Thriving in the age of disruption, change and chaos
When I was young and silly, life was so simple then. Today, it’s no longer business as usual.
In Africa, there were 134 million cellular phone users in 2005. By 2011, there were 660 million users. Mobile sales on e-Bay amounted to $660 million in 2005, and $5.2 billion in 2011. In 2008, there were 800 mobile apps available; today there are over a million. It took 18 months to sell the first 1,000,000 units of Palm Pilot; it took only 24 hours to sell the first 1,000,000 units of iPhone 4S.
Disruption, Change, Chaos
“Disruption” refers to massive changes affecting business and other aspects of life. Disruption could result from technological advances, geopolitical shifts, demographic change, innovation or invention.
In marketing, the most critical C’s of disruption are content, complexity, and connection. Not all innovations can be disruptive, although they might be revolutionary. In the 19th century, the typical means of transport was the horse-drawn carriage. The invention of the first automobiles did not disrupt the market of horse-drawn carriages because the former were so expensive. Henry Ford’s mass-produced Model T in 1908 was a disruptive innovation because it changed the transportation market.
Disruptive innovation
Disruptive innovation refers to an innovation or invention that creates a new market and value network that eventually disrupts an existing market and value network. It eventually displaces established market leaders, products, and alliances.
Disruptive innovations are often made by entrepreneurs and not by the market leaders who want to protect the status quo. Walkman allowed us to enjoy a long-playing music album as we jogged, but a young upstart named Steve Jobs suddenly introduce the iPod that allowed us to listen to thousands of songs inside a tiny gadget. Motorola and Nokia had the lion’s share of cellular phone sales, until Apple and Samsung came up with their disruptive innovations.
Disruptive innovations take longer, require massive investment in R & D, and have higher risks than incremental or evolutionary innovations. However, the former could achieve a much faster market penetration and impact. They could also disrupt economic, social, and other aspects of life. Consider the foregoing stories on thriving in a disruptive environment.
Different techniques
Chaotic disruptions are now happening, not only in the technology companies but in almost every aspect of life, leisure and business. In the mid-1970s, large multinationals were successful because they had the LRP (long range planning) system.
DJ Patil, of venture-capital firm Greylock Partners, said, “The pace of change in our economy and our culture is accelerating, fueled by global adoption of social, mobile, and other new technologies, and our visibility about the future is declining.”
When conditions are chaotic, Patil explains, you must apply different techniques. “I don’t have a plan. If you look too far out in the future, you waste your time.”
New mindset
To thrive in an era of disruption, change and chaos requires a whole new approach. Robert Safian, editor and managing director of the Flux Group, wrote, “Some people will thrive. They are the members of Generation Flux. This is less a demographic designation than a psychographic one: What defines GenFlux is a mind-set that embraces instability and tolerates (and even enjoys) recalibrating careers, business models, and assumptions. Not everyone will join Generation Flux, but to be successful, businesses and individuals will have to work at it. This is no simple task. The vast bulk of our institutions (educational, corporate, political) are not built for flux. Few traditional career tactics train us for an era where the most important skill is the ability to acquire new skills.”
Learn new things
“We are under constant pressure to learn new things. It can be daunting. It can be exhilarating,” says Beth Comstock, Chief Marketing Officer of GE.
We already saw how mobile, social, and other breakthroughs are changing our way of life. In the process, these changes are remaking age-old geopolitical and business assumptions.
Safian continues, “No one predicted that General Motors would go bankrupt – and come back from the abyss with greater momentum than Toyota. Digital competition destroyed bookseller Borders, and yet the big, stodgy music labels, seemingly the ground zero for digital disruption, defy predictions of their demise.”
“All these industries are being revolutionized,” observes Pete Cashmore, the 26-year-old founder of social-news site Mashable, which has exploded overnight to reach more than 20 million users a month. “It’s come to technology first, but it will reach every industry. You’re going to have businesses rise and fall faster than ever.”
Speed matters
“In a big company, you never feel you’re fast enough. Business-model innovation is constant in this economy. You start with a vision of a platform. For a while, you think there’s a line of sight, and then it’s gone. There’s suddenly a new angle,” say GE’s Comstock.
Within GE, she says, “Our traditional teams are too slow. We’re not innovating fast enough. Weneed to systematize change.”
New world
When you see that cars are transforming into rolling, talking, cloud-connected media hubs, you better believe that you’re in a new world. Safian says, “In an age where Twitter and other social media tools play key roles in recasting the political map in the Mideast; where impoverished residents of refugee camps would rather go without food than without their cell phones; where all types of media, from music to TV to movies, are being remade, redefined, defended, and attacked every day in novel ways, there is no question that we are in a new world.”
We can no longer ignore the change, the flux, and the resulting chaos in the new world. The pace of disruption continues. If you are looking for a forecast that will define the next era, you’ll hardly get a unanimous voice from seers, except that the future will be more fluid, and there will be no discernible coherent pattern. The “monarchs” and market leaders insist on maintaining the status quo. They are incessantly interrupted by the revolutionaries who do things differently, turn old truths into falsehood, and make the impossible possible.
It’s time to accept, embrace, and love the chaos. Who knows, but opportunities await you?
(Ernie is the Co-Chairman of ECOP’s TWG on labor Policy and Social Issues. He also chairs AMCHAM’s Human Capital Committee. He was Past President and Past Executive Director of PMAP. He can be reached at erniececilia @gmail.com)
In a big company, you never feel you’re fast enough. Businessmodel innovation is constant in this economy. You start with a vision of a platform. For a while, you think there’s a line of sight, and then it’s gone. There’s suddenly a new angle.