Leading a Bionic Transformation

Learned a lot lending an editorial hand here:

strategy+business, October 29, 2018

by Miles Everson, John Sviokla, and Kelly Barnes




Illustration by Mark Matcho

What is it about companies such as Alphabet, Amazon, Apple, and Alibaba? No matter where they turn their attention — cars, banking, groceries, healthcare, media, retail, trucking — industries quail before them. Company leaders start wondering if their moats are deep enough. Investors flee before the drawbridges rise. These companies are among the largest and richest in the world, and they use this leverage to become larger and richer still — in 2018, Apple and Amazon became the world’s first trillion-dollar companies. These powerhouses attract huge numbers of extremely talented people to work for them, and they generate one innovation after another. But none of that explains the source of their industry-disrupting power.

There are probably 100 companies around the world — including at least 40 “unicorns,” startups with a market capitalization of US$1 billion or more — with similar qualities. They are known for rapid, exponential success. Most are in the U.S. and China right now, but they will probably become more common elsewhere soon. We think of them as bionic enterprises: a name that evokes the fusion of technological and biological systems for extraordinary performance and growth. These companies compete in unprecedented ways by combining digital prowess, human ingenuity, and strategic purpose, as if they were the corporate equivalent of superhuman cyborgs such as Marvel Comics’ Iron Man.

Over the past year, as we’ve been researching and writing about the nature of bionic companies (see “The Bionic Company,” by Miles Everson and John Sviokla, s+b, Feb. 22, 2018), it’s become apparent that no company has a monopoly on this way of doing business. A few companies are out in front, but many others will follow. Some will be part of consortia; some will take advantage of highly capable platforms. You can lead your own company toward a bionic transformation if you think about changing your business in the following ways.

• From a business model based on managing the supply of your product or service to one based on providing whatever customers demand, using any means possible

• From an operational approach based on stocks of information that you hold and capture, to one based on flows of knowledge that you collaborate on and share

• From a competitive position based on a stable landscape of rivals to one based on platforms where a single winner dominates the system

Underlying these three shifts of mind is a quiet revolution in the sources of wealth that businesses deploy and create — the first such major shift since the Industrial Revolution. These new intangible (but very powerful) assets are behavior capital, the awareness and insight developed by tracking ongoing activity; cognitive capital, knowledge codified into digitally managed routines; and network capital, the human and technological connection points available to an enterprise (see “Wealth in the 21st Century”). When you deploy these three forms of capital effectively, you transform your enterprise...read the rest here