Social Innovation and Information Technology

Ian Miles
Science Policy Research Unit
University of Sussex
November 1985

Keywords: information technology, service economy, social innovation,

post-industrial society

Paper prepared for Nordic Summer School seminar on social innovation, Stockholm,
December 1985. FIRST DRAFT: for comments

This paper draws heavily upon analyses and conclusions developed in a programme
of work spanning several years1, much of the support for which has come from the
Joseph Rowntree Memorial Trust. A set of studies carried out for the Long Term
Perspectives Subcommittee of the Information Technology EDC of Britain’s National
Economic Development Office2, and for the FAST and IRIS programmes of the
European Community3 have also been important. The Ideas expressed here are the
product of many peoples’ joint work, although the present author takes responsibility
for how they are here shaped and articulated.

1. Social and Technological Innovation

There are many conflicting definitions of the terms invention and innovation.
Although it is not always easy stick to a hard and fast distinction, this paper will
attempt to follow the most common usage. This reserves the term ‘invention’ to
describe a new idea or object (or sometimes the process whereby it is developed), and
‘innovation’ to cover the adoption, diffusion and use of such an idea or object4. The
terms are evidently framed in terms of the study of technological change. When
turning attention to social change, it makes more sense to think of the terms as
referring not only to ‘ideas or objects’, but also as bearing on institutions,
organisational structures and procedures, roles, and social practices. Innovation
should be considered as a process, although there is not always sufficient evidence on
1
Miles 1975, Gershuny 1977, contributions to Freeman and Jahoda 1978, Miles & Irvine 1982,
Gershuny & Miles 1983, 1985 and Miles 1985, 1986 are among the main outputs of this programme
2
Bessant et al 1985, Miles et al 1985, Miles et al 1986
3
Thomas and Miles 1985, Miles and Thomas 1985
4
Rogers and Shoemaker 1971
the diffusion and consequences of specific social and technological inventions –
especially those that are only now emerging – to map out the whole of this process.

The process of technological innovation has been studied in great detail, which is
more than can be said for innovation which involves organisational forms. Successful
technological innovation, naturally has important social dimensions – invention itself
is a social process (some authors draw attention to the ‘politics of curiosity’5), and the
diffusion of new technologies has traditionally been studied in terms of the
microeconomic and social-psychological characteristics of adopters and non-adopters.
New information technology (IT) which is central to the present paper, has also been
studied in such terms6. But there are broader relationships between technological and
social innovation.

What is the rationale for putting the issues of social innovation and IT together?
There are several overlapping reasons. IT is a revolutionary technology which is
liable to be associates with significant changes in many areas of social life. The
application of IT (not IT itself) will demand reactive changes in behaviour, as will be
discussed below. IT offers the potential for reorganisation of many established
practices in a proactive way, too – other technological inventions have been the
catalyst to social innovation, and this is already apparent around IT. This paper will
suggest that without appropriate strategies for social innovation which take account of
these proactive possibilities, new technologies will be posing serious questions for
social justice and economic progress – that we are liable to face aggravated problems
of unemployment, inequality, social dualism and economic stagnation.

If IT does constitute a new technological revolution, then seeing the accompanying

social innovations merely in terms of diffusion is seriously limited. For social
inventions and social innovations may often be facilitated by, or dependent, upon new
technologies. The super- and hyper-markets, for example, are social inventions that
would not have emerged without new forms of motor transport. More broadly, the
‘auto-industrial age’ was associated with new patterns of urban development and

5
Albury and Schwarz 1983. One study which does concern itself with social innovation, Smith 1974,
notes several differences from technical innovation: less clearly defined goals, requirements for both
individual and institutional change, need for dialogue, etc
6
Freeman 1984
housing, and new ways of life as people structures their use of time (engaging, then,
in innovations in their individual lives) to accommodate to and/or take advantage of
these development. The new forms of motor transport could not have been successful
without investment in new road systems, etc – and their popularity is likely to have
been enhanced by the availability of attractive new living patterns around them. (As
well as by deterioration in some previous arrangements related to the impact of motor
car use – eg the decline of public transport, the despoilation of some urban
environments.)

As the example suggests, there is a complex interdependence between social and

technological innovation; each may depend upon the other. A first hypothesis might
be that the more wide-reaching a technological innovation is, the more dependent it
will be on appropriate social innovation for its successful adoption. This will be all
the more true for technological revolutions.

2. Technological Revolution and Social Change

What is a ‘technological revolution’? such revolutions may be characterised by the

application of new heartland technologies that dramatically change the relative cost
and factor structure of production, giving rise to new products, processes, and inter-
industry linkages, across a very wide range of economic sectors6a. IT is widely
identified as the heartland technology of a technological revolution whose opening
stages we are currently witnessing. Many forecasters adopt a ‘long wave’ approach –
successive periods of economic growth and stagnation are related to processes of new
product development and rationalisation of production of established products around
technological systems. (The distinction between product and process innovations is of
some importance to the concerns of this paper.) Historical analogy can be used to cast
light on our present predicament, by seeking parallels with earlier technological
revolutions.

This approach has considerable attraction. However, some of those implicitly or

explicitly using historical analogy fail to recognise the specificity of IT, effectively
eliding important differences between successive core technologies. In particular,
6a
Freeman 1984
three features of IT may differentiate current and future developments in the near
future from historical changes.

