Thursday, August 16, 2007

Disruptive Technologies

As one with theories about just about everything, I've become enamored over recent years with the concept of disruption. Partly as a management technique, I've learned that unpredictable shifts and experiments can help organizations (companies, non-profits, government agencies) shake off their lethargy, and acquire a new agility, embracing new opportunities.

On the other hand, by nature, I am not a disruptive person, nor have I ever been. The kind of person who introduces a sudden tension into the room is not someone I admire or aspire to be like. Preferring compromise to confrontation, and reconciliation to alienation -- synthesis being my goal -- I'm always happiest when the groups I am in find a happy medium, as opposed to one extreme or another.

Thus, it is with some irony that I often find myself perceived as a disruptor, not by personality type so much as by a congenital intellectual restlessness. It seems that I cannot shut out new pieces of information that adjust whatever complex puzzle I am helping to assemble.

In the technology sector, we recognize that certain technological advances disrupt business as usual. Even as the Web 1.0 bubble burst, there was no doubt that the Internet had successfully disrupted every business activity on earth, rendering the old ways obsolete and the new ways inevitable.

We are in the midst of a second wave now, Web 2.0, even as the stock markets undergo a serious "correction" that is the classic sign of the end of the Bull market, and the beginning of what for lack of a better term will be a recession. Credit will be harder to obtain, for individuals and companies, growth will slow, and forming new ventures may once again become more difficult.

(My Apple stock has dropped the 30 points from 147 to 117 almost as rapidly as it gained them. Markets go up; markets go down. Timing is everything. Small investors like me are losing money faster than we could have spent it, but if I learned one lesson from the Web 1.0 bubble bursting it is to stay the course, stop looking at the latest numbers, and wait for the recovery.

After all, where are baby boomers going to invest their money if not in the stock market? Most own their own homes already. And, all pension funds and IRAs are deep in the markets.

Therefore, I am not particularly concerned about this downturn in the Dow-Jones, NASDAQ, et. al. It's the inevitable disruption of stupid sub-prime loans, granted by greedy lenders to greedy borrowers, and in this, I am a Darwinian. The markets are weeding out those ignorant and reckless enough to gamble their assets on an ever-more-prosperous future.

Better, I say, to buy seeds and plant your own salads. Shop for used clothes. Eat chicken gizzards. Ride out the hard times, but don't use your credit card, and don't panic. After the storm, the sun will again shine.

Disruptions, even painful ones, are good for the system overall, much as a forest fire is good for the trees.

-30-

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