Deloitte’s Duleesha Kulasooriya Tells Me How The Orange Economy Can Be A Force For Social Inclusion.
The Singularity University has a track record for innovative thinking. Their Singularity Summit returns to Bogotá, Colombia this August 18th and 19th at the Grand Hyatt hotel in Bogotá. At the last one, I was able to sit down with Deloitte’s Duleesha Kulasooriya who runs their Center for the Edge. Kulasooriya says he was impressed with Colombia’s “Orange Economy” initiative, and had thoughts to share on how disruptions brought about by things like Robotics Process Automation, Artificial Intelligence, and the decline of large scale manual labor as seen in traditional factories can actually be a benefit for developing economies.
Here are excerpts of our conversation.
The Singularity U Colombia 2020 Summit takes place August 18 & 19. For More information click here.
Loren Moss: So, I am here with Duleesha Kulasooriya. You are Deloitte’s executive director for their Center for the Edge. What is that?
Duleesha Kulasooriya: We are a small group within Deloitte, it´s based at San Francisco and Silicon Valley, we have another unit in Amsterdam another in Melbourne, (and now one in Singapore). We look at how the world is changing and why it matters and what you do about that, and if you ask a consulting colleague what drives their behavior, they will tell you it is whatever keeps their clients up at night. Our mandate is slightly different, our mandate is what should be keeping clients up at night and how do you bring that to the table. So, we look five to ten years out, we frame the perspectives in a way that you can understand it, and then, not only do we frame the future in a way that you can understand it, we say, well, given that, what do we do about it today? We do three things. We do research, we write papers, we do the research to kind of understand and frame, so we write papers about it, we do eminence, speaking like this and we also do advisory with a selection of clients, we work with them to help with their own transformation.
Loren Moss: That´s interesting, because, you know, I think of Deloitte coming from a finance background, I think of Deloitte as an audit, and large company accountant basically, but it´s interesting because we see companies like Deloitte, and the traditional Big Four have been evolving, then we also see companies, I am reading a book right now by Bill Mattasoni and when his time met at McKinsey and also BCG and its fascinating because his focus was marketing, he kind of pulled them away from traditional strategy into a different area, and so now, how important is it for companies, even if you go as a consulting you tell, for example General Electric how to reinvent itself, but you guys as a company that has been known 20 or 30 years ago, Deloitte, ok, they do my audit as a publicly traded company or they do our taxes for a multinational, but here we are talking about innovation and ways to disrupt and ways to see the future. How does that fit into the core DNA of a company like Deloitte?
Duleesha Kulasooriya: It´s a very common misconception that we are still an audit and tax firm, those are our roots, it started as an audit firm more than 100 years ago, and in most geographies that’s still what we are commonly known for. Now, in the US, in Europe and Australia, our consultants…at this point, consulting makes more money than all the other businesses combined, so it´s very dominant, and beyond consulting, we have many other edges like The Center for the Edge, we have a practice in blockchain, we have a practice on the future of work, all these different edges that are relevant to everything here at the Singularity Summit. I mean our partnership with Singularity University itself, is an example of that where the other guys aren’t. So, we recognize that we too need to evolve, and a big part of the evolution is kind of pushing the boundary, pushing the edge from where it is and I think the marketplace is coming to realize that Deloitte is more than an audit firm. I think for Colombia we had to do something like this, for them to say “wow, I didn’t know you guys did that!”
Loren Moss: That´s interesting and especially in a place like Colombia, I don’t know how familiar you are with the country…
Duleesha Kulasooriya: Not enough unfortunately. It´s my first time here, I have been reading a lot before I came, this Orange economy thing is very interesting and I´ve done very relevant work for that in the US but I am learning more about that.
Loren Moss: I live in Medellin and Medellin works very hard to position itself or has the aspiration to be like the Silicon Valley of South America. And it’s fascinating because you have San José California and then you have San Jose Costa Rica that also has had a lot of success, and so Medellin is really trying to be the new version, there are a lot of fascinating things happening…
Duleesha Kulasooriya: Santiago de Chile has also done really well in some of those aspects.
Loren Moss: You spoke about how a lot of companies or too many people traditionally depend on the resume or old traditional qualifications and I think that that is fascinating, especially in Colombia, if you spend time here you will see it is a very traditional country.
Duleesha Kulasooriya:I spoke at Deloitte Colombia yesterday and I was the only male not wearing a tie. And I was definitely the only person with a mohawk! Well I am the only partner at Deloitte with a Mohawk.
