Moving to the Collaborative Age is simple… but not easy!
Many organizations just touch collaborative tools from far, sometimes just using them as another broadcasting tool.
The thing is, organizations need to dramatically change their approach to be able to take advantage of all the value made available by the Collaborative Age.
This excellent post by Amber Naslund, The Ripple Effect: Why Social Business Isn’t Simple, is an excellent summary of some tactics organizations can adopt if their strategy is truly to move into the Collaborative field.
Still, whatever the techniques and tactics, something is required first. It is a deep commitment of the organization, at the highest level, to engage with the social community. Engagement means a two way conversation and emotional exchange. Engagement has a cost. It requires continuous maintenance. It requires emotional work and vigilance. Yet it can lead to fantastic stories and experiences.
Like everybody, you want to jump into the Collaborative World. Still – are you really deeply ready to engage emotionally with your network, with your customers and your entire ecosystem?
It does not happen too often to me, but right now I am upset that statistics are being misinterpreted.
In these times of crisis, of 99 percent movement, of demonstrations against the financial and corporate world, numerous charts are disseminated that show how the proportion of wages in percent of GDP is declining (and how the proportion of corporate profits is increasing). Here is an example from a recent post on the Daily Beast titled “the era of corporate profit”:
typical historical curves for wages and corporate profit
Now, what does that really show? Obviously, it shows that the proportion in the GDP of the wages and salary income of people employed traditionally by corporations is decreasing. Does it show that the average worker earns less? That’s quite a stretched interpretation even if most commentators just mean it!
As an avid reader of the Fourth Revolution blog, the fact that the share of salaries in the overall income should not surprise you: salaried employment by large corporations is a model of the Industrial Age, which is declining – BECAUSE THERE ARE LESS PEOPLE THAT ARE SALARIED (and not, because each of them gets less money!!). In fact, the diminution of the share of conventional salaries in the GDP is another precursor of the Fourth Revolution!
The US Bureau of Economic Analysis provides historical tables on the revenues in the USA. Here is a curve anyone can obtain with a little bit of patience:
why wages and salaries are only a small part of people's income
So what? Yes, wages and salaries have a tendency to decrease, but the income from non corporate business, sole proprietorships, and non-profits organizations increase dramatically. These are organizations which certainly create value for only a few individuals (to obtain the curve we have reclassified their profits as income for the owners)! These are the organizations of the K.E.E.Ns…
Stop the fallacy of showing decreasing salary curves as an indication of the impoverishment of the average citizen. The future lies in other forms of organizations, and their importance increases dramatically.
Welcome to the Fourth Revolution. The future and the Value is elsewhere than salaried employment. When do you jump to other forms of organization?
Why is there so much frustration and so many people that don’t really do what they long to do, what they dream to do?
Ever since I have written a book, every time I present it, I get more questions on how I managed to write and publish it, than on the book itself! So many people dream to write a book, or have written a book already!
Ever since I have announced to the world that I was leaving the comfortable corporate environment to be an entrepreneur, I get more questions on how I manage to do it than on my actual project itself! So many people dream to start their business, so many people have a truly good business idea ready for application!
The answer is obvious, of course: fear, which often hides behind busy-ness (being busy on actions with little impact, spending one’s time). All of this entertained by Industrial Age institutions, which repeat endlessly how inappropriate it is to be weird, to have initiative, and lock us into a system from which it is difficult to escape.
Of course these institutions look like they provide us with a stable, safe environment. That was maybe true in the past, but today we know that’s really overrated. No job is really safe today in any corporation. Still, we cling to that mindset for lack of another safe haven. And the Industrial Age system also cleverly provided barriers to our dreams: large mortgages that limit drastically our financial freedom; tax, professional and immigration legislation that limit our freedom of movement or of choosing our activity.
do you need a buddy for tandem jump?
There are ways to minimize risk when starting a venture. Have good advice and support from people who have gone through the transition (like you stay safe during your first free fall jump by having an experienced person jumping in tandem with you). Have a parachute already open that slows down your scary dynamics (a signed contract, savings…) and gives you more time. Have encouragement and support from your family and friends.
You know what? It is rare to find someone who has jumped out of the Industrial Age system and has really, deeply failed. Of course people go through temporary failures until they find their way; they might not seek and get those shiny things that Industrial Age ego would crave (a larger car, a larger house, etc); still, overall I find that people who jumped are more happy. And above all their contribution to the world is just tremendous.
