Are you ready for the Second Machine Age?

I sat in on an interesting panel Wednesday morning at the MIT Sloan CIO Symposium being held in Cambridge, Mass., involving four MIT professors sharing their insights on the economic impact of connected smart machines.

The burgeoning Internet of Things is part of what Erik Brynjolfsson and Andrew McAfee call the Second Machine Age, with the Industrial Revolution being the first. Their hypothesis is that interconnected smart machines will lead to dramatic growth in the global economy.

What distinguishes this machine age from the last is the dominance of the machines in the process. In this second age, machines are making decisions.

"We are beginning to talk to our machines and expect them to understand us. When I was growing up, that was science fiction, that was something Captain Kirk did," Brynjolfsson tells the MIT Sloan CIO Symposium.

Machines "are not that good at understanding us. But we are at the cusp of a 10-year period when we are going from machines not being able to understand what we are saying to machines routinely understanding our spoken language and carrying out our instructions," Brynjolfsson relates.

"Machines are doing legal analysis; they are answering questions in call centers... There are machines that do medical diagnosis," he says.

John Leonard says that autonomous vehicles are making great strides, particularly Google's efforts. "The challenge in driving is dealing with the unexpected, processing this huge stream of many sources of information," he explains. "Google is using detailed maps to predict some of the expected things that might happen and they can learn from the behavior of pedestrians and cyclist," he relates.

While this technology might revolutionize transportation, it could also lead to a "huge shift" in employment, Leonard cautions. Autonomous vehicles that can function effectively in cities could put truck drivers and taxi drivers out of jobs, he adds.

Alex (Sandy) Pentland cautions that the machine revolution presents legal issues. "The problem is the way law has been written…with human judgment. But human judgment is disappearing as everything becomes 'datafied'. We have to find a different way of dealing with the law and consensus of people as we bring this new technology to market," Pentland notes.

One solution for better human-machine interaction is to build computers that are better at social intelligence--a term that refers to the ability to negotiate complex social relationships and environments--explains Thomas Malone.

Malone studied groups to assesses collective intelligence and found that groups with members displaying higher social intelligence also had higher collective intelligence.

These MIT professors' ideas are intriguing, particularly as it relates to the impact of connected smart machines on enterprises and the broader economy. Certainly, the economic impact of connected smart machines will be far reaching. Companies that seize the opportunity now will reap significant rewards in the future. - Fred