The word exponential is one of the most used and least understood words in the lexicon of political and managerial speak, and yet it is fundamental to the way our world is being driven by technology in an unprecedented way. It also heralds a move away from our slow, stable and predictable industrial past, to a new era of speed, non-linearity, and greater uncertainty.
It is not by accident that our working and leisure activities seem to be accelerating – everything is now mobile, intelligent, connected and communicating whilst changing at an accelerating rate. If we are to cope, if we are to win in this new environment, we have to think and act differently. The old tools and methods will not only fail, they will pose a significant and growing threat.
Here we identify and consider the big game changers, look at failure mechanisms, and identify changes to come including some aspects of growing complexity. We also point out some of the basic management errors and the need to innovate in new ways that allow organisations to quickly learn and adapt on the hoof. This includes business modelling, war gaming, and celebrating failure!
1. Winning in a
F a s t
Changing World
Peter Cochrane
cochrane.org.uk
ca-global.org
COCHRANE
a s s o c i a t e s
Tuesday, 7 August 12
2. du strial past
pac ed in
om a slow
com e fr nd,
We nde rsta
asy to u
ed ,e nage!
l be hav ma
r, we l easy to
as l i nea t, very
thatw rospec
d in ret
an
Tuesday, 7 August 12
6. Four BIG game changers !
• Microelectronics revolution
• Computing and software
• Internet, mobility and networking
• Globalisation and distribution
Tuesday, 7 August 12
7. Our world went digital,
non-linear & exponential !
• Huge manufacturing capabilities
• Massive computing engines
100,000 • Instant connectivity
10,000
• Everyone & everything networking
1000
100
10 • Non-obvious cause and effect
1
• Unintended consequences
1 23
4 5
6 7 8
9 • A growing lack of understanding
Tuesday, 7 August 12
8. Digital Failures
• Always abrupt
• Mostly avoidable
• Often caused by people
• By unanticipated mechanisms
• From a direction we are not looking
• Can be very expensive & threatening
• Almost always reputationally damaging/fatal
Tuesday, 7 August 12
9. How come, and
what caused all
this?
Tuesday, 7 August 12
10. We went from a single transistor in 1947 to
10Bn/chip in 2012 and by 2020 10Tn/chip at a
much reduced cost and improved performance at
every stage...
Tuesday, 7 August 12
12. > 10Bn Networked
and active devices on
the planet and growing
exponentially...
Tuesday, 7 August 12
13. BUT WE are such dimensionally challenged thinkers
that even the simplest of exponential
problems have unlikely outcomes
to our way of thinking
One grain of rice on square 1, 2
on square 2, 4 0n 3, 8 on 4, 16
on 5 ....and on the last square
more rice than we can grow on
the planet in a year!
1, 2, 4, 8, 16, 32, 64, 128, 256, 512, 1024.....264
Tuesday, 7 August 12
14. Networking
social & business
now vital tools
Tuesday, 7 August 12
15. Big cultural shifts resulted in society and
business that see: •Insourcing
•Less loyalty •Outsourcing
•Multi - careers •Crowd sourcing
•Shorter tenure
•Self funded training •Soda straw expertise
•Continual education
•Self funded IT & Support
•The rise of the insider threat
Transient relationships
Broader innovation
Faster innovation
More start ups
Higher risks
Tuesday, 7 August 12
16. Complexity and non-linearity are here to stay...
...with emergent behaviours...that are in
general impossible to predict
We have to
be thinking
and acting
differently!
Tuesday, 7 August 12
17. The ratche
t o f c h a n ge
just went‘c
is no going lunk’ ...ther
back ! e
This is the
new norm
- the new
stability!
Tuesday, 7 August 12
18. Some things are inherently complex...
...and some things are made complex by us!
Tuesday, 7 August 12
19. Networks of all kinds naturally exhibit complexity
...of interaction, behaviours and outcomes!
Tuesday, 7 August 12
20. Networks of all kinds naturally exhibit complexity
...of interaction, behaviours and outcomes!
Interconnection
of yeast proteins
Tuesday, 7 August 12
22. Although it is fully understood that layered complexity
does not solve the problem, people mostly continue to
build more layers in the hope that it might...but it never will!
Tuesday, 7 August 12
23. So what do
we have to
do as leaders
& managers ?
