The “gales of creative destruction” forecast by Austrian economist Joseph Schumpeter in the 1940s are blowing as hard as ever.
The twin disruptive forces of tough economic times and technology-driven innovation are giving birth to new innovations, new markets and new opportunities.
Just this month the family-owned US media institution that is the Washington Post sprung a huge surprise, announcing it was selling up to Amazon founder and dot com billionaire Jeff Bezos. While the media industry is undergoing huge disruption right now, few saw that move coming and there’s plenty of speculation about how that might play out.
But disruption and ‘creative destruction’ have been a feature of the corporate landscape for decades. Kodak and Polaroid are two of the most well-known victims of this process. Back in the 1970s Polaroid was one of the so-called ‘nifty 50’ largest stocks on the NYSE, with a huge army of skilled engineers, while Kodak sold 90% of the film used in the US.
Neither was quick enough to foresee and react to the rapid disruption of digital technology and the move to digital photography. When disruption happens it is often swift. Polaroid filed for bankruptcy protection in 2001 and Kodak in 2012.
From shop assistants and financial traders to engineers and celebrities, all our jobs, skills and industries are under constant threat from technology-driven disruption.
A glaring modern example is the decline of the high street video and DVD rental store. These have been overtaken and replaced by online streaming companies who offer the latest movies and TV series delivered instantly to your TV, PC, tablet or smartphone, anytime and anywhere.
The high street companies involved didn’t innovate and the superfast pace of technology overtook them.
But a central line of the creative destruction theory is the idea of a process of constant renewal through innovation. While disruption clearly poses threats to established ways of doing things, it also presents huge opportunities both for existing legacy businesses and nimble new start-ups. When those gales start howling it’s a case of adapt or die.
Here are 4 powerful technological forces the I believe will drive disruption, innovation and opportunity in all areas of business and society in coming years and decades.
1. The internet of things A world where everyone and everything is connected. Sensors in everyday objects and devices will be capable of automatically transmitting data over high-speed networks. Those previously ‘dumb’ objects will then become ‘smart’ objects capable of automated machine-to-machine (M2M) communications.
2. 3D printing This technology opens up amazing possibilities for individuals and businesses, with fully working parts able to be created at the touch of a button and for a fraction of the cost of doing it previously. Already 3D printers have been used to create everything from toys and parts for NASA’s Mars explorer to medical implants.
3. Graphene The development of the super strong and highly conductive graphene has huge implications for the traditionally silicon-dependant technology industry. Potential applications include flexible display screens, electric circuits, solar cells and use in medical, chemical and industrial processes.
4. Connectivity Ubiquitous connectivity through a combination of superfast mobile broadband, fibre optic fixed line broadband and wi-fi will drive massive changes in consumer activity and also the way we live and work, especially with faster, lighter and smarter mobile devices. Advances such as Google Glass are also just scratching the surface of connected augmented and virtual reality devices.
I’d be interested in hearing your thoughts on how your business is adapting to new technologies and what other technological forces you think will impact our world in the coming years.