I am re-reading Salim Ismail’s Exponential Organizations. I especially like the sub-title: “Why new organizations are ten times better, faster, and cheaper than yours (and what to do about it)”

In a way, that subtitle suggests that we need to crack the code. In my work with growing companies, there is a lot of “cracking the code” conversation. Questions about use of social media, mobile technologies, video on demand, online advertising, content marketing, etc., all sound to me like some in business, while very aware of the changes driven by technological advances, talk about them like there is a secret sauce. Like there’s a kind of code that they need to find to uncover something that is hidden from them.

Maybe that’s why it is tempting to hire a 17-year-old with an Instagram account to manage your social media.

I think that insightful people, instead of trying to discover what is hidden, look for the things that are in plain site: business opportunities that present themselves due to the impact of disruptive technologies. To use the author’s terminology, smart leaders will build their organization into an ExO: an exponential organization.

An ExO is an organization that leverages new technologies and sees big gains in measurable results in area like speed to market, production hours, or output quantity and quality. One way that an organization becomes an ExO is to stop engaging in only linear thinking, and begin to manage in more flexible, agile, and fast-moving ways.

Another way of thinking about it: An ExO can do more with less. A startup can compete with an established business. Innovative leaders can find success by breaking the rules. The ride-sharing and travel sites that we hear about in the business news are famous because they are built without huge investments in resources. Such investments would mean more cost and slower growth. For these companies, the value of information outweighs the value of inventory.

But it is about more than building a business based on assets you do not own – it is something even bigger.

The impact of technology and the growing leverage of information does something else: it frees up entrepreneurs to do work that they believe in. This happens because the marketing investment in a purpose-driven organization shifts from cash needed to build traditional advertising, to marketing based on peoples’ beliefs. The public assertion of what drives your organization represents a clear competitive edge in that it naturally connects your organization to the world.

And it is not fluff to call an organization “purpose-driven.” Ismail calls it Massive Transformative Purpose.

Purpose makes for better culture, better recruiting, better community, and better results. In fact, it is the most substantial part of the ExO, driving recruiting, sales, culture, and the bottom line.

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