System Instability by Dr. Tony Salvador

System Instability, PREX16 Keynote by Dr. Tony Salvador

A “strategic inflection point” is a major change in the competitive environment. Strategic inflection points are dangerous to companies – because if you miss it, you lose everything. The general assumption, however, is that “strategic inflection points” are relatively infrequent: that is, we operate in long periods of relative stability with punctuated moments of instability which are represented by these inflection points, and which are often missed; one must be on one’s toes. However, we are entering (if not already in) a period of prolonged instability punctuated by moments of stability across markets. The exact opposite.

Now, markets are merely systems of exchange where parties in a transaction each give up something in the hope of getting something better – where parties vie to be part of the transaction through offerings along particular bases of competition. That there are continuously shifting bases of competition requires companies and institutions to possess a certain resilience and/or robustness to adapt at pace or they will fail. That instability is now and certainly will become increasingly predominant and that relatively few companies and even fewer public institutions are adequately prepared to adapt at pace – including our legal institutions.