Dr. Nadya Zhexembayeva: the linear throwaway economy of today is coming to an end
We live amidst remarkable transformation. The linear throwaway economy of today – where we extract the resources, process them, use them barely once, and trash them immediately like a cheap plastic fork - is coming to an end. We are, simply put, running out of things to mine and places to trash. And the market is beginning to recognize it as well: after an entire century of falling raw material costs, the first ten years of the new millennia have seen a whopping 147% increase in real commodity prices. Do you happen to be one of millions of managers fighting the ever-growing prices on raw materials, transportation, operations, and more? Welcome to the future!
Kyle Wiens, CEO of iFixit, the largest online repair community, and founder of software company Dozuki, describes this transformation with laser-cut precision: “The economy is broken. It's not because of partisan bickering or the debt ceiling. It's not because there is too much government spending or too little, too many taxes or too few. The problem cuts much deeper than that; it's systemic and it's global. The economy is broken because the principles that make the marketplace thrive will eventually destroy it.”
A new economy is being born – one that takes the line and turns it into a circle. With that comes a new economic order, where we compete and win using radically new set of rules. For decades, companies claimed their victory by finding the best spot – a unique position on the crowded competitive landscape. Others strived to avoid the crowd by discovering a new market space – swimming into the “blue ocean” waters far away from shark-filled blood-red existing markets. But this old economic order is running its course. Whether red, blue, or rainbow, the oceans are getting empty, and those managers that deeply understand and master this shift are able to turn the new reality into disruptive innovation and remarkable competitive advantage. As they ride ahead of the wave, new products, new business models, new markets, and new profits follow.
There is a very good chance that all this talk about resource depletion makes you yon, cringe, and recall the recent “green business” craze. No doubt, we all suffer from “sustainability fatigue.” So, let me make one thing perfectly clear. The cutting-edge innovation for a resource-deprived world is a far cry from all the sustainability efforts that result in “green” products that are (let’s be frank!) ugly, poorly performing, and grossly over-priced. The world deprived of resources demands a far more radical change than apologetic compromises or PR nods to the environmentalist. The new era belongs to an entirely new set of approaches and competencies. It is time to leave bolt-on sustainability in the past, and look into the future filled with change of remarkable magnitude – and promise.
My challenge is simple: to make invisible visible. The good news was that the journey of discovery had much to offer. While most of the world (including some of you J) remains in the dark, Microsoft is researching a way to turn data servers into residential furnaces – saving millions on cooling of data centers while providing crucial utility to homes across the world. FLOOW2 is making money on allowing businesses sell their temporary overcapacity – underutilized machines, skills, and real estate – all at a click of a button. Puma is getting out of show boxes with remarkable intelligence of the Clever Little Bag, while BMW stops selling cars – and starts selling mobility, electricity included. In Peru, the first billboard that converts air into drinkable water goes up, while in Netherlands, wasteful party confetti biodegrades and grows into wildflowers. It was my job to tell these stories – and share the secrets that make each of them work.
The upcoming Eduson course is here to make the new competitive reality visible – and share the best examples of the radical innovation for resource-deprived world. Trust me, there is plenty for all of us.
Dr. Nadya Zhexembayeva
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Dr. Nadya Zhexembayeva is the Coca-Cola Chaired Professor of Sustainable Development at IEDC- Bled School of Management, an executive education center based in Slovenia, where she teaches courses in leadership, organizational behavior, strategy, change management, design thinking, and sustainability. As a business owner, Nadya oversees a group of companies active in real estate, investment and consulting industries. Her recent client engagements include The Coca-Cola Company, ENRC Plc, Erste Bank, Henkel, Knauf, and Vienna Insurance Group. Nadya’s new book, Overfished Ocean Strategy: Powering Up Innovation for Resource-Deprived World, is due in May of 2014 by Berrett-Koehler Publishers.