Firstly, it displaces a much broader range of human intellectual and cognitive inputs
that heretofore. Previous technologies displaces energy inputs and manual skills,
leaving human operators to carry out cognitive and information-processing activities;
if these too can now be automated, what niches will be left for human employment?
Second, unlike earlier technological revolutions, IT may reduce, rather than increase,
the material flows between different sectors of the economy, since it can enable
conservation of energy and materials inputs. It will, it is suggested, reduce these
labour-intensive interactions, while increasing the information flows between the
sectors. Again, there may be considerable differences between the future economic
structure emerging from the present technological revolution and those experienced
historically. Third, and on a longer-term timescale, perhaps, artificial intelligence
(and developments around genetic engineering, themselves likely to rely upon IT)
could well challenge our ideas of what it is to be human. The first two of these
critical points caution against the blithe optimism with which some commentators
forecast that a ‘long wave upswing’ in the 1990s will relieve problems of
unemployment and sluggish growth for another twenty five years or so. Some of
those who relate together IT and long waves portray social change as happening in a
predicable, cyclical fashion; periods of expansion and stagnation are related, for
example, to basic discoveries which can form new heartland technologies.
Technological invention is thus at the heart of social change – although the clustering
of such inventions then demand explanation.

Other observers provide a more institutional approach, however; they argue that it is
the changing practices of entrepeneurs with respect to technological opportunities that
conditions economic growth and decline. Here it is more the process if innovation
than that of invention that is at stake. Even so, there is here something of a revival of
the idea of ‘cultural lag’, the idea that many of our problems are due to a failure of
institutions to reform themselves so as to best take advantage of technological change.
Some ‘long wave’ researchers steer dangerously close to arguing in a technologically
determinist fashion that our societies have to be shaped to fit a new technological
revolution, rather than vice-versa. And the more sophisticated ‘long wave’ theories
still tend to stress changes in production at the expense of other social changes7.

Certainly individuals and organisations do need to take account of the technologies

that confront them – or are perceived as confronting or liable to confront them – in
their environment. This is no different from orientations to any other material
phenomenon, especially if it is liable to change one’s relations with others with whom
one may cooperate, compete of conflict. But Technologies are often tools of power.
The ways that individuals and organisations take account of technological
development – including their strategies for shaping further technological
development (if they are so empowered) – can be very different indeed.
Technological change, itself a result of human action, conditions behaviour – it is
among the factors that set the context for social invention and innovation.

But technological invention does not cause behaviour deterministically – social

inventions may never be made, or they may be unmade. Even within the sphere of
technological change, incidentally, it is quite common for an innovation in one
technique to be responded to by an increased pace of innovation on other (perhaps
previously stagnant) techniques that it threatens to displace. (Thus electric motors
and lighting occasioned considerable improvements in other motors and lights,
making the eventual ‘winner’ quite uncertain at the time.)

So social and technological innovation does in practice have to be taken into account
by other actors with whom the innovators are involved – whether they like it or not in
some instances. (A case in point is the plight of some Third World manufacturers who
are finding that their comparative advantages in producing, say, textiles, are being
eroded by new production methods in the industrial countries.) One option, in
principle, is to simply reject use of the technology for oneself; and another to engage
in some complementary or competing innovation using existing technologies (the gas
lamp rather than the electric light). And, of course, the new technology itself may be
imitated, or one may seek to better it, or to use one means or another to restrict its
implementation while enhancing one’s own competitive advantage. Numerous
approaches have been developed for understanding the competitive processes here,
7
I discuss these approaches in Miles 1986
not only in economic affairs (eg theories of the product cycle), but also with respect to
‘arms races’ (eg theories of weapons and strategy succession) and to government
industrial and prestige policies.

A technological revolution will necessarily create opportunities for – and demands for
– social innovation. But the point is that these innovations can take various forms –
even if the range of choice (which was limited beforehand) is limited in new ways by
the new technologies. IT is often held to be a supremely malleable technology, and
one which allows for increased flexibility in previously rigid operations. 9similar
‘chips’ sit inside Cruise missiles and home computers; economies of scope are now
believed to be displacing economies of scale in some sectors.) Thus the limitations it
imposes might expected to be less constraining than those of earlier generations of
technology. This is the basic point of many forecasts portraying the ‘information era’
as a utopia of individual fulfilment. Before being carried along on the utopian tide,
however, it would be appropriate to investigate the features of the new technologies
around which prospective innovations may be shaped.

3. The Trajectories of IT

Three major aspects of It-related trends are identified in the forecasting literature8:

- rising performance capability of the heartland technology, the basic IT

components (increasing speed, memory capacity, lowered price, processing
power and transmission capacity, etc)

- growing application of this potential by users (incorporation of the heartland

technologies in an increasing range of devices and their orientation to an ever-
broadening range of problems);

- the integration of different parts of the processes of design, production and

distribution (the shifts towards the automated office, computer-integrated
manufacturing, etc).

8
Bessant et al 1985
The increasing capability of IT’s heartland technologies, their paths of application in
various economic and social organisations, and the process of integration and
convergence that many observers have spotted in advanced sectors, are the product of
powerful social forces. In the case of heartland capabilities, these include the market
forces acting upon IT supply industries, which demand continual improvement in
performance, and motivate the investment of huge volumes of R&D funds and
personnel to this end. These market forces are an amalgam of many specific social
forces; in particular. Consumer and intermediate demand, and the perception of this
demand by designers; and military and industrial strategy.

These basic technological trends can be expected to continue simply because large
quantities of human effort are devoted to making this happen. Continued
improvement in performance of IT products can be anticipated – not because the
technology itself is driving us on, but because there is little reason to expect a
substantial shift, on a global scale, in the pattern of social forces that underpins the
trends. (Even if the military imperative is reduces by peace movements, economic
competition is unlikely to become any less substantial as a driving force.)

