Here’s what it means for business

In 2006, Nokia was the global leader in mobile phones, growing by double digits. They were rated as the eighth most innovative company in the world, according to BusinessWeek. What could go wrong?

Turns out, a lot.

In 2006, Nokia invited me to lecture on driving growth through innovation to an elite group of 50 of their “high potential” managers who would fly to Palo Alto from around the world. A pre-session poll I took should have tipped me off about Nokia’s next dilemma. I asked about barriers to innovation, half expecting them to leave the question unanswered. Instead: “We are risk averse.” “Our operational mindset dominates” and we suffer from “big corporation syndrome.”

I still remember asking this group a question: “If I work for you and I have an idea, what do you want me to do with it? One manager spoke up and said, “I would just advise you to forget it. In this company, you’re just going to frustrate yourself; there’s so much red tape that you’re not going to get anywhere with this idea.”

I passed on what I had learned about Nokia as an anomaly: “Rapid growth covers many sins.” But a year later Nokia discovered otherwise. In 2007, Apple introduced the iPhone and Nokia began its spectacular fall from grace. They were woefully unprepared for the inflection point that suddenly confronted them.

We are about to face the biggest economic and social tipping point in history and, like Nokia, we are unprepared.

Futurist Ray Kurzweil defines the Singularity as a period during which the pace of technological change will be so rapid, its impact so profound, that human life and business will be irreversibly transformed. We’re almost there, and the influences are everywhere.

Simultaneous revolutions are happening at the same time: in business, in society, in geopolitics and in the climate. Over the next ten years, industry after industry will experience exponential change. Customer needs will change overnight. New technologies will appear at a record pace. The workforce and the type of talent that will be needed will be radically different. In my work, I’m seeing many companies caught off guard by the future Singularity. I believe the single biggest problem organizations will face is the challenge of rapid change. In 10 years, research suggests that forty percent of the 500 largest public companies will no longer be around.

Intel, once led by a CEO (Andrew S. Grove) who wrote “Only the Paranoid Survive” was caught serving the PC and data center markets. Intel missed the smartphone trend. Ten years later, they missed the AI ​​revolution. But rival Intel saw the opportunity and pounced. Nvidia repurposed its chips designed for video games and started using them to power the AI ​​Revolution.

Boeing faces its own Singularity Moment. Once the company’s commitment to safety and quality was second to none. Their catchphrase was “If it’s not Boeing, I’m not going.” Boeing swallowed rivals, expanded from airplanes to military equipment to missiles. The Saturn V rocket that powered Apollo 11 to the Moon was proudly manufactured by Boeing.

But then he took over the bean counters. Today Boeing appears in an endless loop. Two of its 737 Max planes crashed, killing hundreds of passengers all because, various investigations have revealed, Boeing tried to avoid the costs of retraining pilots.

Two astronauts, aboard a Boeing-built Starliner spacecraft, arrived at the International Space Station on June 6, 2024. They expected to stay for a week. But due to an embarrassing series of technical failures they are still there. They will not return to Earth until February. NASA calls Starliner “very dangerous.”

Meanwhile, rival SpaceX is making the most of the Singularity Moment. Their Falcon 9 rockets are driving unprecedented growth and market share. The Falcon 9 was developed at a fraction of the cost it took Boeing to develop comparable systems. CEO Elon Musk’s insistence on a fixed-price, milestone-based payment model led SpaceX to adopt a leaner and more innovative engineering approach. Boeing limped along with the traditional cost-plus business model.

To thrive and prosper in the next decade, organizations and their leaders must face the ever-increasing pace of change and the need to constantly disrupt or be disrupted.