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Seeing Around Corners

Capitalize on Inflection Points for Business Success

Book Review by Andy Ghillyer

Venture capital funds commit hundreds of millions of dollars annually in search of disruptive technologies that promise “paradigmatic shifts in the business landscape.” Insatiable demand for these unicorns can drive astronomical valuations––Uber, WeWork, Theranos––before the long-term viability of the model is even proven.

In her new book Seeing Around Corners: How to Spot Inflection Points in Business Before They Happen, author and Columbia Business School professor, Rita McGrath, argues that such fundamental shifts in the business landscape––so-called “inflection points,” or 10x shifts––can be identified in advance. During their gestation periods the signals are just strong enough to be noticed by those who are paying attention but weak enough to be overlooked by those (hopefully your competition) who are not.

The Four Stages of Inflection Point Development

There are some cautionary tales for those who underestimate the potential damage of an inflection point (RadioShack, BlockBuster, Toys ‘R’ Us) or those who realize the potential damage too late (Sears, Dell, Hewlett-Packard). In both cases, the damage can be significant and the potential recovery unlikely, if not impossible. McGrath outlines the four stages of development of inflection points and identifies the key points at which they should be closely monitored.

1. Hype
As the name implies, pundits with large enough platforms begin by formally endorsing the next ‘paradigm shift.’ Investors, driven by faith or fear of missing out (FOMO), rush in with a “land-grab” mentality. The assumption is that there will be massive growth (much like the early days of Bitcoin) none of which has yet to be proven.

2. Dismissive
When the chaotic investment activity inevitably dissipates with no clear victors, those who sat on the sidelines of the “land-grab” get to say “I told you so,” while paying no attention to the key players who do manage to survive the shakeout and begin to “set the foundation for major growth.”

3. Emergent
At this stage the dust is starting to settle, and key contenders are beginning to come into the cross-hairs of those paying close attention. There may still be competing models in play, but those looking to anticipate the next inflection point will be generating options to respond to whichever model rises to the top.

4. Maturity
In true Darwinian fashion, the leader(s) emerge and the dramatic change to the business landscape become the new normal until the cycle begins again.

McGrath makes a critical distinction between seeing the inflection point and fully understanding the implications for the, “taken-for-granted ways we do business.” Blockbuster’s now ill-timed decision to pass on purchasing Netflix in its nascent years is a perfect example of this.

You have a clear choice ahead of you. You can sit in the executive suite and give your opinions on Google’s purchase of YouTube or Facebook’s purchases of Instagram and WhatsApp, or you can build a team that does the research and legwork to develop a comprehensive assessment of what that impending shift really means.

Seeing Around Corners presents a simple but clear strategy for identifying inflection points before they reach full maturity.

If you want to be Facebook rather than MySpace, read this book.

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Andy Ghillyer

Andy Ghillyer is a Contributing Writer at Soundview. He lives in Tampa, FL where he specializes in writing for the B2B and academic markets while raising a growing menagerie of cats and dogs. His other reviews are here.

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