Loren Moss: Especially in Bogota. It would be very hard for a nonconformist to come up through the ranks in a place like Colombia, many times you will go to some talk and you will see introductions and the speaker will spend five minutes reading about what university the speaker went to 30 years ago and what they did and all this…
Duleesha Kulasooriya: It´s a qualification for you up there…
Loren Moss: While back in the states on the other hand, you might see somebody who is a great programmer for example: “Well how did you learn Python?” “Oh, I taught myself”…We´ve got a friend visiting right now in Medellin, I had to leave him to come here, but he has been a CTO, he lives in California, and he has been a CTO for several companies that have been clients of ours, and his whole career has been in IT and software, but his degree is in music, and it would be extremely difficult for somebody to do that here in Colombia. I think that as they can shake that they can accelerate, and you see that need for…
Duleesha Kulasooriya: Absolutely. So, in all of these places, either we break the culture or not, so, that is no different from what I am talking about in an organization and having to do something different, and having the conviction and the courage to do something different. Once you find one or two examples, if you shine the spotlight on them, then more people feel you have permission to try something as well. The reason I have this mohawk (haircut) is kind of for that reason, there´s a festival called Burning Man, actually in the next building they have a whole lot of….
Loren Moss: A lot of people here know about Burning Man, I´ve got a friend from Cartagena who goes to Burning Man every year.
Duleesha Kulasooriya: Yes, I go to Burning Man every year, and I shaved a mohawk for the festival because that is what I wanted to do, I could be myself and be that for that week. So, I come back, shave it back, go bald, it’s hair, right? Not a big deal. One year, I kept a little longer than that, and this lady walked up to me and said thank you, and I said for what, and she said, well, I don’t know if you noticed, I am wearing a snow string. I don’t, it´s a tiny little thing, and she said, well I take it off during the week and only wear it on the weekend, because I didn’t think it was appropriate then I saw you walking around with a mohawk and it made feel okay to bring my whole self out to work.
So, what I realized was that inadvertently I had created a space of permission, where others can be themselves. so, I kind of took that to the next level, so, even, I have an office, but I don’t sit in the office, I sit in the bullpen with all of the younger colleagues so that I can also learn from them and then can learn from us, and I am also in their day to day so that we can interact more, and we can have a normal conversation, so we can actually talk about it, and there is not like a hierarchy. I go to work in a hoodie, I go to work in jeans and a hoodie, because we always had this thing of “dress to the level of a client.” Well, what do you think people at Facebook and Google and all the startups wear? They are not wearing suits and ties, it´s a different world, right? You realize that stuff is very superficial, it´s not what matters.
So, what you need in Colombia, and it will happen over time, are more examples of people who are doing things differently, you will need that startup, Rappi or something else, that suddenly begins: Oh! So, I don’t have to go join a large corporation, I can do this and be successful too. You need someone who is kind of flamboyant in some way to show a case and be successful. You need alternate models to succeed in order for others to have permission to do so as well.
Loren Moss: We look at scale and one of the things you talked about, disrupting at the edge, that reminded me of the book “The Innovators Dilemma” which is a very popular book in Silicon Valley, and there are cases of companies that are very large for example, General Electric, IBM, Kodak, and what happens is that sometimes there are business reasons why the cant necessarily bet the whole company on something, maybe the right thing is to disrupt yourself, eat your children, and it´s fascinating because I wonder how that can apply to countries that are medium size economies like Colombia that just entered the OECD and are advancing, the basic infrastructure is here such as fiber optic, and 4G and all that stuff, but still in many ways they are playing catch-up. How can they leverage those concepts to be able to either leapfrog or to grow more quickly?
Duleesha Kulasooriya: So, a few things. One, you do need the technological infrastructure, if you are saying that is already there, that is great, because that gives everyone access and the ability to take part of the digital economy. That’s the first one.
The second one is: Play to your strengths. Go back and see “what are we traditionally good at? And it can’t be just oil and minerals, that is not going to sustain yourself. So, that is why I really like the orange economy because it goes to the creative, the making stuff.
Third, it’s really a cultural shift, a cultural mind shift, is shifting from a fear-based or a scarcity zero-sum game mindset to an abundance mindset where you can do more. One of the things I think a lot of countries do wrong, is they try to emulate the Silicon Valley model, you will never catch up to Silicon Valley. You are never going to catch up to China, they are too far ahead. But if you were to do things differently based on your local strengths that can be very different. So a good example is this. If you look at the manufacturing sector, I have written a couple of papers on it. The Maker Movement. Have you heard about it?
Loren Moss: Absolutely.