Though there are likely to be physical limit to some particular technologies (eg ‘chip’
circuit feature size, magnetic memory storage) many alternative solutions are being
explored (eg laser surgery of defects, optical storage). A slowdown in the rate of
increase of technological capability in the long term is, however, seen as likely by
most forecasters. Nevertheless, considerable change is still bound to take place –
especially given that software is lagging behind hardware, and applications are
lagging behind software.

These trends – especially the cheapening of processing power, but also the increased
‘user-friendliness’ that is being created – make it likely that applications of IT to many
areas of social and economic life will continue to proliferate. These are not going to
happen because some metaphysical process or value change is creating the
‘information era’. Quite simply certain potentials that cheapened IT makes available
are very likely to be of interest to many organisations – from large firms to families –
if and when they can perceive them. Let us first consider the industrial sphere.
Early views of the long-term impact of IT tended to depict systems dominated by
massive centralised computers. But with the rapid diffusion of micro-computing and
the creation of distributed systems, the picture has changed. (Rather as it took a while
to realise that electric motors could be distributed around factories rather than driving
everything from one central location as had earlier power equipment.) Many
observers portray IT as leading to an intensification of existing industrial processes,
and certainly some applications in industry are deskilling and oppressive. But there is
also considerable opportunity to break with many of the practices established as parts
of the ‘mass production paradigm’ of ‘Fordism’.

Economies of scope become important, alongside economies of scale; product mix

can be more flexible and the steps between product design. Production, and marketing
abbreviated. Cheap information-processing, -storage, and – transmission allow for
the integration not only of different stages in the production process of material
goods, but also of the stages of design, financial and resources control, and
distribution – and the integration of all of these stages together. Not only are
secondary industries liable to be transformed by ‘computer-integrated manufacturing’
systems (systemofacture), but tertiary industries can be reshaped, and not just by the
‘office of the future’. In some cases, the constraints of space and time that these
services have traditionally encountered – they could not usually be stored, and
required persona; presence for their delivery – are also overcome.

Opportunities of this sort often appear as impressive ones for private companies and
public services. A wide variety of institutions are liable to consider toe reorganisaiton
of current practices, so as to apply IT to their (diverse) goals, well worthwhile. Social
and technological innovations are thus likely to characterise practically all parts of our
society; not because impersonal technology demands it, but because the organisations
that are influential in various areas will make it so.

The malleability that IT in principle offers may not be reflected in practice by a

proliferation of organisational forms, even if it does mean a proliferation of new types
of product. To what extent are the applications liable to be similar in different
countries, for example? Involvement in the international division of labour may push
industrial countries towards some uniformity in products (for an international market)
and production processes (organised by trans-national corporations). Nonetheless, at
present different OECD members do often display considerable variety in their
product design (compare American and Japanese cars) and organisation of production
around a common base of heartland technologies (notably in the emphasis upon
production line as compared to other assembly methods). (It is ironic that the
practices developed in Japan during the last long wave are often heralded as the wave
of the future for everyone else.) Differences are most evident, naturally, where the
products involved are typically not traded – in housing and in variety of services,
especially those provided by public authorities.

IT may be rather contradictory for these latter products. While permitting more
flexibility and ‘customisation’ of many services, it also appears to offer opportunities
for trade in a large number of what have mainly been non-traded services (the issue of
liberalising services trade has recently appeared with some force on the agenda of
international organisations).

4. IT in the Home

The use of new technologies by households is tied closely to patterns of development

in the formal economy, in several ways. As well as receiving finance for purchases,
households can often choose different ways of using this finance to achieve their
objectives (this point is returned to later), and this may involve the acquisition of new
technologies. Households do not typically carry out their own R&D; they are thus
often portrayed as merely being passive consumers of innovations created in the
formal economy. But without social innovations – changes in people’s ways of life, in
their patterns of production and consumption in the informal, domestic economy –
there would be no market for the technologically innovative products. People did not
just acquire TVs and washing machines as status objects during the 1960s, for
instance; they reorganised their ways of life around them – with considerable
implications, in turn, for the housing, transport, entertainment and laundry industries,
for the use of time and pattern of consumer expenditure, for family life and the sexual
division of labour.
Thus final demand tends to involve innovation in ways of life rather than in
technologies alone. The technological change is promoted by agents in the formal
economy (making use of market research and other techniques, of course), and
technological innovations in the private household very often involve a transfer of
technologies from the formal economy. For example, household production tends to
lag behind similar processes in factories and service industries (as is clear in the case
of devices like washing machines and cookers), and, perhaps increasingly, behind
offices. The time lag is one in which the products are cheapened and adapted to the
size of households.

Obviously, the goals of families differ from those of most formal economic
institutions. This can be overstated, since some goals may be shared in specific
circumstances: clean clothing may be sought for employees as well as family
members, and some of the same processes of rationalisation are thus likely to be in
evidence where it comes to the possibility of relieving routine and time-consuming
domestic tasks with IT. Household work that parallels services in the formal economy
(for example cooking, cleaning, driving) may share many similar functional
objectives. But families do have objectives that are not shared by most industrial
organisations to anything like the same extent: for relaxation, entertainment, affection,
eroticism, self-development etc. They are often not so concerned with the details of
work performed and materials consumed in domestic activities as large corporations
would be for similar work carried out profitably. And, of course, the financial
resources of the average family are very limited compared to those of most firms.

These factors mean that some technologies transferred to households may have
applications there very different from their industrial uses. Thus the cathode ray tube,
used for process monitoring in industry, is at the heart of the entertainment medium of
TV in the home. (Eventually the cathode ray tube has found its way – with the help
of the video recorder and microcomputer – through education back to industry as a
tool for training and viewdata information systems, which are now being applied for
final consumers as well.) So while some aspects of the ‘home of the future’ may be
derived from the industries of today and tomorrow, others may not be, the uses to
which Its are put may be quite new and surprising.

