Years ago I got introduced to this concept called the Gartner Hype Cycle. It is a way of understanding how a new idea or technology gains acceptance over time. Simply put, it works like this:
- A new thing is created (Innovation Trigger)
- People get really enthusiastic about it, and try applying it everywhere (Peak of Inflated Expectations)
- A lot of those false expectations get deflated, and people start to get pessimistic about the new thing (Trough of Disillusionment)
- Over time, people work hard on appropriate and wise applications of the new thing, and over time you get to a good place where it’s used appropriately (Plateau of Productivity)
Don’t let “hype” fool you. This isn’t a story of negativity – note that on the right hand side is enlightenment and productivity. The Hype Cycle is a great story of how humanity experiments and learns with time, which is why it’s a fascinating look at how societies change, through the lens of human psychology. But before we get into all that, let’s ground it with an example.
Hype Cycle Victim: the Segway
The Segway was a great illustration of this curve that many people saw in their lifetime. When it was first announced it was a revelation (Innovation Trigger). People immediately began writing breathless articles about how it would change the entire landscape of transportation (Peak of Inflated Expectations). Over time, it didn’t work out for a lot of reasons, and then people really started hating on it. Several years later they actually still exist and have a steady business selling to companies that do city tours, and other niche uses. So it turns out that the Segway wasn’t the second coming, and many people got very disappointed, but in the end it did turn out to be useful and long-lasting.
A Predictable Pattern
There are dozens of other examples of this, from Bitcoin, to proposed therapies for coronavirus, to remote work. Once you’ve seen it enough, you can use the pattern to make pretty stable predictions. Because everything goes through this phased approach, if you know which phase an approach or technology is in, you can use that information to know where things are going next.
The hype cycle is a model that describes how societies incorporate new ideas. It works with technology, but even diets: there’s a new kind of structured “fad diet” every week that promises health & weight loss by focusing on certain foods over others. Pretty much 100% of these fad diets end up not being general solutions for everybody, but a good number of them find useful niches in small sub-communities.
In a career or lifetime though, you need to get through a minimum of about 10 years to see a complete wave move through the system to really spot the pattern for yourself. Waves move through slowly.
Why Does This Happen?
Think of any new technology as having push and pull; “push” is what pushes back against the technology’s adoption. And “pull” are things which drive its adoption, and pull it into usage.
Pull by Problem: A pull factor is the range of problems out there which need help. Wide-eyed, optimistic and visionary entrepreneurs want to solve problems, and “go big” in trying to address problems. This is broadly positive, but creates a tendency in them to over-broaden the applicability of their solutions.
Pull by Wishful thinking & Optimism. So many problems in life are intractable. Or rather, they are not problems to be solved, but situations to manage over time. This grinding and uncomfortable reality leads people to seek solutions for hard problems, a sort of “silver bullet urge”. This is a major pull factor that draws technologies up towards the peak of inflated expectations, as the over-application of new ideas usually goes into intractable problem areas with no easy solutions.
Pull by Social Proof. Technology marketing has gotten really sophisticated, and techniques which involve social influence have a powerful effect on people to adopt. You don’t want to miss out, do you? You’d be behind the curve! (Note that this does not make the technology the right solution for you, it’s just a reason why you might try it)
Psychology & Mass Experimentation
Notice how these factors are all about what people think about the new thing. They aren’t about what the new technology is, or what it can do! When society gets a new toy, it needs to go through an experimentation phase to see what it can do. This is natural and necessary. The psychology that’s at play though governs how strong the pull factors will get. The stronger the pull factors, the higher the peak of inflated expectations will go, and the deeper the trough of disappointment will eventually be. We saw that in the case of Segway. They had an extremely high optimistic peak (you can’t get much bigger than promising to transform society), which made for a deep trough and a lot of uncalled-for hate at the bottom.
Leading & Lagging Indicators
When we think of any phenomenon we might want to spot or predict, we can break it into the category of leading & lagging indicators. As a simple example when we predict rain, thunderclouds rolling into our area is a clear leading indicator, but the smell of wet grass or falling raindrops is a late / lagging indicator.
Innovation and new idea development is a leading indicator. It doesn’t tell you exactly what the future is going to be, but it does serve as an indicator that shows up very early in the cycle. For example, you’ll see periods of heavy mobile phone development activity in the 2 years prior to mass adoption of smartphones and mobile applications.
At any time, you can look at what’s going on in the bleeding edge, and make reasonable predictions about what everyone else will be doing in 5 years. That’s what makes it a leading indicator. In the case of technology, this is because technology’s main purpose is to enable or automate other functions. Text messaging itself isn’t so crucial, but the ad-hoc coordination between people that it enables transforms communities.
The Pushback: Reality as a Lagging Indicator
Reality is a funny thing. You can’t change it, but you can defer it. Financial bubbles represent situations where the business community is doing something that in aggregate doesn’t make any sense. And it works! But only for a while.
You can bend the fabric of reality, but it has a tendency to snap back at an inconvenient moment.
The ability to defer reality is what makes it usually a lagging indicator. If see someone using a technology and it doesn’t make sense or work well, that probably isn’t enough to stop its adoption because of all of the pull factors that are at play. Reality will take over, but it appears late in the game.
Enthusiasm and excessive “push” for a technology always runs into the “pull” factor of reality. A technology either works at the end of the day or it doesn’t, and there can be no faking it in the long run. The mechanism for why this will always take over in the end is simple: if it doesn’t work, truly, someone suffers some pain, and stops using the technology to avoid that pain. Or there will be a ready substitute that they’ll use, when they no longer care about missing out on the hot new thing. The pull factors we discussed above are also extremely hard to maintain over a multi-year timeframe, so the pull factors naturally tend to decay, allowing the “push” of reality to catch up.
Slope of Enlightenment
Reality doesn’t kill good ideas, it just tempers and hones them. Nine times out of ten, reality is that the new technology isn’t the greatest thing since sliced bread, but has a useful niche application where it can serve people well, and the Segway is a demonstration of that. What makes the Segway so stark of an example is the massive difference in size between it’s actual proper niche, and the peak of inflated expectations.
In the end, the overall story of the hype cycle is not one of doom and gloom, and crushed expectations. It’s rather a story of experimentation, and niche-finding for new technologies. It’s a rather beautiful repeating human pattern of how we take new things and incorporate them into our societies in a way that is most effective.