Disruption is all around.
Amazon, which rose to prominence as an online bookseller, transformed into the world’s largest online retailer and leading cloud storage provider.
Uber reimagined ride hailing, and ultimately upended the global taxi and limousine industry, which has still yet to recover.
Airbnb leveraged the sharing economy to become a global hospitality juggernaut.
WeWork evolved from cozy office landlord, replete with artisan coffee and beer, to one of the largest real estate office space holders in the world.
This ongoing revolution underscores tech’s unique ability to transform traditional businesses into innovators. This rise has made one thing abundantly clear: Industries of all types must be willing to adapt, or else, get left by the wayside.
Exponential organizations, such as the aforementioned stalwarts, are upending legacy industries at an alarming rate—and there’s no telling who may emerge as the next great tech-based business.
Since this methodology speaks to the very heart of what we do at Pivot Factory, we reached out to the one person who literally wrote the book on how to grow exponentially.
Salim Ismail, our inaugural guest, is not only the bestselling author of the 2014 book “Exponential Organizations,” he’s also a gifted speaker, innovator, and a sought-after consultant.
"...embracing the concepts of exponential growth also means adopting it as a mindset..."
In this podcast episode, Ismail and host Michael Leadbetter, CEO and founder of Pivot Factory, take listeners into the world of innovation, disruption, and what organizations need to do to survive. Leadbetter and Ismail engage in a thought-provoking conversation about how adjoining tech with traditional business models enables companies to elevate themselves to new heights, what motivated Ismail to write his eventual bestseller, why large companies are built to resist change, and why even industries protected by regulations, such as finance, will eventually be disrupted.
As Leadbetter and Ismail discuss in our debut episode, embracing the concepts of exponential growth also means adopting it as a mindset, one that the entire company, regardless of its size, can get behind.
Below are some highlights from our inaugural Pivot Factory Podcast episode. For the full effect, and to gain a better understanding of why Ismail is such an engaging speaker, please download this episode and subscribe to the podcast on your preferred podcast app.
Disrupting the Immune System
The “immune system” in this metaphor are the legacy companies, or certain factions inside a business, that are stuck in their own way. As Ismail describes it, this faction pushes back when it feels like something is disrupting the status quo.
“In any large organization, you try anything really disruptive and the immune system attacks you,” he explains. “Because all of our organizations are built to resist change and actually withstand risk.”
"Today, either you’re the disruptor, or you’re disrupted."Ismail points to Uber and Airbnb as prime examples of nascent companies that disrupted—and continue to upend—traditional industries.
“This conversation of ‘will you be disrupted’ was a very difficult conversation seven-to-eight years ago when I started writing the book, because people just didn’t see it, as you mention,” Ismail tells Leadbetter. “But now it’s kind of obvious. Today, either you’re the disruptor, or you’re disrupted.
This concept is important for any organization seeking to grow exponentially. If the power of the resistance—or “immune system”—is considerable, it can completely kneecap any path toward real transformation.
In the case of such companies as Uber and Airbnb, they were outside agitators that quickly and methodically turned their respective industries on their head before anyone could intervene.
When asked by Leadbetter if seemingly powerful organizations, such as Wall Street banks, which are highly regulated, can stave off disruption, Ismail replied it’s simply a matter of time before change agents catch up to them, too.
“The reason Uber is successful is it deliberately breaks the law, leap frogs from public acceptance, and waits for policy to catch up,” Ismail says. “Not a very pleasant process, but it’s certainly working for them. Airbnb, if it had time to lobby the hotel industry would have banned Airbnb, but they didn’t see it quickly enough.
“It’s not just corporations that have an immune system, we have immune systems in every institution,” he continues. “You try to update education and you have a big fight with the teachers’ unions, or you see the fights between Uber and the taxis, because it’s one thing to have a corporate set of antibodies blocking progress or blocking disruptive new ideas, but in the public sector, the existing policy is the immune system. And so you have to figure out how to navigate that, which is way harder, in many ways.”
New Way of Doing Business: Abundance Over Scarcity
Ismail spends a lot of time talking about industries built on scarcity that have grown exponentially to dominate their sectors. Again, Uber and Airbnb are perfect examples. Uber leverages the abundance of vehicles already on the street. Airbnb built its business model around an abundance of apartments and bedrooms renters or homeowners were willing to rent, or share.
“We’re finding new business models that are tapping into abundance and finding ways of monetizing abundance,” Ismail explains. “And that’s essentially one of the benchmarks and hallmarks of exponential organizations, which is a totally new paradigm.”
Abundance today means having a ride at your fingertips. It also means you could have access to 30 million songs on Spotify, rather than purchasing tunes individually.
Industries of all kinds are changing, and it’s imperative that leaders of all companies analyze potential pitfalls, invest in new ideas, and move forward, immediately.
One path to success, says Ismail, is the ExO Sprint, which is a weeks-long process challenging leaders of organizations to analyze oncoming risks, be open-minded to what change agents inside the company have to say, and invest in their ideas.
“My thesis is that everyone of the Global 5000 has to go through a process like this, with or without us,” he says. “Because there is [an] actual existential threat if you don’t wake up and smell the roses today.”
“It’s actually a state change, which permanently changes the culture inside that organization.”
Procter & Gamble, a Fortune 500 company that’s been in business for nearly two centuries, took part in the Sprint three years ago. Since then, all the initiatives they launched are running at “full speed, with no slow down,” says Ismail.
“It’s not a flash in the pan process, and you revert back to the old,” he adds. “It’s actually a state change, which permanently changes the culture inside that organization.”
The corporate Sprint has been so successful that ExO created a public-sector version, called the Fastrack Institute. They’ve already ran these in Medellin, Colombia centered around mobility, healthcare, education, and corruption. They’re also in the middle of a project with the president of the South American nation and its highest court to transform its justice system, no small task.
In Florida last year, ExO was hired by the city of Miami to help develop plans for the future of public transportation and convinced the mayor to leverage ride-sharing and take advantage of new technologies, such as electric scooters and electric vehicles.
The takeaway from our first episode is this: Change is coming for the public and private sector, and leaders must be having conversations now and developing innovative new approaches to stave off disruption from future Amazons, Ubers and Airbnbs.
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The Pivot Factory Podcast is a Morey Creative Studios production.
The Pivot Factory Podcast is hosted by Michael Leadbetter, and engineered and produced by Michael Conforti, Rashed Mian and Christopher Twarowski. Jed Morey is the executive producer.