What will the product of the future be like?

Generally, all products will become part virtual, part physical. They will be connected, reconfigurable and – hopefully – smart. Also, the business model for their manufacturers will be dramatically different.

This essay was published in Innovation Management magazine

As we moved forward through history and as technology evolved, our products and devices got more complex. The supply chain and the number of people and skills involved in production kept growing – as did the number of supporting factors that needed to be in place for the device to work.

It’s hard to see that this trend towards greater complexity and connectivity should not continue.

Large supporting infrastructure

An old-fashioned pencil doesn’t require much in terms of supporting infrastructure. An eraser and a sharpener are useful additions, but most of the time, the pencil works well on its own. It’s simple and robust, but as a communication device it’s abilities are rather limited.

In contrast, an electronic tablet is a very different device. It will not work fully without electricity, software, and an Internet connection. Not only can you write words with, you can record and edit video, and you can send it instantly to someone else – or to everyone.

Increasingly complex supply chain

Even producing a simple pencil requires a complex supply chain of wood, graphite, paint and glue – but that is nothing compared to the number of players involved in delivering the functionality of a tablet.

Try to think through how many companies are feeding in to the process – and which consequently need to be coordinated and must adhere to the same standards and conditions in order to cooperate… The network easily extends to thousands of companies and millions of people. Display and chips, electricity, connectivity, various software, GPS signals – plus a whole Internet’s worth of content. It all comes together (almost) seamlessly – and that’s what it takes to produce the next level of utility for users.

The future production of value will take place in increasingly complex networks coordinating large numbers of contributors. Closer collaboration is a pre-condition. No one can produce this type of utility alone.

Hardware and software allows reconfiguration

You can get red, blue, green, hard or soft pencils – and you can get a certain variety of tablets. But tablets are a different species, because it can be completely reconfigured and customized depending on what software is installed.

The value of the tablet comes from the combination of hardware and software. The physical object can be standardized, we may all be using more or less the same phone or tablet – but my tablet is likely to be set up quite differently than yours.

It’s an advantage to have objects and devices, which are similar, so they can be mass-produced at low cost, but which can run a wide variety of applications. However, it’s difficult to make much money from manufacturing commodity items, which are practically the same as everyone else’s. Instead profits will shift towards software and services that run on top of devices.

Connected to the network

Embedding computing power is hardly news. Over the past decades, we’ve seen chips built into everything from toothbrushes to doorknobs.

What happens next significantly changes the game again: When all of those chips connect to the Internet of Things. They will be in touch with everything else; coordinating, exchanging data, adjusting, learning. An increasing part of the value that the product of the future offers, compared with conventional devices, will come from the connectivity. This is where growth will happen.

Smart, contextualized solutions

The product of the future is not a stand-alone device. Whether is jet engine or food processor it will be working in combination with many other devices to create solutions that fit the users’ needs in a particular context. The defining unit in the economy will not be the individual device, but the solution or process, which solves the customer’s current needs. It’s the difference between selling thermostats and selling comfort in a building.

Such solutions will be based on the vast and detailed streams of data that our sensing and communicating objects will create. Ideally, this will result in ”smart” systems, where all sorts of devices cooperate to deliver optimized solutions at low cost.

And again, this points to the basic condition; that value creation will happen in collaboration.

Both virtual and physical

A much greater part of a product’s value will not reside in the physical object. What the product offers will depend on the many services, processes and data, which are layered on top of the physical object - virtual superstructure.  Crucially, the manufacturer of the physical device will not make many of these services. Applications, tutorials, and user forums, support services – these can be created by third parties and users themselves. Never the less, they contribute to the value and competitiveness of the device.

Objects will be individually identified. They will have an address, an increasingly detailed profile, and an Internet presence that others can interact with. The materials that it was made from, and it’s consumption and yield will be tracked throughout the product’s life cycle. In a sense each object will have virtual doppelganger, consisting of all the data associated with it. Increasingly, it will be meaningless to distinguish between the physical and virtual sides of an object’s functionality. And yes, this includes toothbrushes, doorknobs… anything, basically.

