Buggy whips (and buggy whip manufacturers) are commonly used as a reference to something that was once common but that’s now all but extinct.

It’s not so hard to make a list of things that are either already there, or trending heavily in that direction.

-Fax machines

-Printed newspapers

-Land lines (and the busy signal)

-The US Postal Service (thanks in no small part to the doxo’s of the world).

-Shopping malls (Amazon fueled this)

-Signatures (the squiggles we draw at the grocery store and in restaurants, and the lack of frequent pen use have made our John Hancock’s unreadable – and in many cases not useful.  Docusign is also a big part of this shift.

-Change (and cash).

-Repair shops (it’s often cheaper to replace something now than it is to fix it).

As individual cases, none of these should be particularly shocking, or newsworthy.  What’s more interesting are the secondary and tertiary impacts of these and what that means.  Change and cash are an interesting one – and something I have seen that has started to happen is that panhandlers are asking for something we don’t have – we don’t have any change let alone spare change – and even if they were wise enough to ask for a dollar, many of us aren’t even carrying one of those around on a daily basis anymore.  So where’s the future of panhandling?

Writing and signatures are interesting as well.  Will pen manufacturers go out of business?  Will notebooks (actual paper) become a thing of the past?  Will the hand written note (including the thank you note) go away even more than it has already?

The big one that will be messy but that seems inevitable is the USPS.  It’s already crazy that they go to my house at least once a day for six days a week when at most I need it delivered twice a month.  But what if UPS and FedEx took over the whole thing as doxo gains momentum?  No more mailboxes?   No more stamps?

Shopping malls are pretty clearly in the crosshairs.  We saw a terror group threaten US malls recently, and I couldn’t help but wonder why people even go to malls anymore at all?  Sure you need to try some things on and window shopping can be a way to kill time – but with things like same day order/delivery – which suggests people are busier than ever – is the notion of killing time dying as well?  Bowling alleys were the first to go – real estate costs in high density areas got to be too much.  Amazon and expensive real estate are why malls are the next thing to go.

I am not saying I have all of these things figured out – I just think it’s an interesting spin on predicting what’s next.

It seems everyone is talking about the Internet of Things, more commonly referred to simply as IoT.  It has overtaken “cloud” as the biggest buzzword in tech.  But while there have been some very big, very public early successes, from the Nest home thermostat to the Disney MagicBand to name only two, the IoT suffers from some pretty big problems.  This is the first of a series of pieces about the state of the IoT.  The goal of these pieces is to help people navigate through some of the hype and hoopla so they can better understand why, or if, they should care about IoT, and in that context, how urgently they should be doing anything about it.  I will lay out five core issues with IoT and the next five pieces will delve more deeply into each with specific thoughts on how to solve each specific problem.

1. It’s Just a Horrible Name. In 2009, Mary Tripsas wrote an article in The New York Times “It’s brand new but make it sound familiar” and in that article, she pointed out that automobiles didn’t sell at first because no one understood why they would want one. It wasn’t until it was named the “horseless carriage” that they got the context of what it replaced. While Internet of Things is technically an accurate term describing the fact that machines can now communicate with other machines in much the same way humans interact with the internet, IoT is still too abstract for many people to understand the use cases that might apply to them – or where there might be opportunities for new businesses. At least the notion of putting your data in the cloud conveys the fact that data and computing power exist in what is for you a non-physical ether-like space. While I am not going to tell you I have the perfect name to replace IoT, Robert Scoble’s book Age of Context, which I will admit I first overlooked in large part because of the title – context is one of the words that is missing from IoT, as is the word experience. There are many examples on the piece about the name – so stay tuned for that.
2. Way too tech focused. Sure, the things that are possible under the umbrella term IoT would not be possible without technology, but again, whereas “cloud” has a common thread in its meaning across all uses, IoT encompasses a vast array of technologies, and technological possibilities so as to almost make the term too big for its own good.   Yes it can be real time location services, yes it can be reminders to take your daily medication, yes it can tell you whether or not your heat is on, but there isn’t yet enough of a unifying element to all of these use cases to make it simple enough for many of us to explain to our parents or our young children. And we need that. At the risk of being ironic, the larger piece about this point will delve into several examples of the technology developments behind the term IoT, in large part because point #3 is all about the business opportunity side.
3. Business opportunities are often non-obvious. By now many of us have heard about dirty oil or “oil sands”, the gist of which is that it has been known for a very long time that there is oil in Canada that’s full of dirt – and unless the price per barrel of oil is greater than some specific number, it’s not cost effective to go get that oil.  Until recently the price of oil was very high, so it was an easy decision to go to work on the oil sands. That opportunity has been out in broad daylight, even known to people like me who have nothing to do with the oil and gas industry. The opportunities for IoT are, in most cases, much less well known and even less obvious. That’s partly because technology is moving so fast, many people are unaware of how cost effective some things have become – their “oil sands” opportunity might be right in front of them and they may not be aware of it. The piece on this point gets to several examples of what I call trajectories of opportunities intend to help unmask some of the opportunities that are emerging right now.
4. Not a one-size-fits-all solution. While there are some solutions that amount to an IoT solution “in-a-box”, for now these solutions remain fairly expensive for organizations to implement. Kite Solutions is the name of an early stage company that is somewhat a match dot com for big companies looking for the right little company to help them with brand-aligned innovation. I don’t know if Kite will expand to help companies find the right IoT people/technology/company for them – but it wouldn’t surprise me, and that’s sorely needed. This piece breaks out some classes of opportunities that are emerging to help people better understand navigating the build versus buy decision – and in some cases just sit and wait for now.
5. Shift too big for the big guys. If you look at a company like Cisco, they started out as a pure hardware company. Today they describe themselves as a software company and they are trying to play catch up with the likes of IBM and Microsoft in figuring out selling and tracking licenses as companies shift from paying for perpetual licenses to software as a service (subscription based), or SaaS. But Cisco still has a lot of hardware people leading this shift to being a software company, and hardware people have very different DNA compared to software people. So when you look across at what amount the Mount Rushmore faces of high tech – Cisco, Intel, Microsoft, Oracle, IBM, and some others, not only do they need to pivot to position themselves for success in IoT, they are going to inject some new DNA if they want to stay a face on Mount Rushmore. Careful mergers and acquisitions will be a key to success for this, but there is more to it than that, and this piece explores that in greater depth.

