Institutions and Revolutions | The Fourth Revolution Blog

How the Fourth Revolution transforms the market for work

Our Industrial Age world is apparently in a crisis – employment rates diminish currently for most generations, and those who are employed are increasingly so on a part-time basis. The proportion of salaries in the net national value creation is diminishing.

Contract work - the new work framework — Contract work – the new work framework?

Yes, the Industrial Age model of salaried work is in a crisis – not a crisis actually, but a transformation. Even the Harvard Business Review now blogs on “The Rise of the New Contract Worker”, or how increasingly people look for alternative forms of work. Not straightforward employment but rather innovative forms of work and compensation, which generally imply some sort of contracting or more or less informal grouping.

The portion of salaries in the economy will further diminish because more and more people will be contractors, on their own or in small ad-hoc companies. The inter-mediation cost has dropped dramatically with freelance platforms. When countries will give even more flexibility on such basic social services like health insurance, the proportion of freelance contract workers will only increase.

The salaried worker working exclusively for one single employer is dying. What will replace it might increase anxiousness for some because of the apparent risk and the need to market oneself; yet it will unleash the creativity of the world by making sure that all work that gets done really contributes to creating value.

An employment market crisis? Reframe it: it is just a deep transformation of the way we will get compensated for work! When do you start taking this opportunity?

The Fourth Revolution in action: already baby steps towards direct democracy

We argue in The Fourth Revolution book that representative democracy is a remnant of the Industrial Age travel limitations and that forms of direct democracy will emerge as a result of the Fourth Revolution.

Ready to Ask Your Question to Your Representative?

Some hints of that shift can already be observed. The website AbgeordnetenWatch.de (literally Parliamentary Watch) in Germany is a website that connects citizens and elected representatives. According to David Eaves, a guru of open data, the German site has, since 2004, posed over 140,000 questions from everyday citizens of which 80% been answered by politicians. According to the website itself, in average, the website counts 10.000 Visitors a day and about three million page impressions per month; two thousand questions are asked through the portal of abgeordnetenwatch.de each month and questions and answers are visible to all visitors.

This type of websites will extend and become progressively central to our countries’ governance. Eventually citizen’s questions will be relayed in parliament and to government and answers posted in such forums.

The Fourth Revolution is coming quickly. Old-fashioned politicians beware!

Done! The Fourth Revolution put the music industry upside-down!

This summer for the first time the ‘summer hit’ in the US came out of nowhere. That’s “Call me maybe” an infectious song (250 million views on YouTube). Well, that’s not exactly true: it came out of YouTube and social networks. The story is counted in this very interesting NYT article which I recommend to read.

This song became a hit through a YouTube-twitter infection. And it is only with regret that the radio stations went on to play the title after a few weeks. For whom actually? It seems the young generation listen to music (for free) on YouTube anyway. Artists make money through public appearances and other means; not any more through broadcasting their songs. That’s a fact.

It goes to show how the traditional music industry is completely overtaken. It does not master the broadcasting channels that are important to the young people. It is the end of that industry as we knew it in the last decades.

And it is the beginning of viral hits. Funny videos, cool songs… Stay tuned! The Fourth Revolution has toppled the music industry and it is not the last institution that will go!

PS – listen to the song it’s really viral!

How the Fourth Revolution transforms our view of Earth

Working in the field of large, complex projects, I can’t see a project file nowadays without great pictures coming from Google Maps adorning the file: pictures of the site, of the present facilities…

Industrial Facility seen from Google Satellite — Industrial Facility seen from Google Maps

And indeed it is so easy from any computer to have precise satellite pictures of any place on Earth that we just don’t think any more about the miracle that is… ten years ago only, this privilege was reserved to government authorities and large corporations who could pay to get the picture taken by an aircraft or a satellite.

And today in developed countries most roads in large cities are also visible through Google’s StreetView.

This unprecedented democratization of earth imagery has far reaching consequences. It changes fundamentally the concept of ‘public space’ (which can now be observed from anywhere on Earth) but also the concept of ‘private space’ (you can’t hide what you have in your garden from your neighbor any more!). It changes fundamentally how we perceive the physical space around us. This transformation is as strong as when we saw the blue planet Earth for the first time from space, floating in emptiness, in the 1960’s.

Some people argue that because only a limited number of actors manage this data (Google being the most prominent), we are exposed to possible manipulation of the data for commercial purposes, showing us only what they want to show us (see the paper “The Dark Side of Commercial Mapping”). We are not so pessimistic, because there will always be competitors and the crowd will denounce abusing behavior. But certainly our view of the geography that surrounds us has been transformed and this has already changed our decision making when it comes to property or project management.

Today, our perception of our immediate and distant geography has been transformed. Like our new vision of Earth transformed our mindset in the 1960’s, how will our action taking relative to geography, in particular in the field of ecology, change?

The best digital maps are created by humans and crowd-sourced

Following the outcry about the poor quality of the new Apple mapping application that came out with the iPhone 5, let’s investigate how the best electronic maps around have been created.