It is already possible to identify a large number of new technologies that are under
development by consumer electronics and household appliances industries. These
include, for example, active solar heating systems; high-definition, wide-screen and
flat TV; programmable and ‘informed’ cookers, washing machines, DIY tools and
equipment for most types of domestic work; sophisticated exercise and personal care
equipment; robotic toys; emergency and security systems; and the like9. It is no
exaggeration to say that consumer durables are liable to undergo a change as profound
as that associated with the diffusion of ‘white goods’ and ‘brown goods’ in the
postwar boom period. Table 1 displays some characteristics of the technological
innovations that are taking place here.

But beyond these stand-alone items, there is the prospect of home automation: a
linking together of different items of equipment. The integration of systems in
households is likely to follow a different trajectory to that of industry, even though
current technological developments are certainly motivated by equipment
manufacturers’ hopes that ‘the automated house’ will be a reality in a few decades at
most.

9
See Miles et al 1985; and the May 1985 issue of IEEE Spectrum
Table 1 – Trends in IT Applications to Household Technology

On the basis of current developments, domestic equipment over coming decades is

likely to be increasingly:

- remote controlled (eg infrared switches), leading to multiremote (multiple

devices operated by same controller), and

- distance or telecontrol (eg controllable by telephoned instructions, as are

telephone answering machines now, in a fairly primitive way).

- ‘user-friendly’ (voice control; menu-type displays for control; more

informative output display, voice synthesised messages).

- Programmable (offering increased options to fit current user requirements, and

automatic control which takes into account, for example, energy tariffs, the
weight and nature of the food or clothing being processed, etc)

- ‘informed’ (memory to recall previous programming and data inputs – eg

weight of dieter on successive days – and ability to interface with other
devices to optimise performance, and with external information sources to
achieve desired outcomes)

- portable (smaller, more personal, devices; devices permitting greater mobility;

devices for cooking, washing, etc for single people and for fitting into small
spaces, etc; cordless devices for convenience of use)

- safety featured (warning indicators, automatic fail-safe controls)

- breakdown featured (easier repair, diagnostics; auto-diagnostics)

- power conserving (more energy-efficient devices, ability to take account of

environmental temperatures and energy tariffs)

- integrating different items of equipment around common monitoring and

control systems (moving toward IHS)

source: Miles et al 1985

There is little incentive at present to link together many items of domestic equipment:
the main exceptions, where work is being pursued with considerable effort, are in
energy management systems (automatic metering, control of apparatus to take tariff
rates into account; security systems (fire, intruder, health and equipment malfunction
earnings); and audio-video equipment, where remote control, and the interrelation of
receivers and recorders, is leading to new combinations of components. As it
becomes possible to control more appliances by voice or telephone messages, the
potential for integration becomes even more apparent. (Turning on the heating and
cooker when one is leaving the office, for example) Figure 1 represents the sort of
developmental process whereby these systems may be linked together. Much effort is
currently going into establishing the sorts of standards and control equipment required
to bring this vision into being.

Is the house of the future a reality for everyone in the next few decades, or is it
reserved for the hobbyist – or the rich? The rapid diffusion of new technologies such
as television and telephones indicates both that the take-up of new consumer items
can be very rapid, and that a shift to new ways of doing things can take place very
unevenly across society (and even more so across countries). The consequences of
new household goods for community life – the ‘privatism’ of entertainment, for
example, with more and more stress placed on in-home activities – are much
discussed but little documented. (These consequences should not be exaggerated: the
telephone does enable people to retain contact with distant relatives, and out-of-home
leisure is generally increasing alongside the growth in passive entertainment.)10 But
some doubt is expressed that the major new markets needed to revive economic
growth can really be established around IT. People may want better TVs and cookers,
it is argued, but are major social innovations likely around these things? Are there
going to be new activities for which new types of goods and services may be
demanded? This question raises several social issues.

10
Gunter 1982 provides evidence that passive TV viewing retards childrens’ reading development, but
argues that TV can be used to actively encourage reading instead: the social inventions are as important
as the technologies which carry them in this example.
5. New Consumer Products and Social Change

Analysis of the consequences of IT for social innovation is often limited by a fixation

on current patterns of demand and consumption.11 A historical precedent case is
provided by early anticipations of the use of TV, which portray it as a videophone
used for personal conversations, or as a stage- or cinema screen- like device for
watching ‘live’ performances and sports events in the manner of a special outing.
With the exception of videophone systems, such developments are common enough –
but they are dwarfed in the daily use of TV. Studio productions and recording
technology have meant that vast quantities of material are made especially for TV
broadcasting. They are made in special studios and with much editing and reworking.
New types of material are produced: soap operas, news and analysis programmes,
cartoons, TV advertisements – these are social inventions. And people consume TV
in much greater volumes than they previously used theatre, cinema, etc – the models
for the early forecasts.

Are anticipations of the consequences of IT similarly blinkered? Certainly there is a

tendency to see IT as substituting for existing activities – videogames replacing TV
viewing, online databases replacing magazines, teleshopping replacing shopping, for
example. The degree of change in social practices associated with these different
substitutions clearly varies, from minimal social innovation to possibly quite profound
impacts on social relationships.

