{"id":12467,"date":"2015-07-20T09:54:53","date_gmt":"2015-07-20T08:54:53","guid":{"rendered":"http:\/\/timoelliott.com\/blog\/?p=7404"},"modified":"2015-07-20T09:54:53","modified_gmt":"2015-07-20T08:54:53","slug":"eating-disruption-for-lunch-digesting-decentralization","status":"publish","type":"post","link":"https:\/\/timoelliott.com\/blog\/2015\/07\/eating-disruption-for-lunch-digesting-decentralization.html","title":{"rendered":"Eating Disruption for Lunch: Digesting Decentralization"},"content":{"rendered":"<p><a href=\"https:\/\/i0.wp.com\/timoelliott.com\/blog\/wp-content\/uploads\/2015\/07\/pacman-disruption.jpg?ssl=1\"><img data-recalc-dims=\"1\" loading=\"lazy\" decoding=\"async\" class=\"alignnone size-medium wp-image-7412\" src=\"https:\/\/i0.wp.com\/timoelliott.com\/blog\/wp-content\/uploads\/2015\/07\/pacman-disruption.jpg?resize=608%2C456&#038;ssl=1\" alt=\"eating disruption\" width=\"608\" height=\"456\" \/><\/a><\/p>\n<p>In the industrial age, businesses grew large because services that were centralized were better.\u00a0 Railroads and electric power companies are two examples of industries where companies expanded to improve the services they delivered.\u00a0 The bigger they became the better they could service their markets.<\/p>\n<p>In the paradigm shift that\u2019s emerging in 2015-2020, technology is enabling de-centralization.\u00a0 Think how Tesla\u2019s creation of a standalone battery to power a home or office, eliminates the need for an electric utility company.\u00a0 3D printing, Internet of Things, smart watches and mobile technology are enabling people to de-couple from businesses.\u00a0 The implications for businesses today are vast.<\/p>\n<p>In the Game Changers Radio series hosted by Bonnie D. Graham, Futurists Frank Diana, Gray Scott, and Timo Elliott discussed &#8220;<a href=\"http:\/\/www.news-sap.com\/eating-disruption-for-lunch-digesting-decentralization\/\">Eating Disruption for Lunch: Digesting Decentralization<\/a>&#8220;.<\/p>\n<p><video src=\"http:\/\/cdn.voiceamerica.com\/business\/011537\/sapdigital052615.mp3\" poster=\"http:\/\/www.voiceamerica.com\/\/content\/images\/host_images\/011537\/SAPDigital-player-wide.jpg\" preload=\"none\" controls=\"controls\" width=\"608\" height=\"400\"><\/video><\/p>\n<p>[<a href=\"http:\/\/cdn.voiceamerica.com\/business\/011537\/sapdigital052615.mp3\" download=\"\">Download MP3<\/a>] [<a href=\"https:\/\/itunes.apple.com\/us\/podcast\/digital-world-game-changers\/id966714798?mt=2\">itunes<\/a>] [<a href=\"http:\/\/www.voiceamerica.com\/account\/addepisodetolibrary\/85565\">Bookmark Episode<\/a>]<\/p>\n<p>Below are some of the key notes from the show &#8212; and you can join us for <a href=\"http:\/\/www.voiceamerica.com\/show\/2428\/digital-world-with-game-changers-presented-by-sap\" target=\"_blank\">part two of the show<\/a> on August 5th, 11 AM EST, 5PM CET.<\/p>\n<p><a href=\"http:\/\/twitter.com\/frankdiana\">Frank Diana<\/a>, Futurist, TCS<\/p>\n<blockquote><p><i>&#8220;The challenge is to rehearse the future and prepare for a range of possibilities\u201d Fast Future Research<\/i><\/p><\/blockquote>\n<ul>\n<li>The centralization so core to industrialized society is giving way to decentralization.\u00a0Driven by enabling technologies like 3D Printing, the Internet of Things, and Renewable Energy, decentralization and democratization will drive a massive paradigm shift.\u00a0This same decentralization rips at the foundation of our organizations, as centralized command and control structures give way to an enabled edge that is unencumbered by the legacy and culture of the core.<\/li>\n<li>Disruption on a massive scale is likely, and it will be continuous with no period of stabilization. This lack of stabilization makes this transformative period different from previous ones.\u00a0The exponential progression of technology and science is at the heart of an emerging paradigm shift \u2013 but institutions and humans are linear entities: the shift is from linear to exponential.\u00a0The characteristics required to survive in this exponential world are not part of the DNA of most institutions.\u00a0This exponential progression spawns a mounting number of disruptive scenarios that collectively, even if they each play out 10%, are massively disruptive<\/li>\n<li>The challenge is to rehearse the future and prepare for a range of possibilities.\u00a0It is critical for leaders to embrace scenario thinking.