Exponential Organizations Quotes

Today, if you’re not disrupting yourself, someone else is; your fate is to be either the disrupter or the disrupted. There is no middle ground.

The great differentiator going forward, the next frontier for exponential growth, the place where individuals and organizations will find a new and sustainable competitive edge, resides in the area of human connectivity.

in the future, the defining metric for organizations won’t be ROI (Return on Investment), but ROL (Return on Learning).

The ultimate objective is what the Gartner Group calls a zero latency enterprise—that is, a company in which the time between idea, acceptance and implementation all but disappears—and implementing

While exponential growth is a remarkable manifestation of our extraordinary accomplishments as a species, built into it are the potential seeds of our demise and the portent of big troubles just around the next corner.

Most [organizations] think the key to growth is developing new technologies and products. But often this is not so. To unlock the next wave of growth, companies must embed these innovations in a disruptive new business model.

when you move from point A to point B, you can then see point C. But you can’t see point C from point A. Iteration/experimentation is the only way.

As Eric Ries explains, “The modern rule of competition is whoever learns fastest, wins.

Martin Seligman, a leading expert on positive psychology, differentiates between three states of happiness: the pleasurable life (hedonistic, superficial), the good life (family and friends) and the meaningful life (finding purpose, transcending ego, working toward a higher good). Research shows that Millennials—those born between 1984 and 2002—are showing an orientation towards seeking meaning and purpose in their lives.

In an ExO world, purpose trumps strategy and execution overrides planning.

as data becomes the new oil, many business models will be transformed from hardware to software to services.

McKinsey & Company advised AT&T not to enter the mobile telephone business, predicting there would be fewer than one million cellular phones in use by 2000. In fact, by 2000, there were one hundred million mobile phones.

An Exponential Organization (ExO) is one whose impact (or output) is disproportionally large—at least 10x larger—compared to its peers because of the use of new organizational techniques that leverage accelerating technologies.

The late maverick economist Kenneth Boulding perhaps best summed it up when testifying before the U.S. Congress, declaring that “anyone who believes exponential growth can go on forever in a finite world is either a madman or an economist.

The biggest risk is not taking any risk.

6Ds: Digitized, Deceptive, Disruptive, Dematerialize, Demonetize and Democratize. Any technology that

as technology brings us a world of abundance, access will triumph over ownership.

Any company designed for success in the 20th century is doomed to failure in the 21st.

In general, if an organization needs to do something that uses computation, and that task is too expensive today, it probably won’t be too expensive in a couple of years.

If you really want to know what an organization or a team values, just study their culture.

Today, if you’re not disrupting yourself, someone else is;

The world has over a trillion hours a year of free time to commit to shared projects,

It is our opinion that in the future, the defining metric for organizations won’t be ROI (Return on Investment), but ROL (Return on Learning).

In 2013, Reddit, which has just fifty-one employees, most of whom manage the platform, saw 731 million unique visitors cast 6.7 billion votes on 41 million stories.

When failure is not an option, you end up with safe, incremental innovation, with no radical breakthroughs or disruptive innovations.

You have to be self-aware and look for that startup idea and purpose that is a perfect fit with you—with you as a person, not as a business[person].

According to noted hotelier Chip Conley, “Culture is what happens when the boss leaves.

In fact, the best definition we’ve found for a startup comes from Ries: “A startup is a human institution designed to deliver a new product or service under conditions of extreme uncertainty.

To demonstrate, consider the number of times the founders of the following companies pitched investors before finally succeeding: Company Number of Investor Pitches Skype 40 Cisco 76 Pandora 300 Google 350

Jerry Michalski notes that in the past, scarcity meant value. That is, without scarcity, you didn’t have a business. Now that notion has been upended. Dave Blakely of IDEO thinks about ExOs in the following way: “These new organizations are exponential because they took something scarce and made it abundant.” Nokia bought Navteq, trying to buy, own and control scarcity, only to be leapfrogged by Waze, which managed to harness abundance.

