Small changes, big differences and the need for redefining enterprise purpose
It amazes me how delicately balanced things in life can be. Even when things seem to be stable and predictable, small changes can completely change the status quo. As a keen skier, I know only too well the risks of sudden blizzards turning a beautiful day in the mountains into a potentially dangerous situation, or delicately poised snow cornices becoming avalanches that destroy everything in their path in a matter of seconds.
The principle of small changes resulting in big differences can be applied to many areas of life and attempts have been made to understand causes and effects using models like Cusp Catastrophe theory. The cusp model (which was first proposed around 50 years ago), has been refined for situations as diverse as sports psychology and mechanical structure failure, but in the ever-changing world of digital technology, it can equally be applied to the way that related business models behave and are perceived. A careless data breach can destroy the trust of on-line service users and result in crippling regulatory fines; ethical concerns over the application of digital technology can render otherwise compelling business models worthless; and geo-political differences in attitudes to data privacy can lead to damaging competitive bias.
You might argue that such risks are not particularly new, but the speed and impact of their potential realization seems to be ever growing. The increasing ubiquity of digital services, the complexity of their interconnections and the scale of influence mean that well-positioned businesses can exploit network effects to almost monopolistic advantage. But get the balance of trust and fair value-exchange wrong and that network effect can work in reverse.
In Journey 2024, the latest thought leadership report from the Atos Scientific Community, which I co-chair, we use the term “cusp” to describe the kind of sudden disruptive changes that businesses and societies can be exposed to in the digital world. In mathematical terms, the word cusp describes a point on a curve or a surface where a moving point makes a sudden change in direction – we extend this as a metaphor for an enterprises’ “Path to Purpose”. There will be many digitally related disruptions that businesses are exposed to – anticipating them, recognizing them and responding appropriately to them (sometimes with radical realignment) will make the difference between thriving, surviving and perhaps dramatic failure. The current pandemic, whilst arguably much more than just a disruptive cusp (in that it has led us into truly uncharted territories), has shown the necessity of responding appropriately to sudden uncontrollable disruptions. Those businesses that have been able to adapt, even to unforeseen changes, are the ones that are successfully navigating the crisis. Those that found themselves unable to respond have struggled or even failed.
The interesting observation is that many of the change responses we are observing are not just operational ones, we are starting to see changes to the very core of business purpose. There is an emerging imperative not merely to solve today’s pressing business goals, but to tackle tomorrow’s long-term challenges concerning things like sustainability, decarbonization, inequality, security and the ethical impact of IT.
As a race, we are remarkably resilient and adaptable to disruptions that arise. The question we have to address is whether or not our digital business models are equally as adaptable and resilient. The pandemic showed that some businesses believed they had effective digital strategies but were not able to scale up in areas like remote working, online services and supply chains. However, those businesses that had deeply transformed their digital operations, embraced web-scale IT architectures and adopted platform ecosystem models (for resilience, data-driven automation and value exchange), were best placed to ride out the storm.
It is likely that meaningful responses to the business, technology and societal challenges that lie ahead will require enterprises to rethink their nature and purpose.
The question remains as to how business and society will collectively respond to the challenges that lie ahead. But it is likely that meaningful responses will involve enterprises rethinking the core of their nature and purpose.
I invite you to read our recently published thought leadership report, Journey 2024, where our Scientific Community anticipates technology and business trends that are expected to bring and respond to some of the greatest disruptions (both positive and negative) over the next four to five years.
Data and Artificial intelligence;
Ethics & Digital Society;
IoT & Edge;
Quantum computing & HPC