“How do we move to an exponential approach to innovation,” asks John Hagel, director of Deloitte’s Centre for the Edge in the latest Decoding the New Economy video.
The Centre for the Edge is Deloitte’s Silicon Valley-based think tank that identifies and explores emerging opportunities related to big shifts that are not yet on the senior management agenda.
John tells us how the cycles of change and innovation have varied over the last 30 years in the industry: “The biggest thing for me is that nothing is stabilising. I often go back into history and look at things like electricity, the steam engine and the telephone – all hugely disruptive to business practices.”
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“But the interesting pattern is they all had a burst of innovation and then a levelling off,” he says. “You could stabilise and figure out how to use all this technology.”
“With digital technology, there is no stabilisation.”
That lack of stabilisation leads to what John has termed ‘exponential innovation‘ where he sees business and education being rapidly transformed as technology upends established practices and methods.
Healthcare, financial services and “any industry that has a high degree of information content” are the sectors currently facing the greatest challenges, John says.
He sees the solution for businesses and managers in looking at the current era not as a time of technology innovation but of institutional innovation; that institutions, like companies, have to reinvent how they are organised.
Reinventing well-established companies or centuries old bureaucracies is a massive challenge, but if John Hagel’s view is right then that radical change to institutions is what is going to be needed to face a rapidly changing society.
For smart, agile businesses, an era of exponential innovation is an opportunity to grab an advantage over larger and clumsier rivals. Are you up for that challenge?