We are living in an era of continuous and rapid change, which is evident in every aspect of our social, economic and political lives. No matter where you are and what you do for a living you can sense changes happening in a pace that is more rapid than ever before. Take the labor market as example: We are changing more jobs and more frequently than ever before, while this trend is continually growing. Few years ago it was normal for people to change very few jobs in their lifetime. Nowadays, according to the Bureau of Labor Statistics, the average worker is likely to change ten (10) jobs before becoming forty years old, while this number is projected to grow.
A related example concerns the introduction of leading edge technologies (such as robots, artificial intelligence systems and other forms of automation), which are constantly eliminating traditional jobs. A recent study by McKinsey estimates that about 60 percent of all occupations could see 30 percent or more of their constituent activities automated[1], while Forrester Research predicts that robots alone will eliminate nearly 6% of the existing jobs in US[2]. At the same time such changes are also causing a radical shift in the skills required by the job market. Great demand for new jobs is generated, including several jobs that did not even exist five or ten years ago. In this context, businesses are facing significant skills shortage problems, given considerable talent gaps in the use of new technologies and associated social skills. As a result, enterprises are increasingly investing in lifelong learning, while at the same time employing outsourcing in order to attract talented workers regardless of timezone and geographical location.
Also, western countries (e.g., US, Europe) are not longer the sole source of excellent students and innovators. For example, students from Shanghai have topped in two consecutive rounds of the OECD’s PISA (Programme for International Student Assessment) programme, which is used to assess 15-year old students’ performance in reading, mathematics and science. Furthermore, according to the World Intellectual Property Indicators, China, Japan and South Korea, along with US are topping the list of countries with the most patent applications.
The three driving forces
While the world has always been changing, it’s only recently that we are witnessing this unprecedented rate of change. The reason is that today’s change is associated with exponential growth trends in three main areas, namely technology, globalization and climate change. These three areas are growing exponentially and interact with each other in a way that one reinforces the other, which leads to tremendous multiplier effects. Let’s illustrate these three trends.
Technology Acceleration
Technology acceleration refers to a wave of technologies that have been growing exponentially, penetrating our lives and changing completely the ways we work and live. For instance, there is an exponential growth in the number of internet connected devices, which are expected to amount to several tens of billions by 2020. This gives rise to the Internet-of-Things (IoT) paradigm, which enables the combination of data and services from numerous devices in order to offer added-value services that were hardly possible few year ago.
Beyond connected devices, there is also an hyper-exponential increase of the amount of data and content that is produced by people and devices. Nowadays, an average of 6.000 tweets is produced every second, which leads to a generation of 500 million tweets per day. Moreover, an average of 40.000 search queries are handled every second by Google, which means that over 1.2 trillion searches are carried out per year worldwide. Hence, incredible volumes of content (BigData) are produced on the internet every day.
Furthermore, leading edge IT technology services are running on immensely scalable and efficient cloud computing infrastructures, which have enabled entirely new business paradigms. Every day millions of people around the world make use of on-line cloud based services that have completed disrupted (or even dissolved) traditional markets, for example:
- Facebook is the world’s most prominent media owner without creating any content.
- Alibaba one of the world’s most important retailers has no inventory.
- Airbnb is the world’s largest accommodation providers without owning any real estate.
- Uber is the world’s largest taxi service, without owning a single taxi.
These are only few examples of successful business models in the cloud.
The combination of these and other technologies enables rapid technology innovation that changes completely conventional business paradigms and associated social and economic models.
Note that technology has been rapidly growing for decades. You may recall Moore’s law about the exponential growth and the falling price of computer processors, which dates back in the 60s’. However, it is only recently when this rapid growth overcame a tipping point that empowers entirely new business paradigms. That’s a typical characteristic of exponential growth, as things can be manageable up to a given point. According to the recent book “Thank you for being late”, by New York Time columnist Thomas Friedman[3], this tipping point was back in 2007, where a whole range of innovations that underpin our current technology ecosystem were introduced. These include the iPhone, YouTube, Facebook, Twitter, github, all of which were publicly released and made widely available in 2007.
Globalization
Globalization emerged nearly two decades ago as a process that enables organizations to operate at an international (global) scale. This process has been propelled by changes in the economic, political and regulatory environment, which enables companies to operate without any restrictions. For example, in the era of globalization, the world’s economies are connected in order to enable free trade of goods and services.
The globalization has a very strong footprint in economy, culture and technology at the same time. From an economic perspective it facilitates multinational corporations to operate worldwide and eases outsourcing and movement of employees. It also empowers virtualized operations such as virtualized manufacturing and logistics. As part of this virtualization it is very common for global companies to receive an order for a product in one location (e.g., the Netherlands), produce the product in a second different location (e.g., South Korea) and ultimately deliver it in a third location (e.g., Belgium).
The cultural dimension of globalization is reflected in the blending of different cultures in different countries, the flows of immigration, the availability of food (e.g., sushi) and TV content from a certain culture worldwide, as well as the continuous movement of people all around the globe for reasons relating to work, leisure, or even the human desire to pursue a better lifestyle.