In other areas most people may be reluctant to assign IT much of a role – how can
even the advanced human-machine interfaces currently under development cope with
the requirements for verbal and physical contact called for in many types of personal
care? And who needs these services the most – in terms of personal care and health,
then surely the answer must be the aged population, which is rapidly growing in many
industrial countries? These arguments have considerable force – after all, there are
evident dangers in the mechanisation of important human interactions, and the needs
of the elderly are extremely pressing, even if they may not always be converted into
adequate pressure upon most policymakers. An ideal health policy for elderly people
might well be one that placed much more weight on prevention rather than cure, on

11
These notes were in part inspired by discussions with Ken Green of Manchester University
 Figure 1 The Networking of Household Functions

Fire Alarms

Burglar Alarms

Medical Alarms

Etc Intelligent Security Systems

External Messaging

Household monitors responsive

To external enquiries

Energy Metering ‘Central Controllers

Water Metering

Heating System Home Energy Management Advanced HIS

Systems

Laundry Appliances

Cooking Appliances

Audio Entertainment

Home Entertainment Systems Advanced Data

Communications

Video Entertainment

High-quality Interactive

Telecommunications

Source: Miles et al 1985

Keeping people fit and active rather than allowing them to become disabled. This
may well often involve labour-intensive, caring activity.

But as almost all commentators failed to understand in advance what form of new
ways of life around TV might take, so we are liable to overlook important possibilities
in the application of IT to health – and other areas of social life. Consider another
historical example: that of transport. In the 1910s it would have seemed eminently
reasonable to scorn the idea of private motor cars dominating transport; after all, they
are absurdly expensive compared to bus and train rides; they cannot be driven by the
very old and young; they would impose an intolerable burden on the roads and urban
environments; and why should people want to travel so much anyway? The logic
seems persuasive, until confronted with history: in a short period of time car
ownership became the dream and then the reality for large proportions of households.
Markets for technological innovations can be established in the right circumstances,
then, even if they involve remarkable changes in consumption and ways of life, and
bring a host of social innovations in their wake. Are we overlooking similar
possibilities around IT?

Perhaps this makes a good case for historical analogy. What if innovations around
health were to take a form similar to those of TV or road transport? New markets
would be created, as much as old markets would be finding substitutes – indeed, the
innovations might not be catered to those currently requiring most resources from the
formal health system. The motor car facilitated a vast expansion of personal transport
– especially for already mobile groups! Perhaps IT will support an expansion in
health-related activities – for those already healthy.

Examples of possible inventions here are not needed – there are many technological
innovations well underway. Examples of existing devices and software that merely
requires cheapening, some quality improvement, and further diffusion. Thus: digital
monitoring of bodily functions – thermometers, sphygamometers, pulse meters,
biofeedback devices – is already available. The devices may be used for people with
chronic illnesses: for example to monitor blood pressure, blood sugar, heart
conditions, etc. Or they may be used by the ‘healthy’ people, to determine exercise
and diet programmes and to assess their appropriateness), and in the case of
biofeedback to acquire control over involuntary functions – for health, relaxation and
meditation functions. Medical instrumentation may be adapted or invented for home
use: forms of online and computer-aided diagnosis, for example, are already available
for consumers.

The sceptic is liable to doubt that such market development is likely to take off in any
scale. But several factors make it more plausible than it might at first seem. First,
these are areas where there has been an explosion of public concern in recent years –
viz. Movements for preventative and self-help medicine, for more holistic approaches
to health and lifestyles, for sport and physical fitness, for spiritual growth and the
expansion of consciousness. (Here there have been such social inventions as ‘free
clinics’, women’s medical self-help groups, support groups for sufferers from specific
illnesses – or from a variety of addictions.)

Second, these areas have already seen major interventions by commercial interests,
ranging from individual practitioners of alternative and complementary medicine to
the franchise companies promoting dietary supplements, from new sports centre to
new cults offering instant nirvana. And, third, there has been a concerted
political/ideological offensive against collective provision of many health and similar
personal services. This may have been motivated by a desire to reduce state
expenditure and make profits from private medical concerns (or by less self-interested
individualist ideology), but it has also reflected the popular discontent with
impersonal and inflexible bureaucratic service organisations which has helped fuel the
self-help trends mentioned above.

It does not seem at all unlikely that these developments have been (unconsciously)
laying the groundwork for a major expansion of technological innovation – and for
accompanying social innovations. In such a climate, it is quite likely that the major
impact of IT-based health-related innovations will be to develop new markets, rather
than to cater for the health needs of the seriously ill and underprivileged. This has
important ramifications. While these technological innovations may not be directly
substituting for existing health services, it is still possible that the accompanying
social changes may subvert them in various ways – just as the motor car undermined
much public transport, the television much theatre.
A shift away from collective services and towards individualised provision may occur
on account of various factors: its convenience, its reduced costs, and its perceived
higher quality (in terms of personalisation, convenience and innovativeness) in many
everyday situations (if not emergencies). Collective Services, in contrast, are liable to
face a number of problems: declining revenue due to removal of affluent clients (or a
resistance on their part towards paying taxes to support the service), a leaching off of
qualified staff, increasingly critical attitudes based on their ‘old-fashioned’ approaches
– and a vicious circle’ of decline caused by reduced demand and/or by the shaping of
infrastructure, training and R&D around the new services. The pressures to
rationalise collective services – in the process displacing labour and reducing some
services – are thus liable to grow.

6. Rationalisation and Augmentation

Before taking these issues further, it is first necessary to take a step back to consider
the process of technological change again. In the short term, many of the
consequences of the introduction of IT may involve the replacement or enhancement
of traditional technologies in a piecemeal way – word processors instead of
typewriters, computer games instead of board games, video recorders systems instead
of TVs where choice is limited by the broadcasting schedules etc. These are, of
course, technological innovations, and they do not necessarily involve very much in
the way of social innovation. The same social practices are carried out, but with new
and hopefully improved technical devices. IT is applied, at least in production, to
make existing activities more efficient: this is process innovation. It may be described
by the term rationalisation – and as the connotations of the term have come to suggest,
this often involves displacing labour from production.

