Virtual Enterprise
As Esko Kilpi put it in 2017, the firm of the future may be ten million people working together for ten minutes. Since then, technology has evolved to a degree that the firm of the future can be hundreds of AI agents working together for 10 minutes.
The trend I am observing nowadays is the abstraction of hard assets such as machines, roads, materials, containers, boxes, vehicles, warehouse space, ports, etc. This is already happening with 4PL service providers abstracting logistics-as-an-outcome while companies such as Xometry, Protolabs, and Fictiv are abstracting manufacturing assets similar to what Uber does with fleets of cars.
Given today’s state-of-the-art technology, it is possible to have generative AI design a product, break it down to its components, pass the bill of materials to the “manufacturing cloud” and “4PL”, then sell and fulfill on Amazon, replenish via another service optimizing pricing, inventory, promotions, etc. It is even possible to add elements of mass personalization with AR, stable diffusion, additive manufacturing, and other programmable manufacturing processes like laser etching, UV painting, etc. This is a considerable disruption vector threatening many established sectors and players.
Interestingly, this disruption vector stems from the most advertised value proposition of cloud computing: digital abstraction and aggregation of hard assets in ways to make them programmable. Later in the evolution, we saw the abstraction of software (containers), abstraction of orchestration of software (k8s), CICD automation, infrastructure-as-code, and even the coding itself is nowadays losing ground to generative AI. Given today’s state-of-the-art technology, it is possible to make ~90% of all IT resources and processes programmable.
Tragically, although the cloud has been one of the most advertised technologies of the last two decades, most corporations jumped into the logistics of adopting it and missed the great inspiration of the cloud.
The almost all adopters are taking technology incrementally and doing this in self-defeating ways. They do not transform their legacy enterprise architecture and business models of the 90s. Instead, they are adding some new tech here and there, creating Frankensteins, usually accompanied by more profound complications of inorganic growth.
And this is precisely the self-defeating part. Incremental evolution complicates the already complex, oftentimes unmanageably complex enterprise. And the emergence of super-elastic virtual competitors is already here.
If your business is already a Frankenstein, it might seem daunting to transform it into an Olympic gymnast; but it is super simple with some change hacking.
©Saip Eren Yilmaz, 2023