Ricochet is the best place on the internet to discuss the issues of the day, either through commenting on posts or writing your own for our active and dynamic community in a fully moderated environment. In addition, the Ricochet Audio Network offers over 50 original podcasts with new episodes released every day.
I’ve been doing some thinking recently about the life cycle of industries. “Industries” in this context means anything that you can make a living at. If you have an idea, a new idea, something that will genuinely change the world, what happens with it? It seems to follow the old adage about every political cause (probably because political causes qualify as industries in this regard.) Let’s take a walk through it:
It Begins as a Movement
Paul Asadoorian runs a series of computer security podcasts under the brand Security Weekly. Every week he interviews a guest on his podcast, and every week he asks them a question: “How did you get your start in Information Security?” The answers to that question are always varied and interesting. This is a composite of things none of the answers contain:
I looked up the numbers for salaries by profession in my high school guidance counselor’s office, found one that matched me pretty well and went to college for it. Got the degree, interned at Black Hills Information Security, and then took an engineering job at Tenable Network Security before being poached by my current employer.
Computer Security is a very new field. The answers are always something like “Well I was eleven and someone crashed my Windows 3.1 computer remotely, so I ended up spending a lot of time on hacker BBSes looking for ways to do that and other things to my buddies.” or “I was working in IT while I was going to college for something else and I said ‘hey, this isn’t secure.’ My boss said ‘Good point. Make it secure.’ and that’s what put me on this path.” Or “They said ‘Computer Security? You’ll never make any money doing that. Networking, that’s where it’s at.”
That last one, by the way, is the best way I’ve figured out how to tell what’s a truly new idea. At the very outset the brand new ideas get the usual treatment. You don’t get sensible people at the edge of innovation. You’ve got the tinkerers who are messing with a thing because it’s fun. You’ve got the visionaries who know that this thing is the thing of the future (which is no guarantee that they’re right, mind you) and you’ve got the lucky types who happen into the right spot at the right time.That doesn’t mean it’s a useful idea; the vast majority of these things never revolutionize anything. If I could tell the useful ones from the chaff I’d let you know about it, from my solid gold Rolls-Royce.
The next step still happens while no one understands the new industry, they just know they want it. A lot of it. Innovations happen, but since nobody’s figured out the general rules yet you get all kinds of weird and wacky things that fade off as the field matures. You get wacky 90’s internet startups, and the Girandoni Air Rifle (one again, hat tip to @Arahant for pointing me at that particular fascinating bit of history)
All in all the ‘movement’ stage of any industry dies out when people figure out how to mass produce your results. These days you can find a tech school degree to get you into information security. There are established firms that deal with these things (the two I mentioned in the made-up example above are legitimate companies). The high school guidance counselor might even have numbers describing the expected salary in that career path. But the movement stage won’t be over as long as the people at the top of the industry are still the innovators who built it up from the bootstraps.
It Devolves into an Organization
This is the mass production stage. You’re no longer Apple building computers for hobbyists in a garage, you’re Apple selling the nation’s schools on your standardized boxes. You have well defined firms working in the field, and they compete one against the other. You’re no longer focused on marketing a product which people haven’t heard of before, you’re convincing your customers that your iteration of the product is better.
Innovation continues, but it’s incremental improvements on previous results. These things can be immensely important but they don’t change everything around like stuff in the previous stage. You’ve heard of Marie Curie, right? You know what her husband did? He was a physicist, and he did some important work on the interaction between temperature and magnetism. He also died by being run over by a cart — as important as his equations were when we were learning them, they got equal class time with that salacious but pointless factlet. All the fields of science are advanced by legions of nameless scientists commanding hordes of grad students doing tedious but essential work charting the territory around the exciting advances.
If you’re working at this stage your job is straightforward. The innovations are as mechanized as possible; people can be trained to do it. Your production goes to making the same thing cheaper, and with shiny new colors and features. If you’d like you can track this phenomena in battleship sizes and power before the introduction of aircraft carriers, or automobile reliability. Me, I think I’ll move on to the next stage.
And Ends as a Racket
You enter the Racket stage of Industry when the players in the game stop trying to provide a product, they’re focused on extracting the most value out of the consumer. To be sure hucksters and charlatans are present at every point of the evolution of any industry, but this is when they dominate. You have monopolists who are more concerned with crushing upstarts than in improving their product. You have cronies who spend more on lobbying than marketing.
At the start of the cycle you had innovators and weirdos doing the majority of the work. In the middle you have workers and drudges. At the end? Bureaucrats. You’ve had one too many lawsuits so now you employ more lawyers than engineers. And you need to add another three spots to the HR department because the vital work of ordering retirement cakes needs to be done. And do you have time to sit on the committee to draft a new mission statement? The old firms in the market have gotten crusty. They’re ossified with the accumulated coral of decades doing business.
This is also when innovation becomes possible again. People outside the established order either build the same thing but much cheaper (Think Harry’s Shave) or they sidestep the established order and offer a substitution better than the original. They also tend to advertise on podcasts.
But does that apply to anything other than traditional business? Sure. Aristotle first calculated Pi to 3.14 by describing the difference in area between two 96-sided polygons. After his time people got closer and closer approximations by making polygons with more and more sides, until the seventeenth century when some savant (I forget his name) ran the calculation with polynomials with something like thirty two thousand sides. Then along came Newton, who invented calculus, devised a new way to approximate Pi, and then broke the world record for digits calculated, because he was bored.
You want another one? Socrates disrupted Greek philosophy (which has ossified into a cynical, results-oriented form) by asking Athenians to examine their lives. The racketeers promptly made him drink hemlock.
Movement, Organization, Racket. Is there anything useful we can learn from all this, or is this merely an exercise in curve-fitting? Good question. So far I’ve figured out that your best chance to be truly innovative is to go where even your momma thinks you’re insane, that the easiest way to determine where an industry is ripe for innovation is to measure the cost to physically produce their good versus the cost they charge for it, and that Hegelian Dialectics remains fundamentally unsound. Let me know if you think of anything more.Published in