Are you ready to catch the Third Wave?

Part memoir and part vision of the future, Steve Case’s book “The Third Wave – An Entrepreneur’s Vision of the Future” provides interesting insights about the future of the internet. His guidance for both large and small companies looking to succeed in future is based on lessons learned from growing AOL into the first public internet company, the failed AOL-Time Warner merger, and his experience with Revolution Ventures, the venture capital firm he founded.

According to the author, we are at the onset of the Third Wave of the internet, the era in which the internet becomes a horizontal platform, a resource that is embedded into every aspect our lives. The first wave involved the build-out of the infrastructure and tools that connected people to the internet and each other. The second wave saw the rapid growth of services and applications like Google, Facebook, Amazon, Snapchat and Instagram.

The ubiquitous nature of the internet in the Third Wave will disrupt processes, products, business models and value chains in many sectors. Just as electricity transformed the way we live and work, the internet will transform industries ranging from technology to education, health, transportation, financial services, and food. The implications for corporations are significant. According to the Global Center for Digital Business Transformation, 40% of the top 10 incumbents by industry today will be displaced over the next five years.[1]

How do you succeed in the Third Wave? Having a bold vision and strategy are important, but ultimately execution will still be key. The author identifies three P’s that will differentiate the winning companies:

  1. Partnerships – the ability to secure the right partnerships — ones that increase access and credibility with key customers — may mean the difference between success and failure in the Third Wave. Incumbents will partner with entrepreneurs to leverage innovations and insight that will help them navigate potential disruptions.
  1. Policy – the challenges associated with embedding the internet deeply into every aspect of our lives are just beginning to be understood. Regulators struggle to keep pace with new technologies and the products and business models these technologies enable. The list of questions surrounding data privacy, ownership, control, and usage continue to grow. There are also implications for security, health and safety in some sectors. Organizations will need to develop the capability to work with policy makers to address these issues and shape policies that balance the interests of all stakeholders.
  1. Perseverance – success will not come overnight. Given the previous two requirements, there will be a need for leaders to have the patience and perseverance to survive. In particular, entrepreneurs will need take a long-term, holistic view, one that considers the perspective and potential role of policy makers and incumbents.

Two other P’s stood out in the book:

  1. Purpose – the role of business in society is evolving as more companies broaden their purpose and mission beyond just focusing on the return for their shareholders. The level of impact investing is growing and Steve Case’s Revolution Growth is just one example of a fund that invests in companies that have the opportunity to change the world. The evidence is mounting that companies that do good, can also do well financially. Research by the Wharton School of the University of Pennsylvania found that impact investors – those seeking to make a social impact, as well as financial return–can generate comparable returns to other investments.[2]

“It is no longer acceptable for the businesses to see the world purely through the lens of profits and customers; there is also a patriotic duty to make our country stronger, our people more empowered, and the world better.”

—Steve Case, p. 164

  1. People people are critical. Jim Collins, the author of Good to Great, talked about to the need to have the right people in the right seats on the bus.[3] Steve uses his experience leading the difficult merger of the AOL-Time Warner organization to highlight the importance of ensuring that leadership is aligned with the vision and having a culture where everyone is passionate about what they are doing.

“It doesn’t really matter what the plan is if you can’t get your people aligned around achieving the same objectives. “

–Steve Case, p. 139

Opportunities abound in the Third Wave. Where you land is up to you. Will you be the disruptor – or the disrupted? Your success may depend on how you manage the five P’s: partnerships, policy, perseverance, purpose and people.

Are you ready to ride the Third Wave?


[1]http://global-center-digital-business-transformation.imd.org/en/research/overview/

[2] https://socialimpact.wharton.upenn.edu/general-news/press-release-new-wharton-research-shows-doing-well-while-doing-good-is-viable-investment-strategy-investors-seeking-social-impact-can-receive-comparable-returns/

[3] Jim Collins, Good to Great (New York: Harper Collins 2001), 41

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