\u00a0\u00a0These scenarios create disruptive stress or disruptive opportunity &#8211; and organization viability is linked to how well they rehearse the future.\u00a0Scenario thinking involves the analysis of scenarios to understand opportunities, risks, obstacles, accelerators and the identification of and experimentation with potential responses.<\/li>\n<li>In line with the notion of decentralization comes the shift from vertically oriented value chains to horizontal ecosystems. The connected car, the Smart Home, and Connected Healthcare, are all examples of this shift.\u00a0This is another element of the paradigm shift, as firm-centric, me-oriented thinking must give way to we-oriented ecosystem thinking.\u00a0However, thinking in the context of value creation and capture across an ecosystem of stakeholders is challenging, and fundamentally different than the current firm-level (business model) perspective.<\/li>\n<li>Famous economist Jeremy Rifkin believes we are moving closer to a Zero Marginal Cost society, where our current notion of work changes dramatically.\u00a0Andrew McAfee in his work on the \u201cThe Second Machine Age\u201d believes we are heading towards a world where people will no longer need to work. Even knowledge work, once believed to be something that only humans could do, will be automated in the future.\u00a0Many like McAfee believe a Government-provided living wage is on the horizon.<\/li>\n<li>We are at the early stages of realizing a new general purpose technology platform\u00a0\u00a0that ushers in the most transformative period in history.\u00a0General purpose technology platforms must have three components: energy, communications , transport and logistics.\u00a0The last two general purpose technology platforms were: Industrial revolution One: energy (steam engine), communication (printing press), Transport (railroad); Industrial Revolution Two: energy (oil), communication (telephone), transport (car, highway).\u00a0The emerging general purpose technology platforms is: energy (renewable), communications (internet), transport and logistics (IoT, 3D printing, autonomous vehicles, etc.).<\/li>\n<li>The law of disruption states that while technology progresses exponentially, businesses change incrementally.\u00a0This creates a gap for killer apps that the market rushes to fill.\u00a0This gap is getting wider, and the opportunity for low cost new competitors and market entrants is growing. Incremental business change is no longer sufficient.<\/li>\n<\/ul>\n<div><a href=\"http:\/\/twitter.com\/grayscott\">Gray Scott<\/a>, Futurist<\/div>\n<div><\/div>\n<blockquote>\n<div><i>\u00a0\u201cNothing comes unannounced, but many can miss the announcement.\u201d \u00a0&#8212; Terence McKenna<\/i><\/div>\n<\/blockquote>\n<ul>\n<li>The future will be automated, decentralized, digitized and eventually simulated.\u00a0By 2035, our homes, cars, and most of our jobs will be automated.\u00a0Automation will decentralize and disrupt almost every industry.<\/li>\n<li>The world economy will face a new future filled with 3D printers, personal Artificially Intelligent (AI) assistants, and digital real-time healthcare applications that we can access on our personal smart devices.<\/li>\n<li>Right now, we have a Star Wars economy.\u00a0An economy based on scarcity, paywalls and resource hoarding.\u00a0However, innovations in technologies like automation and 3D printing could create an economy more like Star Trek, enabling us to explore our creativity and our dreams.<\/li>\n<li>Decentralization will enable the individual to produce the products they need or desire in the near future.\u00a0The true age of decentralization will begin when 3D printers that can print other 3D printers become ubiquitous.\u00a0In the future the consumer is also the manufacturer. 3D printers can print circuit boards, fabric for clothing and chocolate.\u00a0<i>What more do you need?<\/i><\/li>\n<li>The idea of the corporation may no longer be necessary in the future.\u00a0Raw materials will be the new big\u00a0business.\u00a0We may not need factories and megastores in the future but we will still need raw materials for the individual.<\/li>\n<\/ul>\n<div><a href=\"http:\/\/twitter.com\/timoelliott\">Timo Elliott<\/a>, Global Innovation Evangelist, SAP<\/div>\n<div><\/div>\n<blockquote>\n<div><i>&#8220;Status Quo is, you know, Latin for \u201cthe mess we\u2019re in.\u201d \u2014 Ronald Reagan<\/i><\/div>\n<\/blockquote>\n<ul>\n<li>Disruption can be very painful if you\u2019re not the one doing the disrupting.