Page 20 - CSA Speaker Bulletin September 2016 | CSA Celebrity Speakers

BOARDROOM DIALOGUE
The Myth of
Exponential Change!
Don Strickland is a former Senior
Executive at Apple, CEO of
PictureWorks and CEO of IPIX.
Currently Don is the President and
CEO of Strickland Associates and
serves as Adjunct Professor of
Innovation and Entrepreneurship
at Imperial College London.
The subject of thousands of
books, articles and speeches
is that today’s business
environment is changing rapidly and
that the pace of change is increasing
exponentially. Cited causes include
globalization, new business models
and big data, to name just a few. But
is it true? Is the world really changing Revenue is growing rapidly, but
at an unprecedented rate, or is it just
a convenient illusion that takes the
blame when a business fails?
“Irrespective of
industry sector,
businesses that
become data
driven are more
profitable than
conventional
businesses.”
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Economists have studied factory
output, inventory levels, supply chain experiences when they launch a new
metrics, product launches and much
more looking for hard evidence of a
faster pace of business. They found
that products aren’t being introduced
more frequently or getting through
the supply chain more quickly. And,
the odds of a company falling out of
the Standard & Poor’s Index remain 1
in 20, the same as the last 20 years.
What about Airbnb and Uber, two of
the most frequently cited examples
of exponential change? Aren’t they
growing exponentially?
It depends on what you measure.
each company’s underlying assets
(business systems, technology, etc.)
are actually quite stable. In their
case, the exponential growth is
nothing more than what any company
hit product – sales start at zero and
grow to a large number quickly. Within
a few years the exponential growth
becomes linear.
So, why do companies feel that
change is happening so fast? It is not
because the business environment
is suddenly changing faster. It is
because the flow of information is
increasing exponentially.
This information flow enables us to
see more of our business environment
and in real time. The business just
seems to “fly by.”
Irrespective of industry sector,
businesses that become data
driven are more profitable and
more productive than conventional
businesses. There are many steps
a company takes to become data
driven, but the most fundamental is
to learn to make decisions based on
correlation, rather than causation. If
there is a high statistical probability
that “A” is correlated to “B” make
a decision and take action. Do not
spend the time and money to try
to understand how “A” and “B” are
causally related. It is more important
to make a lot of decisions quickly than
to strive for perfection. In the new
world of data, perfect is useless! n