The Technology Gap and Economic Alchemy

The concept of the technology gap was presented by Paul Pilzner in his book Unlimited Wealth – which  we highly recommend.   The concept is based on his theory of Economic Alchemy which essentially is that wealth is a measure of natural resources multiplied by a technology factor.  This technology factor is actually an exponential factor of technology in use – meaning as technology goes up the impact of it goes up exponentially.   Stated in mathematical terms Wealth = Physical Resources multiplied by Technology to some exponential order of itself (i.e., W= P x Tn). 

According to Pilzer, there is no limit to wealth for an individual, or for a society, once they understand how to apply technology properly.  The technology gap is the difference between the potential technology that can be applied compared to the actual amount of technology being applied.  This difference can translate into a huge potential increase in wealth.  For example, if Tp represents the Technology potential available the technology gap could be represented at Tp – T.  The wealth potential (Wp) we’d have if all known technology would be applied is: Wp= P x (Tp)n.  If we applied all of what we know how to do, our increase in wealth would be Px((Tp)n-Tn), a potentially huge amount if we are not utilizing most of the technology available to us.

Pilzner suggests that closing the gap (that is having us do more of what we know how to do but are not doing it) is a more effective way to raise our wealth than creating new technologies.  In other words, while we can continue to press forward and learn better ways to do things (i.e., extend the state-of-the-art) we are able to achieve higher returns if we merely implement that which is already known but which isn’t being currently implemented.

We concur with this belief.  We find many many organizations that are not close to implementing what is known.  Trying to create even more possibilities for them would not nearly be as productive as just getting folks to do what is known but which they aren’t doing.  Hence, Net Objectives’ primary focus is on closing the technology gap more than creating new methods (although we do that too).

See Technology Gaps in Software Development to see some of the more significant methods that are currently being under-utilized.