Today we are living a second revolution, comparable to the Industrial Revolution.
The Industrial Revolution changed how people used their bodies to perform physical labor. The Digital Revolution is changing how people use their minds to perform conceptual labor.
Unlike the steam engine or electricity, Digital Revolution technologies continue to improve at a remarkably rapid exponential pace, replicating their power with digital perfection and creating even more opportunities for combinatorial innovation.
From 20,000 years, we as human beings have worked to own “stuff” and then trade access to it. This behavior started in tribes, was adopted by clans, and then later spread to nations, empires, and most recently, global markets. Value has always been generated by owning more land, more equipment, more machinery, more people. Ownership was the perfect strategy for managing scarce resources and ensuring a relatively predictable, stable environment. The more you had — that is, the more value you “owned” — the wealthier and more powerful you were.
In the new context that has been shaped by digital, a new organization paradigm has taken shape: the Exponential Organization.
An exponential organization is one whose impact, or output, is disproportionally large — at least ten times larger — compared to its peers because of the use of new organizational techniques that leverage accelerating digital technologies.
To achieve scalability, exponential organizations such as Uber (transportation), AirBnB (hospitality), eBay (commerce), Waze (car navigation), AWS (cloud computing), are turning the traditional organization inside out. Rather than owning assets or workforces and incrementally seeing a return on those assets, exponential organizations leverage external resources to achieve their objectives.
Two factors are pivotal for your organization to step up from relevance to exponentiality:
- Ground success on resources you don’t own — if some aspect of your company’s product has been information-enabled, notably a compelling digital customer experience, then following Moore’s Law, can take on the doubling characteristics of information growth.
- Take care of information as your greatest asset — thanks to the fact that information is essentially liquid, major business functions can be transferred outside of your organization to users, fans, partners or the general public.
Every company is now a technology company:
- the way power is distributed among and in business;
- the way investments changes;
- the way we organize people and work.
Archimedes once said, “Give me a lever long enough, and I’ll move the world.” Simply put, we have never had a bigger lever.
So race to reinvent yourself and your organization before it's too late: any profession or company designed for success in the 20th century is doomed to failure in the 21st:
- Step back and define yourself in terms of the benefit you provide, starting with why.
- Create great products and great services, make them truly deep.
- Be recognized as intelligent when your customers look at you, let them know you understand their pain.
- Be complete, deliver the totality of a product offering: i.e. it’s not just the software but also the APIs, the documentation, the webinar, etc.
- Empower people, as Guy Kawasaki has taught us this was the key to Apple success.
- Be elegant: great human interface design is a prerequisite.