Accelerating the Acceleration

The Great Acceleration Continues…

“Clearly the human story is one of acceleration. There has been a Moore curve in terms of the number of people alive on the planet, our technological ability, and our ability to understand ourselves. We have had this extraordinary, explosive growth in our ingenuity.”

Andrew Marr

Since the “roaring 20’s” began 14 months ago, we have discussed how every trend seems to be moving much faster. In store retail converting to eCommerce, office work becoming working from anywhere, unicorn companies coming to market faster via SPACs.

McKinsey & Company recently took a look at this through the “Inside the Strategy Room” podcast. Their focus was the widening gap in corporate performance. They looked at stock prices in the public markets as their metric. The bottom line, the gap between the top and the bottom companies has widened like never before.

Clearly, the pandemic had a lot to do with this. Sectors in the tech, media and healthcare industries have done well. Those more dependent on physical locations (banks, utilities, transportation, have done worse. But more important than the pandemic, McKinsey sees the acceleration of existing trends.

These trends include:

·     The shift to eCommerce

·     Telemedicine

·     Digitalization of education

·     Slowing globalization

·     Polarization in politics

But these trends are well known and largely discussed before 2020. What has changed and what can the small and mid-market business leader do?

First, is your business flexible? Can you reallocate resources and shorten your OODA loop? Those businesses that can will be rewarded by faster growth.

Next, is your business model resilient? Business model innovation has become a key differentiator between the successful and the also rans. Examples are plentiful. From Amazon conquering the book retail industry 25 years ago by their ability to sell tens of thousands of titles, versus the average brick and mortar retailer. Or Tesla, building a new car brand without a single franchise dealership. I’m sure you can think of good examples as well.

One final note… McKinsey discusses how during previous business cycles, the strategy was to hunker down until the economy starts to grow, then leapfrog your competitors. This time, it was a “through cycle strategy.” Growing during a recession, is the new strategy, and the successful companies, no matter what size, will reap the benefits.