How to win the technology arms race
How do leaders make decisions in a world that is changing faster than ever before? According to one of the most sought-after thought leaders on radical innovation, it will take a new kind of leadership, mindset and training.
Serial entrepreneur, adviser, keynote speaker and author, Peter Hinssen, shares his insights on the most pressing issues business leaders face today. In this interview, Hinssen explains the impact technology has on the business landscape, the necessity for change and the urgency for innovation.
Q: The past few years have been about industry disruptors and unicorns. However, these do not reflect the majority of businesses. What does the future hold for more traditional companies?
A: They must find ways to reinvent themselves to stay relevant. What I am interested in are the phoenixes. Under pressure, phoenixes transform and reinvent themselves. One example of this is Walmart. It's fascinating to see where Amazon, the aggressor of the 21st century is heading. However, we see that Walmart is transforming and will probably compete very well with Amazon. When it comes down to it, it is an arms race against technology. Technology plays a huge part in understanding the customer and scaling up. Even Walmart has to become like a tech company, and that is something they have understood and have taken advantage of.
Right now we see that there is a cultural disruption and an innovation disruption. Could you explain what these mean to you?
Cultural disruptions means we have to completely re-think leadership. Leadership in the 21st century is about speed and agility and making decisions when you don't have all the ingredients.
We cannot keep innovating as we did in the past, which was longer cycles, slower times. We have to prepare ourselves for taking risks and experimenting. Leaders need better radars and more experimentation. This includes the willingness to try new things even if they blow up in your face. When you have done something that works you need to scale it up.
What are the biggest threats businesses will face in the next 3-5 years?
There is an absolute economic boom at the moment. Everything is going great. Unemployment is very low almost everywhere around the world. Business is booming, the economy is booming. But many people are bracing themselves for a recession. What is probably going to happen is that globally, the economy will not be able to sustain what it has in the past few years. At the same time, technology has been transforming work.
Technology becomes a big part of how companies look at the future. If you put that together in a world where we will have a lot of economic pressure and technology replacing many activities, from an economic point of view, we are left with a very interesting cocktail. One of the fundamental problems is that business schools are still teaching things from the 20th century.
An MBA is a totally outdated concept. If we keep putting leaders into training that does not work anymore, we are going to have a lot of frustration. We must rethink leadership and leadership training because this is a completely different age.
With an economic decline and technology advancements on the rise, how should leaders rethink the future of work?
Much faster way than we're doing today. Today, you see companies thinking about the future of work and saying, 'Oh! New offices! We must replace the walls!' But it's going to take more. We have to think what work means in the 21st century, how technology will affect that and how we will brace ourselves for when times might not be economically that great.
There is an aspect of psychology that if you do not have control over your own destiny you become frustrated. People are feeling like they do not have that control anymore. Skills are changing, jobs are changing, the world is chaining. They find themselves thinking, "Am I going to be able to cope and is someone going to take care of me?"
It could be your corporation that takes care of you by helping you retrain or re-skill. Our government should that takes care of us as citizens, employment and work. Schools should take care of us and make sure that we are trained to have the proper competencies moving forward.
Where should leaders look for innovation inspiration?
We now hear many people who feel that their companies do not know anything about what is happening, the government is completely clueless about all of these changes, and the education is the slowest moving part of society. What is interesting is that this is happening on a global scale. Some regions are better than others. All of the sudden this technological change has become a geopolitical thing.
Traditionally, many of the new technologies came from a very small 400 square kilometer room in silicone valley, that is where all the action came from. In the past three years, we have seen the polarization has shifted completely to Asia. Most of the tech and innovation is coming from China.That is where you find people who are completely optimistic about the future, they really believe that this is the golden age. AI, automation robotics, even simple apps; China is in the lead. If business leaders want to stay ahead in terms of technological advancements, they need to look to China.
Is there a cheap, practical way leaders can prepare for the future?
Reverse mentoring. Now there are bright, young people joining companies every day and they are an amazing lens into the future. They are closer to the future than you will ever be in your entire life.
Peter Hinssen lectures at various business schools such as the London Business School (UK) and MIT in Boston. He has founded nexxworks to help organizations become fluid, innovate and thrive in 'The Day After Tomorrow'. He will join Oslo Business Forum on April 4th, 2019.
Interview by Emily Northway