The Social-Industrial Revolution

Success in every era has been achieved by adapting to—and often exploiting—the winds of change. British entrepreneur-inventors like Richard Arkwright capitalized on the mechanization of labor that marked the first Industrial Revolution. The assembly line and mass production were born of the second Industrial Revolution, and allowed Henry Ford to create his Model T at scale.

Developments during both Industrial Revolutions drove many firms out of business, catapulted others into extreme profitability, and served as the impetus for the creation of a vast array of new businesses. These same forces created the first true middle class, but untold millions of workers lost their livelihoods or were forced into brutal working conditions and housing squalor.

There is a new revolution in the wind today: the Social-Industrial Revolution. Like the economic sea changes that preceded it, there are winners and losers, producers, sellers, workers, and consumers. And while this revolution is more equitable, it has the potential to be every bit as powerfully disruptive as its relatives were—and it is developing exponentially faster.

In this new reality, consumers and businesses fundamentally redefine their roles and relationships. Consumers have more power today than ever before. The essential elements of empowered consumerism are now in place: knowledge, choice, visibility, and collective voice. But, critically, the Social-Industrial Revolution isn’t a zero-sum balance of power: winning does not necessarily come at another party’s expense.

Like all revolutions, this one started on the fringes of society but is advancing into the mainstream at an astonishing rate. And like all revolutions, it will add its share of actors to the “dustbin of history.” But in a uniquely modern way, this is a revolution we can fully participate in as we watch it unfold, evaluate its effects as they happen, and quickly detect the opportunities created as it upends the status quo.


We are quickly nearing the “end of assumptions:” the ubiquity of consumer data—especially social data—means that businesses can stop guessing and start delivering exactly what the market is demanding. As consumers have more information to guide their decisions, and as they interact with others, companies learn more about their preferences, intentions, and demands. Social data, when combined with search data, web data, financial indicators, and other information streams, will soon make forecasts more accurate, and decisions less risky. Industries and academic fields are being built around or enriched by the analysis of this data, and a growing pool of professionals is acquiring the skills needed to turn this data into profit.

Much like an alternative energy source, social data is simply the digital form of something that has always existed: word of mouth. And like any energy source, its value grows as we develop new ways to process and refine it, discover new uses for it, and train a workforce to handle it.

How companies act on this newfound data visibility will be the single most decisive factor as to whether they flourish or fail. The list of viable excuses for not knowing shrinks as the data is collected, distilled, and infused into decision making across the entire enterprise.

Mobile devices connect consumers to each other, to the unvarnished truth about the things they buy, and to a vast universe of choice. The world is now rich with devices that rival the utility of laptop computers yet can be taken anywhere and built into almost anything. The rise of the cloud adds another dimension of access to things that were once locked within unconnected devices.

Businesses now have handheld knowledge centers that can help destroy communication and data siloes, providing access and visibility into every corner of their ecosystems.  Even container ships at sea now enjoy mobile coverage.

The old models of design, production, finance, and fulfillment are being challenged by low-cost 3D printing, alternative funding and pricing models (such as crowdfunding and group buying), and same-day delivery.


Many—perhaps most—businesses will ignore or deny the gravity of these changes. We know how their story ends. Those businesses that detect the opportunities that accompany the risks can and should adapt in meaningful, difficult ways. Here are some of them.

Businesses can no longer rely on creating markets for imperfect products. They’ll need to build products and experiences that are perfectly attuned to consumer demand. Absent alternatives, consumers have traditionally settled for products that don’t fully meet their needs. But “good enough” products are no longer good enough, because consumers have more choice than ever before.

Linear, fragmented supply chains must be transformed into visibility and collaboration “loops” between all points in the ecosystem: design, production, supply, point of sale, and end use. Data that can be used to create efficiency can also be used to create accountability between parties such as retailers and manufacturers.

The old model of slow, iterative improvement (or abandonment) will not be fast enough. Companies need to create the agility to rapidly improve their products in response to insights from the data they continuously collect and process.

Consumer data is often used in ways that do not tangibly benefit consumers, and businesses often collect it secretly. Smart companies should now work towards open exchanges with consumers of data for value, and consumers will naturally select those that offer the clearest and most compelling return on their data.

Product launches can be extremely risky due to a lack of accurate forecasting and market data. Now, better data means safer product launches—companies have far more understanding of how their products will fare upon introduction. Standardization of product lines used to be the only path to sustainable growth. But companies now have the knowledge they need for smarter diversification, and rapid prototyping, crowdsourcing, co-creation, and cheaper production means customization can be done at scale.

Ignore, survive, or thrive?

Three distinct possibilities lie ahead for any business, upon sensing the winds of the Social-Industrial Revolution:

  1. They can see the wind as a breeze that will float right by them, and do nothing.
  2. They can see the wind as a storm, and take preventative measures to preserve their place in the world.
  3. They can see the wind as a resource, and move swiftly to take advantage of its unlimited potential.

Which do you choose?

6 Responses to “Catalysts of the Social-Industrial Revolution”

  1. Hi James, and sorry for the late reply. Missed the ping, I guess. I’m using the term “industrial” here in a slightly different context than you, it seems. In my piece, “industrial” simply means “of industry,” not necessarily manufacturers or the manufacturing economy. I agree with everything you say above.

  2. Ian:

    The social adoption curve varies by industry segment. I agree that the truth is that suppliers/sellers will have to transition from the “industrial to the information worker age.” Stephen Covey said it best in Seven Habits. 100 years ago 97% of our economy was agricultural. Today 3% of our economy is agricultural with manufacturing still the largest part of our GDP. The truth is we are trending towards industrial becoming 3% of our GDP with the services segment becoming the 97%. Agricultural companies such as ADM adopted Industrial automation and survived. Industrials and B2B’s who adopt social marketing and engagement will survive.
    Jon Ferrara of Nimble sCRM just quoted my article today on the impact of social on the selling process in an enterprise. Give my regards to my friend Stephen Collins and best wishes for a successful event next year. Food for thought below. I’d appreciate your thoughts.

  3. Anonymous

    Incredibly insightful and extraordinarily well-written piece putting the social data phenomena into a powerful historical context.

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