Category: Collaborative Age value production system

How to Maintain a Middle Class in a Creative Economy

This excellent HBR article ‘The Creator Economy Needs a Middle Class‘ investigates the possible mechanisms by which a middle class can be maintained in a world where “the winner takes all” according to the rule of the complex systems and the effect of the ‘long tail’.

The interesting historical point made by the article is that the creation and maintenance of the middle class did mostly happen through government intervention in the 20th century. In the Industrial Age it made also sense to compensate adequately those workers who would also be the core consumers of products and services.

In the internet creative age, left to itself, revenue tends to concentrate on less than 1% of the creators. This is what can be observed on most social media creative platforms. This is not sustainable if we want overall revenue to remain significant while we are moving more towards a creative age. What business model can then be put in place to ensure that a larger share of revenue is spread over a larger number of people?

The paper proposes a few solutions that would need to be driven by the platforms themselves (or mandated by law to the platforms):

  1. Focus on content types with lower replay value (like podcasts rather than music)
  2. Serve heterogeneity and empower niches rather than mainstream
  3. Recommend content with an element of randomness to expose others than the winners
  4. Facilitate collaboration and community
  5. Provide capital investment to up-and-coming creators
  6. Decouple creator payout from audience demographic (which is akin to some kind of redistribution)
  7. Allow creators to capitalize on superfans (direct fan payment)
  8. Create passive (or almost passive) income opportunities for creators
  9. Offer some kind of Universal Creative Income
  10. Provide more creator education and learning (as a service)

All in all, this excellent article (which I encourage you to read) reminds us that left to themselves, platforms that disseminate creative work will not all a middle class to emerge, and that active action is required to allow this.

The key point of course is that if this is not in the economic interest of the platform itself, it will need to be mandated externally until everyone understand it is of social importance to maintain a wealthy middle-class.

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How Bots May Have Amplified the GameStop Surge

Following up on our previous post ‘How the GameStop Stock Event Ushers a New Era of Collective Resistance‘, new reports have emerged of bots having also had a significant impact on what happened to this particular stock (see ‘Did Bots Help Push GameStop And Other ‘Meme Stocks’? A New Report Says Yes!‘ or ‘Thousands Of Bots May Have Played Role In GameStop Hype: Report‘. Those bots could have influenced users of social networks by amplifying an existing trend.

“It should be noted that real human beings did indeed start the conversation and push surrounding the GameStop stock and other meme stocks. The report indicates that bots were at least partly responsible for hyping and promoting these stocks once the initial Redditor-inspired campaign took off, however.” We thus seem to be in the presence of a phenomenon of bot-amplification of a trend.

This shows how bots can amplify or conversely moderate the impact of trends on social media, depending probably on how they are driven by the people who create them.

This example, like many others, shows how public opinion can be highly vulnerable to bots that mimic social media users and serve to amplify certain trends, shares and opinions at the expense of others. It is a great opportunity to explore for those that want to highlight their views, and at the same time an issue to be regulated to make sure that opinion diversity remains and to avoid extreme trends to prevail.

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How Timescales of Survival Call on Different Groups

Survival at different time scales (year, decades, centuries, millenia) requires the mobilisation of different groups. This can explain the importance for us to cultivate those groupes (from the family to humankind). And this can also be contradictory therefore leading to paradox and conflict.

This thought is based on the quote by mathematician and physicist Freeman Dyson: “The destiny of our species is shaped by the imperatives of survival on six distinct time scales.  To survive means to compete successfully on all six time scales.  But the unit of survival is different at each of the six time scales.  On a time scale of years, the unit is the individual.  On a time scale of decades, the unit is the family.  On a time scale of centuries, the unit is the tribe or nation.  On a time scale of millennia, the unit is the culture.  On a time scale of tens of millennia, the unit is the species.  On a time scale of eons, the unit is the whole web of life on our planet.  Every human being is the product of adaptation to the demands of all six time scales.  That is why conflicting loyalties are deep in our nature.  In order to survive, we have needed to be loyal to ourselves, to our families, to our tribes, to our cultures, to our species, to our planet.  If our psychological impulses are complicated, it is because they were shaped by complicated and conflicting demands.”

Survival at different time scales requires sometime contradictory approaches and relying on different social social groups. That may be something we do not sufficiently account for in our understanding of social tensions.

Hat-tip for the quote to Valeria Maltoni in ‘Fast Gets all our Attention. Slow Has all the Power‘

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How Our Personal Brand Is Not What We Are Showing Off

In this excellent post ‘Personal Brand 2020 – Document The World (Not Yourself)‘, Mitch Joel makes the point that there is much confusion between personal brand and what we show on social media.