I can barely imagine how the world will be when a significant portion of people will have jumped outside the Industrial Age, when the number of K.E.E.Ns will have increased dramatically, and when all these people will share their talents and contributions with all of us, creating a very different place to live.
Let’s go and do it. Overcome your fear. Become a real K.E.E.N.. Come on, jump!
It shows how experiments are now following each other, more and more frequently, that allow small amounts of money to change hands, without the intermediary of a large organization (and its bureaucracy, risk-adversity, etc). Just because the Fourth Revolution provides us with unprecedented human interaction capability.
Will crowdfunding overtake the Industrial Age conventional financial institutions? For the moment it is rather complementary, a small scale solution to small scale problems that are overlooked by conventional institutions. Still, crowdfunding will become very important for many people. This is only the start!
Crowdfunding adds a layer of possibility on top of the existing institutions. That is what will happen with many of our usual institutions as the Fourth Revolution expands. Looking forward to the crowd-institutions!
While many still believe that Manufacturing (or Industry) is key to value creation, it is very obvious that since the 1980’s, Services have gained preeminence in the economic world.
Moreover, more and more people do not appear in these statistics now, because they are ‘self-employed’! Which is definitely a global trend nowadays.
Even more striking is this graph from the Fourth Revolution book: it shows the composition of the top 100 companies in the US over time. What do we observe? Suddenly from 1985 onwards, Service companies have become the vast majority of the biggest companies.
How Services have taken over from Manufacturing in 20 years
This is identified in the book as one of the precursors of the Fourth Revolution. Value has shifted dramatically. Manufacturing will become like Agriculture: necessary, but a small part of the economical value creation.
That might be hard to understand if you’re borne before 1970-75. Change your mindset. Value is not any more in manufacturing nowadays. And Apple recently overtook Exxon as the largest stock valuation in the world.
The Fourth Revolution is here. Today, value is created overwhelmingly elsewhere than in Manufacturing.
Let’s generalize: the Fourth Revolution is starting to deeply impact our physical environment. The ubiquity of digital communication will deeply change our home environment, but also our usual urban environment (soon to come: urban furniture like bus stops that will communicate with your mobile phone, and advertisement postings that recognize you).
That is going to be destabilizing, there will be trials and errors. Still, one thing is sure: our physical environment is going to be very different in say – 20 years time. Take some pictures today to remember how it was like!
Look closely at this picture, taken in a street of a developed country, and so typical of today’s crisis:
a 2011 crisis queue
What are people queuing for?
Maybe their bank went broke and they queue, hoping to save their last pennies.
Maybe they don’t have anything to eat, and they wait for some food to be given away?
Maybe they don’t have a job, and they wait patiently in front of the local job office?
Sorry – none of this. This is what they wait for:
the real 2011 crisis!
They wait for the new iPhone. They wait for the new communication tools which, behind the scenes, reshapes our world.
The Fourth Revolution is a Revolution. Institutions and society will change. Arab countries revolt, helped by modern communication technology. The foundations of our industry and financial system are shaken by the changes in the value chain. What was worthwhile yesterday will not be valued tomorrow; what was mainstream yesterday might be unethical tomorrow.
The world readjusts to the Fourth Revolution. Schumpeter’s “creative destruction” is happening right under our eyes. The foundations of the Industrial Revolution are shaken. Silently, behind the scenes, a new world is being shaped by visionaries, Steve Jobs and others. An other world. The Collaborative Age.
“Don’t worry about people stealing an idea. If it’s original, you will have to ram it down their throats.”
This is a quote by Howard Aiken, and American scientist (1900-1973) who was very much involved in the computer and electronics field at its outset.
And, by experience, it is held to be true by all the players in front-edge products and companies.
It just means that if your idea is really original, people will just not believe in it. Not only that, but they will try to kill it and discourage you.
So don’t worry about the competition – at least if you pursue this visionary idea persistently. Your following will come. And when you will be successful, you will redefine the market.
An other meaning is that an idea is nothing without its execution. What’s really difficult is to put it in practice, implement, tweak, mature it – and to do it against the rest of the world. That’s where the value lies. Anybody can have fantastic ideas. Not so many will be able to implement them. It takes focus, time, patience and persistence.
The defining criteria of patents should not be any more that some kind of prototype has been produced, but whether it has been adopted by a large following. Nobody cares about an invention if it is not used, and it is not appropriate to have the inventor become rich because somebody else managed to use the idea to produce social value.
Let’s change intellectual property. Let’s make it social. Ultimately, that’s where value lies.
Governments are reluctant to open themselves. Regulatory authorities even more so, generally.
