The 3rd Industrial Revolution?Exploring the future of value creation

Dr. Robin Teigland Karinda Rhode in SLStockholm School of Economicswww.knowledgenetworking.orgwww.slideshare.net/eteigland

RobinTeigland

February 2013www.hhs.se

"...when the rate of change outside an organization is greater than the rate of

change inside, the end is near...."

Jack Welch…

Increasing pace of change

Of original Forbes 100 in 1917- 61 companies ceased to exist by 1987- 18 of remaining 39 underperformed market by

20%- Only 2 beat market index (GE & Eastman

Kodak)- Only 1 (1%) today!

Average S&P 500 company lifespan−1920s – 67 years−2010s – 15 years

Dr. Richard Foster, Yale, Sept 2012−Today's rate of change is at faster pace than

ever −By 2020 prediction is > 75% of S&P 500 will be

companies we do not know about todayhttp://www.fastcompany.com/3001444/what-zara-pg-and-berlitz-know-about-agility

Did You Know: Shift Happenshttp://www.youtube.com/watch?v=cL9Wu2kWwSY&feature=search

1. What trends do you recognize?

2. How are these trends affecting you and your organization?

3. What does this have to do with networks?

Growth

Time

Information and knowledge

Human absorptive capacity

Human capacity cannot keep up…

Adapted from Cohen & Levinthal 1989

A Big Bang in the Information Universe

2.7Blndaily comments and ”likes” on Facebook

500Mlndaily posts on Twitter and Weibo combined

200kvideos uploaded to YouTube daily

http://en.wikipedia.org/wiki/Internet, Tomas Larsson, 2012

Big Data is now big money

Tomas Larsson, Sep 2012

http://hbr.org/2012/10/data-scientist-the-sexiest-job-of-the-21st-century/ar/1

”No one knows everything, everyone knows something,

all knowledge resides in humanity.”

networks

Adapted from Lévy 1997

Six degrees of separation

- Milgram, 1967

3.74 degrees of separation!

Source: Facebook

Aug 20125 mln active

monthly users in Sweden

Growing social media landscapes

http://www.resonancechina.com/2012/03/13/updated-2012-china-social-media-landscape/

People > 45 years becoming more active

Edison Research, 2012 - US-based study

% age group with personal profile on any social networking website

Social media gaining in influence on buying decisions

Which ONE social networking site or service influences your buying decisions the most?

Edison Research, 2012 - US-based study

67% in USA do not follow a brand in social media and for those who do, no one brand

dominates

Of 332 responsesEdison Research, 2012

Think about the companies, brands, products and services

you enjoy following on social networking sites. What is the first ONE that comes to mind?

Creation > curation

46% Creators: Create and post photos, videos, etc.

41% Curators: Find and post photos, videos, etc.

http://pewinternet.org/Reports/2012/Online-Pictures.aspx

The wisdom of the crowd

ClosedExpensiveComplexAccurate

OpenInexpensive

SimpleClose enough

Hinton 2007

AccurateUp-to-date

History tends to repeat itself….Innovation, financial crisis, industrial revolution,

…

Steam engine

Internal combustion

engine

Microelectronics

Late 18th C Late 19th C Late 20th C

Schön 2008

Third industrial revolution?

Where have the traditional sources of sustainable competitive advantage been?

#1

InnovationNetworks of relationships

Brand & Reputation

FIRM

Kaye 1993

#1

InnovationNetworks of relationships

Brand & Reputation

FIRM

TWhere are tomorrow’s sources of

sustainable competitive advantage?

Teigland 2010

Group Exercise

For groups 1-3 – Crowdsourcing

One company per group1. Quirky.com 2. LocalMotors.com3. Threadless.com

• Prepare max 10 min ppt presentation. 1. What is the company’s business model?2. How does the company use social media?3. What benefits does the community

provide the company?4. How could your customers use

crowdsourcing?5. What products/services could Tieto

develop?6. Include videos and internet images.

