs is optimized for specific tasks. After several cycles of development, poorly performing programs are discarded, while the most successful are used to "grow" new variations. Network organizations represent a hybrid organism formed from people and machines, within which programs constitute a continuous network of suppliers supported by feedback, ratings, and other forms of response.
All content contributions in next-generation network organizations are formatted, processed, and expanded through the efforts of the organization's staff (editorial reviews, augmentations, editing). Each platform must invest in innovation to unlock an increasing array of digital opportunities. Next-generation network organizations operate more efficiently as they employ the operational principles of digital industries. Digital services facilitate a complete rethinking of technology development strategies.
Interaction with business, government systems, and urban environments is gradually transitioning into the digital realm. Bold decisions, the analysis of technological, demographic, and economic trends, and an unwavering desire to create a better informational world that brings revival and anticipated technological changes for all of us. However, to achieve this, leaders recommend developing convergent technologies, nanotechnologies, biotechnologies, and socio-humanitarian technologies, collectively referred to as "disruptive" or "alternative," with concepts formulated at the state level by 2045.
Challenges Related to Socio-Psychological Factors in Next-Generation Organizations
One of the most complex challenges arising from the implementation of ICT in management is related to socio-psychological factors. The initial successes of ICT in the 1950s and early 1960s spawned a series of illusions. The potential for computerization in managerial work regarding the processing, storage, and transmission of information led to the belief that human involvement in management work would entirely vanish, replaced by machines.
All of this indicates that insufficient attention was given to the human element, and only the experiences of the 1970s drew attention to the social and psychological aspects of ICT implementation in industrial enterprises amid the digital revolution.
It became evident that many projects failed not due to deficiencies in software or hardware but rather because of a complete disregard for human psychology, interpersonal interactions, and social issues. Efforts were directed toward achieving changes in the nature of employment. This led to an increased focus on various social experiments with computer technology, aimed at optimally embedding ICT into the structure of business relationships, necessitating a shift in management and administration policies as a direction for developing complex systems theory in the context of the challenges of digital society.
A new discipline has even emerged—computer sociology—tasked with investigating all social aspects of the implementation of ICT advancements. As Erik Brynjolfsson and Andrew McAfee observe in their work The Second Machine Age: Work, Progress, and Prosperity in a Time of Brilliant Technologies, "In the future, an increasing number of professions will not be purely information-based work that can be performed entirely at a desk. Instead, they will involve movement and interaction with the physical world. In this realm, computers remain comparatively weak, even as they become significantly stronger in many cognitive tasks."
A positive and optimistic perspective on the informatization of management systems, regarded as a primary potential for the development of organizations within the digital economy, was presented by Martin Stachy, who emphasized the utility of big data for transitioning to an energy transition and a circular economy, particularly for the recovery of valuable resources that would otherwise be lost among other waste. Among the new technologies in digital production, "precision agriculture" stands out, which aims to close the nutrient cycle and restore natural capital.
The ICT revolution traverses vast distances, extending beyond mere information exchange and methods of modeling and understanding complex systems. The entire digital economy today is transitioning to "Industry 4.0." The Internet, Wikipedia, websites, and activist groups play a significant role in fostering a democracy built on information technology, expanding through a multitude of social media platforms that are part of the ICT revolution. The new wealth of nations resides in the trillions of digital bits of information flowing through global networks, collectively documenting the processes of digital production, distribution, and consumption within the framework of a new economy.
To adapt to the profound changes in the development of the digital economy that lie ahead, the old institutional and intellectual resources are insufficient. The world requires new avenues of development: governance structures, technologies, incentive systems, institutions, and values that allow us to navigate through uncharted territory while systematically reducing discrepancies between developed and developing countries, and as powerful governance participants proliferate in all their diversity. We must be capable of addressing new challenges, and in this endeavor, breakthrough digital technologies will play a crucial role.