Corporate Success Metrics for the 6th wave of Innovation (2020-2045)

 

Corporate Success Metrics for Sixth Wave of Innovation (2020-2045)

 

The Software based algorithmic companies of 5th wave of innovation expanded scope of measurement of company’s performance by processing newly available and stored interaction-data - through Balanced Score Cards, , ERP based enterprise systems and their multiple evolutions

PROBLEM CONTEXT:  As failure is known to be an orphan and success becomes a progeny of many parents, finding the real parameters of success of any organization in claims of published stories, is not an easy task. Long-term survivability could itself be a parameter. Irrespective, financial performance is considered the de-facto representation with robust performances year-on-year. The 5^th wave however created peculiar type of companies – unknown to previous wave world - first the Internet based dot com companies and then the platform companies.  When the world transitioned from 4^th wave of innovation to 5^th wave of innovation (1985-1995) driven by software and digital networks, it led also to a new ability to collect and store customer, processes and employee interaction data.   Given the availability of data, combined with easy availability of personal computers, data-base technologies and spreadsheet packages performance evaluation scope of a for-profit organization, its metrics and mechanisms for evaluating them through data-processing systems, expanded to include non-financial metrics such as customer satisfaction, internal company process-efficiencies, employees performance and response times of various client facing services. The Enterprise Resource Planning (ERP) systems helped in massive transformation through integration of broken stand-alone enterprise processes.

Given the deeper understanding of last 30 years with newer, faster and more robust technologies and understanding of social-networks embedded within any formal human organization structure, many new views have emerged that points to potentially different metrics on hitherto unknown and unknowable phenomenon of human interactions and performance that contribute to success or failure of a company. 

As we have stated and claimed, that the world is undergoing a new churn or creative destruction through newer technologies (Industry 4.0 and Sixth wave of innovation) that started impacting around 2015 and will be deepening through 2025, will there be new metrics of corporate success that will emerge? What will they be, if yes? If no, then will these technologies be just add-ons or incremental to already existing 5^th wave technologies?

PROBLEM (s):  An assessment method (s) is needed to answer (a) are these changes really creative destruction of the type/kind we experienced and that have been detailed for periods 1945-1955 and 1985-1995? (b) What are these technologies and how they will impact the ways and means to create economic value through the existing “company” structures? (c) the Algorithmic companies, read google, amazon, uber, facebook, etc, utilized the new resource – the algorithms to create new value. The exclusive use of the new resource – the algorithms – turned out to be a strategic surprise for the energy-matter-electricity based companies of 4^th and 3^rd wave. Will the new resource of (i) algorithmic intelligence and upcoming (ii) quantum computing change the nature of the company as a vehicle for value creation to the same or more than the extent the algorithmic companies changed the energy-matter-electricity resource-based companies? (d) What will be the new phenomenon by a 6WoI company that we need to measure and how? What will be the changes in the 6^th wave to the existing phenomenon of 4^th and 5^th wave companies that need to be assessed and how? How will existing phenomenon of value creation morph in the 6^th wave through new technologies of algorithmic intelligence and quantum computing? (e) What are the dimensions of user/buyer/customer value that will change in 6woi? What existing dimensions will morph and what dimensions

Initial thinking points to the availability of data at multiple levels of granularity and scale – which was hitherto a very bland set of data. The data-richness gives possibilities of data-fungibility to surface variety of meaningful views. The metrics emerging will also need models to explain the rich-data.

will become dormant?

POSSIBLE EXPLORATORY THOUGHTS (s): 

1. 6WoI provides rich-data available – Emerging business models that exploit the multi-resolution, multi-perspective, deep-granularity of real-time and historical data provided at a high data rate and giving processing of rich multi-granular data through classifiers, learning algorithms and high-speed networks will need newer metrics to indicate performance and also measure the impact on the financial metrics

2. 6WoI companies may actually be run-time integrators of multiple companies, platforms and systems that are unimaginable as of now – new lenses (theoretical) and practical may be needed to discover and apportion fair and real value of each player who provides the final service or product to the customer who may never own it.

3. 6WoI companies will be in complex interplay of Employee-Bot systems working with Customer-Bot systems – these interactions will require multi-dimensional mechanisms designs and operational orchestrations that will need newer ways to measure them through newer metrics.

 

One can have multiple scenarios of future studied as 1-3 above (which are anyway not Mutually Exclusive and Comprehensively Exhaustive). I propose, we will revisit this problem after few more themes are explored, problems discussed and our understanding of 6WoI and its impact gets crystallized. I believe this problem is too early to be discussed at this point. I would definitely like more understanding and deeper view.

 

 

About the Author Navneet Bhushan (Navneet) is the founder-director of Crafitti Consulting. He is the leading expert on innovation and principal author of Strategic Decision Making- Applying the Analytic Hierarchy Process, Springer-Verlag, UK, published as part of the Decision Engineering Series and featured at the Harvard Business School. He consults on strategy, innovation, military/defence and intellectual property. He can be contacted at navneet.bhushan@crafitti.com.

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