Instances, created for the moment

How objects are created may be very different, too. Although, most of our physical objects will still be mass produced and probably more standardized across the globe, many products or parts of products will be made specifically for the user. Flexible robots and 3D printers will make it ever cheaper to customize objects.

Such products exist virtually – basically as a collection of instructions and design, which can be modified or mixed with parts from other companies. It will only be manufactured physically once a particular user has configured it and clicked the “buy” button. 

Just like the utility of a product will emerge when it’s combined with a number of other devices and services to create a solution that fits the current context, the physical product itself becomes a solution, assembled for a specific context. It may never be made exactly the same way again. One could call it an instance.

From finished products to tools for collaboration

This will require a change in approach to design and development. 3D printing naturally lends itself to collaboration and participation from many contributors, including the end-users. For companies, this implies that they may be selling blueprints to parts or selling access to systems that allow users to configure individual instances of an object. However, this business model requires a shift in focus. Instead of designing and delivering finished objects, a company must create tools that invite users and other companies to use the company’s designs and participate in co-creation.

No manufacturing, no distribution costs

One consequence could be that companies drop manufacturing their products altogether. Since the final instructions can be sent and printed out on any printer, a company can distribute globally at almost no cost. Factories may function as local, generic centers, which can print and assemble whatever customers upload for manufacturing.

Old categories and roles are mixed up. It’s hard to distinguish one company from another; they collaborate for a solution, and then regroup with others to generate the next instance. It’s like the “Hollywood economy”, where movies are produced by assembling a new team of actors, photographers, director, distributor etc. for each film.

Access rather than ownership

The way we access products will change as well. If the next level of value for users is a matter of how well a number of products can be coordinated to serve the user in a particular situation, then flexibility is crucial.

It becomes less attractive to own a product permanently, and better to have access to combine lots of different products to match changing needs and circumstances. Already products like carpets, cars, apartments and specialized tools are sold as services, which users subscribe to or rent.

As the cost of coordinating resources and needs fall, more products will be accessed temporarily through digital platforms – as we see in so-called sharing economy. Obviously, this will require new business models – similar to the way the music and media industry has been forced to change.

This changes everything…

All of these changes will affect more or less any product. Whether its cars, hospital beds, tennis rackets, lamps, valves, office chairs, their future version will be different in many of the same ways that a tablet is different from a pen.

They will be connected, networked, coordinated and reconfigured for specific contexts. They will be both virtual and physical, and their main value will not be what they can do on their own, but how well they can be integrated into larger solutions.

Obviously, the companies that produce them will also need to organize their business model and value creation in very different ways in order to thrive in the future.

An example: this is not your grandfather's car

Fremtidens produkt: Biler bliver noget ganske andet

En eksempel til at illustrere pointerne i mit essay om fremtidens produkt: 

Fremtidens bil vil stadig have hjul og være beregnet til at køre fra A til B, men stort set alt andet vil være anderledes.

Biler er det klassiske industrielle produkt. Fords enorme fabrikker kunne tage stål og gummi ind i den ene ende, og spytte millioner af helt ens biler ud for enden af samlebåndet.

Fremtidens bil vil kunne konfigureres i detaljer. Mange biler tilbyder i dag online værktøjer, der gør det muligt for kunden at angive præcist, hvilken farve, motor og indtræk, bilen skal fremstilles med. Biler, der er elektroniske og styret af computere, vil kunne programmeres og opdateres med apps og nye styresystemer – hvad enten det er lyden, kabinelyset eller køreegenskaberne. Tesla har eksempelvis netop udsendt en ny version af software, der gør bilen i stand til at holde sig i vognbanen automatisk.

Omkostningerne ved udvikle og fremstille bilen vil i stigende grad være knyttet til elektronik og software. Navigation, overvågning, kontakt til andre biler og trafiksystemer, underholdning og information til passagererne… Det er ikke længere stål og gummi, der er den vigtigste udgift.

Den elektroniske del af bilens funktion er også der, hvor udviklingen går stærkt – hvis ikke ligefrem eksponentielt, i takt med stærkere computere, big data og kunstig intelligens.