\u00a0The ability to disrupt and absorb the blow of being disrupted becomes an essential core competence for organizations in the future.<\/li>\n<li>Decentralization means new competitors, well outside traditional industry boundaries.\u00a0For example, Tesla is a car company that has just introduced home batter solutions that will take revenue away from electricity companies.\u00a0And the latest competition to car companies is a software company: Google, that announced they\u2019ll be selling their own self-driving cars.\u00a0And a software company is taking on the banks \u2014 Facebook launched the ability to easily send money to another user, taking away a lucrative niche from traditional institutions.<\/li>\n<li>Disruption has to be a core competence.\u00a0To be game changing, you have to figure out what game you\u2019re playing \u2014 go back to the core of the job customers are trying to do when they purchase your product.<\/li>\n<li>One of the best ways to deal with disruption is to constantly do what you would if you were just starting out.\u00a0A lot of the pain of disruption is psychological.\u00a0It\u2019s not who you are that holds you back, it\u2019s who you think you aren\u2019t\u2026<\/li>\n<li>Companies need to stop focusing energy on fighting the old, and instead nurturing the new.\u00a0This is painful, because it means\u00a0threatening your existing product lines.\u00a0Few things guarantee failure faster than the safe option \u2014 by definition, breakthrough products disrupt current lines of business.<\/li>\n<li>Decentralization applies to companies, too \u2014 business departments are now more empowered than in the past. Marketing departments now spend more on IT than the IT department.<\/li>\n<li>The old centralized command-and-control organizational style doesn\u2019t work anymore.\u00a0\u00a0There\u2019s a lot of tension between the center and the edges \u2014 we need new ways of organizing\u2026<\/li>\n<li>There\u2019s a huge opportunity to disrupt with new business models.\u00a0Famously, people don\u2019t buy quarter-inch drill bits, they buy quarter-inch holes.\u00a0Now the opportunity is to use all these great new technologies to sell them \u201cquarter-inch holes as a service\u201d<\/li>\n<li>Decentralization has a lot of benefits \u2014 but some real costs.\u00a0There\u2019s a lot of needless duplication, and it can make it very hard to do things that are good for everybody, like have defined standards that permit interoperability.\u00a0For example, some form of central control becomes more important than ever.<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>In the paradigm shift that\u2019s emerging in 2015-2020, technology is enabling decentralization &#8212; and the implications for businesses today are vast. <\/p>\n","protected":false},"author":2,"featured_media":12812,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":false,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[7],"tags":[197,367,398,518,519,618,863],"class_list":["post-12467","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-interviews","tag-business","tag-decentralization","tag-disruption","tag-game-changers","tag-gamechangers","tag-innovation","tag-radio"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"https:\/\/i0.wp.com\/timoelliott.com\/blog\/wp-content\/uploads\/2015\/07\/pacman-disruption-608x456-2.jpg?fit=608%2C456&ssl=1","jetpack_sharing_enabled":true,"jetpack_shortlink":"https:\/\/wp.me\/p3X9RF-3f5","_links":{"self":[{"href":"https:\/\/timoelliott.com\/blog\/wp-json\/wp\/v2\/posts\/12467","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/timoelliott.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/timoelliott.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/timoelliott.com\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/timoelliott.com\/blog\/wp-json\/wp\/v2\/comments?post=12467"}],"version-history":[{"count":0,"href":"https:\/\/timoelliott.com\/blog\/wp-json\/wp\/v2\/posts\/12467\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/timoelliott.com\/blog\/wp-json\/wp\/v2\/media\/12812"}],"wp:attachment":[{"href":"https:\/\/timoelliott.com\/blog\/wp-json\/wp\/v2\/media?parent=12467"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/timoelliott.com\/blog\/wp-json\/wp\/v2\/categories?post=12467"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/timoelliott.com\/blog\/wp-json\/wp\/v2\/tags?post=12467"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}