A new era in tech will redefine what it means to be an innovator

We’re entering an era that will redefine what it means to be an innovator. Where integrating into existing systems – not the invention of new ones – will reign supreme.

Date May 16, 2023

In Point of view

The Mountaintop can be blinding

How tech companies answer Clayton Christenson’s ‘Innovator’s Dilemma’ will determine the winners and losers of a new tech era.

Companies like Uber, Salesforce, and Airbnb burst onto the scene, promising to disrupt stagnant industries and change the world. And for the last 10 years, these disruptors did just that. But now, these tech companies are the leaders, with new competitors coming for their crown. This puts companies in the position where they have to make a choice: pivot from the strategy that empowered them to reach the mountaintop or continue to ride that strategy in hopes of outrunning the competition gathering at the base of the mountain?

The Market is putting companies in a box

While an economy will naturally ebb and flow, the last year has put it under a microscope for investors. The NASDAQ – the public market bellwether for tech – is down 13% YoY¹. The private market is also taking a hit, with the overall value of VC funding down 42%² in 2022. Altogether, this has resulted in major tech players losing ~$7.4 trillion³ in market capitalisation and tech firms reducing⁴ by 260,000+ employees since 2022. With the financial picture starkly different, tech companies are now re-evaluating the investment strategies that had previously supercharged growth.

Tech companies have long tried to protect themselves from falling prey to innovation, going as far as then Alphabet CEO Larry Page⁵ saying in 2015 the new organisation was created because ‘in the technology industry, where revolutionary ideas drive the next big growth areas, you need to be a bit uncomfortable to stay relevant.’ A quick look at where Big Tech made cuts paints a picture of companies narrowing their vision of what’s possible.

Google: Funding cut to its Area 120 incubator for new projects.⁶
Meta: Made cuts⁷ to its hardware and AR+VR division Reality Labs as CEO Mark Zuckerberg promised investors 2023 would be focused on efficiency by ‘[being] more proactive about cutting projects that aren't performing.’⁸
Amazon: Sunset its primary and urgent healthcare business Amazon Care⁹ and its testing of a robotic fleet of delivery vehicles called Scout.¹⁰

Integrating Tech That's Already Been Invented

This change presents the chance to completely change what consumers expect and how they engage with the world.

‘Cheap money’ fuelled by low interest rates and investment spurred an incredible level of building for tech businesses. Companies like Amazon¹¹ spent double-digit billions of dollars working to uncover the technology of the future. Entering a new economic paradigm, the next era of tech will be for businesses that put the fruits of R&D into the core products consumers use every day.

Integration of actually talking to machines

While the Microsoft integration¹² of OpenAI’s chat model into its Bing search hasn’t been perfect¹³, it has set in motion an AI arms race with Google¹⁴, Baidu¹⁵ , and Alibaba¹⁶. But the real disruptive nature of the technology is outside the search bar. As AI becomes further embedded into some of the most popular¹⁷ websites on earth, people will be re-wiring how they engage with technology. Speaking – or typing – to these AI systems will open new doors for engaging with technology. Imagine an enterprise AI platform trained on company data where you can simply ask it questions versus searching for answers.

Integration of life by the algorithm

Powered by a predictive algorithm based on what it thinks you will like – regardless of who you follow – TikTok has changed our expectations for content. It’s no wonder Meta¹⁸ has increased the presence of its ‘AI Discovery System.’ TikTok has bigger ambitions for its addictive algorithm, using it to power live shopping experiences; an effort already wildly successful in China. With the perfect product and the ability to buy it showing up like magic, it’s no surprise that companies like Spotify¹⁹ are following suit. Could Airbnb or Doordash use an algorithm that removes choice and only shows you the singular properties or food it thinks you’d like?

Integration of the lane switching

Traditionally, organisations in the gaming ecosystem stayed in their respective lanes. In 2023 however, there was a sea change. Nvidia – a maker of GPUs for gaming PCs – launched a cloud gaming service GeForce Now, in 2020. With a 20% market share²⁰ in a growing category, Nvidia has extended its reach beyond selling GPUs. Epic Games, the studio known for Fortnite and Rocket League, recently launched its Postparty²¹ app to bridge the gap between online playing and the connection that happens on platforms like Discord. While neither is revolutionary on its own, what makes GeForce Now and Postparty a disruptive innovation is the way both companies are using their core offerings as a launching pad – not the destination -- to build deeper and wider relationships with users.

So, what’s next?

While nobody has a crystal ball, what we know is tech will be forced to answer tough questions as we move into the era of integration:

When you rely more on machines, do you lose trust in each other?
When an algorithm remakes your decisions, will you lose your ability to choose for yourself?
As companies create more self-contained experiences, what does that do to the small company on the fringes?

Out of the innovator’s dilemma, something new is emerging: the Integrator’s Opportunity. The opportunity to take a holistic approach to innovation where you consider both the technology and cultural impact of integration. To atone for years of being blinded by the pursuit of invention. To learn from the past and build a future that puts humanity first.

Want to explore how humanity-centred tech innovation can shape the future of your organisation? We’d love to help you. Let’s talk.