Fremtidens bil vil være konstant opkoblet og i kontakt med den omgivende trafik. Den vil sende observationer om sin position og om trafikforhold, ligesom den løbende vil modtage data. I første omgang vil det gøre det lettere at styre trafikken, undgå trafikpropper og finde parkeringspladser, men efterhånden som bilen bliver selvkørende, vil den skulle koordineres tæt med bilerne omkring den.

De fleste biler er i dag personligt ejet, men stadig flere bruger dele-biler eller leaser bilen i en periode. Specielt med selvkørende biler, vil det for mange være en lettelse, at kunne bestille en bil, der henter og bringer en til sit destination og så kører videre med nye passagerer. Når bilen er en del af en pulje af biler, forandres forretningsmodellen markant. Det samme gør den tilknytning som mange ejere i dag har til deres bil.

Bilen bliver én af en række elementer, der tilsammen leverer en mobilitets-løsning. Hvilken kombination af bil, tog, cykel, delebil osv. der bedst og billigst løser en bestemt persons behov i en specifik situation sammensættes til lejligheden. Det er løsningen, ikke bilen, som brugeren betaler for.

Hvordan vil være fremtidens produkt være?

Hvordan vil fremtidens produkt være forskelligt fra nutidens produkter?

Helt overordnet vil stort set alle produkter være halvt virtuelle, halvt fysiske. De vil være forbundet til nettet, de vil kunne programmeres og konfigureres. Og de økonomiske spilleregler for virksomhederne, der leverer dem, vil være markant anderledes.

Artiklen kan også læses i bladet Erhvervsfilosofi

Gennem historien er vores produkter og apparater blevet stadig mere komplekse, både i deres funktion og i måden, de produceres på. Forsyningskæden bliver mere vidstrakt og det antal mennesker og kompetencer, der er involveret i produktionen stiger – og det samme gør mængden af de omkringliggende og understøttende faktorer, der skal være på plads for at produktet overhovedet kan fungere.

Det er svært at se, at den tendens til større kompleksitet og mere forbundethed ikke skulle fortsætte fremadrettet.

Stor understøttende infrastruktur

En gammeldags blyant kræver ikke meget i form af understøttende infrastruktur. Et viskelæder og en blyantspidser er nyttige tilføjelser, men det meste af tiden fungerer blyanten fint på egen hånd. Den er enkel og robust, men som et redskab til at kommunikere, er blyantens egenskaber unægtelig noget begrænsede.

Det moderne sidestykke er den elektronisk tablet - et ganske anderledes stykke grej. Tabletten kan bestemt ikke klare sig alene. Den fungerer ikke rigtigt uden elektricitet, software og en internetforbindelse. Til gengæld kan man ikke alene skrive ord med den. Man kan tage billeder eller optage og redigere video, og sende det øjeblikkeligt til en anden - eller til alle.

Mere kompleks forsyningskæde

Selv en simpel blyant kræver en kompleks forsyningskæde at producere. Man skal bruge træ, grafit, maling, lim osv. - men det er intet i forhold til det antal af leverandører og faktorer, der er involveret i at skabe en tablets funktionalitet.

Prøv blot at tænke igennem, hvor mange virksomheder, der føder ind i processen - og som derfor skal koordineres, og som alle skal overholde de samme standarder og vilkår for at kunne samarbejde... Det netværk omfatter let tusindvis af virksomheder og millioner af mennesker. Der skal være display og chips, strøm, internet opkobling, diverse software, GPS signal – og dertil et helt Internet af indhold og apps. Alt det samles i en enkel og overskuelig dims, som vi kan stikke i lommen.

Den fremtidige værdiproduktion af værdi vil foregå i stadig mere komplekse netværk, som koordinerer et stort antal deltagere i processen. De tættere samspil er en forudsætning for at kunne skabe det næste niveau af anvendelighed og værdi for brugerne. Ingen kan producere den slags alene.

Software gør hardware fleksibel og programmerbar

Der er en vis variation i vores fysiske produkter. Du kan købe røde, gule, grønne, og hårde eller bløde blyanter – ligesom der er et vist udvalg af forskellige tablets. Men en tablet er væsensforskellig fra en blyant, fordi den kan konfigureres og fungere på helt forskellige måder, afhængigt af, hvilken software, der er installeret på den.

