Why you need to understand the power of a zero distance world

Google Car first appeared in public in 2012. It was not the first time autonomous driving had been discussed. It was, however, the first time an autonomous car had appeared on a public highway.

Crowd holding up devices to take pictures

The Lidar device that sits on top of the car and “sees” cost USD 65,000 back then. It now costs USD 500. Ford and Baidu have just led investment in Lidar maker Velodyne. Does that make Ford a technology company? Or a transport company? None or all of the above?

Even if you think your business looks very similar to how it did in 2012, the world has dramatically changed. You need to be ready to re-evaluate and re-invent your business. Jason Hoffman, Head of Product Area Cloud Systems, and I have written a new paper about this called: Future Digital – changing designs and minds.  The ideas in this post are taken from the paper.

Digital transformation in a zero distance world
We have developed systems that enable us to eat, manufacture, trade, learn and play. These systems have introduced sustained stability, from currency mechanisms to set value to trade agreements to establish predictability. The one constant through the ages has been geographic distance. Whenever distance has been ‘reduced’ – from the Silk Road to the invention of the telegraph – then change has been quick to follow through efficiencies of supply and information.

The current transformation, the one of replacing physical with digital, is exceptionally powerful because it destroys distance rather than accommodating it. The zero distance world challenges all previous systems, even ones that have worked so well that we no longer question their existence.

10 ways digital has changed the world
Let us look at some examples:

  • Currency: An alternative to fiat currency exists for the first time in the shape of bitcoin, which is currently the best performing currency – “Bitcoin was the best performing currency of both 2015 and 2016”, Business Insider [ref];
  • Government control: Russia has been accused of participating in a US presidential election for the first time, something that would have been nearly impossible before due to physical distance – “Secret CIA assessment says Russia was trying to help Trump win White House”, The Washington Post [ref];
  • Privacy: The safe harbor agreement between the EU and USA from 2000 was declared invalid – “What is safe habor and why did the EUCJ just declare it invalid?”, Guardian [ref] and has now been replaced with the EU US Privacy shield agreement – “After Safe Harbor: EU-US Privacy Shield”, ITI [ref];
  • Data: Many countries such as Canada, Germany and Russia are now applying individual data sovereignty laws. – “10 Things to Know about Data Security and Sovereignty”, MSPMentor [ref];
  • Gross Domestic Product: GDP no longer captures the total economic performance of a country – “Spotify is causing a major problem for economists”, Business Insider Nordic [ref];
  • Trade: International trade agreements and import/export taxes are being challenged by 3D printing – “3D Printing Will Not Only Change the Way We Trade; it Will Change the Way We Live”, America’s Trade Policy [ref];
  • Insurance still doesn’t know how to quantify cybersecurity risk and cannot offer coverage – “The Problem With Cyber Insurance”, Dark Reading [ref] The zero distance world challenges all previous systems, no matter how successful;
  • Country: India is accusing Facebook of “e-colonizing” them with their internet.org initiatives – “Digital India: did Modi get it wrong in Silicon Valley”, [ref];
  • Residency. Estonia offers “e-residency” in the EU – “Estonian e-Residency”, Estonian Government [ref];
  • And Facebook is becoming a bank – “The First Big Brand Bank – Facebook”, Duena Blomstrom [ref].

Behind innovation is a digital master
Zero distance changes everything. Behind each change is a leader that has mastered the digital landscape rather than the physical one. In some cases, the existing management systems were put in place for very good reasons (tax, trade, security) in order to manage the physical reality. These systems need to be replicated but in a way that makes sense in the digital world.
This is the opportunity.

10 steps of digital transformation
In our latest paper, Jason and I took the 10 steps of emotional processing and applied them to digital. We write based on the model that change starts with acceptance on the inside that is then reflected on the outside. Here are the 10 steps as applied in the paper:

  1. Observe: New leaders are behind big changes, using new rules and winning.
  2. Notice: The results are transformational, economically and disruptive.
  3. Recognize: Connected everything creates data to feed machines to augment human effectiveness and reach.
  4. Acknowledge: This forces all companies to ask their “why” question.
  5. Accept: And then accept the need to change.
  6. Own: Where a new approach to digital is required.
  7. Appreciate: With next generation digital economics.
  8. Understand: New best practices are required.
  9. Process: And safe change requires discipline.
  10. Reframe: Finally accept the need to embrace, accept, and start observing again.

Again, if you want to explore this in more depth, check out our paper and join the discussion!

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