No surprises, there’s a lot of human work, sweat and crowd-sourcing behind them. This excellent paper on “How Google Builds its Maps and What It Means for the Future of Everything” describes how an army of people (most of it probably in India) have reviewed all the grueling details of the Google map database, helped lately by Google Street View cars to achieve the appropriate accuracy.

But Google Maps also allow users to give their input to correct inaccuracies (even wondered at the small clickable “Report a Problem” at the bottom right that allows you to give input directly to Google?). So, a significant additional accuracy is given by crowd-sourcing.

Digital maps aggregate an incredible amount of geographical information on several layers, giving insights into our world in a way that had never been possible before – and thus changing our view of it. Even if Google maps was only created in 2005 (!), taking into account the effort that has gone into it, you can’t just improvise an alternate version. Catch-up of the current mapping data will take significant amount of effort. That effort will be done by competitors because this data is so strategic commercially, but only those will be successful that have significant capability to mobilize people to code the data – and to mobilize the crowd to ensure constant accuracy even in case of changes. Google has an advance over everybody else, and this huge investment they made will be one key to their future success.

Building a Ghost Town to Test New Technologies – Another Ghost from the Industrial Age?

A town is being built in New Mexico to test all sorts of new technologies that will apply in towns and cities. At a cost of several hundred million US$, the plan is to create a replica of an actual 30,000 people town that can be used as a laboratory. A detailed explanation of this incredible project is to be found in this Fast Company article on “America’s Most Innovative Neighborhood: 15 Square Miles In New Mexico, Population: 0”.

When looking at this project one can but wonder whether that’s not a relic of the past Industrial Age research approach. The place is in the middle of nowhere (so remote that atomic laboratories and disposal sites are nearby – I’ve been to Carlsbad, NM) – do some people fear an explosion? Why on earth put a research center so far away from anything?

The investment is huge to test what – technologies that would be deployed in cities? Why would you want to spend so much money when small scale tests could be deployed in actual cities – of course in less controlled but so much more realistic settings. And Google cars without drivers are already oozing on California’s highways, so what’s the point of building a special town to test them?

It looks like it is a ghost from the Industrial Age past where research had to be done in huge concentrated laboratory – where research was to be produced like in a factory. What will this town laboratory bring to the world? History will tell if it sees the light. In view of where actual innovation happens in the Collaborative Age it is dubious it would happen in such a remote place.

Publishing A Book is Not Any More a One-Way Broadcast

If you are a e-book reader you might have noticed that you can type in your notes and share your text highlights with other readers, the world… and the publisher.

Publishing a book is not any more a one-way broadcast. And the role of the distributors has increased dramatically. Since a decade, readers can easily speak their mind on all books on most e-bookshops (the distributors) – which in effect is a sort of crowdsourcing of opinions. I now look at who recommends the book and what the opinions of readers are before buying.

ebook interactive reading — Ebooks add a layer of interaction and can spread your notes and highlights

Now an other layer of feedback has been added with e-books. Distributors like Amazon or Barnes & Noble can also get feedback from the inside of the book when you read them. On most e-book reading devices you can take notes and highlight quotes – and share them with the wider community – and the publisher.

This paper in the Wall Steet Journal, “Your E-book is Reading You” explains that the distributors have only started analyzing that huge pile of data.

And because of this huge trove of data, and the insights that will be derived from what the readers like or don’t like, the power of the Publisher will vanish while the power of the Distributor will soar – and we can predict that soon Publishers will be taken over by Distributors, like Amazon is already doing.

Publishing books started the Industrial Revolution, the era of Broadcasting. Today, publishing books enters the Collaborative Age in full, allowing almost real-time interaction with the readers. And as with other industries, publishing will be put upside down by the Fourth Revolution.

Old Industrial Age Cliches Die Hard. Kill them Faster to Transform the Economy!

As I was travelling in France a few weeks ago I was repeatedly struck by how Old Industrial Age cliches die hard – and in particular in ‘developed’ countries.

Lets' Reindustrialize France (2012 Union poster) — Lets’ Reindustrialize France (2012 French trade union poster)

Trade unions claim that the country should be re-industrialized (poster on the right I saw on a building). That would be fine if they did not mean rebuilt large manufacturing complexes.

Authorities and traffic forecasters still believe that people take their leave all together when the factories close (which is of course, less and less true – no wonder traffic predictions are less and less accurate!).

In the midst of the crisis, the government plays with the idea of creating large manufacturing giants, the key to wealth and prosperity. Is it really?

I have two main objections to this:

First, in the Fourth Revolution, as argued repeatedly in this blog, a nation wealth and prosperity will not come from its manufacturing proficiency, but from its creativity, networking and knowledge enhancement capabilities. There will always be cheaper places to manufacture. There won’t be so many places to create value.
Second, frankly after I spent as a student a one-month experience in a car manufacturing plant, I don’t see working in a manufacturing environment as the dream of my life where I would encounter the development opportunities I dream of! So I don’t necessarily wish this to be the future of the entire next generation.

