The Day Before Your Defeat
It is difficult to realise exponential growth. Most natural phenomena are linear. Acceleration, for example, occurs from point A to point B. In the case of a race car, a cheetah, or a sprinter, no matter how fast or how slow, organisms travel and accelerate in a linear fashion; steadily gaining momentum, and reach a terminal velocity. After the maximum point of acceleration is achieved, the organism or object slows down and stops.
Look at how nature, plants, animals, and humans grow very slowly; even those that grow very quickly, only grow to a certain point. All of this has coded our behaviours and our reactions into our environment. Hunters and gatherers trace animals linearly to hunt them. Plants pollenate in a very similar way.
Exponential growth is a phenomenon of the 20th century. Throughout the 20th century, Moore’s Law, the rise of the semiconductor, the development of computers, and the space race have all contributed to the phenomenon of exponential growth. Doubling computing power every 18 to 24 months not only triggered technological advancement, but it enabled economic growth, prosperity, employment, and global change.
Incumbents and exceptionally large enterprises originating from the 20th century or older, have their issues with exponential growth. These companies are used and simply doomed to linear growth, surely and steadily. That is what the stock market trends and board members prefer, and that is what CEOs are compensated for.
This changed with the rise of the internet and the first inflation-then-burst of the dot-com bubble. But after the first bubble burst, there was a second boom, and after the financial crisis, there was even a third boom. Now, the pandemic added yet another layer of digital-born and pure-play digital scale-up; the so-called unicorns.
As of August 2021, TikTok is now the most downloaded mobile application on the planet. The next big thing will always be even more impactful than the last, and reach billions of users even faster than before. Now more than ever, the sky is truly the limit.
Now. Why all this introduction about linear growth versus exponential growth? Well, the distinction makes all the difference. 20th century born companies don’t understand exponential digital growth, and most of the time it is too late, when they realise there is a problem with their linear thinking.
Let us examine why, how, and what happened to Kodak…
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