Some expertise appears to enhance regularly over time, and repeatedly get incrementally higher by small steps.
We name this incremental innovation.
However what about expertise which appears to be enhancing at extremely quick charges?
Nicely, this could be as a consequence of exponential development, and is very prone to occur with newer applied sciences.
Exponential development implies that as a substitute of a given metric (like “efficiency”, or “megaflops per greenback”) rising at a gentle tempo (akin to “enhancing by 20% yearly”), it could attain an inflection level the place the development improves by an element of 10 or extra every time.
In an incremental situation, you would possibly go from having 100 prospects in a single yr, to 150 the following yr and 250 the yr after that.
In an exponential situation, you would possibly go from having 100 customers in a single yr, to 1000 customers the following yr, and 100,000 customers the following yr.
Examples embrace the historic rise of cryptocurrency values, the variety of individuals on fb, the variety of individuals with mobile telephones, price of laboratory-grown hamburgers or the proliferation {of electrical} lighting.
In the event you chart this progress, it usually appears flat for a very long time, adopted by an inflection level the place the graph rises steeply. It nearly appears like a “hockey stick”.
This inflection level is commonly pushed by expertise which has been in improvement for a very long time, finally reaching a crucial efficiency metric which or a perceived worth threshold earlier than individuals are satisfied to lastly purchase it. For instance, the iPod was enabled by a tough drive which was small and energy environment friendly sufficient to hold 1,000 songs in individuals’s pockets, for a worth which was reasonably priced sufficient for customers.
Each enterprise would like to have an innovation or enterprise unit develop at an exponential charge (until the enterprise places its personal limits on development), however there are quite a few challenges to predicting which applied sciences are going to develop at an exponential charge.
One problem is that earlier than the inflection level, progress could look stagnant whereas the expertise continues to be within the improvement phases, particularly from a price-performance perspective. Many applied sciences depend on public funding, and don’t ever overcome the innovation valley of demise earlier than a enterprise mannequin is discovered for them by non-public corporations.
Secondly, this can be very tough to foretell which improvements will truly be fascinating by prospects as soon as the expertise has matured. Annually, hundreds of merchandise are launched which find yourself not discovering a market in any respect. Earlier than the inflection level, it’s nearly unattainable to foretell which expertise is assured to be a hit.
Lastly, one other problem is that any innovation which does develop exponentially will nearly undoubtedly entice the eye of different corporations who rapidly comply with and launch their very own variations. Subsequently, the market can rapidly change into saturated with competitors. If these are sufficient prospects to go round, this may not be an issue, but when the market measurement is proscribed, then competitors can rapidly erode the first-mover benefit.
For some extra insights into exponential applied sciences, take a look at this podcast interview I did with Duleesha Kulasoorya – Exponential Expertise is already right here
Creativity & Innovation knowledgeable: I assist people and firms construct their creativity and innovation capabilities, so you may develop the following breakthrough concept which prospects love. Chief Editor of Ideatovalue.com and Founder / CEO of Improvides Innovation Consulting. Coach / Speaker / Writer / TEDx Speaker / Voted as one of the influential innovation bloggers.
