The economy is in a state of flux as are the market dynamics for every market segment. If you haven’t noticed markets have been in turmoil for some time and this turmoil is changing how markets work. Business as usual is out and business as unusual is in.
Unusual means doing things differently than you have in the past. Doing things differently in the sense of what, who, when, where and why you do certain things. Social technology is fueling change and the primary change required to do the unusual begins with how we think and what we believe.
Assets Have Changed
In business assets are economic resources. Anything tangible or intangible that is capable of being owned or controlled to produce value and that is held to have positive economic value is considered an asset. Simply stated, assets represent ownership of value that can be converted into cash. In today’s creative economy asset values have shifted from tangible to intangible and the ownership of such things rest with the individual and/or organization that can harness the creative power of individuals.
A Business Week article by Peter Coy titled “The 21st Century Corporation” states: Now the Industrial Economy is giving way to the Creative Economy, and corporations are at another crossroads. Attributes that made them ideal for the 20th century could cripple them in the 21st. So they will have to change, dramatically. The Darwinian struggle of daily business will be won by the people–and the organizations– that adapt most successfully to the new world that is unfolding.
The turn of the millennium is a turn from hamburgers to software. Software is an idea; hamburger is a cow. There will still be hamburger makers in the 21st century, of course, but the power, prestige, and money will flow to the companies with indispensable intellectual property.
That’s because ideas, like germs, are infectious. They can spread to a huge population seemingly overnight. And once the idea–say, a computer program–has been developed, the cost of making copies is close to zero and the potential profits enormous.’
The rising importance of ideas creates all kinds of difficulties for traditional corporations.
In the Creative Economy, the most important intellectual property isn’t software or music or movies. It’s the stuff inside employees’ heads. When the vital assets are people, there can be no true ownership. The best that corporations can do is to create an environment that makes the best people want to stay.
Technology is fueling new idea based start up organizations that are able to generate lots of revenue and profit off a small base of assets and employees. Just consider Apple, Facebook, Groupon, Google and Linkedin. These organizations are creating significant influence over politics, governments, social policies and the economy. And they are really just beginning.
In the Creative Economy, the power to exert influence is nearly unlimited because there’s no ceiling on how many people can be made to depend on idea-based assets. A great idea is only worth as much as the number of people who will depend on it. The new face of business is driven by ideas that stick.