Here we look at the singularity of the Cambrian Explosion, which spawned multi-cellular life, and predict a similar singularity for businesses.
The Cambrian Explosion
For the first 2 billion years of life on earth, the only creatures were single celled, floating around in the primordial soup, not doing very much at all. Then 500 million years ago an event occurred that still has biologists scratching their heads ( Wikipedia gives 5 possibilities why). Single cellular organisms became multi-cellular, leading to complex creatures and eventually to all of us. This singularity is called The Cambrian Explosion.
I see the same singularity approaching, but not with organisms but organizations.
Since the start of the industrial revolution, companies have been essentially operating as single cells. It’s time to look beyond the cell wall and develop multi-cellular organizations. This Cambrian Explosion in the business world is the Business Network.
Let’s look at the criteria for multi-cellular life, and see how it applies to networks of companies.
Specialization of Cells
An organism is made up of many types of cell: blood, skin, bone etc. each with its own speciality. No cell can be efficient at all of the tasks required for a complex organism such as the ability to move, feed or reproduce. An extended organization likewise has Value Chains made up of many different groups: design, engineering, marketing, distribution. These used to be departments in one company, but they are increasingly becoming separate companies. Companies that used to have in-house catering, real estate or IT support are increasingly turning to specialist companies who provide these services.
Adaptability and Evolution
Multicellular life is far more varied then single cells, because cells can be repaired or regrown. With a Network of Businesses our value chains are more flexible: got a problem with a subcontractor in Manila? Switch in a similar company in Vietnam. Need a geologist in Chile? Don’t hire, use a subcontractor on a three month contract. Networks also give great scope for evolution of business, some of the most innovative business models and profitable companies are network based: eBay, airBnB, BlaBlaCar
DNA Keeps the Network of Cells in Order
Every cell in an organism contains the same DNA code, which provides consistency and information. In a network of companies, there is a need for consistent data, policies, rules and interfaces. A business network also adds the component of information: advising companies on how they can work
It’s early days in the evolution to multicellular organisations. Just a small number of companies are linked, and in very small groups of cells. But Business Networks are forming, and if you’re outside, you’re plankton.
Learn more about SAP’s Business Networks and how you can move from a single-cell to multi-cellular by attending the Business Networks Campus at SAPPHIRE NOW.
This story originally appeared on SAP Business Trends.