|Booms and Boomerangs: reviewing 'A New Dynamic'|
|Written by David Brunnen|
|Friday, 24 January 2014 00:00|
Booms and Boomerangs: review of 'A New Dynamic' in the context of 'Value and Worth'.
‘A New Dynamic: effective business in a circular economy’
Edited and Published by the Ellen MacArthur Foundation
‘Value & Worth: creating new markets in the digital economy’.
Prof. Irene Ng, first published by Innovorsa Press - and shortly available in new reprint by Cambridge University Press.
Two remarkable books marked the beginning and end of 2013. Both demanded time and attention from business readers and students. Both arrived with fresh and diverse perspectives. Both books encouraged businesses to adopt new strategies and agendas. Both were delightfully free of political special pleading.
The year was kicked off with the Kindle version of Value & Worth (soon to appear in a new edition published by Cambridge University Press) with Prof. Irene Ng of Warwick University’s Manufacturing Group (WMG), explaining the delights of digital disruption; how new platforms and services are empowering consumers and imposing new imperatives on the way business propositions are designed and delivered. The subtitle reflected well the author’s focus; a need in business to understand the value of any proposition from the ‘digitalised’ consumers’ viewpoint and how that value is often informed by very individual usage contexts.
As expected from a professor with real world experience of business and markets, the reader is taken through a brief history of the digital revolution before embarking on an exposition of the impacts of recognizing that product or service values are defined not so much by their costs of production and delivery (their ‘exchange value’) but in the context of their ‘value in use’. These impacts include shifts towards intangibles and service propositions assisted by an interpretation of competitive advantage as ‘Collaborative Advantage’ in a digital world where things are not simply made to work but are ‘made to work with other things’.
The complexity of assembling a multitude of collaborative actors was similarly reflected at the year-end in ‘A New Dynamic’. This book was itself created by a multitude of authors and one of its strong themes centres around the essentially collaborative culture required to deliver services that are both sustainable and truly ‘fit for use’. The context for this production from the Ellen MacArthur Foundation is, of course, ‘the circular economy’ – a road-map that envisions sustainable economies in a world of scarce and shrinking natural resources.
Approaching either book (set texts for MBA studies and, surely, soon to be mandated for senior management across the economy) demands commitment from readers. Both books are journeys of discovery that until recently might have been regarded as science fiction. What might once have been fanciful has evolved into fact over little more than the last three decades
Both books consign linear thinking to the sidelines of history – so readers should not hesitate to take the structure of these multi-dimensional productions apart if their individual expeditions require diversions and retreads. Readers already familiar with the basic notions of digital disruption and the circular economy may choose to start in the middle and work outwards. This is particularly true of ‘A New Dynamic’. Your reviewer was immediately drawn to chapters 7 and 10 long before checking out the groundwork of the first three chapters.
One reason for homing in on Chapter 10 was the happy coincidence of reading John Kay’s economic insights in the latest edition of the RSA Journal (pp. 10-15). In this he rails against over-simplistic models; the tendency of economic advisors to overlook complexity in the search for ‘things that can be run on computers’ and adherence to a dogged fundamentalist belief in the rationality of markets. ‘Economic models are no more than potentially illuminating abstractions’, he writes. The headline for his RSA essay, ‘Circular Thinking’, might at first glance have suggested the prospect of contention but Christophe Sempels’ chapter 10 treatment of business model innovation would probably sit very comfortably with both John Kay and Irene Ng.
Chapter 7, ‘Business Opportunities through Positive Development’ by Janis Birkeland, addresses issues of sustainability in the context of development pressures on cities. In a call to correct the past failures of urban planning, Janis Birkeland looks at how economic, social and ecological sustainability is dependent on systems design. ‘. . . . protecting existing natural functions and eco-services costs less than trying to replace them with industrial or mechanical substitutes.’ Since this concept of Positive Development is not yet much in evidence it is necessary to ask where we might find ethical business opportunities. Janis’s answer is to critique the current shifts from public to private interests, from the poor to the wealthy and from lay public to expert.
In doing so the critique could perhaps support a great case for better recognition of ‘municipal enterprise’ – a concept that free market supporters of outdated linear industrial models would, in their oft-claimed search for consistency and rigour, dismiss as oxymoronic. But neither ‘A New Dynamic’ nor ‘Value & Worth’ allow much space for public policy campaigning. The solutions and innovations they envisage are born of business and consumer enlightenment and leave the politico’s to catch up with reality.
Through these works we come face to face with the last generation’s lust for scale – the short-term comfort of amassing big numbers to achieve viability (regardless of waste) – and the far greater longer-term need to keep the world spinning. The booms (and busts) of previous economic cycles are unlikely to be banished in our lifetimes but, in a more circular service-mediated economy, ‘what goes around’ will more often come around to be reused over and over again. The business boomerang demands that we should all learn (as quickly as possible) to adapt to a post-industrial fully digitalised economy.
|Last Updated on Friday, 24 January 2014 10:52|