Looking for sustained success? Walk on the Edge
DSM started out as a state-owned mining company and is now an international chemistry group. Computer company Apple put music in their business plan and won the jackpot with iTunes. Both organisations were not afraid to widen their horizon and kept close track of the developments at the edges of their industries. You, too, may discover your future business on the edge of your current one.
18 november 2013
What use would a property development company have for 3D printing? What can traditional power companies learn from the increasing amount of renewable energy being generated locally? Do drones have relevant applications for your business? And why do hospitals and doctors need to know that digital applications are on the rise that allow people to make their own diagnoses at home?
Most companies focus on their core business. Questions like these barely cross their minds, either because they don't know the answers or because they are simply not aware of developments like these on the edges of their industries. The reason is that most companies are based on 19th-century business models. They focus on predicting demand and allocating cash as efficiently as possible, which worked fine in a relatively stable economic landscape.
But those days are over, as the steadily decreasing lifespan of products and declining profitability of companies show us. We are currently in a Big Shift, that consists of three waves. The first one: the incredible worldwide growth of our digital infrastructure in terms of bandwidth, computer power and data storage. This is leading to higher productivity, more transparency and better connectivity.
The second wave of the Big Shift is the increasing flexibility of knowledge, talent and capital. Thanks to better connectivity, sharing knowledge is easier than ever; but still many companies remain inward-looking. Talent is less and less inclined to commit to a single company that will put them in a straightjacket, and organisations often attract financing by other means than the traditional bank, for example by crowdsourcing.
The third wave of the Big Shift involves the ability of organisations to adjust their company's fundamentals to these developments, and how that affects markets, companies and individuals. The main thing holding back organisations now is increasing competition, but research shows that their performance will improve once they learn to adjust to their changing environment, and actively participate in knowledge flows outside of their own organisation.
So there is certainly hope, but do you know where to start? How do you investigate the edges of your industry? Since 2007, Deloitte's Center for the Edge in Silicon Valley has been exploring possibilities for traditional and new companies to capitalise on the Big Shift. Executives from all sectors can come to us for clear advice on how to make the most of opportunities on the edges of their industry.
This week, the Center for the Edge will be opening a European branch, as we think Europe and the Netherlands hold a wealth of hidden innovation power. Power that we can harness with you by seizing the opportunities that revolutionary new developments bring for your business.
Are you ready to explore the edges of your industry?
John Hagel is the co-chairman of Deloitte's Center for the Edge in Silicon Valley. Wassili Bertoen is the Director of Center for the Edge Europe and co-founder of Deloitte Innovation BV. For more information about Center for the Edge Europe, please contact Wassili or take a look at our new app.