In all of these areas, the human brain is asked to do and handle more than ever before. We are dealing with several fields of knowledge constantly intersecting with our own, and all of this chaos is exponentially increased by the information available through technology. What this means is that all of us must possess different forms of knowledge and an array of skills in different fields, and have minds that are capable of organizing large amounts of information. The future belongs to those who learn more skills and combine them in creative ways. And the process of learning skills, no matter how virtual, remains the same. In the future, the great division will be between those who have trained themselves to handle these complexities and those who are overwhelmed by them—those who can acquire skills and discipline their minds and those who are irrevocably distracted by all the media around them and can never focus enough to learn. The Apprenticeship Phase is more relevant and important than ever, and those who discount this notion will almost certainly be left behind. Finally, we live in a culture that generally values intellect and reasoning with words. We tend to think of working with the hands, of building something physical, as degraded skills for those who are less intelligent. This is an extremely counterproductive cultural value. The human brain evolved in intimate conjunction with the hand. Many of our earliest survival skills depended on elaborate hand-eye coordination. To this day, a large portion of our brain is devoted to this relationship. When we work with our hands and build something, we learn how to sequence our actions and how to organize our thoughts. In taking anything apart in order to fix it, we learn problem-solving skills that have wider applications. Even if it is only as a side activity, you should find a way to work with your hands, or to learn more about the inner workings of the machines and pieces of technology around you. Many Masters

many ExOs are adopting the Objectives and Key Results (OKR) method. Invented at Intel by CEO Andy Grove and brought to Google by venture capitalist John Doerr in 1999, OKR tracks individual, team and company goals and outcomes in an open and transparent way. In High Output Management, Grove’s highly regarded manual, he introduced OKRs as the answer to two simple questions: Where do I want to go? (Objectives) How will I know I’m getting there? (Key Results to ensure progress is made)

Think of ownership design like organizing dinner for a group of friends. The task gets exponentially harder as the crowd grows. He’s vegan; she’s gluten free; they eat only sushi; this one’s on a juice cleanse; and the other is only free on Tuesdays. If everyone gets a dinner veto, no one dines together. The Senate works this way, with every senator able to filibuster the chamber into gridlock on most issues; similarly, the United Nations is often paralyzed, with the five permanent members of the Security Council—China, France, Russia, the United Kingdom, and the United States—each able by design to veto the others’ agendas.

The secret to living in the rush of the world with a minimum of pain is to get as many people as possible to string along with your delusions; the trick to living alone up here, away from all agitating entanglements, allurements, and expectations, apart especially from one’s own intensity, is to organize the silence, to think of its mountaintop plenitude as capital, silence as wealth exponentially increasing. The encircling silence as your chosen source of advantage and your only intimate. The trick is to find sustenance in (Hawthorne again) “the communications of a solitary mind with itself.” The secret is to find sustenance in people like Hawthorne, in the wisdom of the brilliant deceased.

I know that the consequences of scientific illiteracy are far more dangerous in our time than in any that has come before. It’s perilous and foolhardy for the average citizen to remain ignorant about global warming, say, or ozone depletion, air pollution, toxic and radioactive wastes, acid rain, topsoil erosion, tropical deforestation, exponential population growth. Jobs and wages depend on science and technology. If our nation can’t manufacture, at high quality and low price, products people want to buy, then industries will continue to drift away and transfer a little more prosperity to other parts of the world. Consider the social ramifications of fission and fusion power, supercomputers, data “highways,” abortion, radon, massive reductions in strategic weapons, addiction, government eavesdropping on the lives of its citizens, high-resolution TV, airline and airport safety, fetal tissue transplants, health costs, food additives, drugs to ameliorate mania or depression or schizophrenia, animal rights, superconductivity, morning-after pills, alleged hereditary antisocial predispositions, space stations, going to Mars, finding cures for AIDS and cancer. How can we affect national policy—or even make intelligent decisions in our own lives—if we don’t grasp the underlying issues? As I write, Congress is dissolving its own Office of Technology Assessment—the only organization specifically tasked to provide advice to the House and Senate on science and technology. Its competence and integrity over the years have been exemplary. Of the 535 members of the U.S. Congress, rarely in the twentieth century have as many as one percent had any significant background in science. The last scientifically literate President may have been Thomas Jefferson.* So how do Americans decide these matters? How do they instruct their representatives? Who in fact makes these decisions, and on what basis? —

