At our Conference a couple of years ago, Dr Simon Moores illustrated the power of exponential growth by telling an anecdote about how long it would take to fill Wembley Stadium with water. Like all such anecdotes, you have to suspend disbelief – Wembley must be waterproof, the plumbing must be able to supply water at the required rates – and people would have to sit still in the face of impending doom. Nonetheless, if one droplet of water is added to the stadium in minute 1, then 2 in minute 2, 4 in minute 3, 8 in minute 4 and so on then sitting in the stands your feet would be damp after about 39 minutes, and everyone would have drowned by 45 minutes.
Dr Moores’ point was that if you scan the horizon for potential disruption to your business, by the time it impacts you, you actually have no meaningful time to react. But this would only be in a world where exponential change occurs. Does change occur exponentially in the real world?
There is an everyday saying that I personally like. “We overestimate change in the short term and underestimate it in the long term”. A brief search reveals little about this phrase, other than it being attributed, variously, to different gurus and in a different form to Bill Gates. That sounds a bit exponential… but it also sounds a bit like Gartner’s hype cycle – which basically tells us that we get overly excited by the new, and it takes time for things to settle down and be useful.
Apple announced iPhone 7 this week. Although there are some interesting improvements – especially, as a photographer, to the camera system in 7 Plus – overall it seems to me to be incremental. By about iPhone 3GS the components were in place – although they are much refined now. Yet in all of its forms Apple have sold 1 billion iPhones since its initial release. On the one hand the invention of the smartphone, apps and always on mobility has really changed the world, and in only a few short years. Look back to a world before the iPhone, apps store and widespread 4G networking and you can see how far we have come. But from model to model nowadays there is little that is revolutionary.
Silicon Valley is always looking for disruption – Uber, AirBnB and others have claimed this disruption. These companies seem to come from nowhere – often with the aid of significant hype. But after that then the services change incrementally.
So change is more of an “S” shape, as identified by Charles Handy – disruptive and exponential, then flattening out – a sigmoid curve as Handy calls it.. It is important to realise this, before you rush off the tell your board you are all doomed. But don’t be complacent either – you could be drowned in minutes, by a competitor you have no visibility of, who is planning something that bypasses what you do, rather than making a better go of it.
As an example my guess is that transport drones are hugely hyped at present. Good, solid, dare one say ‘unexciting’ supply chains are here to stay. And as many of you are involved in using information to incrementally improve the supply chains in your businesses, you may breathe a sigh of relief. But when we are sitting here in 10 years’ time with various Amazon craft overhead, and hardly any lorries on suburban streets we may think differently. And that will be completely negated by 3D printing at home of most of the things we need.