The exponential age. By Azeem Azhar. Diversion books; 352 pages; $ 28.99. Published in Great Britain as “Exponential”; Random business from home; Â£ 20
Human borders. By Michael Bhaskar. MIT Press; 432 pages; $ 29.95. Bridge Street Press; Â£ 20
Masters of scale. By Reid Hoffman with June Cohen and Deron Triff. Cash; 304 pages; $ 28. Bantam press; Â£ 20
HISTORIANS OF SCIENCE distinguish between useful discoveries, such as dental floss, and ‘general purpose technologies’ that can be applied for many purposes, such as electricity, which powers everything from factories to streetlights to televisions . These transformative inventions and the gadgets they spawned were developed at a rapid industrial rate in the 19th and 20th centuries. Today, however, a new phase of progress is underway: many technologies are not following linear but exponential growth rates. It does more than accelerate innovation. It poses drastic challenges for businesses, governments and society.
Many Western institutions are unprepared for this change because they are stuck in an industrial age mindset, say three new books. There’s a good reason for this: people are generally much more familiar with linear growth, where things change or add up bit by bit, than with the exponential type, where they double or triple (or more). at each increment. For example, if a step is one meter long and you walk 25, you have walked 25 meters. But if each step increased exponentially, doubling from one to two to four meters and so on, your seventh step would cover a football field and your 25th would span 33 meters, almost the circumference of the Earth.
It might seem slow and boring at first, but the exponential shift suddenly becomes incredibly dramatic. The world is in the midst of such a transformation, says Azeem Azhar. Computer technology, he notes, has long observed Moore’s Law, according to which the power of a computer chip (measured by the number of transistors) doubles every two years, essentially without increasing costs. But, says Azhar, today such exponential growth is also characteristic of other technologies that have been supercharged by digitization or advances in artificial intelligence (AI). These include solar cells, batteries, genome editing, augmented reality, 3D manufacturing, e-commerce, even electric cars and urban agriculture, as well as, alas, online disinformation, cybercrime and warfare.
A multitude of superstar companies are emerging on the backs of these technologies. They dominate their industries because of network effects, where using the same platform is largely beneficial. For example, Alibaba, a Chinese e-commerce giant, created an online payment system in 2004. Nine years later, it had grown into the world’s largest mobile payment platform, called Ant Financial. By having a plethora of data, he could improve his service, which made it more popular, which in turn allowed him to collect more data – a known cycle, in a term popularized by management scholar Jim Collins. , known as the âdata flywheelâ effect. .
Ant Financial data scientists found that women who bought skinny jeans were also more likely to pay for their phone screen repairs. They assumed the handsets were slipping out of the trouser pockets. So the company started offering screen insurance deals to women wearing skinny jeans. Thanks to this information and targeting, 80% of its clients use at least three of its five financial products. Traditional banks that do not have such data are at a great disadvantage, what Mr. Azhar calls the âexponential gapâ.
Drawing on his experience as a start-up entrepreneur, technology investor, innovation manager in large companies and journalist (including, 25 years ago, at The Economist), Mr. Azhar is well placed to decipher these digital trends. He has a knack for questioning and reversing conventional thinking, for example by asserting that the adoption of exponential technology leads to job increases, not job cuts. The resulting unemployment, he says, is due to companies that fail to adapt, not to those that do.
Exponential or bust
The importance of harnessing technology for business is the theme of âMasters of Scaleâ by Reid Hoffman, co-founder of LinkedIn, and his two co-authors. Readers of his book (based on a popular podcast of the same name) will need to look past the stunning clichÃ©s with which he implores future tech moguls of âShoot for the Moonâ or âGet in the trenchesâ. When examining the stories of his fellow entrepreneurs, on the other hand, Hoffman skillfully draws the essence of their strategies.
Kevin Systrom, for example, launched a photo-sharing app that grew exponentially by reducing its functionality rather than, as you might expect, expanding it: in ten weeks, it had 1 million users. . The company, later named Instagram, was sold to Facebook for more than $ 1 billion when it only had 13 employees. (Mr. Hoffman duly advocates “blitzscaling,” or doing whatever it takes to get big quickly.) Often a founder’s story is a mixture of myth and pabulum, but underneath these are usually found bold decisions that have influenced the fate of the company. The book sheds light on critical, often eccentric ideas that have in some cases led to high speed success.
The implications of these technological and business trends for economic growth and the advancement of knowledge are the theme of Michael Bhaskar in “Human Frontiers”. He enters the debate on the âgreat stagnationâ: the idea that innovation is becoming more and more difficult because the most significant advances have been made. According to this provocative thesis, much darker than that of Mr. Azhar, research costs more and more and its conclusions are less dramatic. Much of today’s innovation is aimed at deepening understanding of existing science rather than exploring new ground.
Mr. Bhaskar was a writer for Google DeepMind, a leading company AI laboratory, and he explains with ease the issues of the debate, and the way in which the limits of knowledge have widened in episodes ranging from the scientific revolution to the upheavals of AI. Yet, maddeningly, he refuses to answer the question he asks. âOur ideas,â he writes in a bath, âwill either retreat rapidly from the border or continue to rush towards itâ. Exponential or bust, in other words.
Cynics can chuckle at the hype around tech companies. But exponentially-aged companies often enjoy the last laugh, whether it’s Sears’ Amazon routing, Netflix’s best of Blockbuster, Apple’s defeat of Tower Records, or Kodak’s Instagram kibosh. In each case, newbies were better at co-opting digital tools and applying them creatively. These books convincingly demonstrate that something extraordinary is happening in business and society. But they are far from the end of the conversation. â
This article appeared in the Books & Arts section of the print edition under the title “L’ascension de la machine”