Diving into the Fourth Revolution is not easy. It is not easy at a personal level because instead of waiting for someone to give instructions we need to find out how to create value for others. It requires to change one’s mindset.

Durations of bankruptcy by country (the Economist)

But it is not by dreaming of rebuilding smoking stacks of large manufacturing plants that the economy of developed countries will be saved. It is by releasing the creativity potential of the people!

One of the best papers I read on that lately was from the Economist, “les Miserables“, or how Europe consistently discourages entrepreneurs (published July 2012).

Do you really release the potential of your people when they get a life sentence when they fail (see the graphic on the average duration of bankruptcy)? Do you think they will take the risk to fail – a risk inherent to any creation?

Stop dreaming about going back in time to the Industrial Age. Step forward into the Fourth Revolution or you’re doomed.

Allow people to fail. Allow people to be flexible with their life. Create the infrastructures and institutions that will free people while giving them a guaranteed minimum safety net at a reasonable price.

The opportunity is now. Crisis are time where things can change, where things will shift. The current crisis might be the one opportunity for developed country to do the transition. Don’t miss it.

Crowdfunding is not charity – and it is not free!

Crowdfunding is very trendy. It is about financing startups with many people contributing a little bit of money each (it also works very well in other endeavors like political campaign financing and art financing).

We’ve already touched on crowdfunding in the posts “What’s hiding behind crowdfunding sites” which mentioned Kickstarter, the most famous crowdfunding site, and how these sites are effectively crowd-voting machines; and how crowdfunding applies to small local business as well “Crowdfunding… a local bakery“.

Recently there have been efforts made by the US government to give a legal framework to crowdfunding, although that is still work in progress as the issue is quite complicated (the JOBS act was signed by President Obama and gives 9 months for the SEC to come up with regulations). More information in this Forbes article.

While the regulatory landscape might change deeply, the crowdfunding model also becomes clearer. It is not ideal for everybody as a funding mechanism. And it is more and more obvious that being successful at crowdfunding requires a well thought strategy and plan.

There is one commonality to this plan: you need to give back value to the investor. No, crowdfunding is not free! It is not charity! Investors want something back from their initial investment; and generally they do want good value perks. This excellent paper on a jeans manufacturing startup that has used crowdfunding successfully gives very good advice on what it takes. Basically, investors are paying money in advance for getting your product later as a perk, or to get a special treatment of some sort. There is a fine line between pre-sales and crowdfunding, although crowdfunding perks can also be more flexible.

Crowdfunding is not just generous benefactors giving for free: for them, it is an investment that needs to get a good return in terms of value. If you seek crowdfunding, what future value can you promise to the investors that will more than enough compensate for their money?

Another proof of how Europe fails the transition of the Fourth Revolution

Do you know that the rate of creation of large companies in the last decades has diminished tremendously in Europe? And that it has been maintained in the US only though all the “Fourth Revolution” companies that accompany the net-economy?

Large companies in US and Europe by date of creation (the Economist)

In this graph extracted from the Economist paper, “les Miserables“, or how Europe consistently discourages entrepreneurs (published July 2012), all the drama of Europe is being shown. The drama of the end of the Industrial Age and of the struggle to take the leap of the Collaborative Age. Europe relies on large companies that have been predominantly founded at the heart of the Industrial Age.

Unfortunately this graph is incomplete. It does not show how Indian, Brazilian and Chinese large companies have appeared in the last two decades and how some prominent companies from those countries are already bigger than most companies from the old developed world. Their contribution would only affect the latest period!

Sticking to the Industrial Age model is not a good idea. Europeans, let’s finally do the leap into the Collaborative Age for the sake of the next generation!

How crowd-opinions are now more powerful than any advertising

The world of advertising is trembling. As the following graph from Nielsen, a market research giant, online conversations and the opinions of other internet users have much more credibility than newspaper articles and any other form of advertisement!

Trust in Adversiting (Nielsen Survey 2011) — People trust more other people's comments on internet than newspaper articles or other ads

What can we take from this? The power is to the organizations that leverage the user’s opinions on the products by providing the right platform: this relaunched Amazon at the beginning of the 2000’s, and is the fundamental insight of TripAdvisor and many others. It’s a real crowd-sourcing of opinions that people use more and more to decide whether to use/buy the product.

Is it resilient to manipulation? It is certainly more than conventional advertisement. And the most important is to determine how the seller reacts to these opinions and improves his product.

Crowd-opinion is the new credo of trust, like crowd-knowledge is the new baseline of knowledge. It has limits, it can be sometimes dangerous but in a world where we often buy remote products that none of our friends has seen or used, it seems like the best alternative.

What do you think? How much do you rely on crowd-opinions?

Crowdsourcing to take control of health and emergency response

In the Netherlands, AED mapping has been crowdsourced so as to save patients that might need them urgently. A project is called to do that on a worldwide basis. Watch this TED video

The crowd is taking emergency intervention in their hands.

The other side of the video about taking your blood pressure, hopping on the scale… and there goes your latest health parameter on the web… to your doctor, to your social network. Are you ready to go that far?

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