The Great Acceleration: Death Of Traditional Business Model

As we enter the second year since the start of Covid-19 the world is certainly a changed place. With changing customer preferences, disrupted supply chains, turbulent economy, and long-term uncertainty. The new normal has changed the rules of survival, and this comes out as red flags for businesses that are already declining.

In this article, I will lay out three phenomena accelerating the decline of the once traditional business model so you can make the right shifts in your own business model to transform successfully.

Start Of The 5th Technological Revolution:

According to Prof. Carlota Perez who has studied technological revolutions in her seminal work of Technological Revolutions And Financial Capital says:

Each paradigm has a trigger point. And my analysis is that Covid-19 is the trigger point of what post-internet revolutions. Revolutions are triggered when current conditions become inept to do business the normal way.

Any technological revolution impacts both the social and economic side of businesses and changes the way of the business. In the 5th Technological Revolution, The power of AI, IoT, 3D, robots, blockchain will shape up the new economic value dimension for businesses and societies.

Destruction Has Been Part of The Game Anyway:

According to Schumpeter, the forces of creative destruction are the essence of growth and prosperity in a society, especially in the capitalistic world of today. Schumpeter believed these creative destruction forces come in the form of innovation powered by technology, making many forms of business obsolete.

Gale of creative destruction “describes the” process of industrial mutation that continuously revolutionizes the economic structure from within, incessantly destroying the old one, incessantly creating a new one.

This is seen across human history right destruction of the cotton cottage industry to the end of mom-pop businesses around the corner.

The Age Of Discontinuity:

According to the great Peter Drucker, we are living in the age of discontinuities that prohibit our predictive abilities to correctly gauge how exactly the future will unfold. The drivers of this age are 1) technological developments 2) complex world economic structure 3) socio-political matrix 4) knowledge capital. What this has resulted for businesses is throwing the 100-year organization out of the window. Today the lifespan of an S&P500 company is less than 10 years.

What do these three phenomena mean for you as a business strategist?
Build the future of your current business into your existing business. This dual approach is one of the most prominent approaches for leading the tides of the future safely.

This post was created with Typeshare