A new industrial revolution
The world around us is often described as increasingly volatile, complex and ambiguous. We see signs of accelerating change and exponential growth in a number of different areas, such as the increasing speed of technical development and digitalization. Some claim that we even walk faster in cities today than what we did a few decades back.
Perhaps it is not so strange that eighty per cent of all companies already run some type of change projects. Not seldom several change projects are running in parallel, sometimes completely paralyzing the whole organization. The problem is that seventy per cent of all planned changes fail to reach their goals, and there is nothing to indicate that the future will be more forgiving, quite the opposite.
Academia has provided several different explanations as to why big and well-established companies fail to adapt to the changes around them. There are theories ranging from economic cycles, creative destruction and disruptive innovation, to organisations becoming inflexible with age, that successful companies become the victim of their own success, but also that the destruction is brought about by poor, misdirected and irrelevant strategies combined with poorly executed implementation and change management, and a strong internal resistance to change.
To me, these explanations offer great potential. Because many of them fall back on areas which a company management team have an impact on through continuous renewal and revitalization.
Basically, realizing that change is the only constant is a good start.
Simply said, if you continuously listen to weak signals, and work to understand the evolving playing field early on, you have time to take action proactively, long before it is too late. Then, you can even contribute to actively shaping and co-creating the future. If not, you may instead become a victim of circumstance.
Continuous change and renewal has however proven to be extremely difficult to mature companies. Why is that? Perhaps because the majority of companies are so busy delivering their results here and now, that the future and the world around them remain unchartered land. Maybe also because it is easier – and feels safer – to focus on the present (or even the past), rather than making the effort to explore what the future could bring.
What’s interesting here is that this is nothing new. For example, economic history helps us see and understand that certain patterns repeat themselves over time – and that it’s not for the first time in the history of the world that there are old and new generations of companies. Or, that the new generation renders the old one irrelevant.
The first industrial revolution began during the latter half of the 18thcentury and was established in the 19th century, with the increasing use of the steam engine. When the second industrial revolution commenced in the last third of the 19th century, confirmed by widespread use of electricity in the 20th century, companies of the old generation soon became irrelevant. Partly also because of the introduction of new management theories for effective leadership of large, industrial organisations (Scientific management).
We are currently most likely experiencing yet another industrial revolution – or technical wave – currently manifested through the many possibilities of green technology and the Sustainability Revolution. From the creation of something new follows creative destruction of the old – of that which is no longer effective, relevant or attractive enough to customers, consumers and investors. Almost like the natural cycle of life. We are born, grow up, mature, age and die. This time, it’s the old energy giants that struggle: “As climate challenge intensify, clean tech may reshape business models and consumption partners”, as stated by the Visual Capitalist in their History of Innovation Cycles overview. Personally, I believe what lies ahead is even more disruptive than that. You can read more about some of the drivers behind sustainable investment here.
Still, the development is moving too slowly considering the vast challenges that are currently facing humanity and our planet.
Why not explore the Better Business Acceleration Program to get up to speed? It’s designed to help business leaders and organizations surf the waves of the Sustainability Revolution, to build Better Business and a Better Future.