As businesses are increasingly exploring and feeling anxious about the latest technology trends such as business digitisation, artificial intelligence, and blockchain, I am reminded of the famous work done by futurist Joel Barker in the early nineties. He elaborated on a few very important factors that influence business and our daily lives when paradigms shift. Simply put, a paradigm is a set of rules or patterns that shape the way we think about and do things. In most instances, businesses and even industries operate according to a set of paradigms prevailing at the time.
A number of interesting points that Joel Barker mentioned are still very true. The first being that when a paradigm shifts, everyone goes back to zero. One famous example here is the collapse of the video rental industry. Another is that paradigm shifts are very often introduced by outsiders and currently we are experiencing how concepts such crowd sourcing (non-banks) are changing lending paradigms. Cryptocurrencies were not introduced by central governments, and may yet change the payments paradigm forever.
Coming back to the world of business digitisation – in their book “Digital to the Core,” Gartner mentions three factors that can lead to a paradigm tipping point, i.e. when a number of factors coincide at a point in time that facilitates a business model change. These are technology, culture, and regulation. Technology enables new business models, e.g. the internet enables online stores, mobile networks create global instant connectivity, and artificial intelligence will change the nature of human professions and labour.
Culture shifts the consumer’s mind-set to interact with providers differently. Online shopping is a very clear example, in some first world cultures this is now common practice, whereas some developing economies are still getting to grips with the concept.
Finally, regulatory shifts remove legislative roadblocks and enable new business practices. As an example, when import regulations change, it can fundamentally enable or destroy industries.
The point we are making here is that every organisation must constantly review their own paradigms, and work hard to make the shifts before someone else makes it for them. It takes courage and leadership but the result can be either prosperity or a long recovery journey.
From a technology and approach perspective, we need to invest in flexible architectures and agile methodologies. We must experiment, fail fast, learn from our mistakes and restart the cycle. Lessons should be learned from other industries, considering that today’s global consumers are exposed to multiple industries instantaneously, and are not only comparing the products and services they buy, but also the user experience.
Joel Barker importantly states that ‘the role of leadership is to find, recognise, and secure the future.’ I am dedicated to this pursuit.
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