The Four Stages of Evolution
Simon Wardley explains the four evolution stages that all components go through, from Genesis to Commodity, and how understanding this evolution is crucial for strategic decision-making.
Passage Details
The Four Stages of Evolution
Everything evolves through four stages: Genesis, Custom Built, Product, and Commodity. Understanding these stages is the key to making strategic decisions.
This passage from Simon Wardley's book explains the fundamental concept of evolution in Wardley Mapping - how all components in a value chain evolve through predictable stages, and why understanding this evolution is crucial for strategic thinking.
The Evolution Stages
Genesis
In the Genesis stage, components are:
- Novel - New and unfamiliar
- Uncertain - Unclear how they will develop
- Constantly changing - Rapid evolution and iteration
Examples of Genesis components:
- Emerging technologies (AI, quantum computing)
- New business models (sharing economy, subscription services)
- Novel customer needs (virtual reality experiences)
Custom Built
In the Custom Built stage, components are:
- Growing - Increasing adoption and understanding
- Becoming more defined - Clearer purpose and capabilities
- Scarce - Limited availability, high value
Examples of Custom Built components:
- Specialized software platforms
- Unique customer experiences
- Proprietary processes and systems
Product
In the Product stage, components are:
- Stable - Well-established and reliable
- Well-defined - Clear specifications and capabilities
- Widely available - Multiple providers and options
Examples of Product stage components:
- Standard software applications
- Established business processes
- Mature technologies and platforms
Commodity
In the Commodity stage, components are:
- Ubiquitous - Available everywhere
- Standardized - Consistent specifications and interfaces
- Utility-like - Reliable, predictable, and cost-effective
Examples of Commodity components:
- Basic infrastructure (electricity, internet)
- Standard services (hosting, storage)
- Common business functions (payroll, accounting)
Strategic Implications
Understanding evolution stages helps answer critical strategic questions:
Where Should We Invest?
Focus on components in Genesis and Custom Built stages, where you can create competitive advantage through innovation and differentiation.
What Should We Outsource?
Consider components in the Product and Commodity stages, where standardized solutions are available and cost-effective.
How Do We Compete?
Differentiate on evolving components (Genesis, Custom Built), optimize on stable ones (Product, Commodity).
What's Changing?
Monitor components moving between stages to anticipate opportunities and threats.
Evolution in Practice
Technology Evolution Example
Genesis: Blockchain technology (2010-2015)
↓
Custom Built: Enterprise blockchain platforms (2015-2020)
↓
Product: Standard blockchain services (2020-2025)
↓
Commodity: Utility blockchain infrastructure (2025+)
Business Model Evolution Example
Genesis: Subscription boxes (2010-2015)
↓
Custom Built: Specialized subscription services (2015-2020)
↓
Product: Standard subscription platforms (2020-2025)
↓
Commodity: Subscription management tools (2025+)
Key Insights
- Evolution is inevitable - All components eventually move toward Commodity stage
- Timing matters - Investing at the right stage creates maximum advantage
- Multiple stages exist simultaneously - Different components in your value chain are at different stages
- Evolution creates opportunities - Changes between stages create strategic openings
- Understanding evolution reduces uncertainty - You can anticipate changes and prepare accordingly
Application to Strategy
When mapping your value chain, ask for each component:
- What stage is it in? Genesis, Custom Built, Product, or Commodity?
- Is it evolving? Moving toward the next stage?
- How fast is it evolving? Rapid change or gradual transition?
- What does this mean for our strategy? Invest, optimize, or outsource?
Conclusion
The four evolution stages provide a framework for understanding how components change over time. This understanding is fundamental to Wardley Mapping and strategic thinking. By recognizing where components are in their evolution and anticipating where they're going, you can make better strategic decisions about where to invest, how to compete, and what to expect in the future.
This passage is from Simon Wardley's book "Wardley Maps: Topographical intelligence in business." For more insights from Wardley and other strategic thinkers, explore our book passages collection.