In the 18th century, warfare was changed forever. Out were the romantic knights with armor and lances, and in were muskets, artillery and infantrymen. Armies now used gunpowder as an effective means to destroy an enemy from afar. Although early muskets had a limited rate of fire, range and accuracy, firearms allowed anyone to become an effective soldier with very little training. Previous military units like bowman and knights needed years of practice to master their skills. These disruptive changes created an entirely new approach to the art of war.
The prince or king — the CEO of that era — who recognized the disruptive force and seized upon it early gained an overwhelming advantage.
Disruptive change is present in every era. It shifts the underlying forces of society, industry or business. In modern times, we have many examples of industries undergoing a disruptive change — computers, telecommunications, pharmaceuticals, newspapers and music to name a few.
The question facing today’s CEO may not be a matter of life and death, but it is vital to business survival: What is the next great disruptive change, and when should you act?
History is littered with the failures of companies that did not see disruptive change or technology: Kodak and the digital camera, BMG and digital music, the minicomputer industry and personal computers, and Dell’s entrance into printing and the threat it posed to HP. Fortunately, history reminds us of the success of those who ride the wave of disruptive change: Apple with its iPod, General Electric, SAP and Oracle.
There are huge rewards for recognizing the indicators of disruptive change. The penalty for lack of response? Struggle, failure and an ignoble exit.
What in the world is the next disruptive force?
Business leaders in every industry have a powerful interest in figuring out what the next big disruptive change will be. Will society move to e-books? Will voiceover IP dominate the telecommunications industry? Will CD collections be discarded in favor of digital?
Those are important issues, but they pale next to the real change that is coming. The clues to this change are literally all around us — in the air, under our feet and in our water. The single most important issue of our generation is not only threatening how we do business today, it is threatening our society, economy and health.
This looming issue is the environment.
Once a concern only for hippies and extremists, the environment has become a pressing issue for everyone living in our world today. In “Green to Gold: How Smart Companies Use Environmental Strategy to Innovate, Create Value and Build Competitive Advantage,” authors Daniel Esty and Andrew Winston write: “In today’s world, no company, big or small, operating locally or globally, in manufacturing or services can afford to ignore environmental issues.”
Some may argue about the causes of climate change and the role that humans play. But from a business perspective, there is no question that the environment is fast becoming a driving force behind public, governmental and economic activities around the world.
In short, the environment is the new musket.