There’s an interesting article in a magazine I read that the human body has reached its maximum in all the sporting events, and world records will not be broken as much as they were in the past 50 years. Usain Bolt cannot keep on shaving off tenths of a seconds much longer. Marathoners have been reducing the time taken to complete the Marathon over the past 10-15 years but not much for the past 5 years. This means that sporting S-curve is reaching its plateau.
I learnt about an S-curve when I was studying penetration of mobile services in India, about 17 years back. And discovered to my child-like glee that mobile penetration in developed countries grew slowly in the beginning for a few years, possibly 5-15 years, then grew at a very rapid phase for the next 5-15 years and then, started slowing down after that high-growth phase, almost plateauing in some countries. My boss, an ex-Partner of Booz Allen & Hamilton, told us that India will also follow this curve and though it was tough to believe, since He had said that, we believed that. The S-curve indeed played out in India over the past 17 years, a slow growth from 1994-2000 and then a rapid growth from 2001-2008 and then horror of horrors, a slow down. Thankfully, the penetration in India is still growing albeit at a slower pace. But it’s sure to plateau at some time.
I moved into wealth management and discovered the Wealth curve (see Karvy Private Wealth’s India Wealth Report), which was growing slowly from 1950-1991 and then started growing at a rapid pace. We are still in the high-growth phase and have been adding as much wealth in the previous 5 years as much as we did in the period from independence till the beginning of this 5-year period. Our research shows this high pace continuing for another 10-15 years before slowing down. Why will it slow down ? See China…and before that, Japan…and USA.
Now, to another NON-BUSINESS S-curve – World Population touched 1 bn in 1804AD after millions of years of man inhabiting this world. Then it moved from 1bn to the current 7bn over the next 208 years. 1bn became 2bn in 123 years, 2bn to 3bn in another 33 years and then 3bn to 7bn over next 52 years. However, the next bn is expected to take 15 years and the one after that about 20 years. Population growth is thankfully slowing down. In fact, there’s a chance that the population will plateau at 10bn as rate of births equals the rate of deaths by that time. Another S-curve in the final stages of growth.
Good to find out the stage of S-curve of the industry in which you are…corporate strategies and business strategies differ for industries in different stages of the S-curve.