A crisis unfolds!
One virus. 1.4 billion. Unknown value creation in prevention.
Yes, I am speaking of the Coronavirus. And I could spot at least 3 Black Swan moments.
Coronavirus originated in China and 1.4 billion, a fifth of humanity, is held captive for survival today. On top of this, there is also an outbreak of Avian flu in China and Swine flu in Africa, widely believed to be the result of unhygienic conditions in animal farms, meat and insect markets, and dirty butcheries providing a perfect breeding ground for deadly diseases like the new coronavirus, SARS, bird flu, and more.
The impact is not limited to affecting human health. It’s also disrupting several supply chains and endangering food chains. The immediate solutions seem challenging, but governments and various agencies do react to contain or manage this crisis. This too shall pass and we pray that humanity comes out triumphant with minimal loss to human lives.
As the crisis is still unfolding and is likely to bottom out soon, it is the best time to drive certain changes in the world for the betterment of humanity. The moment may have arrived for an accelerated adoption of exponentially growing technologies like AI, lab-grown meat, food supply chains and 3-D printing, which can address the issues associated with such pandemics. Let me come back to this story and talk of another one that hit an entire nation.
Crisis for billions, blessings for one!
One announcement. 1.3 billion people. $18 billion value creation!
On November 08, 2016, in an unprecedented move, the government of India announced demonetization, by withdrawing two of its largest currency notes (INR 500 and INR 1000) from circulation. This amounted to US $320 billion at the time, representing 86 percent of the total currency value in circulation in India.
In a cash-driven economy like India’s, the ATMs ran dry for weeks and mile-long queues were seen in bank branches where people were waiting for hours to get only a rationed amount of new cash. The country of 1.3 billion literally scrambled to cope for weeks, as cash ran dry. Many small businesses suffered and the poor, who had no access to credit cards or mobile wallets, were hit the worst. The wealthiest became poor overnight, with no cash to spend! It had, at least for a while, leveled the playing field in a country with a high Gini index.
Economists or bankers, techies or bureaucrats, optimists or cynics will continue to debate for the next few years or even decades about the pros and cons of such a move on part of the government to contain circulation of un-taxed money in a parallel economy. But the playing field changed for the opportunity seekers.
Paytm, a mobile wallet start-up from India, noticed this Black Swan moment and seized the opportunity. It went on an overdrive to galvanize an existing wallet economy, bombarded media with awareness, upgraded its back-offices, strengthened its field force, brought in quick changes to make the system easier than before! Over time, Paytm spent nearly $2 billion to convince Indians to substitute digital payments for cash. Its 125 million user base soared to 185 million in 3 months, and sprinted to 285 million in twelve months’ time. Demonetization appeared like a God send opportunity for Paytm. The marginalised and illiterate road-side vegetable sellers signed-up for Paytm. It became a tool for business and economic inclusion for the bottom of the pyramid. As a crisis savior, it truly received the blessings of more than a billion Indians and became a household name. The Paytm moment had arrived!
Small wonder, that the valuation soared to a whopping $18 billion by 2019, with investments pouring in from Softbank and Ant Financial. And, it went on to remain as a poster-child of a very aspirational digital India!
With necessity playing the role of the mummy of all inventions, digital payments are now mainstream. Several players, including big names such as Google and Walmart, are now pushing the agenda with the number of transactions crossing 1 billion every month. And it all started with one crisis!
Moving from one crisis to the next
Much like Paytm became a saviour for Indians, can there be “Paytm moments” in the ongoing Coronavirus crisis as well? Let’s look at possibilities.
One. Bluedot, a Canada based company specializes in infectious disease surveillance. They predicted the outbreak of coronavirus on December 31 using an AI-powered system that looks at various animal and plant disease networks, reports, government documents, and other online sources. It signaled warnings about Wuhan, before travel advisories to Wuhan started.
Forewarned is forearmed. Can AI be trusted and taken more seriously? Can agencies come together to strengthen the data framework of agencies such as Bluedot? Disease outbreaks globally as per WHO - 119 in 2019.
Two. Beyond Meat, Memphis Meats, Mosa Meat and several others are producing lab grown meat, which are commercially available today. These meats are tasty, free of disease, free from harmful effects and animal cruelty, and nutritionally balanced among other features.
This is an opportune moment for such plant-based meat or stem-cell based food to find its place on the dining table and start changing habits. This has the power to minimise potential outbreaks of disease from animal farms. Such moves will work better now than at other times, since planet-centric sentiments are at their highest levels. Also, these companies are constrained both by the supply side and the creation of new markets. Can we take this as a turning point to accelerate adoption and production, or both? The global meat market will stand at $1.5 Trillion in 2020.
Three. 3-D manufacturing. China being a factory for the world, there is a significant impact on production, given the freeze on movement of people in most parts of the country. On top, shipping lines are moving limited goods, as agencies try to contain the spread of infection. Production has come to a standstill. It is estimated that about 80% of world goods by volume is carried by shipping and China has seven of the world's 10 busiest container ports. As a result, commerce is taking a huge hit. Be it smartphones or chemicals, solar panels or electronics – the supply chain is suffering. Can this trigger another explosion of change? Localized manufacturing is ripe for adoption, which can separate out the processes of value creation and value delivery. 3-D printing was just waiting for such turning points in human history.