So stay tuned for the five follow-on pieces to this.  I look forward to your feedback.

-Ric

I don’t go to Starbucks every day, but I am certain that I never heard anyone order a “flat white” until about three months ago, and now with huge “Flat White” signs prominently displayed in every cafe I have gone into lately, I hear it at least 50% of the time i go in for my breakfast sandwich.

What is a flat white? Well in their words:

A product of simplicity, crafted into artistry, our baristas know that balance is key to the perfect Flat White. An extra ristretto shot ensures that it’s bolder than a latte, yet steamed milk keeps it smoother than a cappuccino. But perfection doesn’t end there—the technique for steaming and pouring the milk requires close attention as well. Steamed milk is folded into itself creating a velvety microfoam that gives the Flat White its silky texture and signature white dot.

I have a theory about why they did this and why it appears to be a runaway success.  While some places will advertise things when they have a surplus of something or when something is about to go bad (the real reason there is a blue plate special – sorry if I burst your bubble there).   It’s obviously not because they have a surplus of ristretto shots. I believe it’s because most people are afraid to order complex drinks at Starbucks, and even more afraid to hold up the line and ask questions – like what on earth is a ristretto shot, or for that matter microfoam?  Arming customers with a simple label – the flat white, allows them to sound smart, while venturing away from the one drink they have memorized so they can sound smart (soy vanilla latte drinkers, you know who you are) but really don’t know how to order anything else.  I am guilty of this – I typically order drip coffee because I am in a hurry and I don’t know much about espresso drinks.

My prediction is that Starbucks will continue to educate customers by offering drink names that are easy to use and remember, like flat white, so that people will try new things and get better educated about their choices.  I could be wrong, but that would be my guess, and whether it was an accident, or really smart, a win is a win.  Just ask the New England Patriots.

That’s what I think.

Amazon wants to own retail, and at this rate, the only company that could stop that is Amazon – that is if they fall, stub their toe, or take their eye off the ball (Fire phone . . .ahem).

So if you look at the end to end customer “journey” of buying things, from search/discovery of an item, to selection, to plan to purchase it, to purchasing it, selecting shipping, payment type, and destination address  – Amazon has that, and better yet – they have our trust.  OK – that’s about half the battle.

The other half of the battle, probably more than 50% depending on where you sit – is on the seller side.  The  seller has all sorts of journeys to go through from selecting products to sell, making or procuring them, pricing them, figuring out how to advertise and sell them, and so on.  Amazon touches some of those aspects of the seller journey, and they certainly play a matchmaker role in connecting buyers with sellers – and that’s one of their biggest value adds.

But there is one thing that has gotten Amazon in the news in a, well, awkward way, and that’s when and whether to charge sales tax.  While that has largely resolved itself, I think Amazon could help sellers save mountains of money in a way that has almost zero impact on the customer experience – and that’s helping the seller with tax calculations.  Tax calculation, especially in the US is shockingly complicated – so  complicated in fact, that Avalara, from sleepy little Bainbridge Island, Washington processes billions upon billions of tax calculations every month because sellers understand they can never stay on top of this on their own.  Never heard of Avalara?  Well then you aren’t a seller.

Avalara. That’s who Amazon should buy.  Great business, profitable, and owning that further locks Amazon in as the backbone of retail.

Who killed Clayton Christensen? Jill Lepore did.  With her mightier than a sword, pen that is.

Her article in the June issue of The New Yorker, “The Disruption Machine” is very long and very through in pointing out the flaws of Christensen’s thesis in his book The Innovator’s Dilemma (which is wildly popular and successful by almost any measure).

I once suggested to my editor, the recently wed Donna Carpenter LeBaron, that we do a piece pointing out the incompleteness of Jim Collins’ Good to Great, which isn’t hard to do, but she suggested that it’s better to offer a new solution than to highlight the flaws in the work of someone else.

So here goes.

First, the thumbnail idea of the innovator’s dilemma, I am told, is that organizations spend too much time keeping current customers happy and don’t focus on what the customers of tomorrow will want or need – which is a massive innovation on what they have today.  So instead of a company focusing on how to make the best buggy whip, they should instead invest in innovating around the horseless carriage (my example, not Christensen’s).

Creative Destruction, credited to Joseph Schumpeter, became very popular in the middle of the 20th century, and Lepore suggests that Christensen’s thesis is not so different from his, and goes on with many examples of why Christensen’s algorithm for predicting the future of where innovation is needed and who is on the right track is flawed.  One example she cites is that Christensen declared the iPhone could not possibly be successful (when it was first announced).

When I read Lepore’s piece, I instead wondered if the simple reason that the innovator’s dilemma is flawed in predicting the future, is because the model, or more precisely, the algorithm, went out of date sometime between Schumpeter and Christensen, and by that I mean that I suspect that something that was a valid assumption, or constant, in Schumpeter’s day is now a variable and Christensen’s model did not take that into account.   That assumption / constant being human behavior.