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Situation Normal,
Everything Must
     Change
Evolution
Impacts
 Cycles
 Today
Strategy
Diffusion, a common
     concept ...
Evolve ?




... doesn't explain
     evolution ...
However, there's a non
Ubiquity

           time based process of
                evolution ...
                                                  Utility


                                              Commodity
                     Product
                                                 Service



                               Custom Built
           Genesis

                                                 Certainty
... which we call
                  commoditisation
Ubiquity




           User

                                           ti on
                                  iti sa
                           m od
                    C om




                                                   Supply

                                                            Certainty
... which helps
explain the whole
       story.
Map evolution against ...




          Custom                  Commodity


Genesis               Product




                                    Evolution
... value chain. We can use
Value Chain

                   this to explain how
                   industry changes ...




                                   Evolution
... creating a cycle of
commoditisation driving
 higher order systems.
Hence Cloud ...




                  Product   Utility
Chaotic    As things evolve, their
          characteristics change ...
Chaotic                          Linear

                                Six Sigma




... which is why one size fits
   all methods don't work.
Evolution
               Impacts
                 Cycles
                  Today
... this cycle also has
              Strategy
 standard impacts ...
Creative
          Destruction


                        + Efficiency




                        $$
+ Value
Componentisation



                          + Efficiency




+ Agility


+ Value
Jevons

                   + More

                 + Efficiency




+ Agility


+ Value
... and it's not just activities (what we do)
that evolve but also practices (how we do
                    things) ...


                  ∆ Practices
                   ∆ Activities
... through a similar
       process.




 Novel        Emerging   Good        Best


Genesis        Custom    Product   Commodity
Often practices co-evolve
    with activities ...     Best




               Product

                                   Utility




                             Best
... creating inertia to
       change ...                    Best




              Product

                                            Utility

                      + Transition


                                      Best
... or a least one of the
    forms of inertia ...

                            Inertia
... which also occurs in
       vendors ...

                             Inertia



            + Past Success
... leading to three
 economic eras ...


             Peace / Margin




                          War / Disruption


 Build / Growth
Carlotta Perez




... which appear in every
           age ...
Peace / Margin
 Technology Diffusion

                                                Maturity

                                        Synergy


                                                 War /
             Build / Growth
                               Frenzy          Disruption

                        Eruption
... e.g. ....                                     Time
Technology Diffusion




                                    Organisations

         ... each state of war is
          associated with new
         organisational forms ...         Time
... those organisations being
based on the new practices ...    Best




                 Product

                                         Utility
                  Organisations

                                   Best
... hence we have a common
       cycle of change ...

                                       Inertia

                          Disruption


                                                 New
               Emerging



      Growth
... for every age ...          Mechanical
                               Components

                                        Inertia

                           Disruption


                                                  American
                Emerging                           System



       Growth
... ditto ...             Means of mass
                          communication

                                    Inertia

                       Disruption


                                              Web 2.0
            Emerging



   Growth
... ditto ...                  Cloud


                                    Inertia

                       Disruption


                                              Next
            Emerging



   Growth
... ditto ...




The next Age ?
2004
... ditto ...             Manufacturing


                                    Inertia

                       Disruption


                                              Next Next
            Emerging



   Growth
... also we see increases in
     unmodelled data ...

                                            Inertia

                               Disruption
     Data
                                                      New
                Emerging



       Growth
... which evolves ...


                        Algorithms

   Unmodelled                        Modelled



                   ∆ Practices
                   ∆ Activities
So what is happening
      today?




                 Today ...
... what we would
     expect ...                    Cloud


                                        Inertia

                           Disruption
    Data
                                                  Next
                Emerging



       Growth
... and also new forms of
      organisation ...
                            Web 2.0




       'Traditional'



                                      Next
... with different
                        Traditional       Next Gen
characteristics ...
          Structure    Departmental          Cell

              Focus        Profit          Disruptive

       Open source     Cost reduction      Weapon

             Scaling       Scale-up      Distributed

          Resilience        N+1         Design For Fail

             Failure   Disaster Rec.    Chaos Engine

           Learning       Analysts        Ecosystem

      Infrastructure     Enterprise      Commodity
Of importance ...
                       Ecosystem ...
Innovate
           Leverage




                        Commoditise
... and use of open as a
 competitive weapon ...




    Open Technology
    (open source, open data, open
hardware, open standards, open APIs,
            open process)
Open Technology
1. Drive adoption
2. Drive innovation (as in feature completeness)
3. Drive innovation (genesis higher order systems)
4. Drive efficiency
5. Undermine competitors barrier to entry
6. Enable formation of an ecosystem (ILC)
7. Protect an existing value chain      ... numerous
                                      strategies in the
                                             wild ...
Open Technology
9. Prevent competitors differentiating around a core
revenue stream (Tower & Moat)

10. Retention and recruitment of talent

11. On ramp to another product or service (open core)

12. Overcome an obstacle (insertion strategy)

13. Encourage formation of a competitive market
(interoperable play)

14. Avoid transition costs (standards play)
Open Source &
 the Next Age
       ... this will also matter in
              the next age...
... critical is understand
Ubiquity


             evolution ...
                                                     Utility


                                                 Commodity
                     Product
                                                    Service



