Wednesday, May 26, 2004

IT innovation in the next decade

De-captivating markets is my latest thinking out loud about the subject brought up in the post below. It begins,

I just realized what’s been missing from Clayton Christensen’s rap about “disruptive technologies”: most of his attention is on the customer side of the marketplace. It’s great stuff, but it misses the potentially critical role played by IT in keeping innovators out of dilemmas.

Got some nice help from Phil Windley on the piece. [The Doc Searls Weblog]

Looks worth a read. John Robb wrote about this issue a couple years ago — that the next CEO titans won’t be Gates or Ellison, but will be those who figure out how to apply the technology to their business problems.

This is also consistent with William Janeway’s comments at Red Herring Spring last week (link takes you to the Socialtext Eventspace we set up for Red Herring Spring). He talks about three steps in the IT-as-catalyst trend:

  • Innovators, where IT is the business (like Amazon, eBay, Google)

  • Competitive Innovators, where IT is used to extend a lead (Wal-Mart, Cisco, Dell)

  • Defensive Innovators, where intense competition forces deployment of new, IT-enabled processes

I think what John was pointing to (Peter Drucker observations about 21st century management challenges), what Janeway was discussing, and what Doc and Phil Windley talked about above are all linked: the next decade will be characterized by the Wal-Mart-ization of any and all businesses. Wal-Mart commoditized the logistics, which used to be where the friction and inefficiencies were. It places a premium on their hard-to-build and even more defensible just-in-time inventory management system. (Ditto with Dell.)

The end result: when IT is used well, it commoditizes workers who are there to manage and/or otherwise handle inefficiencies. Those that are left are what Drucker (and others) calls the knowledge workers — and the real IT challenge over the next decade will be finding ways of empowering those knowledge workers to collaborate more effectively. (There’s of course a whole separate discussion worth having about this commoditization and the resulting off-shoring of labor, but that’s not what I’m focused on here.)

This is where the real innovation is coming. That’s why the umbrella of “social software” is such an important (and often misunderstood) catalyst to the next stage of economic growth: if used effectively, it will empower groups to work together more effectively. (I’m distinguishing social software from social networking; social networking lets people link up, but doesn’t ultimately affect a group’s ability to work together.)

1 comment:

  1. Rick Klau (and others) on De-Captivating Markets

    Reflections on the Innovator's Dilemma.