En tablets værdi for den enkelte opstår i kombinationen af hardware og software. Selve det fysiske objekt kan være helt standardiseret. Vi bruger alle mere eller mindre den samme telefon eller tablet - men min tablet vil sandsynligvis være indrettet meget anderledes end din.

Det er en fordel at have ensartede objekter og apparater, der kan masseproduceres med lave omkostninger, men som kan afvikle en mangfoldighed af vidt forskellige programmer. Men det er svært at tjene særlig godt på den rent fysiske produktion af dimser, der kan næsten det som dem, alle andre fremstiller. I stedet vil indtjeningen skifte i retning af software og tjenester, der afvikles med de fysiske dimser som platform.

På nettet

Det er ikke ligefrem en nyhed, at man kan indlejre computerkraft i genstande. Gennem de seneste årtier har vi set chips indbygget i alt fra tandbørster til dørhåndtag.

Det næste skridt i den retning, vil endnu en gang ændre spillet markant; når alle de små chips forbindes i the Internet of Things. I princippet vil alle produkter og dimser være forbundet med hinanden, og de kan koordinere, udveksle data, justere, og tage ved lære. En stigende del af den nytte, som fremtidens produkt tilbyder, vil opstå fordi dimsen er på nettet. Det er her, væksten i værdi vil ske.

Smarte, kontekstualiserede løsninger

Fremtidens produkt er ikke en stand-alone enhed. Hvad enten det er en flymotor eller en røremaskine vil den blive brugt i kombination med mange andre enheder til at skabe løsninger, der passer så præcist som muligt til brugernes behov i en bestemt kontekst. Den afgørende enhed i økonomien er ikke det enkelte produkt, men den samlede løsning eller process, som løbende løser kundens behov. Man kan illustrere det som forskellen på at sælge en termostat og sælge komfort i hjemmet. Det kan koordineres ved hjælp af de enorme og detaljerede datastrømme, som vores sansende og kommunikerende objekter vil generere. Ideelt set vil det føre til "intelligente" systemer, hvor mange forskellige slags enheder samarbejder om at levere optimerede løsninger med lave omkostninger.

Igen understreger det den grundlæggende betingelse fremover; at værdiskabelsen vil ske i tættere og mere omfattende samarbejder.

Både virtuelt og fysisk

Det vil efterhånden være meningsløst at skelne mellem den fysiske og virtuelle side af en genstands funktionalitet.

En langt større del af det, et produkt kan gøre for brugeren, vil ikke stamme fra den fysiske del af produktet. Produktets nytte og værdi vil i stigende grad afhænge af de services, processer og data, som tilføjes som en virtuel overbygning på den fysiske genstand.

Nok så vigtigt, så kan det meget vel være andre end producenten af ​​den fysiske enhed selv, der skaber de tjenester. Apps og programmer, instruktionsvideoer, et bruger forum eller support-funktioner – de kan ligeså vel leveres af tredjeparter eller brugerne selv.

Vores dimser vil ikke være anonyme. Hver genstand vil have sin egen ID, en adresse, en stadig mere detaljeret profil, og en Internet tilstedeværelse, som andre kan engagere sig med. De materialer de er sammensat af, og deres forbrug og ydelse vil blive tracket igennem hele deres livscyklus. Man kan sige, at alle genstande vil have en virtuel dobbeltgænger, i form af alle data, der knyttet til den. Og ja, det gælder også tandbørster og dørhåndtag ... det gælder alle ting, dybest set.

Forekomster, sammensat til lejligheden

Måden, fremtidens genstande vil blive fremstillet på, kan også være meget forskellig fra dagens produktionsform. De fleste ting vil stadig blive masseproduceret, og sandsynligvis vil de mest populære produkter endda være mere ensartede over hele kloden. Men samtidig vil et voksende antal produkter, eller dele af produkter, blive lavet specielt til den enkelte bruger.

