February 08, 2019
The Creative Destruction Revolution Is Here - and No Industry Will Ever Be the Same Again
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This past month, a Washington Post story title read as follows: “Walmart’s latest hire: Robotic janitors that clean floors and collect data”. The story, like so many of late, referred to Walmart’s entry into the AI Universe by partnering with the company Brain Corp to outfit the retail giant with autonomous robot custodians that can clean the aisles and collect data in the process. The retailer already has a fleet of more than 100 of the devices operating inside its stores. The robotic “maintenance” workers are nothing more than the latest notch of a rapidly growing trend toward automation where machines are quickly replacing work that used to be performed by individuals, several individuals in fact.
Automation is just one of the quickly converging forces and trends that promise to disrupt entire industries and wipe out entire sectors in the process. For individual employees, this prospect is understandably terrifying. According to a McKinsey Global Institute report released last year estimates that as many as 800 million people may lose their jobs to robots by the year 2030. This heralds a massive amount of disruption in the world of work with companies and organizations having to create new roles for entirely new demands in their markets.
For companies, the challenge is no less daunting. Imagine for a minute about the vendors who hold maintenance contracts for Walmart and other big box chains. These companies, as in many others will see their businesses wiped out by the arrival of machines who can perform twice the work for half the costs in the long run. It’s a temptation that no organization can afford to resist. And, for companies whose core services are not replaced in part or whole by automation, the threat of disruption is no less real as even peripheral competitors will surely leverage these emerging technologies to perform services that may impact their business.
The conclusion is truly hard to miss. As these emerging trends and technologies converge, there are very few, if any sectors and industries that will be immune to complete or partial disruption. Companies are increasingly at risk with the velocity of change ramping up when they continuously miss opportunities to adapt or take advantage of these changes.
Disruption is coming, but there are concrete steps that every organization should take to prepare for the coming waves:
It is almost impossible to stay ahead of the curve and be aware of every single technology that may or may not have an impact on your business. However, if you create an internal team whose focus is to research, dissect, discuss and make the business aware of emerging trends, ideas and customer shifts, you will be better prepared to take advantage or mitigate them as they appear on the horizon.
Most companies focus on their customers’ need for their services or products without considering how it may be used in conjunction with other services in order to get a job done. Most customers are seeking convenience, speed, and results and are willing to pay a premium to get it. If you spend time understanding your customers’ needs through focus groups, observation, and feedback loops, you may begin to see some emerging trends as well as some unforeseen needs. This will help you stay ahead of their shifting demands and needs.
As a rule, you should know what your weak spots are as a business. If not, take the time to find out by using specialized teams to come up with ideas of how they would disrupt your business as a competitor. You would be surprised about how much you learn about your vulnerabilities and what you should be thinking about in the future in order to guard against eventual disruptors. The driving question should always be how you would disrupt your business if you were a competitor who looks at the market very differently. This will always force you to understand your customers better and put your business model under a microscope and learn how well it works under a stress test.
Most companies wait until the threat of competition is at their doorstep to begin thinking about innovation or to guard against disruptors. That is a result of short-term thinking. The time to begin building the evolution of your business model is now. Develop internal teams made up of external stakeholders (clients, partners, supply chain vendors etc) and begin putting together a business model that integrates where your customers might be in the future and how their expectations might evolve. Companies should learn how to create the future while keeping the core business going at the same time.
The age of disruption is upon us, but with a little bit of planning and foresight, you don’t need to be one of its latest victims.
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