Duleesha Kulasooriya: So, in that context, we see the manufacturing world breaking into two things. The manufacturing industry is going to fragment and consolidate. The large companies are getting bigger and bigger, they are consolidating, they are buying others and getting bigger and bigger. And they will use less labor and more robots, but we also see the other part, where the last mile of manufacturing will fragment, and that is where most of the labor is going to be. So, to put this in context, the generic product will be made at scale, but it will be customized to your need, my need, our niche needs by the local population, so, that´s where the labor is going to be, and that is where the creative community, the Maker Movement comes together. So, the work I’m doing with GE, there is an example here, dorm refrigerator, the mini refrigerator, nobody has done anything with that for 60 years, it’s been the same product literally for 60 years. What if you take the same product, keep the refrigeration part exactly the same, because that is what is important, the compressor, but make the top and the front that is dumb plastic, and make it different with a little electric connectivity, so, it gets shipped with the plastic on top and you can pull it out and put something in it such as an electric connectivity, and then tell all the third parties: design what you want.
Loren Moss: It´s a platform.
Duleesha Kulasooriya: It´s a platform, it´s a product as a platform. Now, if you do that in every college there will be one kid who says I am going to laser cut beautiful acrylic with the college colors and you can buy it and put in on there and it will light up and all the stuff.” GE will never do that, something where they produce 100 units, but this kid will be able to pay for his college tuition by doing that, and someone else might build a charging pad, another one might build a project on the ceiling. The thing is that GE does not have to imagine the 1,000 different ways nor all the niche markets because someone closer to the market can do that, someone closer to that last mile can do that.
Loren Moss: Right, because there is a local need, a local peculiarity, something you need, and you can take that and because it´s a platform, you can adapt it.
Duleesha Kulasooriya: And this goes to everything from pure window dressing to utility, so you could take a food product, and just customize the packaging to be local and language relevant, by size, they used to do it in size, because people couldn’t afford the large package so would break them down into one-rupee packages in India. They do stuff like that. So, there’s a lot to be done in this last mile that people are just ignoring here.
Loren Moss: One of the things I never saw and then I realized after I lived here is why they do it because they have….You can go into the corner store and buy a single serving pack of shampoo, and because people are buying, people are making micro-purchases.
Duleesha Kulasooriya: They can’t afford to buy the big one, they can afford to buy the 1 dollar one, that is something that happened 20 or 30 years ago, but here is another example: One of the photographers here, Mauro, I met him last night, he is an amazing photographer. He does nature nightscapes, really hard stuff to do with natural life, beautiful stuff, but he doesn’t know what to do with it. It’s his hobby, it’s his passion. His options are Instagram, which is proliferated by good and bad, or a gallery, which is a few people who are kingmakers; nothing in between. The two hotels I stayed at, the Hilton and the Hyatt, they have very generic pictures. Why would the Hyatt not say we have 12 floors, every floor, we will invite a photographer to come and furnish it and have a story attached to it and have a person. Suddenly, my stay there would be much more Colombian, unlike a generic Hyatt that could be anywhere in the world. So, there are these little things that we can do that we are ignoring because we are so enamored with replicating Silicon Valley.
Loren Moss: One of the things you have mentioned that is interesting to me, they have the micro purchases here and in places like India. One of the things Colombia struggles with, is inequality, right after you went off stage, the next person came when you talked about the Bronx, which was a very infamous neighborhood here in Bogotá where they have been working to rescue and renew the area. In Medellín there are some innovative things being done by the city and by Ruta N. The city has installed public maker labs. So, what the city itself has done is say: Hey, we know most people cannot afford a 3D printer. So the city created these facilities, and put them in modest neighborhoods, and anybody can come in, you are a student….Back in the States we had garages, we had experimental garages and Apple and HP were started on garages, but most people in popular neighborhoods here don’t have garages, so, this gives you a chance to come in and they have all these high tech machines and all this amazing stuff, and you can go in there, and it is free, but if you have like a small scale commercial project, like a start up, they will say okay, there is a like a nominal fee because it is a commercial project, however, you can use it to get started and take of and get your own, and its fascinating how you see these things and these innovations taking place down here.
One last question, how significant is, because one of the areas that a lot of things still need to be done in places like this just because you are going to have the “haves and have-nots” evolving into the “know and know-nots” is the role of talent, and we look at how everybody, and I think is overblown, but RPA is going to change jobs, I don’t think we will get to a zero employment era,
Duleesha Kulasooriya: Not zero employment, but it´s something really serious, because a lot of the jobs we do, are going to go away and that takes us back to the previous thing, we can’t focus on trying to get a big manufacturing facility set up, because every single new one will use more automation robots and the people that they need to hire are going to be hired higher skilled and not the people that you need to get jobs.
