Forward Thinking: Global trends - Strategy Dynamics Global SA - The ownerless economy
The proliferation of social media, mobile and digital has kick-started a process of change that will lead to an environment where solutions and experiences are key, and power rests with consumers.
Tracey S Keys and Thomas W Malnight
People have more choices than ever before and are often making them with friends, communities or networks. The impact of this is being felt from Middle Eastern politics to the high street to the way we seek knowledge.
Everything can be influenced and even done by an individual or community with an objective and access to some modern technologies. This represents a fundamental redistribution of power, away from traditional institutions such as governments and firms, toward consumers, individuals and communities of influence. It is the democratisation of everything.
In this world, the notion of value itself is shifting. Goods and services are no longer enough: experiences and solutions are required, often personalised and developed with the active participation of the customer. Even ownership is becoming less valued, particularly by younger, mobile generations for whom experiences act as the status symbols that possessions used to be.
We are witnessing the emergence of an ownerless economy, one where sharing and renting provide what is needed, and possessions are simply not necessary. Companies are increasingly being judged by customers, employees and stakeholders according to their purpose and contribution to society. Great staff won't come and profits won't last if the company is not deemed to be relevant and legitimate.
In the future, consumers will have more scope to create value themselves, potentially redefining whole markets as production, like consumption, becomes mobile. Social technologies are key links. Already permeating every aspect of life, these are becoming tools of creativity and productivity within and beyond the firm, empowering individuals and communities.
These rapidly growing channels of influence offer the potential to enhance or detract from the firm's value proposition. Who influences your consumers today? Remember, relationships are no longer one-to-one, but many-to-many, as word of mouth means marketing is not aimed only at the buyer, but their whole network.
The question is, who will control the relationship in future: the firm, the consumer or the interface between them, be that Apple, Facebook, Amazon or Google?
For businesses, it's an exciting world of opportunity and challenge. Collaboration and networks are becoming more important than ever to create and capture value in a fast-changing world where consumers demand solutions and experiences. Industries are being redefined, building around rising consumer expectations.
What does this mean?
Telecommunications companies are becoming lifestyle companies: they create value by enabling mobile lifestyles. Food and beverage companies are becoming wellbeing companies, moving beyond the products that they sell to the potential benefits they can offer. In this future, your competitors will not be those that look, act and think like you do, but players from other industries that offer fresh solutions and experiences. At the centre of this emerging world are consumers with power and choice.
These long-term trends are reflected in shorter-term changes we expect to see, as part of our 10 Key Trends to watch for in the next year, which include:
Social everything: social technologies are now central to everyday life and work. The social generations are re-shaping companies from the inside, helping them to build broader, more agile networks to create and deliver value. Mobility and connectedness will be at the heart of the future business environment. Communications and marketing's focus is moving from one-to-one relationships to many-to-many.
Redefining value: the notion of value is being redefined for the 21st century. Consumers have choice. They want personalisation and to participate in value creation, shifting the mindset to 'made with me'. Value will also be about 'shared with me' as the ownerless economy expands. This will be driven particularly by younger generations who value experiences they can share - that also deliver benefits to society - over possessions.
Distributed everything: mobility is entering a new stage. Consumption can occur anywhere, anytime, and tools to create and capture value are more broadly distributed, too. Work is becoming increasingly distributed. Small-scale manufacturing will re-shape production. Renewable technologies are distributing energy production, while mass teaching platforms are revolutionising education. Ask what can't be distributed, not what can.
As we outline in 'The Global Trends Report 2013: Towards a Distributed World', the challenge for business leaders is to step up, understand the implications for your organisation of the global trends reshaping the world, and take action now. Prepare for the future today.
Thomas W Malnight is professor of strategy and general management at IMD and Tracey S Keys is director of Strategy Dynamics Global SA
This article was first published on marketingmagazine.co.uk
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