Half-life is a term normally used in nuclear physics to describe how long atoms will survive radioactive decay. In other words, half-life refers to the time it takes before an object loses half its quantity. Determining the half-life of a given element is not a straightforward procedure since atoms decay randomly. Half-life is based on the most probable rate that, over a huge number of randomly-decaying atoms, it will hold true for each of the 29 elements known to go through this process.

Interestingly enough, the concept of a half-life transcends the atom world and can be observed acting somewhat similarly in other fields and objects such as biology, chemistry, economics, investments, ideas, drugs, and much more. Not even facts are immune to it.

Much of what people believed to be irrefutable fact two centuries ago may no longer hold true today. Even something seemingly as indisputable and undeniable as the force of gravity is being put into question nowadays. Randomness, circumstance, and probability still determine which facts are being disproven by the advancements of science at any given time, but when looking at the bigger picture, a reasonably predictable half-life pattern emerges.

The Half-Life of a Business Model

It shouldn’t come as a surprise then that business models experience the same effect. It is true that up until recently, a well thought out business plan could withstand the test of time, spanning over many generations. But with the emergence and development of capitalism, alongside the technological and social advancements of today, businesses no longer can afford to stick to the same model year after year. In fact, they need to adapt, not only to get ahead and gain more market share but just to remain where they were one year prior.

Not only is this trend happening but it is actually accelerating. With the amount of new knowledge that is being presented on a daily basis, it is hard for even the most learned people to keep themselves up to date on everything. In a paper from 1966, entitled “The Dollars and Sense of Continuing Education,” Thomas F Jones concluded that an engineer fresh out of college would need to study 5 hours per week, 48 weeks every year, just to keep up to date with the new advancements in the field of engineering. Likewise, it took roughly 4,800 hours of study to get that degree; 2,400 of which would become obsolete in just 10 years. One decade was the half-life of knowledge and education during the 1960s.

The same engineering degree today is said to have a half-life of anywhere in between 2.5 and 5 years. It would also require roughly 15 hours per week of study just to stay on top of things. Determining the exact half-life of a given business model is harder to ascertain, but a similar trend is happening here as well. Nevertheless, a willingness to learn and adapt to new ideas and circumstances is imperative for any business to survive and thrive in the 21st century.


Though challenging, this rapid change is not all bad either. It is more of a matter of perspective than anything else. Even if a business model’s half-life is shorter than it was in decades past, this change also means that the amount of knowledge that can be used to one’s advantage is greater than ever and constantly growing by the same amount. It is up to each and every business to keep itself up-to-date and to make use of all this new information to get ahead.

Philip Uglow is the President of Renshi Consulting Group. Renshi lowers clients costs by pulling ideas from your people in the moment, when they are most busy with real work. This is when they learn. This is when they change.