True masters all have the mindset to break through deadlocks.

Currently, the world is undergoing profound changes unseen in a century. We stand at the intersection of three major historical turning points:

The turning point of technology - The wave of the Fourth Industrial and Technological Revolution is surging forward;

The turning point of China - A crucial leap from the demographic dividend to the innovation dividend;

The turning point of the world - The process of the great rejuvenation of the Chinese nation is accelerating.

In this VUCA era, there is no certain business model. The only certainty is the exponential growth law of technological innovation. Behind this law is the inevitable choice of life evolution.

So, how can entrepreneurs apply the laws and survival strategies of life evolution to achieve a key breakthrough?

In today's article, we will analyze this issue from the perspectives of underlying technology and life evolution. We hope it will be helpful to you.

Three Core Strategies to Counter Uncertainty

Entropy - Reduction Organizational Management

Today, both the evolution of life and technology are restricted by the law of entropy increase, which is determined by the most fundamental technology.

Note: The law of entropy increase is derived from the second law of thermodynamics. It states that in an isolated system, entropy (a physical quantity measuring the degree of disorder of a system) always tends to increase, and the system will develop from an ordered state to a disordered state.

The law of entropy increase is the most important law in thermodynamics. Scientists attach great importance to this law, and so do entrepreneurs. For example, General Electric and Huawei.

Huawei has applied this law very thoroughly. Ren Zhengfei emphasizes that an organization must be full of vitality and avoid the phenomenon of entropy increase.

To prevent entropy increase in the company, Huawei has been carrying out the survival - of - the - fittest principle. It implements a strict mandatory proportional elimination mechanism for managers. At least 10% of managers are removed from their positions each year and become ordinary employees.

People are inherently lazy. Many mediocre people will eventually follow the bad and lazy ones. This is human laziness and the law of entropy increase.

Therefore, avoiding entropy increase and maintaining vitality and innovation are the most core issues in corporate management.

Liquid Innovation Network

The earliest evolution of life took place in the ocean because there was a very important innovation in the ocean, namely the liquid network.

Life behaves differently in gaseous, solid, liquid, and plasma states:

In the plasma state, due to the extremely high temperature, life cannot be active;

In the gaseous state, gas molecules are too far apart, and it is very difficult for them to meet;

The solid state is too rigid, and it is difficult to form cooperation and connections;

The liquid state is between the gaseous and solid states, and it is just the opposite.

Therefore, in ocean water, the probability and frequency of collisions between molecules are much greater. Collisions are more likely to occur in water, which may lead to connections and then assemble into life - related molecules.

The same is true for innovation. Innovation needs to form a liquid network to increase the probability of people colliding with each other.

This is why big cities are more likely to innovate. They are like liquid networks, where people communicate more frequently, are more likely to have ideological collisions, and are more likely to generate innovation.

The same applies within a company. Google designs its offices to be very open and has a central passage where everyone can gather.

Apple's offices are designed to have a place where all employees can naturally gather during commuting, allowing them to chat casually.

Casual chats can unexpectedly generate sparks and innovation. This is a typical liquid innovation network.

Entrepreneurial Strategy Selection

① Choose the right general trend

Entrepreneurship must follow the general trend. The situation is more powerful than individuals.

What is the general trend? It means being able to see trends that others cannot see, especially when most people think it is the most difficult and are reluctant to do it.

For example, when Elon Musk started SpaceX, almost no one supported him.

From the perspective of human history, the Industrial Revolution (including the technological revolution) is the greatest general trend.

Those who can seize the Industrial Revolution and follow its general trend can seize the opportunity for the next round of growth.

The reason why China was backward in the past was that it missed the general trend of the Industrial Revolution. The West went from being backward to far ahead, which was precisely due to the general trend of the Industrial Revolution. After learning from past mistakes, we began to rise and catch up, striving to keep up with this trend.

From the history of the Industrial Revolution, human technological history covers five major fields: matter, energy, information, space, and life. Each field has its core future directions, and these major trends are what we should focus on and plan for.

Economists have summarized the information revolution in the past 60 years, namely the 60 - year Kondratieff cycle, the 20 - year Kuznets cycle, and the 10 - year Juglar cycle.

What is the Kondratieff cycle?

It is a process of economic prosperity, recovery, recession, and depression every 60 years. Currently, we are in the recession and depression stages of the previous round of the information revolution.

We can observe that since the steam engine, economic fluctuations are similar to the cycles of technological revolutions. The Kondratieff cycle is determined by technological revolutions, and technology determines the economy.

Technological revolutions last about 60 years. Whether it is the continuous iteration of technology or the gradual reaching of technological bottlenecks and limitations, they all belong to the cycle of technology diffusion.

From the steam engine revolution to the internal combustion engine, then to integrated circuits, and finally to artificial intelligence, these are all major future trends.

Currently, we are in the stage where a new round of technological revolution is starting to break out, and the AI revolution is also part of it. The outbreak of the new technological revolution will drive the economy to quickly enter a period of high - speed growth.

Therefore, I believe that after the outbreak of the AI revolution, our economy will recover and boom again.

The Kuznets cycle refers to the real - estate cycle.