Andre-Claude Lacoste, president of the French Nuclear Safety Authority, in a press conference
When I was at the French Nuclear Safety Authority ten years ago, the President, Andre-Claude Lacoste, decided to publish the follow-up letters that were sent to operators after they got inspected and audited. He took this decision very much against everybody (in government, operators and civil society). They were scared it could give leverage to anti-nuclear activists to know all the small mistakes they were making. I myself, managing inspectors, must say I was not very comfortable letting my activity be under close public scrutiny.
I learnt my lesson. The end result is globally, today, a much more mature discussion about nuclear safety, and a much better understanding of the effectiveness of public control and regulation by all parties. The operators are much more careful to respond to the Regulator’s observations and are being held accountable by the public. The anti-nuclear activists watch how control is effectively done. The Regulator itself is more careful to have a balanced view.
That was a bold step. A step many regulatory authorities in many fields have not yet taken. But that was openness 1.0. – before the Fourth Revolution.
Although the French Nuclear Authority does use today many social tools, it is still only one way, only broadcasting. When will Regulators move decisively into openness 2.0?. Go and open discussion forums, create a network of interested people, let people comment on blogs and articles, let a debate grow, let people in the organization be in touch with the citizens, their issues.
Most people will think it is risky. It is as risky as when 10 years ago, Andre-Claude Lacoste decided to publish inspection follow-up letters.
It will only bring the debate to an even more mature stage, where the Regulatory authority, a public authority, will perform its job closer to the citizen. Where all parties will be able to express their views publicly and create the right debate. And at the end, where the citizen will feel it is taken care of.
Open Regulation 2.0, where the Regulatory Authority will foster debate and exchange on the industry it regulates, listening much more deeply and quickly to citizen’s issues, is the way Regulation will work in the Collaborative Age.
The French Nuclear Safety Authority was a precursor of Open Regulation 1.0. Will it also be a precursor of Open Regulation 2.0?
Let’s repeat: the cost of defending innovation has been 500,000,000,000 (500 billion) dollars for publicly traded defendants since 1990! And it has increased over time to a staggering 83,000,000,000 (83 billion) dollars per year in the last four years!
And some researchers (Bessen and Meurer in their book Patent Failure) have shown that showed that, outside the chemical and pharmaceutical industries, the cost of patent litigation had already begun to exceed the rewards to inventors by the year 2000. Their new work suggests that the problem has gotten much, much worse since then. And that the intellectual property system is definitely broken. It is supposed to bring wealth to society; actually is stymies it!!
The book “Patent Failure” is reviewed here. I can’t help copying in this post – with all due respect to copyright – a stunning graph from the book (other industries refer to other than chemical and pharmaceutical – mainly software):
Patent litigation costs are now far higher than benefits
No doubt. The intellectual property system is deeply broken and needs to be mended. Otherwise innovation might just be scared away by a bunch of parasites.
And… what better illustration for the Fourth Revolution ignition?!?
No doubt – that’s an area where the Fourth Revolution is already there and deep institutional changes are required, and fast.
Have you read lately about “patent trolls” (companies that make their living by doing nothing, just sitting on a few juicy patents)? Or the battles between Apple and Samsung, Google and Microsoft, to win ownership of treasure troves of patents, avoid long and costly legal battles about patent rights… Or the billions of dollars earned by lawyers in the field of patents in the gigantic battles that are ongoing?
In the Fourth Revolution Book, we relate how similar situations arose at the onset of revolutionary inventions, like how the patent for automobile was unduly exploited by Mr Selden who made a living by selling expensive licenses for building automobiles. That, until a certain Mr Ford just went ahead and filed lawsuit after lawsuit against him…
So, the current situation is not entirely new.
First, it confirms that something is happening that is revolutionary, in rupture with the usual slow improvement that is best suited for our intellectual property regime.
Still, it shows that the patent regime currently acts against public good, instead of acting in favor. Apple does not really need patents to be the largest market capitalization in the US. This time, the patents conundrum might become so problematic that a complete revamping of intellectual property might ensue. We can’t afford any more to give an exclusive right to an idea for 20 years in particular if this idea is vague or general. Resistance against changing the law will come primarily from lawyers, not consumers or companies. But change is inevitable. Because ideas are now produced collectively, and competitive advantage is based on speed of execution, quality of the product, and not any more on static defense of one’s position.
Which legislator will be bold enough to engage this much-needed change of the intellectual property regime? Shorten the timeframes, ensure that the patents are really specific, that the product described has really been produced, put some limits to the monopoly situation that ensues… such are the directions for a change.