Likewise globalization is also reflected in technology trends, including the ones previously discussed. Internet and the cloud enable global operations and are therefore key enablers of the globalization. At the same time content delivery networks enable the distribution of content worldwide, while mobile communication technologies (e.g., 4G cell phones) enable people and business to communicate regardless of time and location. Also, technology enables global collaboration for military, defense, counter-terrorism or even environmental purposes. Overall, globalization and technology go hand by hand: more technology evolution means more globalization and vice versa.
Climate Change
Climate change refers to continuous changes in climate patterns, which leads to increased levels of atmospheric carbon dioxide generation. It is by definition a global problem, as greenhouse gases produced by factories, urban transport, agriculture and consumers’ behaviors affect the atmosphere of planet earth as whole, leading to the “global warming” phenomenon.
Climate change has significant societal, economic and political causes. For example, urbanization and changes to lifestyle patterns contribute to global warming. Likewise, thousands of businesses are advocating “green” practices as part of their operations. Also, local and regional governments are introducing laws, regulations and social initiatives that aim to prevent global warming.
Being a global issue, climate change is greatly influenced by globalization. Free trade agreements, multi-national corporations that operate worldwide in order to bypass strict environmental regulations, as well as the ease of exploiting natural resources of the underdeveloped counties are all sources of climatic pressures. Thus, globalization goes hand in hand with climate change and subsequently with technology as well.
Socio-economic Implications
The three trends have already a significant impact of people, business and governments. Starting with people, citizens are faced with the challenge of adapting to changes. While human beings are by nature adaptive, this time the rate of change seems to far exceed the rate at which individuals can absorb technology changes and their implications. This is particularly true for less technology savvy individuals, such as the elderly. Nevertheless, even younger individuals that are comfortable with technology use have hard time keeping up with technology change and associated business and lifestyle paradigms.
Businesses are also faced with a host of challenges such as skill shortage and a need to continually revise and adapt their business models and operations. Those businesses that fail to adapt to the new disruptive paradigms are bound to face a rapid decline in their business results. Therefore, enterprises need in many cases to reinvent themselves within very fine timescales, which are much shorter that in the past.
Apart from people and businesses, governments need also to understand and adapt to this host of accelerated changes. Governments are expected to produce laws and directives that could be used to regulate and ensure proper use of new technologies in the most sustainable ways. Nevertheless, governments have also problems to understand and follow the pace. With business and technology paradigms that remain valid for two or three years, it’s practically impossible for legislators and regulators to keep up with the current rate of change in the business environment and the technology landscape.
Guidelines for Succeeding in the era of Change
The challenge of understanding and keeping up with accelerated change is currently depressing millions of people and many thousands of businesses worldwide. Many are trying to resist and resort to older safer paradigms, while others are struggling unsuccessfully to follow the pace. Some others expect that political or social change will stop the pace of technology, globalization and climate change. This emotional stance is understandable, yet not the right approach. The era of acceleration provides fantastic opportunities for businesses and individuals, as soon as we align our strategies and activities to it. After undertaking such an alignment, we can start being excited and optimistic about the things to come. Here follows a list of guidelines that you should seriously take into account:
- Understanding our era: First and foremost, it’s important to understand the dynamics of the era of acceleration, including technology, globalization and climate change. We aspire that this article serves as a starting point.
- Becoming agile: It’s not possible to survive in the era of acceleration without agility that embraces rapid change. You have to become agile in the way you plan business goals and the means you use to accomplish them.
- Innovate: The need for innovating in short timescales has become vital and more important than ever. Expect innovation cycles and related business models to evolve at a timescale of weeks or months, where they used to evolve at a pace of years or even decades almost 4-5 years ago. Innovation should not be confined in the technology forefront. You need to be able to innovate in organization and business processes as well.
- Paradigm shifts: The depth of innovation is also changing. Few years ago innovation was usually targeting the reengineering of processes as part of a continuous improvement strategy. In the era of accelerated change this may no longer be enough. Instead, you may need to engage in whole paradigm shifts. This means more risk, but also opportunity for much higher returns.
- Leverage technology: See the rapid technological change as a vehicle for improving business results. You don’t really need to be an IT or other technology expert. Rather you need to appreciate technology, understand the value of it and work with the right partners for optimal business results.
- New social contracts: New social contracts are emerging as a key element of corporate innovation strategies. Innovation in organization and business processes implies also new ways for motivating and engaging workers. For example, embracing lifelong learning in the scope of new social contracts and mutual agreements with employees is indispensible towards facing the skills shortage reality.
- Collaborate: You should not be left alone in the era of acceleration. Collaboration is a key to success. It’s time you create a network of partnerships that could help you innovate through supporting you in inception of new products and services, business planning, technology implementation, continuous support and more. Make sure you select reliable, trusted partners that you really enjoy working with.
There are certainly much more things to be done, beyond these guidelines. The latter are just setting a new framework of thinking and acting in the era of accelerated change. With such a framework in place you can be start being optimistic rather than skeptical.
[1] http://www.mckinsey.com/business-functions/digital-mckinsey/our-insights/where-machines-could-replace-humans-and-where-they-cant-yet
[2] https://www.theguardian.com/technology/2016/sep/13/artificial-intelligence-robots-threat-jobs-forrester-report
[3] https://www.amazon.com/Thank-You-Being-Late-Accelerations/dp/0374273537