A crisis is as universal as the sun rising in the east. A crisis will never go out of our lives. Focusing on the deadly Coronavirus at hand today, this is an opportune moment for entrepreneurs to set-up Design and 3-D printing job-shops and offer a risk-free approach to meet localised demand. Once such change happens, it will transform the way hyper-customized goods and services are delivered on-demand, forever.
So, there are crises to be tamed and several jobs-to-be-done addressed using exponentially growing technologies and domains. We believe that the orthogonal impact of the family of suggested solutions can be far-reaching, while minimising chances of such pandemics in future. These are in sight and within striking range, and hovering around the knee of the curve. All it needs is a push to jump to the other side of the divide. In other words, the future is already here, it is just not evenly distributed!
Easy to plan. Harder to execute. Made-easy by ExO
We need a global reset in the way we do certain things. And when you have countries and continents and thousands of human lives at stake, trade and commerce getting impacted, exponential technologies would be futile if they failed to come of use in such critical times. Much in the same way, India leapfrogged to using digital cash post-demonetisation, the world can change the way meat is consumed, goods are manufactured and pandemics are predicted and prevented forever.
Although the Black Swan moments are in sight, such large scale transformations do not come easy. When people are met with a crisis, they are more amenable to embracing changes. Be it age-old human habits, or adoption of newer technologies or even fund-raising. The bigger challenge for ventures boils down to exponential scaling without growing proportionately on resources. And this is where the ExO Sprint steps in.
Exponential Organisations is a family of organisations that work around the construct of abundance, created as a result of exponential technologies. Salim Ismail, author of the best-selling book Exponential Organization, had studied roughly 100 successful companies, which leveraged abundance to create an exponential business model. He found 11 common parameters that orchestrated the success in these companies, which are shown in Figure 1. There is a memorable acronym for them: MTP (massive Transformative Purpose) + 10 remaining characteristics of Exponential Organizations: SCALE and IDEAS.
This is fundamentally a new construct of business. With abundance, comes a change in the business model, that creates exponential value for clients and the organisation itself. And it renders conventional paradigms irrelevant.
How does the mantra of abundance work? How does one create and access abundance? And, how does one manage abundance?
The ExO Sprint is a process to connect a purpose-aligned group of enthusiasts, equip them with a 10X attitude and mindset and skills to identify and manage a growing list of abundances. That helps create, deliver and capture value in a manner that was never done before.
The recipe for success is building a growth mindset and applying a relevant set of attributes. A brief understanding of 11 attributes is given below:
Massive Transformative Purpose (MTP) – The MTP marks the “why” of the organization. Purpose goes beyond a conventional mission statement because it is on a bigger scale of aspirations and this means it can revolutionize an industry and even a society.
Staff on Demand – A radical implementation of this construct enables one to act quickly and flexibly in a fast-changing world. ExOs leverage external talents, who find easier alignment with purpose. They outsource even core tasks, rather than maintaining a large full-time workforce. It allows companies to fill expertise gaps and ensure a constant flow of fresh ideas.
Community & Crowd – ExOs build and join multiple communities, drive network effect and create value for stakeholders. They crowdsource or crowdfund ideas to achieve rapid growth.
Algorithms – If the MTP is the soul of a company, the heart of companies such as Google, Airbnb and UPS are algorithms. They create value by saving costs or generating revenue directly. Dynamic pricing, credit card fraud detection, traffic optimization are some of the common examples. Machine-learning technologies are used by ExOs to refine these algorithms.
Leveraged Assets – Asset-lite strategies are nothing new. However, companies are now outsourcing mission-critical assets. Apple, for example, uses its manufacturing partner Foxconn’s factories for key product lines..
Engagement – Engagement of purpose-driven stakeholders, including the community of users, is achieved through techniques such as gamification, incentives, leader-boards and a variety of value-creation methods in the network.
Interfaces – Interfaces are algorithms and automated workflows that route the SCALE outputs as efficiently as possible to the right people within the organization.
Dashboards – To track and monitor performance, all members of an organization can access real-time metrics via a dashboard
Experimentation – Rapid experimentation and process improvement through build-measure-learn loops are the key drivers for most ExOs.
Autonomy – Reaction times are key to agility, as is accelerated learning. ExOs often adopt principles of holacracy quite often and have flat hierarchies.
Social Technologies – Social technologies promote real-time, transparent and horizontal conversations across the organization. This promotes innovation and avoids red-tapism.
A select set of attributes from above are then applied to the business model through a 10-week Sprint process, taking the venture through a 10-X journey. ExO Works has the experience of taking core teams of several organisations, large and small, through these Sprints who then drive growth.
Ambition to Action
All’s well that ends well. Three things need to come together to make this magic happen. First, we need sponsors to champion these tipping points and fund these changes. Second, ExO evangelists, spread across 112 countries, need to bring the power of SCALE & IDEAS to scale these solutions at an accelerated pace. These ingredients would offer the ventures a recipe for sustainable growth. Lastly, an ExO score-card that the sponsors can use to monitor progress. As a community, we believe in radical thinking, learning by doing, a relentless focus on execution using a sprint construct and, most of all, exponential changes for a better world!