Fleksible robotter og 3D-printere vil gøre det stadigt billigere at fremstille skræddersyede produkter. Den type produkter vil i høj grad være virtuelle – dybest set er de en database af instruktioner og designs, som kan ændres eller blandes med dele fra andre virksomheder. De vil kun blive fremstillet fysisk, når en bestemt bruger har konfigureret en version og trykt på ”køb” knappen.

Ligesom det enkelte produkts værdi vil opstå, når det koordineres med en lang række andre enheder og tjenester til en løsning, der er tilpasset en specifik brugers situation her og nu, så kan fysiske produkter også blive løsninger, der er samlet af bidrag fra mange forskellige parter for at passe til en bestemt sammenhæng. Præcist den samme genstand bliver måske aldrig lavet igen. Man kunne kalde den en forekomst – eller på engelsk: An instance.

Fra færdige produkter til værktøjer til samarbejde

En mere sammenkoblet form for værdiskabelse vil kræve en anden tilgang til design og udvikling. 3D-printede produkter egner sig naturligt til at skabe i samarbejde og med deltagelse fra mange bidragsydere, inklusive slutbrugerne. For virksomheder kunne det

Indebære, at de kan sælge tegninger og designs til deres komponenter, som andre så selv printer ud. Eller man kan sælge adgang til systemer, der tillader brugere selv at konfigurere individuelle forekomster af et objekt.

Det kræver, at virksomheden ændrer sin forståelse af, hvordan den leverer værdi. I stedet for at designe og levere færdige genstande, skal en virksomhed skabe værktøjer og processer, der inviterer brugere og andre virksomheder til at deltage i at sammensætte løsninger.

Ingen omkostninger til fremstilling eller distribution

En konsekvens kan blive, at nogle virksomheder helt dropper selv at fremstille deres produkter. Når instruktioner og designs kan overføres via nettet og udskrives på en 3D printer, kan en virksomhed distribuere globalt næsten uden omkostninger.

I stedet for at være knyttet til en enkelt virksomhed kan fabrikker få rollen som lokale, generelle fremstillingscentraler. I stedet for kun at producere for en enkelt virksomheder, kan de udskrive og samle alle mulige forskellige genstande, som deres kunder uploader til produktion.

Gamle kategorier og roller blandes grundigt. Det bliver svært at skelne det ene selskab fra det andet; virksomhederne går sammen om skabe en løsning -  hvorefter de omgrupperer og samarbejder med andre om at generere den næste forekomst. Man taler om, at det er en ”Hollywood økonomi”, fordi film produceres ved sammensætte et nyt hold af skuespillere, fotografer, instruktør, distributør osv til hver film.

Adgang snarere end ejerskab

Måden vi bruger produkter på, vil også ændres. Hvis det næste, højere niveau af værdi for brugerne afhænger af, hvor godt en række produkter kan koordineres til at tjene brugeren i en bestemt situation, så bliver fleksibilitet afgørende.

Det bliver mindre attraktivt at eje et produkt permanent, og vigtigere at have adgang til at kombinere masser af forskellige produkter der kan matche skiftende behov og omstændigheder. Allerede nu sælges produkter som tæpper, biler, lejligheder og special-værktøj som services, som brugere kan abonnere på eller leje.

Digitale platforme, som vi ser dem i dele-økonomien, vil kunne koordinere udvekslingen af ressource, så det bliver lettere at få midlertidig adgang til et produkt. Det vil naturligvis kræve nye forretningsmodeller – på mange måder svarende til hvordan, musik- og mediebranchen er blevet tvunget til forandring.

This changes everything…

Alle disse ændringer vil påvirke stort set ethvert produkt. Uanset om det er biler, hospitalssenge, tennisketsjere, lamper, ventiler eller kontorstole, vil den fremtidige udgave af dem være anderledes på mange af de samme måder, som en tablet er forskellig fra en blyant.

De vil blive forbundne til internettet og i netværker, de vil blive koordineret og re-konfigureret til specifikke kontekster. De vil være både virtuelle og fysiske, og deres største værdi vil ikke være, det, de kan gøre på egen hånd, men hvor godt de kan integreres i større, sammenhængende løsninger.