For group 4 – 3D printing

Prepare max 10 min ppt presentation. 1. How is this technology being used

today?2. How could it be used in the future?3. How could it change the future of retail?4. How could your customers use 3D

printing?5. What products/services could Tieto

develop?6. Include videos and internet images.

For group 5 – BitCoin

Prepare max 10 min ppt presentation. 1. What is BitCoin and how is it used

today?2. How could it be used in the future?3. How could it change the future of

commerce?4. What does this mean for Tieto?5. Include videos and internet images.

Some search tips

Some search tips−www.twitter.com−Homepages/websites /blogs−www.wikipedia.org−www.slideshare.net−www.youtube.com−www.flickr.com, instagram−Groups on www.linkedin.com−www.facebook.com

sketchstreet

From clothing to home products….

The new market place

A shift by companies from being “problem solvers” to “solution finders”

Ericsson & Augur 2011

Shifting market logic

Ericsson & Augur 2011

Into the future….

Who develops it?

Who finances it?

Who manufactures it?

The Firm

The Collective

vs

E.g., Microsoft~ Built by employees within

organizational boundaries

E.g., Linux~ Built by users and distributed freely regardless of affiliation

Models of Knowledge Creation

Teigland, Di Gangi, & Yetis 2012

“Open source” …not just about software anymore

Open innovation in automotive design/production

“Local Motors is the place for people to create influential vehicles together.”

New forms of financing

http://blog.intuit.com/trends/crowd-power-what-is-crowdfunding-infographic/

And even new forms of currency

Mahaley 2012

3D printing becoming more commonplace…

…and it’s no longer just for companies

3D scanning apps

Affordable home 3D printers

In stores near you

Where is all this

happening?Online

Access to 24x7 global workforce

Matchmakers: USD 1bln industry

Increasing supply of freelance talent globally

https://www.elance.com/trends/talent-available

Global Online Employment ReportQ2 2012 at Elance

InternetComm + Open Source + 3d Printing

http://mashable.com/2013/02/13/robohand/

$USD150

Just when you thought you got it….

Here comes the Immersive Internet….

O’Driscoll 2009

What are Virtual Worlds ?

http://www.youtube.com/watch?v=Quh2OiPHkm8

Platforms for unleashing creativity and revolutionizing

value creation

“Clearly, if social activity migrates to synthetic worlds, economic activity will

go there as well.” Castronova, 2006

$14.8 billion worldwide market for virtual goods in 2012E

http://www.superdataresearch.com/monetization-is-a-four-letter-word/

US$ 635,000 for a virtual asteroid!

http://blogs.forbes.com/oliverchiang/2010/11/13/meet-the-man-who-just-made-a-cool-half-million-from-the-sale-of-virtual-property/

• US$ 500,000 profit in 5 years by Jon “Neverdie”

Jacobs• Entropia Universe with GDP

>US$ 440 mln

Accelerating innovation to meet global needs

Teigland et al. 2010

Integrating users in development

process

http://www.youtube.com/watch?v=2kMNWBU1Yb8

The future of immersion…

http://www.bbc.com/news/technology-19568451

Coming soon – by Palgrave Macmillan

From factories to office parks to….

Here today, gone tomorrow?

From the mobility of goods to the mobility of financial capital to …

Teigland, JVWR, 2010

...the “mobility” of labor?

Some things do not change

Innovation Exchange

Exchange Trust

Trust RelationshipsRelationships Interaction

Are you ready?

How do you stay in command

……while letting go of

control?

Karinda Rhode

aka Robin Teiglandrobin.teigland@hhs.se

www.knowledgenetworking.org

www.slideshare.net/eteigland

www.nordicworlds.net RobinTeigland

Photo: Lindholm, Metro

Photo: Nordenskiöld

Photo: Lindqvist

If you love knowledge, set it

free…

Interested in learning more?