Obviously, Covid-19 has brought massive uncertainty to businesses. From managing remote workers, to internal communications dominated by video platforms, to the devastation of small business buyers and consumer budgets, the ‘new normal’ would have been barely recognizable at the beginning of 2020.  Make no mistake, the pandemic disrupted business.   

But is the pandemic the root cause? Are business leaders looking forward to the day they can go back to the way it was before?  

To think so is to miss out on what’s really happening. The world has endured 3 massive economic disruptions in the first 2 decades of the 21st century, including the dotcom bust and 9/11, the Great Recession of 2008, and the current pandemic-caused economic devastation. The US experienced Covid-19, #BLM, political turmoil, an insurrection on the nation’s capital, and a massive power failure in Texas, in less than 12 months.   

Is disruption itself the new normal? Will the business world continue to face disruption from new technology innovation, natural disasters, pandemics, and social turmoil on an ongoing basis?   

Disruption, like innovation, should not be, “Oh, well, that’s somebody else’s problem.” What’s important to understand, is that the pandemic is part of a larger disruption. 

“The pandemic is part of a larger disruption.”

Leaders hoping for a “return to pre pandemic normal”, are looking myopically at the current situation. They need to take a step back and recognize the new world we live in. “It’s a Small World” was written by Robert and Richard Sherman for the 1964 World’s Fair in New York City. Think about how much smaller the world is today.   

All corners of the globe are intricately connected. In 2019, there were 1.46 billion international tourist arrivals around the world. The number of people using mobile phones worldwide is 4.8 billion. 73% of them are smartphones. Human beings with computers in their pockets have access to information held by a relative few a mere decade ago. This information can be powerful. It makes the world complex. The cliche of a butterfly flapping its wings in the Amazon wreaking havoc on the other side of the world is almost visible in real time. 

“The very structure, processes, and the way we manage people inside society’s institutions are changing.”

The bigger disruption is this: the very structure, processes, and the way we manage people inside society’s institutions are changing. 20th century business management  is based on the extension of the assembly line. But we are no longer in the 20th century. The Industrial Age no longer describes the world we’re living in.   

As technology innovation has moved to the edge, from massive computers in big business, government, and research institution data centers to massively powerful smartphones in nearly every consumer’s pocket, society has become increasingly complex. Consumers have more knowledge about companies and products than ever, and with knowledge, comes power. They are able to figure out which products best serve their needs.   

As I wrote in my upcoming book Disruption Proof, “As the digital revolution reaches the edge of the economy, i.e., consumers, technical risk is less problematic than market risk. The risk to business is less “can we build the product” than “should we?” Customer insights represent an important and vastly underappreciated intellectual capital versus, say, patents.”

The very structure of our organizations is fundamentally transforming to meet the new challenge.

Call this the digital age or the information age; call it whatever you’d like. But, the very structure of our organizations is fundamentally transforming to meet the new challenge. This is true in corporations, startups, education, government, and so on. They must change in order to deal with the uncertainty brought on by increasing complexity and continuous disruption. 

“Companies must be nimble and move fast.”

Businesses must be closer to the customer; understand them deeper. They must be able to respond to change. Product design, marketing, and selling must be responsive to their needs and desires. Overall, companies must be nimble and move fast.  

We need to rethink work: What is the behavior we need to see in the Digital Age?  What does leadership look like? How can we reinforce the behavior?   

Next post, I will dig into how to think about business in the 21st century.  We can’t stop the continuous disruption, we must adapt to it.