                                  Custom Built
           Genesis

                                                    Certainty
Threat
Value Chain




                         Barrier


              ... understand the
                  landscape ...
                                        Evolution
Competing in an
      Open World
  Please complete our
survey - bit.ly/opensurvey

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Situation Normal Everything Must Change

  • 3. Diffusion, a common concept ...
  • 4. Evolve ? ... doesn't explain evolution ...
  • 5. However, there's a non Ubiquity time based process of evolution ... Utility Commodity Product Service Custom Built Genesis Certainty
  • 6. ... which we call commoditisation Ubiquity User ti on iti sa m od C om Supply Certainty
  • 7. ... which helps explain the whole story.
  • 8. Map evolution against ... Custom Commodity Genesis Product Evolution
  • 9. ... value chain. We can use Value Chain this to explain how industry changes ... Evolution
  • 10. ... creating a cycle of commoditisation driving higher order systems.
  • 11. Hence Cloud ... Product Utility
  • 12. Chaotic As things evolve, their characteristics change ...
  • 13. Chaotic Linear Six Sigma ... which is why one size fits all methods don't work.
  • 14. Evolution Impacts Cycles Today ... this cycle also has Strategy standard impacts ...
  • 15. Creative Destruction + Efficiency $$ + Value
  • 16. Componentisation + Efficiency + Agility + Value
  • 17. Jevons + More + Efficiency + Agility + Value
  • 18. ... and it's not just activities (what we do) that evolve but also practices (how we do things) ... ∆ Practices ∆ Activities
  • 19. ... through a similar process. Novel Emerging Good Best Genesis Custom Product Commodity
  • 20. Often practices co-evolve with activities ... Best Product Utility Best
  • 21. ... creating inertia to change ... Best Product Utility + Transition Best
  • 22. ... or a least one of the forms of inertia ... Inertia
  • 23. ... which also occurs in vendors ... Inertia + Past Success
  • 24. ... leading to three economic eras ... Peace / Margin War / Disruption Build / Growth
  • 25. Carlotta Perez ... which appear in every age ...
  • 26. Peace / Margin Technology Diffusion Maturity Synergy War / Build / Growth Frenzy Disruption Eruption ... e.g. .... Time
  • 27. Technology Diffusion Organisations ... each state of war is associated with new organisational forms ... Time
  • 28. ... those organisations being based on the new practices ... Best Product Utility Organisations Best
  • 29. ... hence we have a common cycle of change ... Inertia Disruption New Emerging Growth
  • 30. ... for every age ... Mechanical Components Inertia Disruption American Emerging System Growth
  • 31. ... ditto ... Means of mass communication Inertia Disruption Web 2.0 Emerging Growth
  • 32. ... ditto ... Cloud Inertia Disruption Next Emerging Growth
  • 33. ... ditto ... The next Age ?
  • 34. 2004
  • 35. ... ditto ... Manufacturing Inertia Disruption Next Next Emerging Growth
  • 36. ... also we see increases in unmodelled data ... Inertia Disruption Data New Emerging Growth
  • 37. ... which evolves ... Algorithms Unmodelled Modelled ∆ Practices ∆ Activities
  • 38. So what is happening today? Today ...
  • 39. ... what we would expect ... Cloud Inertia Disruption Data Next Emerging Growth
  • 40. ... and also new forms of organisation ... Web 2.0 'Traditional' Next
  • 41. ... with different Traditional Next Gen characteristics ... Structure Departmental Cell Focus Profit Disruptive Open source Cost reduction Weapon Scaling Scale-up Distributed Resilience N+1 Design For Fail Failure Disaster Rec. Chaos Engine Learning Analysts Ecosystem Infrastructure Enterprise Commodity
  • 42. Of importance ... Ecosystem ... Innovate Leverage Commoditise
  • 43. ... and use of open as a competitive weapon ... Open Technology (open source, open data, open hardware, open standards, open APIs, open process)
  • 44. Open Technology 1. Drive adoption 2. Drive innovation (as in feature completeness) 3. Drive innovation (genesis higher order systems) 4. Drive efficiency 5. Undermine competitors barrier to entry 6. Enable formation of an ecosystem (ILC) 7. Protect an existing value chain ... numerous strategies in the wild ...
  • 45. Open Technology 9. Prevent competitors differentiating around a core revenue stream (Tower & Moat) 10. Retention and recruitment of talent 11. On ramp to another product or service (open core) 12. Overcome an obstacle (insertion strategy) 13. Encourage formation of a competitive market (interoperable play) 14. Avoid transition costs (standards play)
  • 46. Open Source & the Next Age ... this will also matter in the next age...
  • 47. ... critical is understand Ubiquity evolution ... Utility Commodity Product Service Custom Built Genesis Certainty
  • 48. Threat Value Chain Barrier ... understand the landscape ... Evolution
  • 49. Competing in an Open World Please complete our survey - bit.ly/opensurvey