The butterfly effect of digital disruption

We’ve been talking about digital transformation for a while now and one of the things we’ve noticed is that many people still underestimate the impact of digital disruption. Most people manage to see the direct impact, but if you want to be ahead of the rest, you need to anticipate the indirect changes in the long term as well. We’ll explain it through an example here.

Let’s say Google announces in 2015 that they will be placing 5000 self-driving cars in Brussels, to transport business people from the edge of the city to the center and back. Does this sound to you like 5000 taxi drivers might lose their jobs? Let’s think further than that.

Google self-driving car

The business people in these self-driving cars can suddenly save themselves several hours a day, which they would otherwise spend behind the wheel. This time can be spent productively like writing a report of the meeting they just attended or even having another meeting in the car, which leads to less assistants and executives being needed in the long run. That is not the economic crisis taking jobs, it’s technology.

If this project became a success, it would be scaled up and implemented in other cities too. Imagine what this would do to car insurance companies with less accidents, less injuries and less damage happening. And what about the carwashes and car repair shops in the center of the city? Would people still listen to the radio as much now that they would be working instead of driving? Would they even look up at billboards anymore?

We can keep on going like this but you get the idea. A lot more than 5000 jobs would be at stake, because one change can set another in motion and the impact increases exponentially. You might think that we’re overreacting here, but remember that companies do not go bankrupt because all of their clients run away, they go bankrupt because just enough clients do.

We’re also not saying that if you own a carwash, you should close it as soon as self-driving cars are introduced in your city. Your business will still run fine for a while and hey, those self-driving cars will need to be cleaned too, how about a partnership? Perhaps the parking lots at the edge of the city will be an interesting spot to open up a new shop at in a while, rather than staying in the center.

So don’t throw your traditional business overboard. Instead, try to keep it profitable as long as possible, because this is the business you know best, the business that brings in the money and the value that creates your foundation for innovation. In the mean time, you need to take this disruption seriously and look into opportunities to continue to make yourself relevant in the future.

Now in reality we’re probably not going to see any self-driving taxis in Brussels just yet, as the existing taxi industry would stop this initiative through some rule that dates back to the dark ages, like they did with Uber. The point here is not whether this specific example will happen though. What matters is the butterfly effect; something that seems small can have a tremendous impact in the long-term. This is why you should take technology seriously, instead of making fun of it.

If you feel like you need help in transforming digitally and preparing for future disruptors, check out our book about Digital Transformation. It is a story of hope and opportunity, with a methodology to prepare you for your near and distant future.

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