In the first two parts of this three-article series, I introduced you to the concept of long waves. Also known as Kontratiev-waves, these are long economic cycles ignited by a series of disruptive innovations based on a few new leading-edge technologies. These cutting-edge technologies tend to drive economic growth for several decades and lead to structural changes in the economy and society.
In part 1, we revisited the leading-edge technologies of the first five waves and touched upon the necessary infrastructure upbuilds to get them going. In part 2 of the series, I synthesized perspectives of various scholars on what leading-edge technologies are likely to drive the Sixth Wave. Three main Sixth Wave technology spaces emerged — digital tech, health & human-centered tech, and cleantech, with a fourth (nanotech) being a wild card. I also mapped out likely technology niches in each of the three main spaces and their intersections.
In today’s third and final part, let’s explore how your business can either drive or learn to ride the Sixth Wave or risk being crushed by it — and how you can create and innovate as a tsunami of disruptive innovation is about to unfold.
How will the Sixth Wave transform business as we know it?
The disruptive innovation in the three main tech spaces of the Sixth Wave (digital tech, human tech, cleantech) will arise as direct responses to some fundamental challenges that humanity needs to resolve in the coming decades, such as climate change challenge, the sustainability challenge, the labor challenge, among others. Hence, the Sixth Wave will initially depend on, and subsequently more widely trigger, a significant paradigm shift in business. It will elevate business from exploitative industrial capitalism to all-encompassing conscious capitalism:
- In their book The Sixth Wave, Moody & Nogrady predict a paradigm shift in production from the logic of the industrial age (“resource exploitation”) to a new one to drive the Sixth Wave (first “resource efficiency,” later moving towards closed-loop systems that reuse everything that gets produced and used).
- Likewise, the human factor in business will experience a similar paradigm shift from “human resources” to be exploited and controlled to human capital to be developed, invested in, and probably even accounted for in the future.
How will the Sixth Wave of disruptive innovation affect your business?
Well, it depends on who your company is and what you do. Where in the business cycle are your firm and its industry currently positioned? Here, for simplicity’s sake, let’s distinguish four cases that I link to the four seasons:
- Spring: You’ve just recently founded a new venture to ride the Sixth Wave. Your business is in the first phase of the corporate life cycle, where it’s all about creating an impactful value proposition. Typically, you do this in one or more of the Sixth Wave’s technology spaces (digital, human, and clean tech).
- Summer: You’re in the second phase of the corporate life cycle, where it’s all about fast growth, market expansion, and the build-up of a wider team. Your (fast-) growing venture has a successful value offering (perhaps linked to a Fifth Wave-technology niche) that now looks for ways to augment it by connecting it to one of the tech spaces of the Sixth Wave.
- Fall: You’re a seasoned company with a solid operational set-up in a still relatively fast-moving and dynamic yet already well-established industry. Your company needs to evolve its value offerings and business practices to align with the progressing tech spaces and underlying maxims of the Sixth Wave principles.
- Winter: You’re a mature, well-reputed corporation in a long-established “old” industry (that likely was “hot” in one of the first four long waves). You are threatened by the prospect of “creative destruction” by one or more of the disruptive innovations linked to the Sixth Wave technologies. To avoid this fate, you’re eager to rise to the occasion to stay in business.
How can your company ride the Sixth Wave — or at least rise to the occasion?
The Sixth Wave poses a different challenge (= threat = opportunity) to each business. Depending on its season and industry, your company needs to follow a different creative game plan in the coming years to set its business up for success as the Sixth Wave unfolds. Likewise, consider focusing on certain innovation impact types based on your season. So, let’s sum up the essence of each respective scheme in four basic action slogans:
- Create and disrupt: New Spring ventures at the beginning of the corporate lifecycle need to focus on playing in one or more of the emerging disruptive technology spaces. Then, they need to create a novel, original, and meaningful value proposition (product, service, solution, experience) that truly wow the market (revolutionary innovation).
- Grow and accelerate: Fast-growing Summer ventures have already launched a whopping value proposition in the market. To stay on a growth course, they need to make their product more Sixth Wave tech-compatible. Alternatively, they can also broaden their product range with adjacent value offerings that align with the spirit of the Sixth Wave. Hence, while the main focus is on growth, this can be supported by focused incremental or evolutionary innovation initiatives mainly targeting their existing customer group).
- Pivot and evolve: Seasoned Fall companies need to pivot and evolve their value propositions and business models and adapt them to the changing tech spaces and the shifting paradigms of the Sixth Wave. Here, innovation efforts need to target evolutionary innovation initiatives (both to add new value to existing customers and adjust existing offerings to the specific needs of new customers).
- Creatively transform and reinvent. Finally, mature Winter corporations in “old industries” (that drove growth in one of the first four long waves) will likely be disrupted by one or more of the new leading-edge technologies of the Sixth Wave. As such, these mature incumbents need to creatively transform their entire organizational mix (value propositions, business models, leadership, people, and culture). They need to reinvent themselves from scratch to avoid the fate of creative destruction. What innovation impact types should they pursue? On the one hand, they need to “milk their cash cows” and prolong their market lives through targeted incremental innovation projects. And on the other hand, they need to set up their own ventures or new business units to pursue revolutionary innovation initiatives in one or more of the Sixth Wave tech spaces.
Interestingly, the further we move forward through the corporate and industry lifecycle phases, the higher the number of variables in a company’s creative transformation mix that we need to address to make a company Sixth Wave compatible.
How can businesses move towards these paradigm shifts that operate on higher levels of consciousness and creativity?
The most successful Sixth Wave ventures and companies will be led by authentic creative leaders operating on higher levels of consciousness and focusing on sustainably making meaning, not only on short-term profitability. Genuinely creative CEOs ensure they develop a critical number of creative co-leaders (or bring them in from the outside). Together, these creative pioneers and change agents jointly build an agile, action-oriented creative culture that relishes the conscious capitalism-spirit of the Sixth Wave. They will also use effective creativity processes and tools to work successfully on ambitious innovation projects.
Importantly, these more conscious creative leaders and their creative teams are curious to learn how to play on the higher levels of creativity on which true breakthrough ideas reside. This is because the most disruptive innovations of the top Sixth Wave ventures will go back on an uber-conscious Eureka idea (not a conscious idea coming out of a brainstorming session or a design thinking workshop). There will be demand for new creative methods and tools (such as Thinkergy’s Genius Journey method) that can elevate creativity from a conscious to the subconscious or even superconscious level.
Conclusion: You can't stop the waves, but you can learn to surf
Creative destruction has happened to well-reputed incumbents in each long wave so far – think of how fast Kodak became a victim of the Fifth Wave. This fate is likely to unfold quicker and more widespread than in previous long cycles in the Sixth Wave. That’s the threat that hopefully motivates (long) established companies to pivot or creatively transform their business. For entrepreneurs, the threat of the Sixth Wave is “missing out” by failing to embrace the tremendous opportunities for wealth creation in the emerging tech landscape (as mapped out in part 2 of this article). What danger or opportunity can motivate you to learn how to ride the Sixth Wave and thrive?
- With Thinkergy and our suite of integrated innovation methods, I am on a mission to creatively empower Sixth Wave innovators to create and disrupt, grow and accelerate, pivot and evolve, and creatively transform and reinvent.
- When would now be the best time to start the journey with you and your firm? Contact us to tell us more about your organization and your current challenges.
© Dr. Detlef Reis 2021. The article will be reprinted in a shorter version in the Bangkok Post in the coming weeks.