Technology has driven historical shifts from the industrial economy, the information economy and now the emergence of the relationship economy.
Every economic shift comes with revolutionary changes to business models and consumer preferences. Every cycle of change comes faster than the previous change and the accelerated technological dynamics fuel creativity and innovation which only fuel further changes.
Technology is the primary influence both in the changing dynamics and the possible outcomes. Each new technological advancement enables both individuals and institutions to “think out of the box” as to the implications, usefulness and subsequent market dynamics created by the advancement.
As we reflect on history we can see the accelerated changes and the condensed cycle times of change caused by technology. Business 1.0 was a period of basic business models aimed at maximizing the economic gains brought on by production of products and distributed to the masses for consumption. During the era of Business 1.0 people were told what to do and they did it because they wanted to economic gain of a paycheck.
During the era of Business 2.0 businesses produced information brought on by computers networked with other computers and the aggregation of information was consumed by institutions, businesses and individuals. We all became overloaded with too much information and lost in its meaning. Businesses used the information to develop new strategies, new products and process improvements. We all became overwhelmed and became paralyzed by the analysis of all the data.
People were told how to interpret and use the data. The media supported this premise with reports of market movements and developments based on the information technology provided. People became paralyzed and overloaded with the information. Individuals were labeled as “customers or data points of measurement for business gains”. While promoting relationships as a common marketing theme the business cultures were too consumed by the desire for information to think about forming real relationships.
Business 3.0: Enter the social web
The past business models have been consumed with the end target, economic gains. While applying technology, knowledge and management advances the past business models have left behind the most important element of any business success, relationships.
Business cultures have suppressed employee participation rather the cultures have created an environment which encourages following rather than leading with self expression. Businesses have proclaimed the importance of the customer while creating barriers to customer participation and responsive service. Under the pressure of competition businesses have reacted by the numbers, cutting budgets, while not clearly understanding the root cause of poor performance, poor relations.
The social web empowers people with a freedom of expression and the ability to connect with people. The eco-system is creating new relationship dynamics and the consumers are listening and responding to other consumers. People have been empowered by technology and subsequently people are filling a void which was created by the business models of the past.
We’ve been taught not to trust the politicians, the media and our employers. Subsequently we created a subculture of connections, both personally and professionally, with like minded people who see, feel and experience the same dynamics of institutional speak, corporate changes that don’t really bring the changes required and a dominate media that feeds us the same spin. The majority of people have been and continue to seek other people who can relate to the business environment of the past and the fallacy of the behavior that continues today.
Now the people have found a method of fulfilling the fundamental desire for relationships based on free and open expression of thought without governance by any institutions, we the people have become the institution of expression. The social web has created empowerment, individual recognition, the power of self expression and said attributes have attracted the masses forming into “swarms”. These collective dynamics are creating a paradigm shift which the majority of businesses have yet to comprehend and in many cases aren’t even remotely aware.
The Emergence of The Relationship Economy will be fueled by individuals. The Businesses that understand and embrace the very dynamics that are fueling the social web will themselves create significant market shifts in distribution, sales and subsequent revenue growth. Why? Because those business leaders that lead their companies through a revolutionary transformation will gain the respect and loyalty of the people. A simple yet profound truth grounded in the fiber of human relationships.
What say you?