Don Tapscott's Blog, page 20

Is the Digital Economy Still a Capitalist Economy?

In his latest piece on LinkedIn, Influencer Don Tapscott writes:

Read the full post on LinkedIn.

As Toronto dithers, Guelph sets sights on 21st century

In a special report to the Toronto Star, Don Tapscott writes:

Read the full article at the Toronto Star.

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“Guelph Downtown DJS” by Optionbooter – http://www.flickr.com/photos/daveatgu.... Licensed under Creative Commons Attribution-Share Alike 3.0 via Wikimedia Commons – http://commons.wikimedia.org/wiki/Fil...

Rethinking the United Nations for the Networked World

This week’s UN Climate Summit in New York did more than address the urgent issues of climate change. It also put a spotlight on the UN itself, and the role of the UN in tackling the most difficult problems of our increasingly complex world.

Together with Bruce Jenks (who served at the UN for thirty years), I have released the latest Global Solution Networks research initiative, “Rethinking the United Nations for the Networked World.” In it we present an agenda for strengthening the engagement of the UN through global solution networks. Read the full report at GSNetworks.org

A New Strategy for Climate Change

New York: Today’s Climate Summit at the United Nations is unprecedented. Even though it is not part of the UN’s official negotiating process for reducing greenhouse gas emissions, this could be the most important and productive meeting on climate change ever held. In addition to leaders of member states, it’s bringing together leaders at the highest level from finance, business, NGOs and local leaders from public and private sectors – to develop some collective progress on emission controls. The meeting will surely turn up the heat on the world’s political leaders.

Read the full article on LinkedIn

The New Interdependence: Four Pillars of Society

The “networked” approaches to public value and new models of global problem solving are enabled in part by the evolution of global society and the growth of an interdependent world. The digital revolution changes the way we organize capability in society to innovate, and create wealth and public value. There are now four pillars of society that increasingly rely on each other for success and even survival.

1. Most agree that governments continue to be important, perhaps even more so than before. Especially since 9/11 polls show that the vast majority of citizens believe there is a critical role for the state in achieving security and prosperity, and achieving harmonization, fairness and justice. The days of “the best government is no government” are over. Further, despite the challenges of nation-states in solving global problems, they are the primary form of geopolitical organization for the foreseeable future.

2. Second, around the world we have all chosen the private sector and corporations as the dominant institution for the creation of wealth. We understand that markets are important. Other approaches such as a fully planned economy, anarchy or some kind of free agent nation have proven to be unworkable.

3. In recent years the civil society has emerged as a new and critical pillar. When the discussions of Bretton woods the led to our current crop of global institutions like the United Nations, there were only a few dozen NGOs in the entire world. And they sure didn’t have a seat at the table. Now the not-for-profit sector is a massive part of the economy, employing 10 million people in the United States alone. According to one report it is “a US $1.1 trillion industry, the world’s eighth largest economy, with more employees than the largest private business in each country.” Add in the tens of millions of Americans who are active in some organization attempting to “do good” in society and you have a force to be reckoned with.

4. Finally there is a new kid on the global block, courtesy of the Internet, the individual citizen. Because of the web, individuals from every walk of life can have an extraordinary effect on achieving social change. A web site for a murdered Egyptian set up by a Google employee started a revolution. In Macrowikinomics, Anthony D. Williams and I describe how two youngsters in Boston used the Ushahidi network to find a 7 year old girl buried in the post-earthquake rubble in Haiti and save her life—helping solve a global problem (as the Haitian earthquake surely was).

To learn more about the drivers for a new model of global problem solving, read Don’s report Introducing: Global Solution Networks

The Rise of New Institutional Models and Architectures

Smart organizations are encouraging, rather than fighting, the heaving growth of massive online communities, many of which emerged from the fringes of the web to attract tens of millions of participants overnight. Even ardent competitors are collaborating on path-breaking science initiatives that accelerate discovery in their industries. Indeed, as a growing number of firms see the benefits of mass collaboration, this new of way organizing will eventually displace the traditional corporation as the economy’s primary engine of wealth creation.

As the Internet drops transaction and collaboration costs, we are beginning to see a change in the deep structure and architecture of most institutions in society. Take the case of the corporation: it has long been noted that the traditional vertically integrated corporation is a paradoxical beast. Capitalist titans such as Henry Ford would champion the marketplace’s virtues, yet their corporations functioned like planned economies.

For decades these corporate fortresses triumphed over competitors, but no longer. The monolithic, vertically integrated company is beginning to falter against more lithe competitors. Smart companies are making their walls increasingly porous. They use the Internet to open up and harness knowledge, resources and capabilities outside their boundaries. They set a context for innovation and then invite their customers, partners and other third parties to co-create their products and services. In most industries, companies innovate and perform better by creating networks or business webs.