Og de virksomheder, der vil trives med at levere dem, vil have organiseret deres værdiskabelse ganske anderledes end i dag.

Et eksempel: Hvordan biler bliver noget ganske andet

Paradox: The means of production are democratized – but income in-equality is rising

As Karl Marx observed, the means of production used to be controlled by capitalists. Only the very rich could build factories and large machines. 

Now, an increasing part of the value in the economy is created using a PC with an Internet connection. As the maker movement demonstrates, even very advanced tools, cutting edge knowledge, as well as world-wide supply chains and distribution is now available to most people in the global middle class.

Creation and production of value is being democratized – yet the inequality of wealth and income is rising. We can all participate as individuals or through platforms like Upwork, eBay, Etsy or Uber. But very few can earn more than peanuts from their efforts. Meanwhile, the digital platforms that aggregate and coordinate all of the offerings generate staggering fortunes to owners and investors.

It seems that Marxism needs an update. The capitalist doesn’t control the means of production. Rather, it’s all about coordinating the platform – in a sense controlling the means of making money.

My talk at Oui-share fest in Paris

The video from my talk at the Ouishare Fest in Paris this summer is now online:
How the collaborative economy challenges existing businesses. What are the challenges that companies face if they want to engage in the sharing economy? What tools and methods might make it less risky and more "normal" for a business to collaborate more widely?

The new normal in business: Going from product to platforms and processes

Platforms and processes, rather than products, will become the focus of new business creation as we move forward. The main characteristic of a handful of new trends in business – Collaborative consumption, Sharing, the Maker movement and the Circular economy – is that the value creation is less about adding some new feature to a product. Instead, the appeal of these models is that they can deliver more value for less by involving a number of stakeholders, including the users, in co-creating solutions. What’s innovative, and what distinguishes successful companies in this type of economy, is their ability to create well-working platforms that enable a wide set of actors to participate.

Conventional hotel chains like Hilton or Intercontinental have built their business over decades by owning and operating hotels. Now, in just a few years, Airbnb has created a service that rivals them in size, by coordinating that a great number of private persons can rent out rooms to others. Likewise, the large media companies used to be broadcasters that would send the same ready-made content to millions of viewers. Now, 7 of the top ten global websites are services based on content created by the users. Sites like Facebook, Wikipedia and Twitter do not produce content, they operate platforms that make it easy for millions of users to exchange the information they need.

Even producers of physical devices need to start focusing on platforms and processes, because increasingly, this is where they can create value for their users. Take as an example a manufacturer of Digital SLR cameras. SLR cameras have fallen drastically in price in recent years, while at the same time, the quality and features offered by companies have become very similar. Technically, the difference between Canon, Nike, Olympus or Sony is hard to tell.  In short, cameras have become commodities, mainly competing on price – which is not a very attractive game for a manufacturer to play. New features or marginal technical improvements in image quality are getting harder and more expensive to develop – even if they hardly can fetch a higher price.

The superstructure

Instead a company can try to improve the user’s experience by building services and processes, for instance by creating sites that teach users to take better pictures, galleries and competitions that allow users to show off their photos and be inspired by others, forums where users can help each other with tips and tricks, or platforms that allow users to share equipment or collaborate on projects.

One could think of these processes as a virtual ”superstructure”, which runs on top of the physical product. For companies, it is typically a less expensive way to improve the value of its solution to users, and often it creates a more engaged and loyal relationship to customers.

The same approach can be used for almost any object or device – whether it’s pharmaceuticals, sporting goods or DIY tools. It’s likely that for many devices there will be no point in trying to distinguish between the physical product and its virtual superstructure – they become an integrated solution. Already products like smart phones make no sense without all the apps and services that run on it. The same will be true for 3D printers, cars, thermostats, running shoes…

In some cases, creating a popular superstructure, can allow a company to change its status from being one among a number of other providers of equipment to becoming an integrator, operating a platform, where many others companies and their customers also go to create solutions. Once again, Apple’s app-store is an obvious example.

Designing tools for participation

From a design perspective, this means that focus moves from designing finished products, to designing tools that allow customers to participate and contribute to creating a solution, which fits exactly to the individual users’ context.

