Life goes digital and changing our world. Airbnb, Instagram, Uber, Whatsapp, Blockchain etc.
Your industry, the business you have built and love, may already be watched by some disruption vultures. These are tech people, identifying limitations of your business model and re-inventing it, applying latest digital technology, making your company obsolete.
There is another aspect: re-location.
In the past, tech firms had one choice only to become really succesfully: Silicon Valley.
But digitalization, kind of invented there, now enables businesses to settle somewhere else, and have even some advantages, the Valley can’t offer: immigration, taxes, operation and living costs, climate and investment opportunties.
We’re in Panama for a reason, some of them.
Stay with us to speak about how to disrupt your business model yourself.
It is months now since Boeing’s 737MAX has been grounded worldwide, following 2 fatal crashes. Now I am reading that it is suggested to change the type’s name, after fixing the problems, of course. Bad idea.
There is one recommendation for Boeing only: learn from Mercedes’ elk test experience.
In 1997, the brandnew Mercedes A class model had been flipped by test-driving newspaper journalists in the so-called elk test procedure – a desaster.
Mercedes did postpone market launch for 6 months and equipped all A-class vehicles with ESP (Electronic Stability Program), unheard of in this category before.
So the problem was not only solved but converted into an advantage and marketed accordingly. Buyers were not suspicious after the event but proud to own such a safe car.
So here is what Boeing has to do:
Solve the initial problem
Add an extra safety feature, only planned for a future flagship product
Thus make the 737MAX brand a synonym for a super-safe aircraft, people longing to fly with.
His song title Power to the people is becoming popular again nowadays, when Internet giants have no shame to exploit our personal data for undisclosed purposes. Well, mostly for money and even more power.
As always, when a movement goes to far, opposing powers rise up, slowly first, unstoppable soon. A good sign is when industry veterans initiate or join such action, feeling that the Web is not anymore what it was supposed to be.
Have a close look at those developments:
Next worth to watch is SOLID and its POD concept, initiated by Sir Tim Berners-Lee himself, the famous WWW creator. POD stands for Personal Online Data Store, promising users to be and stay the masters of their data, enabling them to share through apps, but never losing control.
Last but not least, there is TUTANOTA, a newcomer out of Germany, offering “the world’s most secure email service, easy to use and private by design”. A fresh start, no veterans involved, as far as I know.
Another fresh approach, up to change advertisement and customer relations, is MYFAVORITO, where DISRUPTEC has been an early advisor.
Despite mainly supported by the public, remarkably even under black and hispanic population, NYC socialists have succeeded in killing the Amazon HQ2 project. Great.
Have written few years ago that it’s time for tech companies to move out of Silicon Valley, as there is no need for such silos anymore, not to speak about the ever-increasing costs of doing business there. However, setting up shop in NYC instead is not a real change nor improvement. Gotta get out of the comfort zone completely.
Today, looking at this HQ2 debacle, my advise is to radically diversify geographically, whereby such advise is not addressing the big ones anymore – Apple, Alphabet, Microsoft, Facebook, Amazon and alikes – but their upcoming challengers.
As the end of Airbus 380 has shown that it does not make sense to copy a market leader strategy, if you want to win. Have a distinct different strategy and start with HQ location:
Doing business in SF, NYC or other US metroplexes has become a struggle on many frontlines.
In tropical Panama nobody would complain about becoming home of a corporate headquarter. Instead, Panama has made special bienvenido rules for them and some have been following already. Getting much more for less is easy to understand, isn’t it?
Latin America, located in the same hemisphere, sharing culture and values, is about to learn a lesson after Chavez’ socialism of the 21st century has ruined former rich and beautiful Venezuela. Won’t happen again anytime soon.
Here’s a ranking based on 2018 results, showing how Panama has succeeded in a decade-long race to catch up and positioned to become #1 in 5 to 8 years.
There are many advantages speaking for a corporate HQ507:
The Panama Canal is the backbone of the economy, as well as financial and business services, like ship registry. Tourism is another income source as agriculture is.
If human capital is priority #1 for any hi-tec company to thrive, then Panama is in a perfect position, by itself and being located in the middle of the Americas, with direct flights from/to 80+ cities between San Francisco and Buenos Aires, Santiago de Chile and Toronto.
Young professionals will easily get permanent residency. They’ll enjoy preferrable tax rules and have endless attractive investment opportunities. Imagine to purchase a contemporary 130 m² 2bed/2bath oceanview condo for $200,000.
Having done business in Europe, South East Asia and the Americas, Panama is a perfect choice, all things considered.
To choose a platform for upcoming digitalization projects is a strategic decision. Large enterprises have basically 3 options:
established market leader – as used by their competitors
open source product – without influence on further development
owning a proprietary platform themselves
Obviously, the proprietary option makes a perfect solution:
differentiation from competitors – one does not become a market leader by doing what others do
control of ongoing development
IP creation and future paybacks
However, developing such a complex platform has two challenges: costs and time-to-market as the most important factor.
How to overcome both issues?
There are companies out there, focused on technology, having built a product over years, permanently further developed, based on real customer requirements. Many of these companies have never had sales departments, hired more programmers instead.
They have always quickly identified, built-in and applied new developments in real-life projects. This way they have grown their customers successes significantly and made themselves enough money to independently decide what they want to develop next.
While Cryptocoin enthusiasts are having a difficult time for a while already, the technology behind is moving along unstoppable, not just nicely.
For some eye-opening insight and outlook, George Gilders latest book Life after Google is a great read. It appears to confirm the fact that even the biggest tech firms will be overrun sooner or later. Overrun by people thinking out of the box again, developing new technologies and making it a business from the beginning, finding adequate means to fund it, not the old-fashioned VC way.
There goes the centralized web and the centralized funding, once grown up together. Everything has its time.
Ironically this new tech movement is taking up pace right at the time when the old gatekeepers begin to abuse their power openly and evily. Nice coincidence.
What an environment has been created over time to oust a genius like Brendan Eich as Mozilla CEO for giving $1,000 for a case they find wrong? And this is just one example.
For a guy like me, grown up in East Germany, such Social Warrior movement is like going back in a time machine, but worse.
However, nobody and nothing is useless, can still serve as a bad example.
While writing this post, Bitcoin is approaching the $12,000 mark, again.
Willy Woo has published an analysis showing that the number of bitcoin users doubles every 12 months. Sounds familiar? Because this is the characteristic of exponential growth.
When exponential growth is based on a massive transformative purpose, then disruption is unavoidably going to happen. And here’s this purpose as wisely stated by @ErikVoorheeson November 28, 2017:
Why does Bitcoin keep growing? Because it’s time to separate money and state.
Naturally, somebody who has been working decades in the same industry doesn’t like disruption. It devalues their knowldege and experience, undermines the standing they are used to. So it is no surprise that Nobel laureates Stiglitz and Shiller are not fans of bitcoin & co.
Here is an articulate scenario:
Digitization-based disruption is already happening everywhere. For society, government and finance industry it’s just beginning.