Now I’m not trying to sound big-headed or anything but my sensuality has benefited a lot of people in more ways than I can quantify. It has served people not only in romantic relationships but in businesses, organizations and professional lives as well. (People got big promotions at work and major business deals). This was brought to my attention recently by a very close friend of mine in a conversation we had while we were sitting in a coffee shop. She said, “Lebo, have you noticed how so many people who got close to you either through work or relationship have had major transformations in their personal lives within the shortest space of time, that includes myself?” I paused for a moment and remembered the same words being said by one ex of mine, another lady I helped on her project not so long ago echoed the same notion. To some of you this might seem like... c’mon Lebo, anything could have led to any of those transformations. To even associate it with my sensuality seems utterly absurd, it’s like I’m trying to bolster my significance, but I know better now. I know the value I’m bringing into people’s lives whether they acknowledge it or not. Our conversation also made me recall how I had been exploited by others who saw value in me which I, at the time, was still oblivious of. The thing about human beings is that, usually they won’t show you your true value from which they’re secretly benefiting because they know that once you wake up and start realizing it, you won’t supply it for free anymore. So after I had woken up to my true value I decided to start making my sensuality EXCLUSIVE. Now when you make your sensuality exclusive it automatically makes your company highly priced. Consequently, it makes you highly sought after BY PEOPLE WHO SEEK TRUE VALUE AND KNOW WHAT IT LOOKS LIKE. When you make your sensuality exclusive, it increases your value exponentially as well as your desirability, not to everyone, but only TO THE RIGHT PEOPLE. You become the catch. Now I’m saying this to show you the hidden power of the world of sensuality that most people aren’t aware of. Almost every successful luxury industry in the world essentially thrives on sensual principles whether they’re aware of it or not.

According to entrepreneur Chris Dixon, the most important change for entrepreneurs versus a decade ago is the ratio of reach to capital. Today, the reach of a startup is 100x larger, while the capital needed is one tenth that of a decade ago—a thousandfold improvement in just ten years.

Program. Some

We like to think that thirty or forty years into the Information Revolution we are well along in terms of its development. But according to this metric, we’re just 1 percent of the way down the road. Not only is most of that growth still ahead of us, all of it is.

Success is a lousy teacher. It seduces smart people into thinking they can’t lose.

TechShop collects expensive manufacturing machinery and offers subscribers a small monthly fee ($125 to $175, depending on the location) for unlimited access to its assets.

While on earth, Jesus spoke most often about the kingdom of God. There is a lot of confusion about what this term means but at its heart it is about the rule and reign of Jesus in the hearts of his followers. When you have a growing number of Jesus followers in a particular people group or region faithfully making disciples and planting churches, it begins to have a transformative effect on all aspects of life and society. It brings about human flourishing under the Lordship of Jesus. We refer to this as a kingdom breakthrough. Overcoming the barriers to these kingdom breakthroughs and learning how to establish them in every unreached people group is our highest strategic priority as an organization. If these kingdom breakthroughs are to develop and have their full potential impact, the body of Christ must learn how to make disciples who disciple others and establish reproducing churches within every people. It is only with this type of exponential multiplication of disciples and churches that everyone within every people group will have access to the gospel and God’s glory will be made known in all the earth.

One reason for this debacle, according to Dan Colussy, who drove Iridium’s buyout in 2000, was the company’s refusal to update business assumptions. “The Iridium business plan was locked in place twelve years before the system became operational,” he recalls. That’s a long time, long enough that it was almost impossible to predict where the state of the art in digital communications would be by the time the satellite system was at last in place. We thus label this an Iridium Moment—using linear tools and the trends of the past to predict an accelerating future.

Ronald Coase won the 1991 Nobel Prize in Economics for his theory that larger companies do better because they aggregate assets under one roof and, as a result, enjoy lower transaction costs. Two decades later, the reach delivered by the information revolution has negated the need to aggregate assets in the first place.

