Imagining the unimaginable

Dea Frankó-Csuba
futurist and innovation coach

She told that the latest industrial revolution makes the fusion of biological, physical and digital systems possible for the first time. This creates unbelievable new paradigms: it is enough to mention that a vaccine against a brand new virus has been developed in just a year. While the first three industrial revolutions were about doing things differently, the fourth one changes us and turns our lives upside down.

As a result of the things mentioned above, the lines between traditional industries are blurring. A good example of this is the telecommunications sector, which several technology firms are trying to enter as internet service providers, such as Elon Musk’s SpaceX does: their latest project is to provide internet access all over the globe via a system of satellites.

Lately, companies may easily find themselves in a disruptive situation

Disruption: Forces that are turning our world upside down

Radical technologies
Radical technologies such as AI, learning algorithms, robotics, nanotechnology, gene modification, quantum information science, edge computing and 5G facilitate a brand new type of problem solving, therefore company heads need to find a way to adopt new business models that benefit from these.

New business models and arenas
Instead of industries so-called arenas are being formed, where companies with great experience in certain fields can provide various sectors with the solutions they need, e.g. Amazon, Google.

Changing consumer behaviour
More and more consumers are interested in ethical consumption, conscious capitalism, environmental protection and sustainable solutions.

‘Black swans’
What Nassim Taleb describes as the ‘black swan’ phenomenon is basically the occurrence of events that come as a surprise, which have a major effect and significance, but these are often noticed or understood in hindsight only.

Core és edge

Obviously it is very difficult to make plans in an environment like this. There is nothing left to do but to imagine the unimaginable – and the bad news is that humanity isn’t very good at this. What should companies do? They need to analyse what the disruptive forces are and how it is best to react to them. The starting point is always identifying those phenomena and trends that are likely to disrupt the existing business structure and operations – these are the core innovations. Businesses need to pay attention to edge innovations too: they have to envision along which lines they have to think if it were them that entered a new sector or if they wanted to ‘disrupt’ themselves.

Trenches and unfair advantages

A company should ask several questions on the path towards disruption.

– What are the unfair advantages of the company?

Rich and well-equipped companies have unfair advantages and actually there is no problem with this until a competitor comes and disrupts these unfair advantages.

– What kind of ‘trenches’ protect the company?

For instance in the pharmaceutical industry it is a protective trench that it can take 10-15 years to develop a molecule, which is followed by another long period of testing – these cost millions of dollars. However, nowadays revolutionary new technologies make it possible for market players to appear in niche segments in just 1.5 year–4 months.

– How will the company be profitable if the value it creates today is going to become available for free?

Today this is already a big question in the telecommunications sector: if users pay for the internet service with not money but data, how can a classic service provider survive?

– What will technology make possible in 5 years’ time?

Self-driving cars are a good example: if these will dominate, what will be their impact on mobility, the real estate market or shipping?

Turning disruption into action

Three domains must be considered when turning disruption into action:

Zoom in/zoom out:

Instead of focusing on operative problem solving all the time, companies should regularly take a step back and look at the situation and future scenarios from a distance.

Corporate immune system:

Every company has an immune system that needs ‘maintenance’. Firms should watch out, because this often reacts to new things as they were threats – an ‘autoimmune reaction’ – in order to preserve the status quo!

Sustainability:

This may be a buzzword today, but it is a fact these days that every manager needs to make business decisions with the future of their children in mind. //