We think that digital causes change and uncertainty. However, even if it has a lot of change left there is little uncertainty in it. Uncertainty comes from a new set of paradigm shifts that go beyond information processing and will change our physical world. Digital is the tip of the iceberg, but most change will come from below.
We live in tremendous change and uncertainty. The most cited cause for this is “digital”. Digital is the new catchphrase. Digital is what is changing everything. People are trying to become digital. Companies are creating Chief Digital Officers and Digital Transformation Plans. Governments have Digital Agendas.
Digital is a fuzzy term with no formal definition. It can be thought to encompass the integrated impact of 8 technologies that build on each other:
- Internet. The internet is the decentralized intercommunication of computing devices through high capacity digital channels. The internet was originated as a defense project by DARPA, a USA government agency, and opened to commercial use in the mid-nineties. HTTP is the “language of the internet” developed by Tim Berners-Lee, a scientist at the European CERN. The combination of the internet and HTTP has created “the web” as we conceive it today which is the foundation of digital.
- Digital Marketing. As with all other human media, the first step for the internet was advertising and lead generation. While internet advertising was born fragmented, it rapidly coalesced to a single major chokepoint, search. Google sprung from leveraging that chokepoint for digital marketing which still accounts for most of its revenue. Digital Marketing has gradually eaten up traditional media in the process.
- eCommerce. The second step for the internet was taking economic activity online. Selling and buying stuff was enabled by reusing the existing offline payments (credit cards) and delivery (postal and courier systems) infrastructure. Amazon emerged as the eCommerce juggernaut working on the delivery side. eCommerce is still in the initial steps of disrupting retail.
- Cloud. Cloud is a centralized computing and storage paradigm that was developed on top of the internet in the first decade of the 2000s using virtualization technologies. Cloud uses central capacity to allow for an optimized use of resources and shared access to information, reducing dramatically the cost of deploying technology. Amazon, Google, and Microsoft are the largest cloud players. Cloud has disrupted the traditional technology hardware business.
- Big Data. With centralized storage came big data. The possibility of storing and analyzing information at scales which were uneconomical until then. Big Data is the possibility of new ways of data gathering, analytics, and visualization through the cloud and internet. This new richness in data is what has lead to the “data as oil” metaphor. Everything Digital leverages Big Data today
- Social. Social emerged from the internet, cloud and big data. Once you have a centralized register and direct one to one communication you get social. You could centralize the registry of people you knew (Facebook) and communicate directly with them (Skype). This eventually was transferred to the business realm (LinkedIn, Salesforce Chatter, Yammer, Slack…) and social came to business.
- Mobility. Mobility followed the PC based internet. It unfettered access from cables and put it in our hands. The effective marriage of mobile phones the Internet and Cloud was accomplished through Steve Job’s iPhone in 2007. Mobility has totally transformed society in less than 10 years and propelled Apple to the number one spot. Traditional internet and cloud players had to adapt to mobility with some thriving (Google, Facebook, Amazon) and others being rendered obsolete by it (Yahoo!, eBay), while others emerged in “mobile social” (e.g. Snapchat, Pinterest).
- Platforms and Marketplaces. With the new mobile social cloud, a whole new world of possibilities opened with platforms. Creating two-sided markets that linked demand and supply for various sectors in high volume interactions. The last generation of unicorns came from here (Uber, AirBnB, etc….).
Digital is very important and has transformed the world. However, the technologies incorporated in it are “mature” now. The most advanced companies in the world have already adopted them fully and are leveraging them to a large percentage of their potential. We can see the impact that digital technologies will have, there is little uncertainty left in them. It is a matter of time until this paradigm is fully deployed and its full impact felt.
Of course, there is substantial change left to happen. The adoption curve or the disruption it will cause is not complete. Advertising might be quite far along the path, but other sectors like retail still are feeling the initial impacts. Traditional companies, governments, SMEs and many individuals still haven’t adopted digital, with different estimates of “digital potential” put adoption between 10 and 20%. Even so, this change will be mostly in how we process and relate to information, it has a comparatively small impact on the physical world
Uncertainty and change to our physical reality will come from the new set of paradigm shifts on the horizon. Some are direct heirs of the digital technologies (like Software Processes, Integrated Reality or Digital Governance), others come from a completely different angle but are empowered by digital technology (like the New Energy and Transportation Matrix, Bioprogramming or Neurogamification). All of these new paradigm shifts that come below the iceberg will transform our physical world and way of live and business beyond recognition. Digital was just one paradigm shift. Below the iceberg we have at least 6 new paradigm shifts with others looming beyond in the horizon. These paradigm shifts are uncertain. They will be the sources of surprise and disruption we cannot still predict.