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The four forces of technology, policy, business models, and social dynamics work together to create industry disruption, as explained in the comprehensive book Future Tech: How to Capture Value from Disruptive Industry Trends, by Trond Arne Undheim.
It is not just technology alone, but alignment between these four forces that determine market success. Mastering the dynamics of this interaction is key for success in the future of knowledge work.
Trond Arne Undheim is a futurist, venture partner at Antler and Hitachi Ventures, ecosystem evangelist at Tulip, co-founder of Yegii, and former Director of MIT Startup Exchange. He was earlier National Expert for e-Government at the European Commission, and hosts the Futurized.co podcast.
The book provides a broad sweep of macro-level disruptive forces, as well as micro-level approaches to build insights capacity for capturing value from industry trends. The material is well-researched, with a 28-page bibliography and a 40-page appendix of influencers, events, and digital tools.
Success in a fast-changing world will come from not just an intellectual grasp of these four forces, but also visualising connections, cross-fertilising between different domains, becoming an entrepreneurial tinkerer, and engaging with ecosystem players like mentors and startups.
“We are about to see the most severe split of haves and have nots in several hundred years: those who fully embrace, and are able to sustain, systemic risk and those who do not,” Trond cautions.
The powerful role of the environment has also been heightened by the coronavirus pandemic (the environment strikes back), and potentially the biggest crisis of all, “extinction-level climate change”. The COVID-19 pandemic has boosted demand for video-conferencing, and for VR in the long run.
The book draws on other frameworks like PESTLE (Political, Economic, Social, Technological, Legal, and Environmental) analysis, and expands on others such as SWOT and Porter’s Five Forces (rivalry, bargaining power, substitutes, new entrants, buyer power).
One chapter is devoted to each of the four forces of disruption: tech, policy, business models, and social dynamics. Together, they constitute the “social biosphere of innovation,” with a blend of systems and ecosystems.
Insights for each force can be drawn from academic, industry, and government sources, which include consultancies and event communities.
Here are my key clusters of takeaways from the 310-page book, summarised as well in the table below. See also my reviews of the related books Innovation Ultimatum, Seeing Digital, Fintech Future, Out-Innovate, The Next Billion Users, and Machine, Platform, Crowd.
(Image credit: YourStory)
Science and Technology
On the tech front, the platform model increases chances of success, as seen in the rise of platforms for content, social media, ecommerce, and e-learning. Examples include Fiverr, Udemy, and Uber.
Classifying technologies helps identify patterns, relationships, and new spaces for innovation. Trond categorises them into emerging tech, infrastructure tech, common tech, mass-market tech, and legacy tech.
Prominent tech industry associations include CompTIA and BIO; other regional organisations include AAAS and ScienceEurope. Governments consult with such organisations, and come up with policies, regulations, instruments, and position statements.
Tech-savviness and innovation support of governments varies widely around the world. Trond cites government support of GPS, Internet, supercomputers, AI, MRI, and prosthetics as examples.
“Europe is a global trend-setter on tech regulation,” Trond observes. The EU also has a best-practice sharing network for e-government. Countries like China conduct Internet censorship, but other countries have done so as well at different times and in varying degrees.
Standards-setting, trade, cybersecurity, and big tech (FAANG) regulation are areas to closely monitor. Some standards are voluntary and industry-driven (e.g., GSMA, IETF, W3C, OASIS), others are mandated by government.
Government support for innovation comes from bodies like Swissnex and Innovation Canada. Trond cites useful reports like OECD Review of Innovation Policy, Bloomberg Innovation Index, and WIPO’s Global Innovation Index.
Government consultation processes should be open, participatory, effective, and coherent. Challenges for government include tech complexity, speed of change, and influx of new business models, Trond cautions.
Trond charts the rise of industries over the centuries, e.g., manufacturing and telecom (19th century), aerospace and software (20th century), and more recent sectors in the past decade like virtual industries, cannabis and 3D printing.
Tech forces like digitalisation have become the backbone for all industries. 3D printing could transform manufacturing as well as consumption, and mobility-as-a-service and autonomous vehicles will reshape transportation.
“The way industries morph into each other, change and interact, and evolve is not easy to observe in real time,” Trond cautions.
Startups are inspiring examples of technology innovators, and compete with incumbents who suffer from complacency, inertia and group-think. Clusters of startups are upending entire markets or segments, he observes; this drives incumbents to acquire them.
“Disruptive innovation occurs through inventing something new that customers may not have the imagination to perceive when presented with an early prototype,” he adds, pointing to Steve Jobs’ innovations at Apple as an example. Even methods like lean startup and design thinking can come up with “false negatives”.
Systematic approaches to business model design have emerged, such as bundling, subscription, open source, and crowdsourcing. “There is a creative aspect to business models that is often missed,” Trond cautions. Entrepreneurs sometimes take decisions based on intuition or hunches.
“Disruptive technologies tend to create their own business models, sectors, and entirely new value chains,” Trond explains. Research and analysis are not enough to succeed, in-depth engagement is called for.
“Full understanding requires participating in the solution to see what it really entails, not reading about it. The fact that many corporations are flocking to startup partnerships is evidence of this trend,” he adds.
Trond identifies four sub-forces of social dynamics. Social groups include startup founders and developers. Political, environmental and health communities are examples of movements.
