Exponential Strategy

From Digitised to Democratised

Will Franks
Dec 27, 2019 · 5 min read

We live in the Exponential Era. And it’s a headfuck. But understanding the principles that drive exponential innovation can help us see the mechanisms driving the changes — and how we can utilise them to build a better world.

With digital technology, we can create projects and service that are:

“Infinitely reproducible at next to no cost, accessible to anyone, anywhere, anytime”

Let’s unpack how that becomes possible, using Peter Diamandis’ 6D’s of Exponential Organizations [1]:

  1. Digitalise — Once something becomes digitized, it can be replicated and sold for close to zero cost.
  2. Deceive — Doubling in growth appears as slow progress while the digital technology is in its infancy.
  3. Disrupt — Doubling in growth of a small technology starts to result in massive, disruptive growth. As a result of 30 rounds of doubling, a technology will see about 1 billion-fold growth! This is highly disruptive to industries (think about the exponential growth rate of megapixels in cameras, or of processor speed in computers.)
  4. Demonetise — This is the process by which technologies and services move from costing money to becoming available for free. (Enter the Zero Marginal Cost economy.). Removing paywalls makes the technology accessible to anyone.
  5. Dematerialise — Once a service has become digitized, it is no longer bound by material constraints such as location, size, time. Which means it can be accessed anywhere, anytime. A great example is digital photography which was expensive because it required both physical camera and processing of negatives. You would receive one physical copy of each photo. But this whole process is now free and super high resolution on your smartphone; photos can be copied, shared and distributed globally without limit. For free!
  6. Democratise — As a result of digitizing and demonetizing, the services become available for everyone on the planet. What’s more, the crowd can comment, iterate and improve the service — that’s crowdsourcing. There are 3 billion people connected via the internet today and this will grow to 8 billion people by 2025. Free Wi-Fi is everywhere…..but we used to have to pay a $1/min.

And here’s a snazzy image summary:

Exponential Organisations

How do these principles translate to the design of organisations?

“An Exponential Organization is one whose impact (or output) is disproportionally large — at least 10x larger — compared to its peers because of the use of new organizational techniques that leverage accelerating technologies.” [2]

An exponential organization can be characterized by an “MTP — Massive Transformational Purpose” (a strong and ambitious vision) and at least 4 of the following 10 attributes that are leveraged to achieve the exponential growth (adapted from [3],[4]):

SCALE — External attributes

  • Staff Development — Don’t let your staff become obsolete before your eyes. Encourage continuous learning and actively leverage a global workforce to get: diversity; the best of the best; creativity; up-to-date skills; confluence of culture, training, experience and skills.
  • Community and Crowdsourcing — Leverage the creativity and power of the global digital community. Use or create a platform to automate peer-to-peer engagement and build a vibrant and active community.
  • Algorithms — Leverage algorithms wherever possible to take full advantage of big data and spot interesting trends/patterns (think Amazon, Google, Uber, Airbnb, etc.).
  • Leveraged Assets — Wherever possible leverage assets without purchasing them. When the asset is information based or commoditized, accessing is better than possessing. Only own an asset if it is rare or hard to access (Airbnb does not own any properties and Uber doesn’t won the cars). In short: be lightweight (digitalise, de-monetise, de-materialise).
  • Engagement — Enable collaboration with, and the participation of, your online community. Even better, make your organisation collectively owned (cooperatives, crowdfunds) and governed (democratise).

IDEAS — Internal attributes

  • Interfaces — Automate, wherever possible, the interfaces from the external organisation attributes to the users. For example, Google does not manually give its users data for Adwords. This is all automated. Similarly, Uber does not manually manage its drivers — this is done using automated interfaces.
  • Dashboards — All organisations need a transparent way to measure and manage themselves. This should be a real-time, adaptable dashboard with all the relevant metrics required to effectively run the organisation. Then these metrics must be available to everyone so all members know exactly where the organisation is at any time.
  • Experimentation — Organisations must experiment to create new ideas, strategies, products and services. This is all about taking controlled risks to leapfrog the organization forward. Innovation is not possible without a culture and practice of experimentation — as well as systems to assess, analyse and act upon the learnings of those experiments.
  • Autonomy — Give your employees/volunteers autonomy to do their work, choose their work, and operate the organisation in a decentralised way. Use a version of holacracy and/or deliberative democracy to enable this self-governance.
  • Social Technology — Use technology to create a virtual forum environment where organisation members can exchange ideas, concerns, challenges, etc. This creates a culture of openness, honesty and constructive feedback. This significantly speeds up the time between an idea, acceptance and implementation.

By implementing a “Massive Transformational Purpose” and as many of the above 10 attributes as possible, an organisation sets up the conditions for exponential growth.

I hope that’s insightful. This is really just laying some groundwork; the next post(s) will explore how we can leverage the above principles to respond to an exponentially accelerating global crisis, in ways that go well beyond simple tech-and-business solutions — exponential growth of the new world-system.

References

[1] Article: 6 D’s to Exponential Growth

[2] Book: Exponential Organisations by Salim Ismail

[3] Article: How to Make an Exponential Business Model to 10x Growth

[4] Article: How to Prepare Yourself for Exponential Growth

Predict

where the future is written