How exponential change in technology will transform retail
Winning in today’s environment, where technological change is accelerating faster than ever, will require retail leaders to shift their thinking once again. It’s not about bricks-and-mortar versus digital or omnichannel models. It’s not even about embracing the impact of digital. Today’s big challenge is harnessing the explosion of technology, because it’s changing the world as we know it — and according to Salim Ismail, executive director of Singularity University, that change is happening much faster than we think.
Speaking to digital retailers gathered at the Shop.org Digital Summit, the former vice president at Yahoo shared how exponential technologies are already changing our world, and the implications for retail are profound.
Singularity University is a think tank, educational institution and technology incubator that funds innovative solutions to big, global problems like poverty and health issues. The organization works around the idea that technology occurs at an exponential, not linear rate, just as computational power doubles every 18 months (what’s known as Moore’s Law). Retail, especially from the perspective of holiday seasons, typically works incrementally and projects future results from linear models. But Ismail argues that this doubling pattern of technology’s capability, which occurs in many different types of technologies, creates a new paradigm; those who can spot disruptive, exponential technologies early will have a huge competitive advantage.
“We have never seen so many technologies moving so fast. Never in the history of humanity have so many technologies been moving at this doubling pattern, at this accelerated pace,” Ismail said.
The trouble is, the rate of change is hard to wrap your mind around. As Ismail rattled through several I-didn’t-know-we-could-do-that-already technologies, members of the audience were shaking their heads in wonderment at things like a machine that can replay your dreams back to you or how people are engineering glow-in-the-dark cats. Rather than being in their infancy, the following are a few technologies that Ismail said are closer to becoming everyday technologies than you think:
If you’re paying attention, you know it’s already happening. The first self-driving truck is on the road in Nevada and Google cars have gone 2 million miles without an accident. Singapore has a goal of making a third of its taxis driverless by the end of this year and the Netherlands is just weeks away from launching a driverless shuttle. As more of these vehicles take the road, Ismail said that road capacity will increase by 10 to 15 times, making it a lot easier for people to get around or companies to make deliveries. More efficient roadways will affect real estate values as well.
While some may have the impression that solar energy is growing slowly, Ismail painted a different picture. Solar cells are twice as cheap as they were about 18 months ago, making solar energy already just as inexpensive as other energy sources like coal or natural gas; soon it will be cheaper. As the doubling pattern continues, in 23 years we could be generating 100 percent of the world’s energy from solar; as solar energy takes off, there will be massive geopolitical disruption.
Drones are already here, and not just for Amazon or individual mischief-makers in the United States. Drones are delivering medicine to remote areas like Haiti or even rural Virginia, and delivering mail in Switzerland. Amazon’s drone tests have made headlines, but the technology is becoming cheaper and more available for everyone, and is growing rapidly. “The underlying technology [used in drones] is growing so fast, they are doubling their capability every nine months,” Ismail said.
With so many technologies exploding right now, from 3D printing to neuroscience to augmented reality, Ismail described it as “having 20 Gutenberg moments all at once.” These are just a few of the things to keep an eye on right now, and that’s part of the problem. The other issue: This exponential growth in technology is freaking us out. None of the systems our society is built on are adequate for the world we’re becoming.
“Fundamentally, we have a huge issue,” Ismail said. “We are not ready for this pace of change.” But the pace is not slowing, so we’re essentially going to have to adapt or be lost.
In introducing Ismail, Deloitte Digital’s Kasey Lobaugh noted, “If we fail to recognize that technology is growing in an exponential way and not a linear way, we will fail to think appropriately about our business and be aggressive about repositioning ourselves.”
That means it’s harder than ever to keep up with technology and easier than ever to fall behind and become irrelevant. In order to stay competitive, executives must spot these exponential technologies early and build solutions around them that will scale with the technology itself.
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