As senior editor and foreign editor of Time magazine, Joshua Cooper Ramo developed keen instincts about the ebb and flow of political and economic power. Today, as co-CEO and vice chairman of Kissinger Associates, the consultancy founded by former U.S. Secretary of State Henry Kissinger, he advises companies and governments about navigating that shifting ground. In his latest book, The Seventh Sense: Power, Fortune, and Survival in the Age of Networks (Little, Brown, 2016), he surveys our increasing global interconnectivity and warns that these networks of people, computers, and other machines—and the flood of information they’re creating—are as likely to create chaos as they are to impose order.
We asked Ramo to explain why the most critical skill in an era of linkages and interactions is the ability to perceive connections and understand how to unlock their potential power.
Q. We already take for granted that everything around us is already connected or will be soon. Why do we need to pay closer attention?
Joshua Cooper Ramo: By networks, I don’t just mean computer networks but any set of points linked together. We all want to be connected all the time, but we forget that connection creates new structures. Connection fundamentally changes the nature of the thing that’s connected, whether that thing is a car, a share of stock, or a terrorist. It changes the distribution of power in the world, and when I say that, I mean changes on the scale of the Enlightenment or the Industrial Revolution. Even the most formidable military organization or regional economy can now be paralyzed almost instantly by an attack on its “nervous system.” A collective of hackers can take on Mexican drug lords—or take down a stock exchange.
It doesn’t take a big force to wipe out a big system. A small vulnerability in a big system can have a big impact. Think about how one man, Edward Snowden, revealed the extent of secret global surveillance, and how the world is still reacting to that.
Q. One of your core concepts is that networks simultaneously distribute power and concentrate it. What mistakes do you see businesses making as they try to grasp this apparent contradiction?
Ramo: The biggest mistake is seeing one or the other but not both. For example, doctors think of themselves as the gatekeepers of medical treatment. But they’re going to lose patients to both the distribution of medical information—people who look up their own symptoms online and use that to self-diagnose instead of going to the doctor—and the concentration of it in artificial intelligences that will be able to crunch huge amounts of medical data to make diagnoses and recommend treatments without a human doctor’s participation. To be a winner in many industries, either you’re going to want to own the centralized platform for information or you’re going to help people make sense of distributed information.
Or, if possible, both.
Q. Some networks are too critical to fail, but they’re so big and so interconnected that they’re extremely vulnerable. How do we resolve that tension?
Ramo: In some ways, the answer lies in the design of the network itself. You have to build a network—whether it’s the electrical grid, the financial system, or your supply chain—assuming that it’s going to be attacked, whether electronically or physically. In addition, some network failures will be inevitable, from causes you can’t predict, like the emergence of new technologies or new political groups. We’re faced with such a diverse set of threats and opportunities that you have to employ people with equally diverse intellectual, cultural, and economic backgrounds to recognize and address them.
Q. What does the hyperconnected age mean for business leaders?
Ramo: Power is already moving from old institutions to new and emerging ones. Look at how mobile phones cracked the supremacy of landline phones, and how Skype and other voice-over-IP services set them on the path to extinction. The landscape of business is going to become much more complicated in terms of finance and politics as boundaries are drawn less by geography and more by the networks in which companies and their customers participate. Businesses themselves will be exposed to new forces and new demands at an ever-faster rate, and companies that were architected for the old way of doing things are increasingly going to struggle with the new ones. So companies have to recognize that the drive for interconnection is going to demolish every institution that stands in its way in favor of those built for constant connectivity. D!
Read more thought provoking articles in the latest issue of the Digitalist Magazine, Executive Quarterly.