Kahlil Gibran: “Work is love made visible. The goal is not to live forever; the goal is to create something that will.

Trust Beats Control and Open Beats Closed As we saw with Valve software, autonomy can be a powerful motivator in the age of the Exponential Organization. The Millennial generation is naturally independent, digitally native and resistant to top-down control and hierarchies. To take full advantage of this new workforce and hang on to top talent, companies must embrace an open environment. Google has done just that. As we outlined in Chapter Four, its Objectives and Key Results (OKR) system is fully transparent across the company. Any Googler can look up the OKRs of other colleagues and teams to see what they’re trying to achieve and how successful they’ve been in the past. Such transparency takes a considerable amount of cultural and organizational courage, but Google has found that the openness it engenders is worth any discomfort.

If you are relying on innovation solely from within your company, you’re dead.

Seely Brown: “Companies may promote the idea of new business creation, [but] in the end they are all in the business of reducing risk and building to scale—which is, of course, the antithesis of entrepreneurship and new ventures.

One exemplar of that pending disruption is teenager Jack Andraka, who at the age of fourteen single-handedly developed an early-stage detection test for pancreatic cancer that costs just three cents. His approach (awaiting peer review) is 26,000 times cheaper, 400 times more sensitive, and 126 times faster than today’s diagnostics. Big Pharma has no idea how to deal with Jack, who is one of many wunderkinds emerging globally, all of them with the potential to disrupt great companies and long-established industries. The Jacks of the world bring exponential

classic example is Google’s AdWords, which is now a multi-billion dollar business within Google. A key to its scalability is self-provisioning—that is, the interface for an AdWords customer has been completely automated such that there is no manual involvement.

Don’t just ask what the world needs. Ask what makes you come alive and go do it. What the world needs is people who have come alive.

In 2010, the world had 1.2 billion people online globally. By 2020, that number will reach five billion. Nearly three billion more people and their brains will be available to work via smartphones, tablets or at Internet cafes.

Mark Zuckerberg agrees, noting, “The biggest risk is not taking any risk.” Constant

Indeed, the rate of change is so high everywhere these days that you now must assume that someone will disrupt you, and often from a direction you least expect. As Steve Forbes sees it, “You have to disrupt yourself or others will do it for you.” This applies to every market, geography and industry.

Two well-known examples of crowdfunding companies are Kickstarter and Indiegogo. In 2012 there was an estimated $2.8 billion raised via crowdfunding campaigns. By 2015 that number is expected to climb to $15 billion. The World Bank predicts crowdfunding to grow to $93 billion by 2025.

Clay Shirky calls cognitive surplus. “The world has over a trillion hours a year of free time to commit to shared projects,” he

In his book The Singularity is Near: When Humans Transcend Biology, Kurzweil identified a hugely important and fundamental property of technology: when you shift to an information-based environment, the pace of development jumps onto an exponential growth path and price/performance doubles every year or two.

The gut was not a long-range organ. Its grasp of culpability degraded exponentially with distance; there

Gamification should empower people, not exploit them. It should feel good at the end of the day because you made progress towards something that mattered to you.

100 percent of new job creation has come via startups and entrepreneurs.

small businesses have created eight million new jobs since 1990, while large ones have eliminated four million positions.

The Exponential Organization The modern corporation takes great pride in how fast it can bring products and services to market compared to companies in the past.

the number of digitally connected people on Earth will grow from two billion in 2010 to at least five billion by 2020.

High-traffic areas are the most problematic. Australian researchers recently asked test subjects to jog back and forth alongside a four-lane highway and found elevated blood levels of volatile organic compounds, commonly found in gasoline, after just 20 minutes. But pollution levels drop exponentially as you move away from a roadway, according to a 2006 study in the journal Inhalation Toxicology. Even just 200 yards from the road, the level of combustion-related particulates is four times lower, and trees have a further protective effect—so riverside bike trails, for instance, have dramatically lower pollution levels than bike lanes along major arteries.

