Innovation May Spark Economic Renewal: Warrior
The Economist magazine cover story recently explored whether innovation was dead. Is it possible that after five years of a tough economy with a slow recovery that we're done when it comes to new ideas?
These kinds of concerns are usually loudest right before the onset of remarkable innovation and renewal. Just think back to the early 1990s recession that supposedly marked the end of an era, only to be followed by one of our longest periods of economic growth.
So, what's next? History tells us that times of great innovation spark intense economic renewal and growth.
There are indicators now that we're about to launch into the next era, driven by what people are calling the "Internet of Everything" or IoE. It's the next stage of Internet growth with the intelligent connection of people, process, data, and things.
We see signs of it everyday: the emergence of self-driving cars, smart thermostats, smart buildings and an apps-based economy. It's the start of value creation from the billions of connections that make our daily lives easier and more productive, in both personal and professional realms.
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And just as business success over the last two decades resulted from a web economy that capitalized on the growing population connected to the Internet, success in the next ten years will greatly depend upon how we leverage the opportunities presented by the Internet of Everything.
There is a lot at stake here: $14.4 trillion to be exact—just for the private sector. That's the amount that our research shows could be gained globally in the next decade from the intelligent connections.
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And when new value is created, it flows across global economies. It spurs research and new investments that lead to new sectors, new businesses and from that, new jobs. A McKinsey study once stated that the Internet added more than two jobs for every one lost. I believe that the next stage, the Internet of Everything, should have a similar effect on the economy that the first wave did.
There's an enormous amount of potential gain for businesses and individuals. But it's not going to flow evenly. As always, those who act fast and smartest will realize the lion's share.
To stay ahead of what is an intensive innovation cycle, businesses must invest in technologies and take greater risks than ever before. The pace of change demands it. It is an exciting time to take calculated risks and embrace the change. Companies don't fail because they take too many smart risks, but because they take too few.
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If we've learned anything from the last two decades, it's that every time we think the Internet has exhausted its transformative potential something highly disruptive comes along.
Remember, 99 percent of the world is still not connected to the Internet. Each new connected person, thing, data and process has the potential to bring remarkable innovation, and change life as we know it. I can't wait to see what happens next.
Padmasree Warrior is Cisco's chief technology & strategy officer. She is charged with aligning technology development and corporate strategy to enable Cisco to anticipate, shape and lead major market transitions. Warrior helps drive technology and operational innovation across the company and oversees strategic partnerships; mergers and acquisitions; the integration of new business models; the incubation of new technologies; and the cultivation of world-class technical talent.