But in many cases there is quite considerable behavioural change involved; the
technological innovation does not simply stop at rationalisation, but also involves
some new types of activity. To follow on the examples above, some secretaries learn
that they can also run spreadsheets, database systems and graphics on their word
processing computers, and thus take on new tasks; children may take similar
discoveries with their home computers or, as is often reported in the media, get
fixated on video games and cause a flurry of concern among pedagogues (fixation on
chess, in contrast, is a cause for acclaim); people watch more TV and a new market
for pre-recorded video tapes springs up. How can specific gadgets that appear to
stand alone rather than to embody all the trappings of a technological revolution to be
associated with such great changes? In large part, the answer is one already dwelt
upon above; the new technologies are more flexible. Not only do they operate in
different ways to the devices that they displace, but they also tend to make possible a
wider range of uses.

Thus there is often a learning process where these are created and diffused; and these
often do provide the basis for new social practices, for social innovation. In contrast
to rationalisation may be placed augmentation, which in the formal economy refers to
the creation of new products (goods and services) around new technology: product
innovation.

Other features of innovation around IT may be equally significant for the balance of
rationalisation and augmentation in the longer term. In particular, as already noted,
there are shifts apparent toward much greater integration of different parts of
economic activities; more flexible tailoring of final and intermediate products to
consumer and client characteristics; and an expansion of new types of good and
service made feasible by the availability of cheap information-processing and –
transmission. These developments are still in the early stages, may well encounter
obstacles, and are only likely to be widely visible in the next century.

There are a number of reasons for this. First, institutional factors mean that a long
period of learning is requires for a technological revolution to work its way through
the economy – different branches of production and consumption take time to
accommodate to each others’ new trajectories. This point is made by some ‘long
wave’ writers, but they often give the impression that this learning process is a matter
of discovering the ‘best practice’. It is equally a process of interorganisational
adjustments. They also point to the problem of ‘institutional inertia’: the slowness of
decision-makers to recognise a new context, and to develop new ways of dealing with
their problems. In the absence of suitable awareness and retraining strategies this may
mean that change will be inhibited or misdirected until a fresh generation takes charge
(such generational succession is given weight in the duration of long waves by some
commentators).

A related second reason involves the development of new infrastructural

arrangements, which can permit the realisation of the new technological potential:
new railways, roadways, power grids, telecommunication networks. Often there is a
chicken-and-egg problem where potential applications are slow to develop because a
‘critical mass’ of other partners is for the new facilities to be really useful – it must
have been very lonely to be the first person with a telephone, and users of computer
networks are currently often frustrated by problems of standards that limit the range
of communications they can engage in. Infrastructure requires both hardware (roads,
cables) and standards (which side of the road to drive on and at what speeds in what
places, how to identify electronic or optronic messages and at what rates to transmit
them). It is in the last decade of this century that advances telecommunication
infrastructures of the ISDN (Integrated Services Digital Network) variety are expected
to become widely available in Europe. The first stage of the more visionary Japanese
INS (Integrated Network Services) strategy is due to be completed in the same period
– although this whole strategy stretches almost eighty years ahead. Advanced
infrastructures are an essential component of most visions of ‘information society’;
they facilitate the growth of new methods of working and of obtaining services.

Finally, a more pragmatic reason for expecting major changes to unravel over several
decades is that the eyes of many major organisations other than the PTTs also seem
firmly fixed on the 1990s, and beyond, as the period in which their current
investments will bear fruit. This is the timescale suggested by the firms seeking to
establish themselves as suppliers of ‘the factory of the future’, the ‘automated office’
etc.

Considerations of this sort lead some forecasters to anticipate a change in the balance
of technological innovations around IT – that there will be a gradual shift of emphasis
away from rationalisation and toward augmentation. This is often associated with
long-wave analyses of previous technological revolutions and periods of structural
adjustment in Western societies. But instead of seeing rationalisation and
augmentation as mechanical responses to changing circumstances, is it not more
appropriate to view them as strategies? Figure 2 shows how they may be considered
as the two ‘accepting’ strategies where IT-related innovation is concerned. (Thus this
figure accommodates non-IT-related social innovations, that may, as mentioned
above, often be more appropriate in dealing with some matters of personal care.)

To summarise, rationalisation involves process innovation, a focus upon carrying out

operations much as they are presently constructed, but in a more efficient way. The
flexibility and potential for integration of IT means that in some cases rationalisation
actually paves the way for augmentation. This latter strategy involves much more of
a focus on product innovation, on providing new goods and services, and making new
ways of life possible. To some extent the balance between the two may be influenced
by prior technological developments (eg the establishment of a new infrastructure),
but there is always more than an element of strategic choice available. This has
considerable implications for the question of social innovation – and especially
insofar as that innovation involves the use of goods and/or services.

7. Goods, Services and Social Innovation

Through the 1960s and ‘70s a dominant perspective on the long-term development of
industrial societies was the notion that these were moving towards ‘post-industrial
societies’. Affluence would lead to a satiation of demand for material products, and a
growth of demand for immaterial products. This was being reflected in, and helped to
explain, the expansion of the service sector, the ‘tertiarisation’ of economies and
concurrent shifts in class relations and social values. As public expenditure limits and
the application of IT to service jobs seem to render this prospect less likely,
‘information society’ writers have argues that the trend of demand is not towards
services in general, but toward information products – IT-bases goods and services.

