In just over forty years since Gates and Allen plotted to put a computer in every home, the world has become massively digitized. Instead of a single computer in every house, there’s a computer in every pocket, wrist, kitchen, bathroom, electronic device, and TV. The Internet of Things (IoT) will connect nearly everything in the future. In fact, it is predicted there will be 30 to 75 billion IoT connected devices by 2025.

Examples of this include artificial intelligence (AI) powered voice-activated bots in our homes; sensors that record our every move; drones that deliver packages; robots that automatically order groceries, and networks of autonomous vehicles at our disposal. All these exponential technologies have become reality thanks to digitization and disruption of the norm. Digital transformation has forced a new norm. The Emerging Technologies Stack shares a viewpoint of the technologies coming to market over the next 10-25 years. As we look out into the future, the timeline may shift, yet innovators are working on every one of these technologies and they all have implications for nearly every industry on this planet.

As Singularity University explains, “Exponential technologies are those which are rapidly accelerating, shaping major industries, and all aspects of our lives.”48 The foundations of exponential technologies are built on computing, networks, search, email, social, and video. The next layer that has accelerated change even more includes AI, data, cloud, mobile, and internet of things (IoT). All technologies that have become pervasive in this century. Thereafter, we move into science fiction with blockchain, augmented reality (AR), virtual reality (VR), 3D printing, autonomous cars, drones, and robotics. As new exponential technologies are invented, they begin to stack onto each other, building off the layer beneath it, and thus compounding both their power and impact. This continues to accelerate as each of these ideas (and more) are built on top of each other.

Digitization continues to change how we do everything. People take digital pictures and video of nearly everything and put them online. Arguments can be sorted out with a Google search. Everybody has access to somebody’s Netflix account with infinite entertainment on demand. Amazon Prime has orders at your door in one hour. Grandma has an iPhone, and your youngest cousin just taught her how to use emojis and Snapchat. Your grandpar- ents even use Facebook, and now order delivery meals through apps like Door Dash, Grub Hub and UberEATS.

To better understand exponential growth, here’s a short story. A little girl is negotiating her allowance with her parents. “Just pay me a penny and double my pay every week.” Sounds easy enough. At first glance, this sounds like a great deal.

By week four, she’s only making eight cents a week. Her parents still feel like it’s a good deal. After two months, she’s making $2.56 a week. In six months, she’s making $335,544.32 a week, and after one year, her earnings are equal to the GDP of the United States of America. She accepts Venmo, PayPal, or Apple Pay.

Exponential growth is a game changer.

Currently, five Exponential Organizations (ExOs) have risen to the top of the technology world in the western hemisphere and have become global brands in the process: Facebook, Apple, Google (Alphabet Inc.), Microsoft, and Amazon. Globally, people use or interact with these companies in some way every day. Salim Ismail first outlined ExOs in his book Exponential Organizations when he noticed similarities between companies that grew 10x, Unicorns (startups with $1 billion-dollar valuations), and the leading technology companies in the world.37 As we dive deeper into exponential theory, we will examine these ExOs more closely.

In his work, Salim Ismail defined ExOs as companies that are ten times larger than peer companies, with four or more specific internal or external attributes (as defined below), and a Massive Transformative Purpose (MTP). The MTP functions as the “why,” the motivation for why a company operates. Simon Sinek has made a living helping people think about their why. This philosophy is driving purpose-driven growth companies and a movement towards Environmental, Societal, and Governmental (ESG) companies making an impact. An MTP often describes the ExOs vision for a better future for the industry, the community, and the world at large.

From Salim Ismail’s book Exponential Organizations, here are the five internal and five external attributes of an exponential organization using the acronyms IDEAS and SCALE.38

Internal (IDEAS):
• Interfaces: ExOs have very customized processes for how they interface with customers and other organizations.
• Dashboards: A real-time, adaptable dashboard with all essential company and employee metrics, accessible to everyone in the organization.

·  Experimentation: Implementation of the Lean Startup methodology of testing assumptions and constantly experimenting with controlled risks.

·  Autonomy: Self-organizing, multidisciplinary teams operating with decentralized authority.

·  Social Technologies: Social technologies, or collaborative technologies, allow organizations to manage real-time communication among all employees.

External (SCALE):

·  Staff on Demand: Minimize full-time staff and outsource tasks. Uber uses staff on demand when they incentivize drivers to go online during busy times.

·  Community and Crowd: If we build communities and we do things in public, we don’t have to find the right people—they find us.

·  Algorithms: ExOs leverage data and algorithms to scale in ways that were not possible just five or ten years ago.

·  Leveraged Assets: Hold on to what’s critical. Outsource everything else. Access not ownership.

·  Engagement: Enabling collaborative human behavior (social behavior) to engineer the results we want from our community.

Leaders use these internal and external attributes to create a compounding effect, where change accelerates, producing more efficient processes, strategies, technologies, and organizations. For example, with the compounding effect, a negligible improvement can be dramatic over time. A 1% improvement everyday compounds into a 37x improvement after one year. IDEAS and SCALE pay off in the long run, though in the short term, none of these attributes are likely to make a noticeable difference. Using these attributes, ExOs like Facebook, Apple, Google (Alphabet Inc.), Microsoft, and Amazon have grown to be very BIG companies, with influence larger than governments. New companies like Uber, Airbnb, Netflix and others leverage these principles to grow faster than other companies, taking over their industries in a short period of time. They are likely to be the giant companies of tomorrow.