Concept of Diagonal Progress for startup innovation
In 2014 Peter Thiel came up with an insightful book, 0 to 1 for startups and people affiliated to startups. The book highlights the concept of progress and divides the concept of “progress” into two further branches, i.e;
(a) Vertical Progress = Technology/innovation or 0 to 1
(b) Horizontal Progress = Globalization/copying/improvements or 1 to n
Peter Thiel portrays both of the concepts as an enemy (opposite forces) to each other, where he takes the side of Vertical Progress against Horizontal Progress, claiming that in the recent past companies and startups from around the globe have just focused upon duplication and replication of things, which stemmed from America initially. Other than this Peter Thiel gives an interesting insight on considering technology as any other product, rather than just limiting/associating the word with “digital, electrical or mechanical” products. We will follow the same meaning for technology that Peter Thiel provides.
The following image represents Vertical Progress as Technological (0 to 1) and Horizontal Progress as Globalization (1 to n).
According to Peter Thiel, 0 to 1 concept reflects something out of nothing (innovation), and 1 to n concept reflects many similar things out of something (copying). Peter Thiel sides with 0 to 1, calling it worthier than the other concept. This gives a very one sided approach for companies to practice, as well limiting the concept of innovation to only being inventive, whereas history of success shows that companies and startups, both have gotten success by practising any of the two concepts, and a lot of times by practicing both concepts simultaneously.
The following framework has been tweaked to integrate both the concepts:
The proposed tweak shown in chart above is based on the historical success of companies, as well as on the idea of reaping dual benefits from both the approaches. Leaving any one of the approach might keep a startup/company from reaping benefits and profits that the other approach might give.
Therefore concept of Diagonal Progress (0 to n) is derived, i.e Horizontal (technology) + Vertical (globalization) progress to cater the following points:
(a) Companies currently in globalization mode can improve over its products/services in terms of technological aspects to gain technological advantages. Scaling on the basis of globalization alone can be removed from the market if tomorrow a disruptive innovation takes place.
(b) People not into business yet can start from vertical technological progress and then move right to horizontal globalization progress to scale effectively. Scaling on the basis of technology alone can be costly, as well as non-eco friendly.
(c) People not into business yet can start from horizontal globalization progress and then move up to vertical technology progress as they survive and grow slowly with their early stage business. Scaling on the basis of globalization alone can cause stagnancy.
(d) Companies should refresh themselves and integrate the concept of “global products or technology”, and replace it with the concept of “globalizing technology”
(e) People and companies should incorporate revisit the meaning of “needs/wants” and bring back “human needs/wants” and replace it with “technological needs” or “globalization of needs”.
(f) A holistic approach should be taken keeping “stakeholders” in mind rather than “shareholders” in mind. This would give freedom in either going for globalization or technology, whatever is better to suffice the need of the market/consumers.
Practicing entrepreneurship and innovation through the lens of diagonal progress (global products/technology) is essential to the initiation and the survival of any startup.