Taking China's real - estate market as an example, it rose from 1999 to 2019, ending this round of the Kuznets cycle in 20 years.

Thirdly, there is the 10 - year Juglar cycle.

For example, in the 1970s, it was the era of integrated circuits; in the 1980s, it was the era of computers, and people invested in Microsoft; in the 1990s, it was the era of fiber - optic communication; in the 2000s, after computers were connected, the Internet emerged, and then came artificial intelligence.

The main driving forces in the information age are Moore's Law and Nielsen's Law, that is, computing + communication. This still applies in the AI era, and the computing power of GPUs is still the superposition of these two capabilities.

Therefore, we must have an understanding of these cycles.

Only by investing at the end of the cycle and at the high point can we develop better. Never invest at the high point, as it is very dangerous.

② The principle of concentration of force

Sun Tzu said, "If you are ten to the enemy's one, surround them; if you are five to their one, attack them." This is a unique skill in military strategy.

The same applies to entrepreneurship. When competing with large companies, it means becoming a local king in a specific battlefield, that is, finding the marginal areas of large companies and outnumbering them in niche markets. Don't compete with leading companies right from the start.

This is the core strategy, the principle of concentration of force. Huawei uses this principle.

Compared with Western companies, Huawei is relatively weak. However, it always concentrates its limited resources on one area at a time, greatly exceeding its competitors in resource allocation, achieving key breakthroughs and rapidly expanding its achievements, and finally achieving system - wide leadership.

Therefore, don't disperse your strength. Focus on one thing at a time. Never try to do many things simultaneously.

The reason why Apple finally succeeded was that after Steve Jobs returned, he cut all product lines except the most core ones and finally focused on one or two products. This is the power of focus.

③ Niche thinking

Current research shows that there may be 8.7 million, or even nearly 10 million species on Earth. Each species has its own ecological niche, that is, it must have a unique skill.

For example, pandas are very cute. I think there may be no other animal in the world as cute as pandas.

Why do we think they are cute? Because for humans, pandas look very much like our babies. This characteristic ensures that as long as humans exist, pandas will be able to survive. This is their survival strategy.

The same applies to enterprises. You need to find your own ecological niche. The world needs you to make it a better place for you to survive.

If you are in the same ecological niche as other enterprises, it is very dangerous because they may easily replace you.

This is exactly the process of biological evolution.

Due to the long - term cycle, the truly surviving species have achieved maximum efficiency within their optimal ranges.

The same applies to enterprises. They must consider what they can do to the extreme. If they cannot, they will be eliminated.

Customer Value and Entrepreneurial Model

Entrepreneurial Model

During the entrepreneurial process, one needs to successfully cross three key hurdles.

The first is the technology and product hurdle. If you have mastered the core technology, you need to focus on in - depth product development and improvement. When an enterprise wants to expand its scale, a deep understanding of the market is essential.

The last is the management hurdle. As the enterprise scale gradually expands, the requirements for management ability will also increase accordingly.

In the early stage of entrepreneurship, technology leadership should be the core competitiveness, then transition to product leadership, and finally focus on customers. In the middle and later stages of development, it mainly relies on operational management.

In short, for an enterprise to enter the mainstream market, it needs to achieve a progressive transformation from technology leadership to product leadership, and then to customer - value leadership.

Customer Value

Customer value means studying the value that a product can bring to customers.

Customers buy your products because the value you provide far exceeds that of your competitors. Therefore, we need to provide customers with greater commercial value than our competitors.

This is the competitive efficiency and the core of the customer - value leadership strategy.

This is the VCT value model I proposed 10 years ago, that is:

Unit value = Total product value / (Time cost + Price cost)

Through this formula, you can calculate the value you provide. The higher the value, the more likely customers are to buy; the lower the value, the lower their willingness to buy.

Take Xiaomi as an example. When Xiaomi entered the mobile - phone market, the price of smartphones was generally around 4,000 - 5,000 yuan, while Xiaomi reduced the price to about 2,000 yuan. This made many price - sensitive customers choose to buy its phones.

Xiaomi has a significant advantage in price cost. However, customers also need to bear a certain time cost.

Another formula is the Nyquist theorem. When the signal strength is twice the noise, the noise can be ignored.

According to this theorem, either double the value, or halve the price, or cut the time cost in half. All these can have a strong impact on customers.

The same applies when Xiaomi entered the automotive market. If a car is configured to be worth 500,000 yuan but is sold for 250,000 yuan, users are likely to ignore other factors. Lei Jun has used this strategy very well.

Customer Demand Intensity

In business analysis, the VCT value model has a more detailed part, customer demand intensity. According to Maslow's hierarchy of needs theory, human basic needs focus on food, clothing, housing, and transportation.

In the early days of reform and opening - up, the transformation of leading enterprises was centered around food, clothing, housing, and transportation. For example:

The rise of the real - estate industry meets people's need for housing security;

The development of the automotive industry satisfies people's need for transportation.

With economic development and the improvement of living standards, the level of needs has further risen. People begin to pursue a sense of belonging, that is, the satisfaction of social relationships.

That's why companies like Tencent and Douyin, which focus on the social