“Your personal brand is the quality of your work, your professional output, and how it has helped another organization (or individual) improve their current business situation (or how they think/operate).” And that’s not quite the same as what we show off or share on social media.

Mitch Joel then makes sure we understand the difference between personal brand and vanity: “Your personal brand is not vanity. It’s your thinking.”

Those that define well their personal brand and communicate accordingly will have clearer way of presenting themselves to the world. Let’s be strategic on this and not share whatever pleases. In the new world as in the previous one, building a personal brand requires thought and discipline.

Your personal brand is not your presence on social media. It is rather what value to bring forth to the world. There is a huge difference, and we all need to understand it.

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How We Increasingly Live In a Low Resolution World

With the advent of internet and the much increased usage of teleconferencing and social networks, we may have significantly decreased the resolution of our social interactions. This is of course quite a paradox in a world where we all seek higher resolution TV and screens.

Still, our human interrelationships are increasingly virtual and by this fact, significantly lower resolution than real, face-to-face interactions in a real-life environment, with all that is entailed in terms of informal interaction. And this is not going to be significantly improved by higher resolution video!

The same applies for social networks: what we post is usually just a subset of what happens in our lives, and thus gives out an image of significantly lower resolution than would have someone living with us.

There is thus quite an interesting contradiction between a world that seeks always higher resolution TVs to watch the world, and the diminishing resolution of our social interactions. How can we explain this contradiction? Is the race for higher resolution screens a way to compensate for lower resolution relationships?

Hat-tip to Valeria Maltoni’s ‘What is High Resolution, what is Low Resolution. Can we Tell?‘

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How We Should Not Be Fooled by Greenwashing

In this interesting Fast Company article ‘Don’t be fooled by brands that do one good ethical thing, say economists‘, the issue of a particular form of company greenwashing is exposed. All companies want to highlight some ethical action or initiative, but sometimes this hides a whole set of quite inappropriate behaviors.

Greenwashing is a new term: “a form of marketing spin in which green PR (green values) and green marketing are deceptively used to persuade the public that an organization’s products, aims and policies are environmentally friendly.” (Wikipedia). And this seems to be quite widespread, at least more or less consciously.

Still, studies show that “A company touting its One Ethical Behavior will likely manipulate you into a purchase“. This is linked to a psychological aspect: “Understanding our minds’ tendency to accept one positive behavior is essential. It’s commonly used across advertising and politics to mask significant ethical issues.”

Be wary about greenwashing and the good deeds that are communicated by organizations and companies, it is quite essential to understand whether it is just superficial chatter or the reflect of a deep culture. And if that is the case, those organizations may be those that communicate the least!

Greenwashing is an issue nowadays and let’s not be fooled by superficial communication on good deeds, rather examine if ethical behavior is deeply rooted in the organization!

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How Most Companies Play a Finite Game in an Infinite Game World

In his highly recommended book ‘The Infinite Game‘, Simon Sinek makes the point that whereas we live in a world of infinite games, most companies today play a finite game. And this is not getting better in the last years.

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“Sadly , over the course of the past thirty to forty years, finite – minded leadership has become the modern standard in business. Finite – minded leadership is embraced by Wall Street and taught in business schools. At the same time, the life span of companies appears to be getting shorter and shorter. According to a study by McKinsey, the average life span of an S & P 500 company has dropped over forty years since the 1950s, from an average of sixty – one years to less than eighteen years today.”

It is quite amazing to have such a contradiction between a much more open, infinite game in business and economy with globalisation, and the fact that the financial markets promote finite game behavior. This also explains in a certain way the comparative success of fmily-driven businesses that take a long view on their development.

Let’s hope that with the development of sustainability thoughts, more economic players will start playing infinite games and that this finite-game behavior will change. This is definitely what is needed for the Collaborative Age.

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How We Should Have a Diversified Portfolio of Gigs

In the interesting book ‘The Gig Economy‘ by  Diane Mulcahy, she describes how we all should develop a diversified portfolio of gigs to succeed in this new economy.

“Diversifying our work reduces our risk, opens up new opportunities, expands our networks, and develops our skills. Diversifying our interests brings balance and variety to our lives and gives us a way to explore our passions, nurture new interests, and satisfy our curiosities.“

Her point is that in this portfolio, we should have profitable gigs and also gigs we don’t do for money – at least for now – and serve as exploration. “They could accomplish personal and professional goals and achieve a balance between money and love, play and work, passion and pragmatism“.

Some of those gigs should be pilots gigs we use as test benches: “Having a portfolio of gigs allows us to create low – risk opportunities to experiment with new ideas and new opportunities. An experimental gig lets us test an opportunity and if we find we don’t like it, we can drop it and try something else. By using gigs to create small pilot tests of opportunities, we create the option to either continue and invest more if it’s successful or stop and move onto something else if it’s not.”