This is already evident in the many websites that enable users to customize the products they order. Cars, furniture, glasses and shoes have been modularized, so customers can pick and choose the combinations of features, colors and materials they prefer. This makes the product much more valuable to the customer, indicating that making the interfaces for participation effective and easy to use is an important part of the overall design of what the company offers.

Such mass customization is at one end of the spectrum of involving users in value creation. At the other end are much more open-ended systems for 3D printing, which allow users to download CAD drawings and remix and redraw objects completely before printing them out.

It seems likely that users will increasingly expect and demand the option of co-creating ever more details of the objects they use – at least those objects that they are most engaged in or dependent on.

User-driven innovation is another example of the power of creating platforms and services rather than just physical objects. The toymaker LEGO very deliberately works to engage its users in co-creating new products – and in the process, the platforms for involving users have become extensions of the LEGO experience. LEGO Cusoo is an example; it’s a website, where users can show off their constructions, and where they can vote for the constructions that they would like to see as official LEGO sets. If a design gets more than 10.000 supports, LEGO will start the process of developing it into an official product, and if it makes it to the market, the designer will receive a percentage of the revenues.

Traditional roles are blurring

One way of describing the shift in approach is that companies, which have been providing solutions to you and for you, will move to solutions created with you and by you. This goes for customized physical products as well as services like healthcare, education, banking or travelling.

Although it’s not as if customers are taking over completely and starting to build everything themselves, it’s clearly very different than the strict division of roles and responsibilities between providers and users, that were the norm in the traditional industrial society. Those old lines are blurring, as consumers become participants and co-creators.

This in turn has implications for styles of management. The company loses control of the process and the outcome, when solutions emerge in the interaction among a number of different stakeholders on a platform

Managers cannot hand out top-down commands, because the contributors to a project may be from different organizations – or they can be customers or volunteers. The company can influence, but not control, and leadership becomes a matter of motivating others by the strength of your vision.

The shift of roles can be challenging, because it requires a rethinking of how you see yourself contributing value – whether as a company or as a person. In the co-creation paradigm, being an expert is not about knowing all the facts or being able to come up with solutions yourself. Rather, expertise can be in enabling the solution to emerge, by bringing together the right people and resources. Thus , the teacher is not just an expert in the subject, but rather in making learning happen. The doctor is not just an expert in disease, but in supporting health.

Procter and Gamble famously changed the approach of their huge internal product-development labs from “research and develop”, to “connect and develop”.

It’s not just about money

Interestingly, the collaborative economy is not just about money. For the company that operates the platform or sells products that work with it, money may be what drives the business. But for other stakeholders, there can be other motivations for participating than money. Users and volunteers can contribute to get recognition and status, to help each other, because they find it interesting – or because they enjoy the social interaction. It’s an important point that these values can be as important as money in making the interaction work productively.

From ME to WE-thinking

The most challenging part of moving to platforms for co-creation may be the deeper change in mindset that it requires: From a ME to a WE perspective.

Generally, the past decades have been an era of ME thinking. There has been an emphasis on individual freedom and achievement. Winning the competition against everyone else was seen as the way to grow.

The Me-thinking appears increasingly problematic and un-suited for a world that is becoming intensely connected and interdependent.

Instead it has getting easier and more efficient to develop and seek solutions by working with others, and in the process accepting that one’s own success depends on the success of everyone else in the system. WE-thinking is about realizing that our fate is shared.

WE-thinking requires trust. To cooperate and share we need transparency, we need better tools for assessing risk, we need to be able to retaliate if others cheat or free-ride, we need new ways of sharing ownership and benefits. For the WE-economy to become the new normal it needs to be operational for regular, established companies. Businesses may see the potential in opening up, but they will be very reluctant to do so unless there are tools in place, that make sharing and collaborating more predictable and reliable.

Obviously, all of this is not an absolute shift. We will still be competing, we will still be thinking about our own interests, we will still want to be able to control and own. But the opportunities in thinking more in terms of WE are growing as technology connects us, and as the increasing pressure from a growing population on a finite planet makes it clear that ME-thinking will only exhaust the available resources for all of us.