You’ll get your fill of Drucker quotes in this post, but I want to bring one more of his quotes into the front and centre of your attention:
The American regulation of business rests on the assumptions that to every industry pertains a unique technology and that to every end use pertains a specific and unique product or service. These are the assumptions on which antitrust legislation was based.
These are interesting times. Many would say the Net Neutrality debate is over, the incumbents have won. Many would say the same about Intellectual Property Rights and Digital Rights Management. Many would say that my views on identity and confidentiality and privacy are utopian and impracticable.
It would appear that the three Is that I have spent time arguing about are no longer worth arguing about: the internet, intellectual property and identity.
Time for dinosaurs like me to go quietly to the grave. Or so it would appear.
At times like these, I read. And think.
So I delved into Drucker. And chanced across something I hadn’t read for a while, entitled Technologies and End Uses. For those who haven’t read it, Drucker makes some very simple and worthwhile points:
- The assumptions about technology and end uses to a very large extent underlie the rise of modern business and of the modern economy altogether. They go back to the very early days of the Industrial Revolution.
- …..it was assumed — and with complete validity — that [each] industry had its own and unique technology.
- By now this assumption has become untenable…. In the nineteenth century and throughout the first half of the twentieth century, it could be taken for granted that technologies outside one’s own industry had no, or at least only minimal, impact on the industry.
- Now the assumption to start with is that the technologies that are likely to have the greatest impact on a company and an industry are technologies outside its own field.
- Today’s technologies, unlike those of the nineteenth century, no longer run in parallel lines. They constantly crisscross.
- Constantly, such outside technologies force an industry to learn, to acquire, to adapt, to change its very mind-set, let alone its technical knowledge.
- Equally important…. was a second assumption. End uses are fixed and given.
- This was accepted as obvious not only by business, industry and the consumer, but by governments as well. The American regulation of business rests on the assumptions that to every industry pertains a unique technology and that to every end use pertains a specific and unique product or service. These are the assumptions on which antitrust legislation was based.
- But by now it is clear that it is not just one material moving in on what was considered the “turf” of another one. Increasingly, the same want is being satisfied by very different means.
- It is the want that is unique, and not the means to satisfy it.
These two lock-in layers are fundamental. One that says every industry has its unique technology, the other that says end uses relate to unique and specific products/services.
These two lock-in layers have coloured our thinking, our investment processes, our valuations, our regulations.
These two lock-in layers are dead. Defunct. As in the Python Parrot.
It does not matter to me just how entrenched the incumbents and their lobbies are, it will not be possible to protect the lock-ins ad infinitum.
The ability to transfer disruptive technologies from one market to another, and the ability to vary end-use way beyond what the “inventors” ever dreamt of, these abilities are as American as motherhood and apple pie. They are the essence of innovation, something America has excelled at. And will excel at again. I’m not American, but I love innovation, and believe that the US of A got many things right in supporting and enhancing innovation. Now it looks like there are going to be a few backward steps taken. Tough. Frustrating for all concerned. But ultimately unsustainable.
It is these abilities that will be held back if the battle for the Three Is (Internet, Intellectual Property, Identity) continues the way it seems to be continuing. Held back, yes. Suppressed, no.
It is the want that is unique, and not the means to satisfy it.
It is the customer that does the wanting. The signalling of his intentions.
In markets that are conversations.
[Note: quotations from Drucker and the illustration from Monty Python appear here on a fair use basis; my thanks to the copyright holders]