Winston Churchill once wrote that “The empires of the future are the empires of the mind.” I think it’s clear that’s never been more true than today.
As old line industrial firms struggle to survive, web based startups less than two years old become billion dollar enterprises. While the past few decades have been characterized by offshoring to cheap labor markets, now manufacturing is coming back, albeit to factories that are largely ran by algorithms.
The underlying trend is the rise of informational content in the products and services that make up our economy and, increasingly, that information is managed by machines rather than humans. That is the essence of digital business and it’s changing everything we thought we knew about creating value. Here are 3 keys to understanding the new era.
Do you have a philosophy or an ideology? The answer to that question will very likely determine whether you will succeed or fail.
Philosophies ask questions (sometimes annoying ones, which is why they made Socrates drink hemlock). Ideologies, on the other hand, determine answers. That seemingly nuanced distinction makes all the difference in the world.
Most people prefer ideologies. They’re easier. You can believe in world peace or free markets, feel good about yourself and never have to think much about it. Philosophies are much harder. They provide a guide to the journey but don’t give us the destination. The advantage of philosophy is that it will get you where you want to go. Ideology won’t.
There is something intuitively immoral about free stuff. After all, we were raised to respect a good days work for a good day’s pay, so there is something about the concept of not paying for things that’s a bit unsettling.
On the other hand, we all like to be a little naughty, so when we hear that we can get something for nothing, our ears prick up. Not surprisingly, Wired editor Chris Anderson’s book, Free, which advocated a no-fee business model, became an instant bestseller.
Yet upon closer inspection, we find that nothing is really free. Somebody always pays. Even Anderson’s book never suggested that people wouldn’t pay, but merely observed that the onward march of technology creates a shift in value and that, in turn, transforms business models. In fact, “free” just means that there are more ways to get paid.
Are we really achieving anything? Or are we squandering the ingenuity of our predecessors on a trivial consumer culture of tweets and likes? Where is our moon landing, our theory of relativity, our decisive breakthrough that future generations will remember?
That’s the challenge that Justin Fox raised in a provocative HBR post. It’s a valid question, one that should be asked and answered. However, after thinking about it for a while, I realized that much of the hand wringing in this area has been misplaced.
Digital technology has become superficial because we’ve gotten so very good at it. It’s a 60 year-old paradigm that achieved little in its first few decades, then sprinted forward, devouring everything in its path and will soon come to an end. That’s what innovation theorists call the S-Curve and it’s how technology works. The future is bright.
Content can be confusing. It’s tough to get people to agree exactly what it is and isn’t. Much like an eminent jurist once said about pornography, you know it when you see it, but that is hardly a working definition.
To make things even more difficult, content requires intense integration of diverse capabilities. Creativity, storytelling, information technology, user experience, and other skills all must come together to build an effective product that touches hearts and minds.
The core challenge for any organization which seeks to build great content is that the capabilities and skills that need to be integrated come with people attached to them and those people tend to have varied perspectives and see things differently. In order to build a successful effort, it’s imperative to build common working principles. Here’s a start:
How can we “go with our gut” without basing every decision on what we had for lunch? How can we responsibly research the consequences of our decisions without falling prey to “paralysis by analysis?”
Ever since Malcolm Gladwell came out with his book Blink, many people have become familiar with our strange ability to know more than we can explain, but when does it make sense to act on impulse and when should we stop and think things through?
As I noted in an earlier post, Gladwell is not a researcher, but a journalist and therefore probably not the best one to guide us. However, two leaders in the field, Daniel Kahneman and Gary Klein, representing two opposing views, collaborated for eight years to find common ground. The result is an excellent guide to effective decision-making.
More specifically, he said that “Revolution has value, revolution has purpose — a direction and leaders… We don’t want ‘disruption,’ where we just move things around. We want a direction. We want a purpose.”
It would be easy to dismiss Dorsey as just another guy who, finding himself rich, wants to be smart as well. As Kafka noted about wise men, when they say “Go over,” they do not mean to an actual place, but some fabulous yonder that even they can’t designate, which doesn’t help us very much. Nevertheless, I think he was on to something important.
Those damn kids! Since ancient times, it’s been fashionable for people of a certain age to complain their era’s youth. Some things never change.
When I was born in the era of the Summer of Love, hippies were creating the counterculture. My generation of latchkey kids then became “slackers.” Today, the Millennials have caused so much confusion that they have inspired an entire cottage industry of consultants to instruct executives on how to deal with them.
Yet each successive generation also advances technology and business practice. The hippies spawned the computer revolution and Generation X will be forever associated with rise of the Web. The Millennials, most probably, will be remembered as the generation that widely embraced the Hacker Way. Their contribution will likely be the greatest of all.
In 1972, the future seemed bleak. The Club of Rome released their report on the limits to growth and it warned that our planet was faced with overpopulation, which would result in economic and societal collapse. Fortunately, just the opposite happened.
Today, 40 years later, although the global population has indeed doubled, poverty, hunger and war have all plummeted. The Green Revolution has enabled us to feed more people using fewer resources and created a multibillion-dollar market at the same time.
Now, faced with the prospect of global warming, there is a new energy revolution brewing. However, the transformation is not solely, or even primarily, driven by concern about carbon, but represents a shift from resource driven energy to that which is derived from technology and will, like digital innovation, unleash the economics of accelerating returns.
People like to say that life is random. We accept that, even embrace it, because we like some variation in our lives; a chance meeting at the supermarket, running into an old friend at a party and so on. Those little collisions make life more interesting.
Yet it is that same variability that drives us crazy in our professional lives. When we launch a product, we want to know how it will sell. When we invest our savings, we want to have some idea what the return will be.
A lot of smart, practical people have sought to solve the problem. Clever math models and statistical techniques are employed to calculate the likelihood of positive ROI with the aim of creating more certainty. The problem is that fate has a way of thwarting our best laid plans. In truth, it is the whimsical mathematics of chaos that rules our destiny.
Or install manually
Copy and paste the following Google tag code onto every page of your website, immediately after the element. Don’t add more than one Google tag to each page.
, which advocated a no-fee business model, became an instant bestseller.
, many people have become familiar with our strange ability to know more than we can explain, but when does it make sense to act on impulse and when should we stop and think things through?