Tuesday, 7 August 12
24. Our systems and networks will
Accept that
increasingly surprise us if we
the business
continue world current
on the is now
trajectory !
a bit of a blur
& somewhat
out of control...
Tuesday, 7 August 12
25. Understand that business and commerce has now
entered an evolutionary phase...
it is no longer about
the biggest and the
strongest...it is about
the most adaptable !
Tuesday, 7 August 12
26. Vital is is
at th re
pt th futu
cce y to
A
ke ess
the ucc
s
Tuesday, 7 August 12
27. In Short: Get innovating or get dying !
Vital
Tuesday, 7 August 12
28. Incrementalism is reasonably safe but just only
staves off death a little longer !
The card companies
need to do far more Vital
than move from ‘slide
to swipe’ !
Tuesday, 7 August 12
29. Whilst giant
leaps can be
risky!
Tuesday, 7 August 12
30. A few really
do get it
right and
change the
world!
Tuesday, 7 August 12
32. In the past all of this was static
and reasonably certain !
The consultants standard formula
Vital
∂
Tuesday, 7 August 12
33. Today it is all dynamically
uncertain !
The consultants standard formula
Vital
∂
Tuesday, 7 August 12
34. Today it is all dynamically
uncertain !
The consultants standard formula
Vital
∂
Tuesday, 7 August 12
35. Today it is all dynamically
uncertain !
The consultants standard formula
Increasing Uncertainty
Vital
∂
Tuesday, 7 August 12
36. Business Plan
No longer a static
document handed
down by managers
to be implemented
and blindly followed
by those below
Tuesday, 7 August 12
37. Business PLan
But a dynamic
document engaging
managers & people
with continual feedback
at all levels capable of
adapting to a rapidly
changing environment
Tuesday, 7 August 12
39. Never recruit in talented & capable multi-
Success demands your own image
disciplinary teams..
Mono-
cultures are
lethal - literally !
Tuesday, 7 August 12
40. Keep a close eye on the: Competition
Technology
Innovation
Markets
And don’t forget:
Politics
Fashion
Taxation
Economics
Global trade
Investments
...it is no longer all disconnected and independent - it it all linked
- and as a result causality is increasingly complex !
Tuesday, 7 August 12
43. Invest in data mining, business modelling, and decision
support - gut reaction and knee jerk management is now
very dangerous !
Tuesday, 7 August 12
44. Here is why: complexity compounded by greed,
ignorance and old management thinking was the
cause of all this.......
Tuesday, 7 August 12
45. lem
ob n
pr io
ny rat
a
ch side
oa on
p pr c mov es
t a due d
n’ ut
- do ho ns an
g wit
in n ti o
am sio
rg ci op
a e
w d ll t he
in ss
t ne fa
es si
Inv bu tin go
or and t es
Tuesday, 7 August 12
46. You wouldn’t expect a pilot to fly a plane without
due training and experience
And running a company is far more complex a task
Tuesday, 7 August 12
47. Make a virtue of failure
In fact - make it a qualification
If people are not failing from time
to time - they are not trying !
Tuesday, 7 August 12
48. Fail fast but avoid any critical
damage...
...and recover
even
faster !
If people are not failing from time
to time - they are not trying !
Tuesday, 7 August 12
49. Be prepared to be very different - to challenge
convention - to try the new
Tuesday, 7 August 12
51. - No proven market
- No demand
- No project
- No funding
- No design
- No team
- Design & build 18 months
- First flight 1964
- Over Mach 3.5 Lockheed SR71 Blackbird
- Over 80kft
- In service 25 years
Tuesday, 7 August 12
52. We
can
only
. ..
...w
hat
the
futu
re h
olds
. ..
Tuesday, 7 August 12
53. For sure fortune favours
those prepared to take risks!
IP over WDM...Ethernet...
Tuesday, 7 August 12
54. But they should be
calculated and not foolish or
unqualified risks!
Tuesday, 7 August 12
55. All of this needs leadership and constant attention
to detail...but not micro-management, just decide on
the direction, point the way, and apply the light hand
of management!
Tuesday, 7 August 12
56. And in this context the next wave of change is going to
be a challenge
for a lot of
people
& managers !
Tuesday, 7 August 12