When assessing a startup for funding, investors typically categorize three major risk areas: Technology risk: Will it work? Market risk: Will people buy the product? Execution risk: Is the team able to function and pivot as needed?

A startup is a human institution designed to deliver a new product or service under conditions of extreme uncertainty.

The Secrets of Skunk: Part Two At the Lockheed skunk works, Kelly Johnson ran a tight ship. He loved efficiency. He had a motto—“be quick, be quiet, and be on time”—and a set of rules.6 And while we are parsing the deep secrets of skunk, it’s to “Kelly’s rules” we must now turn. Wall the skunk works off from the rest of the corporate bureaucracy—that’s what you learn if you boil Johnson’s rules down to their essence. Out of his fourteen rules, four pertain solely to military projects and can thus be excluded from this discussion. Three are ways to increase rapid iteration (a topic we’ll come back to in a moment), but the remaining seven are all ways to enforce isolation. Rule 3, for example: “The number of people with any connection to the project should be restricted in an almost vicious manner.” Rule 13 is more of the same: “Access by outsiders to the project and its personnel must be strictly controlled by appropriate security measures.” Isolation, then, according to Johnson, is the most important key to success in a skunk works. The reasoning here is twofold. There’s the obvious need for military secrecy, but more important is the fact that isolation stimulates risk taking, encouraging ideas weird and wild and acting as a counterforce to organizational inertia. Organizational inertia is the notion that once any company achieves success, its desire to develop and champion radical new technologies and directions is often tempered by the much stronger desire not to disrupt existing markets and lose their paychecks. Organizational inertia is fear of failure writ large, the reason Kodak didn’t recognize the brilliance of the digital camera, IBM initially dismissed the personal computer, and America Online (AOL) is, well, barely online. But what is true for a corporation is also true for the entrepreneur. Just as the successful skunk works isolates the innovation team from the greater organization, successful entrepreneurs need a buffer between themselves and the rest of society. As Burt Rutan, winner of the Ansari XPRIZE, once taught me: “The day before something is truly a breakthrough, it’s a crazy idea.” Trying out crazy ideas means bucking expert opinion and taking big risks. It means not being afraid to fail. Because you will fail. The road to bold is paved with failure, and this means having a strategy in place to handle risk and learn from mistakes is critical. In a talk given at re:Invent 2012, Amazon CEO Jeff Bezos7 explains it like this: “Many people misperceive what good entrepreneurs do. Good entrepreneurs don’t like risk. They seek to reduce risk. Starting a company is already risky . . . [so] you systematically eliminate risk in those early days.

There is a law of exponential increase in efficiency that applies to all lifeforms that cluster, synthetic or organic. It is the reason your ancestors found it more productive to move to cities than live in small groups. Humanity found a mathematical law to benefit from, and they've been exploiting that law ever since,

renowned consulting firm McKinsey & Company advised AT&T not to enter the mobile telephone business, predicting there would be fewer than one million cellular phones in use by 2000. In fact, by 2000, there were one hundred million mobile phones. Not only was McKinsey’s prediction off by 99 percent, its recommendation also resulted in AT&T missing out on one of the biggest business opportunities of modern times.

Personal development • Fitness • Food • Budgeting or personal finance • Fashion/Beauty • Lifestyle – Home decor – Organization – Travel – Outdoor/Survival

once you get to very high levels of utilization, it takes teams exponentially longer to get anything done.

call the 6Ds: Digitized, Deceptive, Disruptive, Dematerialize, Demonetize and Democratize.

Every company that was designed to have success in the twentieth century is designed to fail in the twenty- first century.” Salim Ismail, author of Exponential Organizations, said

What you should be looking for is something simple like • Less organized to more organized • Anxious to calm and happy • Struggling to get traffic to plentiful page views and subscribers Determining this will help you better articulate the benefits and the problem that your opt-in freebie solves.

Stem Cell Exhaustion: As we age, our supply of stem cells plummets, in certain cases by a ten thousandfold decline. Worse, the ones we do manage to hang on to become far less active. This means that the body’s internal tissue and organ repair system loses its ability to do its job.