Loren Moss: My friend back home in the United States is a CPA, she is a senior level CPA, and we were talking about this and she said that now for the senior people they sign off on audits and things like that, they are relatively secure, but she said the pyramid is getting steeper, meaning that at the entry level, the things that she did 15 years ago, are automated now.
Duleesha Kulasooriya: Our audit practice is going to get decimated over the next decade because most of what we do physically on paper, is only done because of regulation.
Loren Moss: How do companies in Caribbean or Latin American countries, Trinidad & Tobago, Jamaica—India is already ahead in IT, how do countries that are trying to, like I said leapfrog, how do they, not just defend against that. but take advantage of it?
Duleesha Kulasooriya: So, I think one of the things to be aware of is that a digital economy does not always mean digital products and coding and all of that. There is some part of the population that is going to go and do that, but the other part of the population…you can’t make a coal miner a coder—that is a false statement. A few people did that, but that does not apply for most, but you can work on the creative economy, this is the physical making of things. So, it is much more sustainable for people to start a small business and to maintain that without any massive growth implication. Not everybody has to try to be a Facebook or an Airbnb. The majority of people, we should create platforms, digital platforms, this is where the digital comes in, to enable them to do all of this, so that they can get the word out more, so that they can get a global marketplace buying them, not just selling at the market, its all of that where the digital can help the population because that is where the labor is going to be, that is where the jobs are going to be for a good portion of the population, because you are not going to be able to upgrade them all to become engineers and coders. Some part of the population that is ready, might be able to do that, but for the rest of them, create the platforms so they can do all, and again, it´s simple stuff, just like the photographs, the hotel room idea, or the soaps, and shampoos, these are generic somethings, somewhere. It should be a local company using local herbs making something in the store.
Loren Moss: We have wax palms, we have so many different exotic fruits that I had never heard of before until I moved down here.
Duleesha Kulasooriya: Tourism industry, the whole small culture that “go local” and organic, all of that, like buying local, small-scaling everything, is where most of the labor is going to be.
Loren Moss: And the new economy does not require like a traditional economy, the giant capital investments like on factories, just knowledge.
Duleesha Kulasooriya: Right, and the platforms, the digital platforms can help them do what they do better and cheaper, so they can sustain themselves. So, I mean, in terms of, because you can keep educating and training people but you won’t be able to compete against IIT in India, or Silicon Valley or MIT, all of MIT´s courses are available for free, that has not changed a thing.
Loren Moss: So, people here can take advantage of that and make things with it.
Duleesha Kulasooriya: But only so many people, one, will know, will have the aptitude, and the community to do something with that.
Loren Moss: I buy our own team courses on Udemy and I say hey, Amazon gives us free courses, so, that counts, and I think that in the US it counts, “I know how to program C++, so okay, take this test. I don’t care where you learned it, come and get to work.” Here, they give to much importance to the degree, did you get a degree in CIS, did you come from this university?
Duleesha Kulasooriya: What changes the path out is employment, because you only get those questions if you are going to be employed by someone else, but if you are self-employed, it is not an issue. That´s why new models of democratic systems that don’t rely on old institutions is what we need. Peer to peer funding, government has a big role to play and this is why I’m really excited about the orange economy, because they can change the rules, they can change the taxation, they can create economic zones, they can create essentially sandboxes to test new things and test new ideas.
Loren Moss: And supporting the quality of education. I think here you have some really good schools, but then you have a bunch of really awful schools, and you could take somebody and say I am going to give you a free scholarship in this good university and you are going to get in there, but you have not been prepared properly. We have the same problem in some places in the USA too.
Duleesha Kulasooriya: Yes, but you can also change rules, in the US in certain cities, because it´s a city law, if you are building a new building there has to be so much public space and green space, you have to give back to, because you have taken up space in the city, you have to give back something to the city. So, the same way, you could have a regulation that every corporation has to give back to the people.
Loren Moss: What they do here that is interesting is that they have a national community college system called SENA, so for every 15 employees we have on the payroll, we must hire one intern. That is already well established
Duleesha Kulasooriya: And all the training that is required, even for a cleaner in the hotel, so, essentially, don’t keep them in the job forever, elevate them, give them access to something more, but I think the answer to all of this is less employment by large companies and much more self-employment and small units of self-production. That is the different shift because everyone is trying to attract the big companies to set up here, or to build the next Facebook, and you have to have that to, but it’s only a part of the story. That story and that narrative is taking away everything else, but we are ignoring some of the easy things we can do.