In looking at the historical development of service employment, work carried out with
(and largely inspired by) Jay Gershuny identifies at least three different patterns of
development. These characterise different branches of the tertiary sector, and are
extremely relevant to the question of social innovation – and its implications for
employment, social justice, and economic well-being.12

12
See Gershuny and Miles (1983)
Figure 2 A Matrix of Strategies Around IT

SUBSTITUTION

Protection Rationalisation

REJECTION ACCEPTANCE

Alternatives Innovation

AUGMENTATION

Source: Bessant et al 1985

To summarise this viewpoint: first, much of the growth in tertiary employment is not
due to changes in final consumer demand, but is a growth of nonmarketed social
services supplied by the state as a result of political decisions (and subsequent
institutional processes). Second, a considerable role has been played in recent
decades by producer services, supplied to other firms and organisations as part of an
industrial division of labour. And, third, while firms have been externalising their
service provision as well as employing more service workers in-house, private
households have shown a dramatic shift toward ‘self-services’, to the nonmarket
provision of services like transport and housework using new consumer goods. Thus
marketed consumer services have had an uneven pattern of growth and decline – more
money is spent in leisure, for example, but within that a higher proportion is spent on
goods. And there is a growth of services to support this trend (garages, repairs etc).

These trends can be shaped in different ways by the use of IT. Figure 3 depicts the
main linkages in this account, and pinpoints the various sites at which technological
innovation and associates social changes could have a major role to play 9although it
does not distinguish between the flow of marketed and nonmarketed services to
households).

To elaborate on this: nonmarketed social services, for example, are currently subject
to strong financial limitations and cutbacks. It is overwhelmingly used to increase the
efficiency of existing services, to displace labour via rationalisation. But there are
numerous examples and experiments which demonstrates that it could be used to
enhance the quality of these services, or to provide new types of service. Examples
include: improved ambulances and emergency systems which enable home deliveries
of babies to be undertaken with greater confidence in the capability to deal with
serious emergencies, alarms and aids for elderly and disabled people, computer-aided
diagnosis, software to enable individuals to complete taxation returns and establish
their benefit entitlements, improved teaching aids and information systems informing
clients about all types of social services and enabling a reduction in queuing and
waiting time. Table 2 outlines some of the prospects for IT-related innovation in
service delivery.
A strategy of augmenting public services with IT might form part of the basis for
employment generation, for overcoming hostility to paying for social services, and for
a more caring society generally. It might also help circumvent some of the problems
identified in the example of market-driven health innovations above. There is
considerable attention being given to adapting IT to suit the needs of disabled people,
and some development of equipment for self-monitoring of chronic conditions and for
‘expert system’ aids in diagnosis and treatment of conditions that generally require
specialist knowledge. Applications of IT for run-of-the-mill health care are much less
common: the emphasis here is on easing administration (which can be important in
reducing delays). Social services, however, rather than (or in partnership with, under
the right circumstances) private organisations, could be orienting themselves more to
the use of new technology for preventable medical purposes. (In Britain there are
teletext pages on healthy living, but this is a very small step.)
 Figure 3 Shifts in the Model of Relations Between Formal and
Informal Economies

Intermediate (producer) services

Reduced cost, improved quality FORMAL ECONOMIC

of marketed and nonmarketed PRODUCTION
services
Reduced cost, improved
quality of goods

Intermediate
(producer)
goods
Formal labour

Consumer goods
Increased productivity
of formal labour

Final ‘intermediate
services consumer services’ New combination of goods
Changes in working and services for domestic
and leisure time production

INFORMAL PRODUCTION
AND CONSUMPTION

Increased productivity
of informal labour Informal
labour
Exchange considered in
conventional model

Additional exchange considered

in ‘self-service’ model

Possible IT-related innovations

Source: Miles 1986
Table 2 IT-Related Innovations in Final Services

Cost-reduction via automation – May manual activities in final services can be

automated: bank tellers, ticket collection and sale, provision of basic timetable
information, warehousing, etc. Some of this may be accomplished by in-
establishment automated tellers, ticket machines and viewdata systems, but in many
cases there is also scope for teleservices (see below).

Telebooking and information services – Can enable potential consumers to determine

cost, capability and availability of service (eg train times, theatre performances); can
also enable ‘brokers’ and intermediaries to improve capability considerably (eg travel
agents using viewdata systems and videotapes of resorts). Information at point of
service delivery (eg VDU displays at bus stops) can improve service quality by
reducing uncertainty. Better quality information (eg good graphic reproductions of
tourist facilities improves decision-making.

Quality-improvement via better scheduling, use of resources – use of database

management systems, routing and scheduling systems, queue management to reduce
delays, save costs, make time use more effective. Use of expert system-type decision
aids to allow wider access to professional skills and knowledge and allow for more
multi-skilled professionals and use of paraprofessionals (eg in medical practice as
well as offering potential for shift to self-service.

Simplified Equipment Maintenance – maintenance and repair is a service, and the

reliability of IT equipment is an important component of its success in final services
of new and conventional kinds. IT-based equipment typically requires less
maintenance than electromechanical devices; and while this was at first of a rather
specialised kind, the development of modular systems and autodiagnostics is
changing this.

Entertainment and Communications Facilities – Enabling waiting time to be spent

more productively and pleasantly. Possibilities of use for educational or advertising
purposes connected with services.
Customer Design Facilities, Client-Centred Services – Transport services can be
adjusted to meet customer requirements, with more flexible routing, timing.
Provision of goods in shops (including those involving complicated machining, like
clothes and shoes) can be based on individual demand. Education can be programmes
more flexibly to scholar requirements and pace. Computer Aided Design can also be
used so as to increase customer/client design choice and enhance the decision-making
process in public and private services.

Customer Self-Service – Several of the above developments can readily be

implemented using more self-service; which, though often involving the customer or
client in some work previously carried out by service workers (usually in dialogue
with customer) has proved popular in many circumstances due to opportunity to
exercise choice at one’s own pace.