We must remember that SYSTEMS are duplicatable and PEOPLE are not. I cannot hope to build an army of followers if they must be like me. On the other hand, if they have a simple method to follow or a third-party tool to wield, then the chances of duplication and growth in your organization goes up exponentially.

Everything we think we know about the world is a model. Every word and every language is a model. All maps and statistics, books and databases, equations and computer programs are models. So are the ways I picture the world in my head—my mental models. None of these is or ever will be the real world. Our models usually have a strong congruence with the world. That is why we are such a successful species in the biosphere. Especially complex and sophisticated are the mental models we develop from direct, intimate experience of nature, people, and organizations immediately around us. However, and conversely, our models fall far short of representing the world fully. That is why we make mistakes and why we are regularly surprised. In our heads, we can keep track of only a few variables at one time. We often draw illogical conclusions from accurate assumptions, or logical conclusions from inaccurate assumptions. Most of us, for instance, are surprised by the amount of growth an exponential process can generate. Few of us can intuit how to damp oscillations in a complex system.

A final and critical pre-requisite for experimentation is a willingness to fail. Thirty

IdeaScale, eYeka, Spigit, InnoCentive, SolutionXchange, Crowdtap and Brightidea. Validation is achieved by obtaining measurable

We wrote Shift Ahead to document how the smartest companies and organizations shift their strategies in order to stay relevant in the face of swift and exponential changes in everything from technology to the forces of globalization, from politics and culture, from consumer tastes to human behavior. We wanted to find out how they shift ahead – how they stayed ahead of the curve, the competition, and the evolving requirements of their customers – given the barrage of evolving challenges.

Rather than using armies of people or large physical plants, Exponential Organizations are built upon information technologies that take what was once physical in nature and dematerialize it into the digital, on-demand world.

History and common sense make clear that you cannot radically transform every part of an organization—and accelerate the underlying clock of that enterprise to hyper-speed—without fundamentally changing the nature of that organization.

Large numbers of bottom-up ideas, properly filtered, always trump top-down thinking, no matter the industry or organization.

The physical world is still there, of course, but our relationship to it is changing fundamentally.

Thus have computational improvements in weather forecasting delivered a body blow to an industry as seemingly immune to technology advances as Buenos Aires car wash operators.

If you build communities and you do things in public,” he says, “you don’t have to find the right people, they find you.

When Kaggle runs a competition, it has found that the first responders are experts in a particular domain who say, “We know this industry, we’ve done this before and we’ll figure it out.” And just as inevitably, within two weeks, complete newcomers to the field trounce their best results.

How quickly can you convert exponential growth into the critical mass needed to become a platform? Once that happens there is no practical limit. It’s one big coral reef.

Trust Beats Control and Open Beats Closed

Non-ownership, then, is the key to owning the future—except, of course, when it comes to scarce resources and assets. As noted above, Tesla owns its own factories and Amazon its own warehouses. When the asset in question is rare or extremely scarce, then ownership is a better option. But if your asset is information-based or commoditized at all, then accessing is better than possessing.

PayPal’s big challenge was to get new customers. They tried advertising. It was too expensive. They tried BD [business development] deals with big banks. Bureaucratic hilarity ensued. … the PayPal team reached an important conclusion: BD didn’t work. They needed organic, viral growth. They needed to give people money. So that’s what they did. New customers got $10 for signing up, and existing ones got $10 for referrals. Growth went exponential, and PayPal wound up paying $20 for each new customer. It felt like things were working and not working at the same time; 7 to 10 percent daily growth and 100 million users was good. No revenues and an exponentially growing cost structure were not. Things felt a little unstable. PayPal needed buzz so it could raise more capital and continue on. (Ultimately, this worked out. That does not mean it’s the best way to run a company. Indeed, it probably isn’t.)2 Thiel’s account captures both the desperation of those early days and the almost random experimentation the company resorted to in an effort to get PayPal off the ground. But in the end, the strategy worked. PayPal dramatically increased its base of consumers by incentivizing new sign-ups. Most important, the PayPal team realized that getting users to sign up wasn’t enough; they needed them to try the payment service, recognize its value to them, and become regular users. In other words, user commitment was more important than user acquisition. So PayPal designed the incentives to tip new customers into the ranks of active users. Not only did the incentive payments make joining PayPal feel riskless and attractive, they also virtually guaranteed that new users would start participating in transactions—if only to spend the $10 they’d been gifted in their accounts. PayPal’s explosive growth triggered a number of positive feedback loops. Once users experienced the convenience of PayPal, they often insisted on paying by this method when shopping online, thereby encouraging sellers to sign up. New users spread the word further, recommending PayPal to their friends. Sellers, in turn, began displaying PayPal logos on their product pages to inform buyers that they were prepared to honor this method of online payment. The sight of those logos informed more buyers of PayPal’s existence and encouraged them to sign up. PayPal also introduced a referral fee for sellers, incentivizing them to bring in still more sellers and buyers. Through these feedback loops, the PayPal network went to work on its own behalf—it served the needs of users (buyers and sellers) while spurring its own growth.

