Surfing the Tsunami: Surviving the Cascading Changes Facing Manufacturers

Dr. Joel OrrCyon Research Corporation

Christmas 2004

Technology chaos

• Computers

• Miniaturization

• Globalization

• Internet

• Thermos bottle

$Prices

nanotechnology

SingularitySingularity

CHEAP POWER

CHEAP POWER

Genetic programming

Genetic programming

What makes a tsunami hard to deal with?

• No warning

• More of the same - but a lot more

• No idea how much more

• No idea of how many waves

What to do

• Raise the paradigmatic bar and live in a second-derivative world

• Examine your organizational structure

• The next best thing to the impossible task of predicting the future

What’s your paradigm?

• Change is gradual?

• Demand is cyclical?

• The second mouse gets the cheese?

• … yours?

The second derivative

• Distance

• Velocity

• Acceleration

The second derivative in business

• Work on your business, not just in it. Michael Gerber

• Find new questions

• Listen to customers - but not too much (read Christensen)

Structure is destiny

• Pyramids are a place where great things are buried

• The purpose of a system is what it does

• Out of control

• The Dandelion Paradox

Why did the brontosaurus die?

The Dandelion Paradox

Simulation and the essence of chaos

• Less abstraction; simulation is the end of CAD

• No closed-form solutions

• Cheaper to crash a simulator

• Chaos: God’s way of keeping engineers humble

Knowing the future

• Simulation and the essence of chaos

• “The Black Swan” and predictive fallacies

• Scenario planning

Taleb’s Triplet of Opacity

• The illusion of understanding

• Retrospective distortion

• Overvaluing facts and authorities

from “The Black Swan”

Predictive fallacies from “The Black Swan”

• The Narrative Fallacy

• The Ludic Fallacy

• The cemetery

Scenario planning

• Where it came from

• What it is

• More information: “The Art of the Long View,” Schwartz

Tech snapshot

• Computers: Moore’s Law and up

• Telecom: Schmidt’s Law

• Innovation: Joy’s Law

• Nanotech

• Genetic Programming

• The Singularity?

So?

• Keep one eye on the ball - and the other on the stadium

• Continuously consider structure; revise accordingly

• Think “scenario planning”

Thanks!• References:

• “Structure is Destiny” - http://www.lulu.com/content/49992

• “The Black Swan,” “The Art of the Long View,” “The Innovator’s Dilemma,” “The Innovator’s Solution,” “The E-Myth Revisited” - Amazon.com

• “The End of CAD” - http://joelorr.squarespace.com/the-end-of-cad/

• Me: www.joelorr.com

• Cyon Research: www.cyonresearch.com