Source: Miles et al 1985

To continue with the three areas of service development, producer services are already
often in the vanguard of IT developments – if we consider financial,
telecommunications and professional services here (and not just office cleaning and
the like). A technological revolution may well boost such services: firms are liable to
require more specialised advice and skills in timescales too rapid to permit them to
develop them in-house by conventional means; and they are liable to reduce the risks
of investing in new and possibly obsolescing systems by engaging leasing and
consultancy services. New areas of service are liable to develop around a new
information infreastructure: online systems of various sorts are already available, and
policies with respect to such services, and to infrastructural developments which can
support them, are bound to be important.

As for consumer services, the picture is complicated. On the one hand, IT may be
used to augment and reduce the cost of services that historically received little
application of technology. This might reduce the shift from services to goods, which
in the past has responded to the relative price trends in goods and services. However,
the discussion above noted that IT is also bound to be embodied in new generation of
household goods, which are liable to increase the attractiveness of self-servicing – and
the trends in leisure time and the sexual division of labour may also contribute to this.
Developments in public services, and the infrastructural support for teleservices
(teleshopping, remote medical and financial advice, etc) are liable to play a role in the
choice between goods and services. The future is far from fixed, although some broad
patterns of development of household technology do look likely, as has been
suggested above.

This analysis leads to two main visions of change. In the first, IT is largely used to
rationalise existing activities, and current trends in many respects persist. This is not
an optimistic view in employment terms. In the second, much more emphasis is
placed on innovation and augmentation: what this means for employment is less clear,
although there should be more scope for experiments in worksharing and more
flexible patterns of time use.

The relative weight given to each of these developments is likely to be conditioned by

progress in the establishment of advanced telecommunications systems – and the
emphasis that is given in telecommunications development to business users versus
consumers, to serving all areas versus serving only highly profitable sectors, etc.
These choices are likely to vary cross-nationally, but infrastructural development will
generally be perceived as a key element of international competitiveness. Even if
public authorities are relatively slow in providing advanced facilities, big
organisations, at any rate, are liable to make use of parallel private services: Direct
broadcast Satellite or microwave links if a public optical fibre system is not available.
Households are not so flexible. The innovations that would integrate homes into the
information economy other than as mere consumers of passive entertainment services
require infrastructural support in many cases; and private individuals may well balk at
installing satellite transmission equipment as well as receivers!

But alternatives to high-quality telecommunications-based teleservices are also quite

possible in the face of lethargic infrastructural development. These would tend to
require innovations on the part of service suppliers. Take teleshopping: this really
requires access to a ‘user-friendly’, visually attractive and informative catalogue of
items; the pictures must be accurate and the prices up-to-date. A broadband
communications system is required to deliver such visual data. But in its absence, it
is easy to imagine systems for delivery of video discs to carry such images, with
narrowband communications serving as now to convey pricing and stocking data, and
customer orders. This might enter private households as a result of technology
transfer from wholesale trade, who are likely to use such systems in dealing with their
markets of small shopkeepers. Which households it does enter, of course, will depend
upon the firms’ calculations of profitability in this instance. With the cheapening of
equipment (signified by the free gift of Minitel keyboards by the French government)
– and perhaps the practicability of applying already installed consumer devices to new
purposes (eg home computers and Compact Discs) – public service agencies or even
consortia of community groups could be involved in distribution systems that were
somewhat less income-weighted.

The underlying argument here has been that developments in a heartland technology
do not themsselves cause social innovations. The two strategies are makers of the
range of choice that might be available around IT. The focus on IT reflects the
importance of developments around the new technologies, which is not to rule out the
usefulness of working on alternative technologies. Indeed it is arguable that many
activities currently described as ‘alternative’ could be enhanced by IT: preventative
mediine, solar heating, waste reclamation, community control of facilities, etc. To a
large extent, as we have argued, the involvement of households in the social
innovation process will be conditioned by choices about the application of the new
technologies in two policy areas. First: is the telecommunications infrastructure to
become an advanced broadband system for all, or a service more limited in capacity
and social outreach? Second: are public services to be further rationalised, or can
they be augmented? In both cases, both the design and the use of IT systems will
prove crucial.

The design of such systems is an issue of technical innovation, although social

inventions 9eg the technology steward, New Technology Networks) may be used to
transform the design process. The use is more routinely, of course, a matter of social
invention and innovation: computer-conferencing and other networking activities are
social inventions using telecommunications facilities that deserve more attention than
can be given in this paper, for example. They point to the establishment of new
communities of interest around new technological potentials; they illustrate the role
that may be played by formal and informal social movements in social innovation
around IT; and they also reflect at present the overwhelming predominance of those
already information-rich in benefiting from these innovations. The relative popularity
of interactive services of these sorts, as against the pasive database services that
viewdata systems originally sought to provide, is also an indication of what may be
central features of more community-oriented IT-based innovation.

The example of health that was provided above may or may not be typical of the
prospects for individualised innovations. But the issues it raises are certainly
significant when it comes to thinking about the future of IT. For many services can be
sweepingly transformed by the use of new technologies. Unless a proactive stance is
taken by authorities responsible for collective services, innovations catering to
individual private consumption could predominate. And this brings up questions of
equity. The model of privatised consumption may have much to recommend it in
terms of personal choice compared to bureaucratic provisions, even some forms of
personal contact may be lost (presumably queues will not be among those regretted).
But it does imply new divisions between the information-rich and –poor, between
those with resources to benefit from new services and those left reliant on declining
ones. This is not an inevitable outcome of technological innovation: but it is a risk
that social innovations need to take into account, and strive to avoid.
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