Generations (Gen X, Gen Alpha) and cultures (national, sectoral) are other components of social dynamics, but care should be taken to stay away from restrictive stereotypes. Each cluster varies in perspectives, habits and buying power.
As examples, Trond shows how the Segway had excellent technology and patents, but failed in terms of business model, form factor, and unresolved relationship with regulators. Google Glass failed in the consumer sector, but pivoted to the enterprise market.
Innovations from radical innovators “defy common wisdom, focus groups, and expert advice”. They rarely succeed, but when they do, it is in “surprising, society-altering ways,” Trond observes.
Five technologies that matter
Based on disruptive power and ability to interact with one another, Trond identifies five key technologies to watch: AI, robotics, 3D printing, synthetic biology, and blockchain. They are also being accelerated in the pandemic era.
Trond analysed the growth and impact of each of these technologies from the four forces identified earlier. For example, AI-enhanced perception and autonomous driving will scale up, but workforce regulations and ethical frameworks will impact growth of AI.
Robots are finding social acceptance in work conditions where they take over tasks that have danger, difficulty, and drudgery, or in controlled environments such as surgery. In the consumer realm, robots will be used for more disinfection and cleaning due to the pandemic effect.
3D printing spurs rapid prototyping, co-creation, on-demand production, and less dependence on global supply chains. However, the social dynamics are still largely unknown, Trond cautions.
In the field of synthetic biology, some countries have a moratorium on GMO. But useful applications include new synthetic materials across industries, bio-design, and bio-computing. Trond cites synthetic rubber, bio-acrylic, bio-plastics, and bio-fuels as examples; future trends include 3D printing of live cells, gene repair, and wearable robotics.
Social dynamics such as lack of awareness about the complexity of blockchain is a challenge, Trond observes. But uses cases such as the UK land registry and Dubai’s digital city are emerging.
In each area, the author identifies a range of promising startups and players, such as Desktop Metal, Formlabs, Markforged, MX3D, Neuralink, iRobot, Thermo Fisher Scientific, Stratasys, and Bitwage.
The micro-view: polymaths, insight ecosystems
Two chapters in the book provide a fascinating glimpse into the world of polymaths, and what habits we can ourselves imbibe.
Earlier, polymaths include Aristotle, Ibn Khaldun, Leonardo da Vinci, Marie Curie, and Nikola Tesla. More recent polymaths are Steve Jobs and Elon Musk.
Some of their outstanding characteristics include passion for knowledge, learning from first principles, integration across disciplines, systematic note-taking, and embracing the beginner’s mindset.
It is important to be an expert in two or more domains, and immersed in a dozen others (Pi-shaped expertise). Trond distinguishes between inter-disciplinary, cross-disciplinary, multi-disciplinary, and trans-disciplinary capabilities.
Each of us needs to develop our own “personal growth toolkit” to acquire diverse information, improve absorptive capacity, deliberate on decisions, and scale up our capabilities. Strategy frameworks or mental models should be combined with a point of view, an empirical mindset, and skills in pattern recognition.
“When learning is put together with contextual opportunity, we create insight,” Trond explains. These can be used to plot timelines for a year to a decade ahead. Stamina, self-confidence, micro-learning, experiential learning, lateral thinking, assertive expression, and willingness to learn from failure are called for.
Hours of exposure to a field or activity are not enough – it is important to commit to active learning, have utilitarian goals, and desire to make an impact. Skills like drawing mental maps and sketching for industry value chains also help.
Trond provides a wealth of resources for those who want to track and harness emerging tech trends, including books, biographies, podcasts, research reports, newsletters, communities, events, and digital tools. The “insight network” should also include mentors, influencers, colleagues, and friends.
Activities like scenario planning and engaging in open innovation partnerships with accelerators are also recommended. Following macro-trends is common, but one should observe micro-trends as well.
“Experts tend to forget to look in the most obvious places, and forget to use their common sense,” Trond cautions. Hence, it is important to cultivate multiple perspectives and empathy.
The author urges readers to set a clear goal of becoming “10 times more insightful” in a year. He cites Oliver Wendell Holmes: “A moment’s insight is sometimes worth a life’s experience.”
As useful examples, Trond lists reports from CB Insights, Forbes lists of innovators, MacArthur Fellows, The Midas List, as well as dozens of Twitter accounts of industry influencers.
Large events may be energising for some attendees, while others prefer small forums with intimate networking. Publishing one’s views on social media helps being “in the know and in the flow.”
The road ahead: human enhancement
The book ends with examples of how technology is helping humans make a cognitive leap. They range from brain-machine interfaces to bionic limbs.
The kinds of emerging roles in future include developing new machines, tweaking them, or integrating with them. We can set boundaries for their intervention in our lives, or develop new ethics for human-machine interaction, the author describes.
“If we keep learning, our technological future can be bright, both as individuals and as a collective, and it can serve the greater purpose of building a human future – a place where we can all thrive,” Trond affirms.
In sum, this is a must-read book for startups, corporate innovators, academics, and policymakers. The focus on alignment of forces beyond just technology and the practical tips on improving one’s own insights capabilities are particularly useful in an era of fast and global change.
YourStory has also published the pocketbook ‘Proverbs and Quotes for Entrepreneurs: A World of Inspiration for Startups’ as a creative and motivational guide for innovators (downloadable as apps here: Apple, Android).