Aaron Dignan: The Operating Model that is Eating the World

ATN-300InsightaaS: This 2013 post, by digital strategist Aaron Dignan, was nominated as a reference for the TCBC Planning for the Cloud/Cloud Strategy – SMB group, but it informs many of the areas that are important to integrating cloud into business – strategy, but also skills, GRC, and cloud business models, metrics and imperatives.

The post itself can be seen as comprised of two parts.The first is a fascinating analysis of how software-dependent business models are altering business perspectives on what is important to success. Quotes from this section provide an illustration of how powerful Dignan’s perspective is:

  • “It used to be that the best day to start your business was yesterday. Now, due to the constant expansion of what you’re able to invent in your garage, tomorrow is almost always a more advantageous starting point.”
  • “Today’s fastest growing, most profoundly impactful companies…have an intense bias to action and a tolerance for risk, expressed through frequent experimentation and relentless product iteration.”
  • “The physical world that we used to value so much – the devices, cars, real estate, and other infrastructure – are merely inventory for something bigger. The value, it seems, is in the data, the tools, and the optimization of markets.”

The second part of the post focuses on Dignan’s concept of a “Responsive Operating System” for businesses, predicated on “five nested domains: Purpose, Process, People, Product and Platform.” I found this section of the post less compelling; it has interesting ideas (and is worth a review), but some of the concepts don’t hang tightly together – for example, the notion that platforms evolve accidentally or intentionally is likely accurate, but the accompanying description of the process by which they emerge isn’t all that compelling.

This, though, is a nit. The overall post is thought provoking – and despite the fact that it mocks PowerPoint-centric meetings, it’s likely that you’ll integrate snippets from Dignan’s text into your next presentation. I certainly will!

Tesla, the fastest-growing stock in the automotive industry, is run by a software engineer. Amazon has a market cap three times bigger than Target, even though it operates at a loss. Instagram, a company with only thirteen employees at the time, was acquired for a billion dollars just three months after Kodak filed for bankruptcy. These are technology companies doing extraordinary things. But there is a larger pattern here. The dominant players in video, music, retail, recruiting, and direct marketing are also companies that operate like tech startups. This phenomenon is spreading, and by the time it’s through, every category on the planet will be shaken up.

Technology – software in particular – has had a destabilizing effect on traditional business models. The proliferation of personal computing power has leveled the playing field in almost every industry. As products and the means to create them have become digitized (often referred to as software eating the world), production capability has grown more accessible and portable. And the acceleration of that trend (driven by Moore’s Law) means that every single day it gets easier for someone else to compete with your product or service, and to do it better, faster, and cheaper…

Read the entire post: https://medium.com/@aarondignan/the-operating-model-that-is-eating-the-world-d9a3b82a5885



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