Adapting to the NEXT Economy

A few years ago I went skydiving for the first and only time. The instructor informed us about an interesting feature of our brain: depth perception doesn’t kick in until you’re 200 feet above the ground, at which point it’s far too late to ensure a safe landing. You have to activate your parachute much sooner than your senses would advise, which of course is not something you can learn through trial and error.

I was fascinated to observe as I was plummeting through the air at about 120 MPH that there was no sensation of falling. Zero. No perception of speed or distance. It was like hovering above a very large (and windy) photo of the world. We pulled the chute and dropped even closer to the earth. My instructor reminded me, “very soon it will feel like the ground is suddenly rushing towards you, but we’re not going any faster than we were. It’s just your brain’s depth perception kicking in.” And she was right.

Organizations today are going through their own version of free fall. Yet unlike skydiving, it’s not just distance that’s changing… it’s the entire economy and ecosystem in which we operate. Like our brain’s depth perception, our sensors aren’t kicking in that we need to change something, and fast. It’s not as simple as pulling a chute. There is no chute. It’s not enough to do something different… organizations must become something different. They need to learn how to fly.

The adaptation imperative

We’re seeing an urgent need for businesses, NGOs and governments to fundamentally adapt to a new economy, one that we call NEXT. The NEXT economy is:

Networked.

We all know that the internet and social media have made a profound impact on our society. From Arab Spring to the Internet of Things, networks are enabling new connections and opening up new possibilities. Yet most organizations treat networks as something “out there.” A new tool for customer or employee engagement, a new way to recruit donors or sell more stuff… essentially a new way to do business as usual. Silos, not systems, still reign supreme. Organizations must gain network perception: they are simply one component in a much larger, networked ecosystem… not separate from communities, customers, competitors, NGOs and the environment, but intimately connected. We’ll be writing more about what network perception means and how to apply it.

EXposed.

Because everything’s connected and networked, there’s nowhere to hide. If you sell consumer goods, you should hop over to www.goodguide.com, a consumer window into what’s in your products and how responsible is your business. This is just the tip of the iceberg; GoodGuide’s new relationship with Target and Walmart’s impending Sustainability Index at POP mean that consumers everywhere will be able to compare brands based on much more than price. NGOs are more easily publicizing missteps via social media, indices like DJSI provide a new lens for investors, and sites like GlassDoor enable employees to reveal what working for your company is really like. Expect significantly higher levels of exposure in the years to come. Ask yourself: what should your organization stop doing, start doing, or change in this increasingly exposed environment? Does your org structure support authentic brand creation and risk mitigation? Most CMOs aren’t empowered or informed to do what’s required to protect and grow brands in today’s transparent environment.

Thrifty.

If you haven’t yet read The End of Growth by Richard Heinberg (or another with the same title by Jeff Rubin that I have not yet read) I recommend that you do so. Our entire economic engine is built on a faulty theory of unlimited resources, unlimited debt, and uncapped growth potential. We have created a disposable, consumption culture that fundamentally cannot be sustained. Companies must apply network perception to expand their scope of responsibility beyond the four walls, not only to supply chain but to what you sell, how you sell it and what happens to it later.  New thrifty models are emerging like the Sharing (or Collaborative) Economy that will have profound impact on large, established organizations. Design thinking, innovation and “job to be done” versus “what we make” will be the new mode of operation in the coming years.

Our big news

We will be folding Fruitful Strategy in Q1 of 2014 and launching a new company based on NEXT principles that will usher organizations through curated, collaborative learning journeys towards becoming adaptive leaders. We believe that the traditional consulting model is part of the old paradigm (closed, proprietary, siloed) and that NEXT service firms will be more like sherpas and mentors, less like outsourced brains. Measurable outcomes rather than PowerPoints will be the new standard. We’re looking for exceptional, like-minded thought leaders to join our cause; we’d love to be a platform for you. We’re also seeking a handful of organizational leaders who might be interested in co-creating your adaptation with our curated team of experts; we’d love to brainstorm what this could look like.

 

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