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A big problem for many companies dealing with digitally-enabled market disruption is not knowing where to start the transformation. We react to competition, but don’t focus on where we – as an organization – want to be.
I think a really good place to start is by answering this question. And full credit here must go to Geoffrey Moore, an American organizational theorist, management consultant and author, perhaps best known for his book ‘Crossing the Chasm’. This comes from his new book Zone to win, organizing to compete in an age of disruption.
Geoff says a disruptive innovation really matters when what was scarce and expensive becomes ubiquitous and cheap. And he believes we’re currently dealing with five truly massive waves of disruption:
- Cloud Computing makes the marginal cost of computing free. You don’t add data centers, you don’t buy equipment, you don’t add staff. You just add compute power, and it is cheap.
- Smart Phones make the marginal cost of automating a personal transaction free. You don’t pay for the phone or the network time. You just connect and engage at zero marginal cost.
- Social networks make the marginal cost of adding a resource to a sharing economy free. Uber does not buy any new cars, nor does it hire any new drivers. AirBnB doesn’t buy a new property. They just sign them up and set them loose.
- Data science makes the marginal cost of dynamic decision-making free. You don’t have to hire staff to detect the opportunity. You set your algorithms loose on your log files and iterate to optimal outcomes.
- Internet of things makes the marginal cost of systemic optimization free. You don’t have to send out inspectors to detect issues and make adjustments. Again, you set your algorithms loose on your log files and iterate to optimal outcomes.
Geoff’s killer question? You can interact with a billion people on this planet for free. How would you reengineer what you do now, if you started with that design rule?
A big problem for many companies dealing with digitally-enabled market disruption is not knowing where to start. The solution is here: start by answering this killer question.
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