Curves that Matter: S-curve

S-Curve

Shape and characteristics of the curve. The S-curve generally shows growth over time and can be broken down into three (or maybe four) key parts. Early growth is slow with modest gains in the earliest part. Once the effort or activity gains momentum, there is a period of substantial and increasing growth. This is maintained until certain limits are reached and growth begins to slow in the third part. Finally, in the last part serious upper limits are researched and growth stops where consistent inputs maintain a high level of output but no additional output.

Logistic functions are inherently nonlinear. Many forecasting and projection techniques make assumptions about linear growth. What we actually experience, especially in the world of strategy and living systems, is varying periods of quick and slow growth and decline. A key characteristic of the S-curve is two cycles of rapid then slow growth and decline.

Some examples. There are literally thousands of applications and examples where the S-curve shows its characteristics. Here are a few:

Growth in living systems – most living systems, from the smallest cell, bacteria, and viruses to larger populations of animals to humans in cities for example show growth S-curves where initial populations grow slowly, then gain momentum and grow quickly, then slow growth and level out at a maximum population.

Carrying capacities – from a similar but opposite perspective, we see the S-curve at work in the carrying capacities of systems. Whether it be trees on an island or reactions in a beaker, closed and defined systems have an upper limit in their ability to sustain growth of their components.

Individual and organizational learning – individual skill and knowledge acquisition often follows the S-curve as well. It takes a while to learn early concepts but once the general patterns of a new discipline are acquired, learning proceeds at a rapid pace. Advanced topics are more difficult and tend to proceed more slowly until the bulk of the discipline or skill has been understood. This applies to both individual learning as well as organizational learning when new processes, technologies, or other ideas are introduced.

New products & technologies – a very well known example of the s-curve is the introduction and adoption of new product and technologies to a market. Adoption of new products starts slowly and as word spreads, growth accelerates until the market starts to saturate. Growth slows dramatically during saturation until desire for the product or technology wanes and eventually slows to a trickle or stops. One special adaptation of the S-curve and new technology is the Hype Cycle popularized by the Gartner Group. This curve combines two S-curves of different scale and has five distinct phases where expectations change as the new technology makes it way through the population.

Insights for strategy crafting. Awareness of the nature of individuals, groups, organizations, markets, and other phenomena yield key insights for those concerned with crafting strategy. The general pattern of slow growth - rapid growth - and declining gains applies universally in predictable ways.

Planning and execution effort for outcomes – It takes considerable resources to plan for change and then implement and execute. Knowing ahead of time we can gauge the appropriate amount of resources to be applied to support launch and change efforts. Early efforts need a lot of vision and support energies and often the outcomes we experience are underwhelming at first. When the new ideas take hold, we sometimes experience gains that are well beyond expectations or the resources we’ve committed to support growth. Flexibility in matching and optimizing natural growth or adoption patterns is helpful. And finally, as a natural part of any process, we reach a point in planning or execution where our inputs and resources experience diminishing returns. There are a few things we can to keep efforts moving forward.

Linking multiple curves together (jumping) – In most cases, a set of environmental (or sometimes internal) forces or conditions act on effort late in the S-curves growth to limit further growth. If these forces can be changed or disrupted, there is the possibility to reset the growth pattern and experience a second or third period of exponential growth or gain. In essence this reset is like linking two S-curves together - some call this curve jumping. Strategy can be intentionally crafted to both observe S-curve growth patterns and employ curve jumps at appropriate times.

Planned disruption – One way to do this is with planned disruption. Highly stable environments have many S-curve phenomena operating in the saturated growth stage. One way to stimulate growth is to intentionally destabilize the environment and direct energies and efforts to opportunity areas where exponential growth may next occur. But rather than random disruption the idea of targeted or planned disruption yields more expected results. Like positive turbulence, planned disruption is a tool for the strategy crafter; perhaps one not wielded in excess but with cautious prudence.

Adoption of ideas – Strategy, particularly when it’s focused on innovation, is often about putting new ideas into action and creating value. Idea generation and absorption follow S-curve growth patterns. When organizations or environments are continually barraged with new ideas, changing technologies, or redirected strategy, they shift toward slow growth as they are both saturated and grappling with the efforts of new growth. Keeping the organization in peak output relative to input requires a balanced timing of pushing change forward. We know that groups of individuals respond in predictable ways across a wide distribution of types. I will discuss this further along with the next curve, the normal curve.