Understanding the Great Inflection Point Ahead

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Understanding the Great Inflection Point Ahead

Every half-century for the past 250 years, the world has been disrupted by a tumultuous revolution in technology that has improved the lives of tens of millions of people and reshaped the economy, turning winners into losers and upstarts into giants.1

  • The first revolution, starting in 1771 in Britain, transformed industrial production with factories and machines, as well as a national network of canals for transportation.
  • The second revolution, starting in 1829, (also in Britain) was the age of railroads, steam, coal and iron.
  • The third revolution, starting in 1875 in the United States, was the age of steel and heavy engineering.
  • The fourth revolution, starting in 1908 in the U.S., was the age of the automobile, oil, and mass production.
  • The fifth revolution, starting in 1971 in the U.S., is the age of information technology and telecommunications.

Few decision makers recognize these distinct techno-economic revolutions for what they are, and fewer still recognize that each has followed the same predictable pattern. Consequently, understanding this pattern and the factors driving it, gives those who do understand it an enormous competitive advantage. It becomes the “master key” needed to unlock the relationship between hundreds of other trends in technology, demography, and psychology.

We are four decades into the fifth techno-economic revolution. More importantly, we are now struggling through the current revolution’s tumultuous inflection point — a profound transition from the first, investment-intensive phase of the revolution to the second phase, in which all of those investments will begin to pay off in wondrous new ways of communicating, innovating, and living, creating a quantum leap in human quality of life.

Our analysis of this trend is the fourth installment in a multi-part series:

  • Part One, “A New Golden Age…When People Least Expect It,” appeared in the April 2010 issue of Trends. It described each of the five techno-economic revolutions in detail.
  • Part Two, “The Fifth Techno-Economic Revolution,” in the 2011 Economic Update, highlighted the emerging technologies that will drive the economy in the coming decades.
  • Part Three, “Re-Engineering the U.S. Economy,” in the July 2011 issue, examined how the new technologies and business models of the fifth techno-economic revolution are likely to be applied to solve the debt crisis, redefine the social contract, and boost the economy by reinventing education, health care, and other industries.
  • Now, in Part Four, we’ll explore why the fifth techno-economic revolution is unfolding as it is...

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