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Transformation & the Future of Innovation

January 27, 2017

 

This week I’ve spent every early morning catching up on world news — and it’s been a little trying, to speak euphemistically. But this morning a story that didn’t mention US politics at all managed to cut through — this piece by John Battelle. Like John, I believe that the third wave of the connected era is not about disruption, but transformation. In a business context, we define transformation as “a thorough change that simplifies market problems with attainable solutions that benefit consumers and/or the enterprise.” Thorough is really the key word here — transformation is thorough, whereas disruption is merely a disturbance or interruption to an otherwise continuous state.

 

Business thinkers no less forward-looking than Steve Case agree — in a recent interview about his excellent book “The Third Wave,” Case says “as entrepreneurs finally leverage the ubiquity of the internet, they’ll finally be able to transform the largest sectors of our economy.” And in his summary of CES, ad industry philosopher Rishad Tobaccowala uses the word disruption, but truly describes a transformation in the depth (AI), breadth (IoT) and modes (VR/AR/MR/Voice) of connection impacting the third connected era — the one he predicts will create the most wealth and competition of the three. 

 

Why does transformation, versus disruption, matter? When companies and industries transform the ways they invent, create, produce and distribute goods and services, they redefine and shift economies and societies. I’m a Pittsburgher by birth, so naturally I think of the Industrial Revolution, which impacted the way people worked, got around, and lived, truly transforming the very nature of society. 

 

As investors, entrepreneurs and philosophers alike think about fueling innovation, forget about “disturbances or problems that interrupt an event, activity, or process”- aka disruption. We aim to capitalize transformation — and in so doing creating an entirely new slate of economic opportunity. 

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