China may be the country most thoroughly remade by the internet. Over 20-plus years, the internet has hammered the industrial economy wave after wave: five stages of consumer internet from 1998 to 2016, and the industrial internet era beginning in 2016.
The book The Grey Wolf Pack Effect: The Critical-Point Revolution of Industrial Digitalisation uses vivid metaphor and original models to reinterpret the inner logic of that shift.
Internet waves, five times over
Startups flooded in from 1998: news portals, email and search changed how people relate to information. Taobao’s birth in 2003 drove e-commerce and changed the relationship with goods. 2010’s O2O ‘war of a thousand groups’ changed services; Yu’ebao in 2013 changed finance; and ‘new retail’ in 2016 changed the relationship with space.
After 2016, the internet turned to city governance and operations, then to every production factor and operating model of traditional manufacturing via sensors, big data and cloud – hence consumer internet for the first five stages, and industrial internet from here. The change is nonlinear, dissolving the rigid and giving bold early movers a chance to overtake on the curve.
Grey wolf packs change the forest’s rules
Author Zhao Jinwei sees the industrial environment as a forest. The old rule was natural selection: some firms become tiger enterprises through brutal competition, while the mass of smaller firms survive as quick, alert foxes – nimble and alert. Tigers and foxes faced off in a non-cooperative game.
At the transition point between consumer and industrial internet, grey wolf packs – digital industry clusters – change the game: between packs, and between packs and tigers or foxes, relations become competitive, cooperative and fused, a positive-sum digital industrial ecology remaking the forest.
Zhao’s emphasis on close inter-firm collaboration echoes Harvard professor Martin A. Nowak, who argued that beyond mutation and selection, cooperation should be recognised as the third principle of evolution. ‘Through cooperation, evolution produced its constructive side – from genes to organisms, from language to complex social behaviour, cooperation is evolution’s chief architect.’ Cooperation, in business terms, rises to a higher value in the digital transformation hierarchy.
An inward-facing long march
Friction and conflict are inevitable as digital clusters push industrial internet forward – they are part of progress. No one can buy a ‘life plan’, and every firm’s exploration of the forest is unrepeatable. Three hopes for the new era:
First, SMEs can still get a ticket for the internet revolution’s second half – the industrial internet wave has only begun, and it is pre-dawn for everyone. Second, the new business ecology demands organisational iteration: top floors are never smarter than the front line, and only organisational redesign, cultural alignment and technology-and-capital empowerment can meet uncertainty. Third, firms must shift from those-who-are-revolutionised to active revolutionaries: digitalisation is a systematic rebuild of the business ecosystem, no firm can stand aside, and finding one’s ecological niche and evolving matching capabilities is an inward-facing, difficult long march.
The map of the future world is unfolding. We may not know who arrives first, but business is a survivors’ game – what matters is being willing to join hands for the road ahead.
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