Hirsch notes that Paul’s use of master builder “is loaded with notions of design, innovation and strategic craftsmanship.” God’s house is neither a Craftsman prefabricated home ordered from of the Sears catalogue, nor a flat-packed vision to build an Ikea church. Paul learned from experience that each church plant would incarnate Christ differently depending on the gift matrix of the community in which he planted it. What many call vision is actually the strategic organization of the gifts of God’s people.

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Organizations formerly rooted in local relationships, family ties, and regional cultures became exponentially larger, more impersonal, and more standardized.

matrix structures is that, over time, power accrues to the horizontals. Often, HR or legal have no incentive to say yes, so their default answer becomes no (which is why HR is often referred to as “inhuman resources”). It’s not that HR people are bad people. But, over time, their incentives end up at cross-purposes with those of product managers.

. All too often, problems aren’t in the “nodes” (individuals), but in the interactions (relationships). With the exponential rise in contingencies and interactions, we see signs of a deep malaise in many organizations that can be characterized most clearly as the persistent failure of both downward and upward communication, reflecting indifference and mistrust up and down the hierarchy. Quality and safety problems don’t result from technological failures but from socio-technical failures of communication (Gerstein, 2008).

With crypto, we now have a debt-free engine that, combined with Web3, smart contracts, and gamification, provides a new, truly democratic, financial and regulatory regime that will dominate human engagement over the next decades.

The Great Resignation was big. Millions of people around the world quit their jobs rather than returning to the status quo of their working lives before the COVID-19 pandemic and the resulting global lockdown. The pandemic only accelerated trends that had been building for most of the century. Over the last four decades, the half-life of learned skills has dropped from 30 years to fewer than four, in large part because of the accelerating pace of change driven by the tech revolution. According to noted business visionary John Seely, this trend will continue to accelerate in the years ahead. While employees were forced to work at home, the reason they could work at home was thanks to technological breakthroughs like Zoom, smartphones, ultra-high-speed broadband, and more.

The word “exponential” signifies not just a theory but also a warning: the business world is beginning to move so quickly and so purposefully that if you’re not already changing your business model and thinking differently (and way bigger), you are going to be fatally left behind. ExO: Second Generation The original Exponential Organizations book was published in 2014.

For organizational behavior expert Charles Handy, the S-curve is the essential form of how businesses, social organizations and political systems develop over time, “it is the line of all things human.”7 Tech analyst Paul Saffo advises to “look for the S-curve,” noting that the uptake of new technologies—from personal robots to driverless cars—is destined to follow its shape.8 Scholars have used the sigmoid curve to describe the rise and fall of ancient civilizations like the Roman Empire, but also to predict modern-day shifts, such as the decline of the United States as a global superpower.9 In the field of systems thinking, the authors of the Club of Rome’s 1972 report The Limits to Growth put the S-curve at the heart of their analysis.10 More recently, economist Kate Raworth has shown that mainstream economics assumes that GDP growth follows an “exponential curve left hanging in mid-air,” when the reality is that it is far more likely to level off into the shape of the S-curve.