We have to go back to the work of Nobel laureate economist Ronald Coase to fully understand what is happening. In 1937, Coase looked at vertically integrated corporations and asked: “why do firms exist?” after all, the marketplace was the best mechanism for allocating resources, why weren’t individuals acting as individual buyers and sellers, rather than gathering in companies with tens of thousands of other co-workers? Coase argued that the answer was transaction costs, such as searching the marketplace for the right product and negotiating its purchase. The result is that most corporations concluded it was more cost-effective to perform as many functions as possible in-house.

But times have changed. Digital technologies slash transaction and collaboration costs. The result has been that vertically integrated corporations have been unbundling into focused companies that work together. The mantra “focus on what you do best and partner to do the rest” is serving most leaders of the global economy well. In the past a company would outsource functions and ask for weekly or monthly status reports. Today the status reports are 24/7 as companies integrate their networks. Rather than offloading a process, open companies now collaborate.

Conventional wisdom holds that human capital is something closed within a company. Firms are exhorted to hire the “best people,” and to motivate, develop and retain them, since human capital (employee base) is the foundation of competitiveness. This is, after all, the knowledge economy and “a company’s most important assets get on the elevator every night.”

This was especially true in the way companies developed new products and services. For most of the twentieth century, innovation happened inside the firm. Today, smart firms, including very large ones, recognize that innovation often begins at the fringes. The old notion that a company had to attract, develop and retain the best and brightest inside its corporate boundaries is no longer credible. With costs of collaboration falling precipitously, companies can increasingly source ideas, innovations and uniquely qualified minds from a vast global pool of talent.

Today we see a number of radical new models of peer collaboration and production that are successfully challenging traditional corporations. Two examples are the pioneers who created open-source software such as Linux and collaborative sites such as Wikipedia. These initiatives demonstrate that thousands of dispersed volunteers can create fast, fluid and innovative projects that outperform those of the largest and best-financed enterprises. Similarly, smart companies such as Amazon are opening up their products and technology infrastructures to create an open stage where large communities of partners can create value, and in many cases, create new businesses. And in what Anthony D. Williams and I call the “global plant floor,” manufacturing intensive industries are giving rise to planetary ecosystems for designing and building physical goods, marking a new phase in the evolution of peer production.

In this new context, the traditional model of recruiting, managing and retaining employees is clearly outdated. The overriding factor today is engagement. Organizations must build a positive presence in the minds of employees and dynamically engage them throughout their employment years. Companies should encourage those who need a change of scenery and exciting new developmental opportunities to work for business partners, while continuing to maintain ties through alumni groups and other types of networks that can provide ongoing feedback and support for corporate initiatives.

To learn more about the drivers for a new model of global problem solving, read Don’s report Introducing: Global Solution Networks

Technology Push for Change

Over the past 30 years, the digital revolution and specifically the Internet have evolved and grown in ways no one could have imagined. The Internet continues to fundamentally transform how business is conducted, how government operates and how individuals interact. It has become one of the greatest catalysts of economic and societal development of all time.

What the Internet pioneers created as an open platform for sharing data is now a game-changing medium used by more than two billion people around the globe. At the heart of this amazing growth – and what distinguished the Internet from other communication mediums – is its openness, global reach, and its multi-stakeholder model of development and management.

As evidenced by the 300 million people on Twitter, one billion people on Facebook and two billion people with Internet access on mobile devices, the digital revolution continues unabated. The Net has evolved from a network of websites that enabled organizations to present information, to a computing platform in its own right. Computer processing and software and be spread out across the Internet and seamlessly combined as necessary. The Internet is becoming a giant computer that everyone can program, providing a global infrastructure for creativity, participation, sharing and self-organization. And with the explosion of mobile devices, computing is pervasive, enabling us to collaborate 24/7.

The net result is that this new paradigm in technology is radically dropping transaction and collaboration costs and collaboration that used to be glacial, can now occur real-time and on a massive scale. This is now enabling us to devise new ways of collaborating to address global problems that are vey different from the traditional state-based institutions.

To learn more about the drivers for a new model of global problem solving, read Don’s report Introducing: Global Solution Networks

Demand Pull For Change

In the first in a series of video blogs for Thinkers50.com, Don Tapscott identifies what multi-stakeholder networks are and how they effect managers and businesses today.

New Solutions for a Connected Planet

Don Tapscott receives a standing ovation from a full house at Radio City Music Hall in New York for the World Business Forum.

Do we need to rescue our kids from the digital world?

Our children are creating a very large digital footprint, but will they have more control over data than us, the BBC wonders? They turned to Don Tapscott for his take on privacy, and teaching children about communications and ramifications.

Read the full article on the BBC.