Having a diversified set of interests and activities (gigs) appears to be a key to risk management and success in the new gig economy. What about you? Do you have such a portfolio including some pilot or emerging activities?

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How Cities Need a Minimum Size for the Knowledge Economy

This Quartz piece ‘What it takes for a city to jump into the knowledge economy‘ mentions an interesting study to determine the critical size of a city to fully be involved in the knowledge economy: 1.2 million inhabitants.

This is based on studies carried out on a sample of hundreds of metropolitan areas, looking at people occupations. Statistics show a definite increase of knowledge workers above this threshold.

“In addition to more white-collar, higher-paying jobs, a bigger population leads to a more diversified economy, which in turn leads to innovation” In addition, the network effect created by the metropolis does help ideas being exchanged and innovation to be fostered.

This is quite interesting as it tends to show that there is a critical mass for the Collaborative Age metropolis to be fully embedded in the digital innovation. 1.2 million people is a relatively high threshold that makes may local towns seemingly less adequate to be a center of Collaborative Age value.

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How to Motivate People in AI Environments

Motivating people working in AI-rich environments (where many operations are actually driven by AI) is a new challenge. Some researchers work on this issue though, as explained in this interesting Fast Company article ‘Why organizations might want to design and train less-than-perfect AI‘

While it is clear that in the future, value will be created by close collaboration between humans (very strong for creative tasks) and AI (very strong for repetitive tasks). Refer to our post ‘How We Need to Learn to Work with AI‘ for example. What is new here is the idea that AI itself must be adapted to fit this human interaction in the way it behaves.

“Giving too much authority to AI systems can unintentionally reduce human motivation.” How can we retain motivation? According to some Stanford research, the trick is to rely on the fact that “decision-making authority incentivizes employees to work hard“. Therefore, “there may be times when—even if the AI can make a better decision than the human—you might still want to let humans be in charge because that motivates them to pay attention“

The deal is not to have the best AI, but a slightly imperfect AI or an AI that asks humans for directions and instructions are well timed moments may be the best approach for a harmonious human interface.

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How Antitrust Regulations Are Not Adapted to the Digital Era

In this instructive post ‘The Antitrust Quagmire‘, Frederic Filloux exposes how current laws and regulations about antitrust may not be adapted to the situation of the GAFA digital players. As a result, the Collaborative Age requires a new approach to the antitrust situation.

His arguments revolve around four topics:

  • internet time is much faster than traditional legal process time which spans over years, giving the opportunity for digital players to render cases obsolete before they are judged,
  • a difficulty to determine exactly the market and competitors of interest, due to the cross-sectional approach of the digital disruption,
  • another difficult in the physical world when it comes to compare e-commerce with traditional commerce, and the fact that e-commerce provides a selling avenue to many small, independent producers that would not be available otherwise,
  • the fact that possible measures and compensations can’t easily be the same that presided in the geographical or product division of Standard Oil or AT&T – in particular because value is in the network effect.

Thus a new antitrust approach is required that is adapted to the digital universe of the Collaborative Age. It is needed to prevent too powerful private players to take decisions that border on national sovereignty. What could it look like? It is a bit unclear at the moment, however a quicker bit-sized approach as promoted by Frederic Filloux may be the answer.

Antitrust approach to digital players in the Collaborative Age should be one the major research areas in business law at the moment, and innovation will be required.

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How Data Can Develop Into a Competitive Moat

The example of the hedge fund Renaissance Technologies (here on wikipedia, also this excellent post ‘Jim Simons And Renaissance Technologies‘) is an excellent example of a company that has created a substantial competitive advantage from data gathering and interpretation.

The performance of the fund over decades (since 1988) has been quite impressive. The approach of the fund was to have a passionate “team of  of mathematicians whose motivation was doing exciting mathematics and science (rather than hired guns who could be lured away by money or pure trading quants, biased by the industry).”

Still, here is the interesting part: “On top of his intelligent hiring and novel approach to trading, Jim Simons recognized that an impressive data pipeline – and the technological infrastructure to digest and analyze that data was a moat to competitors. It is hard to have an edge if you use the same process and the same data as your competitors.” And from Wikipedia: “Renaissance Technologies, along with a few other firms, has been synthesizing terabytes of data daily and extracting information signals from petabytes of data for almost two decades now, well before big data and data analytics caught the imagination of mainstream technology“.

It is thus the poster-child of a company that has used data retrieval and interpretation as a moat. It is dealing with one of the most public and accessible data (financial trading data), but now the same can be done with many other kinds of user data. Data as a competitive moat is already there, has been for years, and is there to stay.

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