Welcome to the Transformation Age
By admin on Oct 16, 2016 | In Business Value | No Comments »
MidasMoments: Rob Slee’s Comments on the Nation
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All of the ladder climbing that I describe in “Time Really Is Money” happens in a business age. Every so often, the rules of business change. In the past 200 years this has occurred several times. First came the Industrial Revolution, which in the early 19th century ushered in the Industrial Age. John Henry may have beaten the mechanical spike-driver in lore, but machines have dominated in every other way for more than 150 years. Next came the Information Age, which began in the 1950’s with the arrival of computers and reached a climax in the 1990’s with the explosion of the Internet. Computers changed the way we work, making complex jobs easy and enabling routine tasks to be performed at ever-lower costs. During this Age, knowledge workers and MBAs reigned supreme.
On September 11, 2001, we entered the Conceptual Age. The United States was thrust into a global war with terrorists. At about the same time, China entered the World Trade Organization. The combination of these events birthed the Conceptual Age and thrust U.S. businesses into a global war of their own. The Conceptual Age marked the intersection of globalization, logistics, and advanced technology. This age is defined by multi-dimensional thinking, and required business owners to conceptualize their way to success.
As we entered the second decade of the new millennium, a new age of business dawned: the Aggregation Age. This Age reflected the reality that firms around the world had evolved and learned to leverage their intellectual capital in ways that were not possible just ten years ago. Firms aggregated their industry spaces without actually owning them. The mantra of this Age was to control, not own, your sphere of influence.
We have now entered a new age of business called the Transformation Age. Nearly all business models in every industry are being transformed. John Mauldin has been writing about the Age of Transformation for the past year or so. He and I believe this Age is marked by multiple and rapidly accelerating changes happening simultaneously. These changes are transforming our social structures, our investment portfolios, and our personal futures.
This is an Age where whole brain thinking is a must; where orchestrating a network, ala Uber, is the best and quickest way to exploit the “sharing” economy. “Network orchestrators” are the Transformation Age value architects, and they employ transformational business models to intentionally disrupt traditional markets. The intersection of technology, the Internet, and the need for mass customization is creating an almost zero marginal cost society. As a result, the Internet of Things, renewable energy, and 3-D printing are becoming the norm, and not the exception.
A major differentiating characteristic of the Transformation Age is the shift to almost zero marginal costs. Marginal cost is the cost of producing additional units of a good or service, if fixed costs are not counted. Jeremy Rifkin, in his book “The Zero Marginal Cost Society”, discusses the move toward a sharing economy based on a shift to almost zero marginal costs. According to Rifkin, automation and sharing services will replace traditional means of production, rendering the marginal cost of products and services close to zero.
As I discuss in TRIM, climbing the vLadder in the Transformation Age is a challenge, and requires the owner to work on different activities, remaking themselves in the process. I have a sign on my wall that captures this thought:
If you want something you’ve never had,
You have to do something you’ve never done
Let’s get busy doing things we’ve never done. And remember, the choice of how high you climb in this Age, and thus how wealthy you become, is purely yours.
– Rob
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