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Many treatments of digital disruption regard the rapid pace of technological innovation as the key problem facing organizations. It’s true that technological innovation is happening at a faster rate than ever before. Computers continue to become smaller, cheaper, more powerful, better connected, and embedded everywhere. Yet while the increasing rate of technological innovation is a significant part of the digital disruption challenge facing companies, it is not the problem in and of itself. It’s not even the most important part of the problem.
The true key problem facing organizations with respect to digital disruption is people — specifically, the different rates at which people, organizations, and policy respond to technological advances. Technology changes faster than individuals can adopt it, individuals adapt more quickly to that change than organizations can, and organizations adjust more quickly than legal and societal institutions can (as depicted in the below chart from Deloitte’s 2017 Human Capital Trends study). I refer to these differing gaps respectively as adoption, adaptation, and adjustment. Each of these gaps poses a different challenge for companies with respect to digital disruption.
Adoption describes the gap between the rate at which technology changes and the rate at which individuals make those changes a part of their daily life. In his seminal work, Everett Rogers labeled innovation adopters based on various rates and phases: innovators, early adopters, early majority, late majority, and laggards. The result is a logistic function of cumulative adoption by which innovation occurs rapidly as the early and the late majorities begin to adopt. This adoption curve is certainly still relevant to technology companies and IT functions that are trying to drive the implementation of certain types of technology by employees in the marketplace or across the enterprise.
Despite the variability, with a significant portion of individuals lagging behind, adoption is not the most critical problem most managers face with respect to digital disruption — because individuals are generally still adopting technology faster than the organization can adapt to it. As people now have easy access to robust consumer-facing technology products (versus depending on their employers for these formerly costly devices and services), they’re able to gain quicker fluency with new technologies.