How do we create and share value in a jobless economy?

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Jeff Jarvis sparked my thinking on this recently with his post on The Jobless Future. As Jeff so bluntly stated:

“We’re not going to have a jobless recovery. We’re going to have a jobless future.

Holding out blind hope for the magical appearance of new jobs and the reappearance of growth in the economy is a fool’s faith.”

If that is the case in the US, and we have riots on the streets in the UK, Spain, Greece, north Africa and the middle east, then things are not looking good in large portions of the world. There will likely be flow on economic and social effects around the world, especially since Richard Florida is pondering if riots could come to Canada too.

Nouriel Roubini may be right in his assertion that “Karl Marx had it right. At some point, Capitalism can destroy itself.”

The inherent instability of markets in the US and Europe mean that jobs are going to be harder to come by, especially for the less educated and the less skilled.

All of this got me thinking about what skills are really useful in this new world that is developing before our eyes? What kinds of businesses and communities will be more resilient in the face of changing economic verities? How do we need to recast our expectations and aspirations for this new world that is unfolding?

That kind of thinking led me over to John Robb’s blog and one of his recent posts, Entrepreneurs and Open Source Hardware. Perhaps we are all about to become open source entrepreneurs?

The kind of economic environment that is emerging is one where sustainable and ethical business models can come into their own. Not large scale, top-down, industrial operations. Rather there is an opportunity to develop peer-to-peer and networked organisations. Social innovation, social enterprise and ideas like collaborative consumption become significant, and a return to older ways of organising businesses – like co-operatives and mutual associations – become critical.

We also need to find ways to create and exchange value in an environment where traditional mechanisms might no longer be available to us. This means creation of new means of value exchange, or even new kinds of currencies. Reverting to gold is not really feasible, after all it’s rather heavy to tote around. Thus virtual currencies might even come to replace some of the existing ones

If you consider it unbelievable that major currencies can fail then it’s time to go read some history. Just to put it in perspective there’s a great visual post by Jeff Clark over at The Daily Reckoning that illustrates the risk rather neatly: A Thousand Pictures Is Worth One Word.

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Business, boring jobs and social good

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Over the past 150 years businesses have dealt with the challenges of increased scale by optimizing processes, resource allocation and expenditure. However, there is a limit to how much one can optimize a business and not damage the society within which that business exists.

I have spent a goodly part of my career working on optimizing large scale businesses and increasing productivity.

The main way to achieve that is by automating routine and repetitive tasks or outsourcing them to lower cost regions, thus making low paid jobs redundant. That process generally takes bottom line cost out of the business and increases productivity as a by-product. Where it does create new jobs they are rarely suitable for the workforce that has been displaced through this process.

Many older workers have been pushed out of the workforce due to the disappearance of these types of jobs. For them it seems too late to re-train, and many face ageism from employers who are unwilling to give them a chance at different roles.

Thus we are wasting the talents, energy and skills of many older workers who now languish unhappily on welfare payments.

But it is also interesting to consider this: if the many young unemployed people across the western world had been born twenty years earlier they would be doing those repetitive jobs and earning an income. Those jobs have disappeared. And they have disappeared either due to optimization and productivity improvements.

So what do we do with all of the people who used to do those old jobs? In most western countries (except the USA) we pay them some kind of social welfare benefit. That allows them to subsist. But what do they do with their time while subsisting? Are they included somehow in the community? Do they have a role, apart from being passive recipients of welfare, that make them feel part of society?

A boring repetitive job is boring for many young people. But it does provide some benefits: they earn an income; they learn real-world work skills; it gets them out of the house; it gives them some kind of purpose outside of themselves; and it is really a good way to get them thinking about what else they can do with their life.

My first job was utterly dull and boring. It gave me the impetus to get back into study and work out ways to never have a job that dull again. It also gave me a perspective on how business works, and it is a perspective that I could not have achieved from outside.

But now most of those entry level (boring) jobs have gone. And many young people do not want to take them even if available. That is a bit sad.

We seem to have mostly banished boredom in our society, and that might not be an entirely good thing. The social benefit provided by those lost jobs has not been replaced.

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The jobless future and social innovation

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I have argued previously that capitalism is broken and that we need to find new approaches that are good for people, animals and the planet.  Further I asked if social innovation might be part of that new approach.

The world is facing an unprecedented financial crisis that is creating a future in which traditional jobs are being destroyed.  Jeff Jarvis outlines this future well in his post The jobless future. Before our eyes entire industries that thrived during the nineteenth and twentieth centuries are disappearing.

The consumer driven economy of the late twentieth century is teetering due to:

  • the demise of the debt fuelled growth to support consumer spending, and
  • a lack of jobs to provide the income for consumers to continue acquisition of goods and services.

In the period 2008-2010 the car industry is a good example.  A confluence of high fuel prices, a global financial crisis (GFC),  tightening of credit markets, and job losses across Europe and North America meant that demand for new vehicles dropped to historic lows. This in turn drove job losses in the car industry around the world.

But the car industry has for many years produced more new cars than the world really needs to replace old or damaged ones.  Driven by consumer leasing arrangements that saw people acquiring a new car every few years, debt was fuelling an artificial demand.  And when that debt fuelled demand dropped away during the GFC, demand levels for new cars fell back to more ‘real’ levels. With demand down, jobs will go in this industry.  It is unlikely that the lost jobs will return.

This is a strange situation.  Motor vehicles are a great social good.  They have enabled us to achieve mobility to move people and goods in ways that our ancestors could not even imagine.  But even a social good, when inflated by debt driven acquisition, might not be good for us.

Faced with the kind of jobless recovery and jobless future that the US is so kindly modelling for us we need to consider what means of value creation and exchange need to be created to replace the old models. In some places we are even seeing tent cities arise for those who have lost access to traditional housing and jobs.

One response is a top down Keynesian approach, with centralisation and extensive government intervention.   However, the scale of the economic crisis facing us today means that governments simply do not have the resources for continued intervention.  After a variety of interventions in the US and Europe the first world governments cannot afford to keep spending.

But another response is a grass roots and bottom up response that finds different, diverse and sustainable ways to re-create an economy.

It is here that the notion of social innovation comes into its own. It is the notion that we can create innovative businesses and business models that generate value for us from both a social and economic perspective.

Just repeating the same old models will not get us out of this situation.  It is time to broaden our perspective and look to each other, to our local communities for sustainable and ethical ways to generate value.

An interesting place to start thinking about this is the work that is being done about resilient communities:

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Google's interesting social innovation

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My buddy Anthony Baxter has been a Googler for a while and has worked on many fascinating projects. But what he’s working on now is not just interesting from a technology perspective, it is interesting from a social innovation perspective too.

He’s working on the Google Crisis Response Team, which is part of Google’s philanthropic activities, and he’ll be talking about this at the next Social Innovation Sydney Unconference on 13 August 2011.

The Crisis Response team is an excellent example of social innovation. Google set it up to focus on technology-driven philanthropy via Google.org.  It is a practical way of helping people who have experienced some kind of disaster or humanitarian crisis.  They work to make critical information more accessible during times of crisis.

As they explain it:

The types of activities we might initiate include:

  • Organizing emergency alerts, news updates and donation opportunities, and making this information visible through our web properties
  • Building engineering tools that enable better communication and collaboration among crisis responders and among victims such as Person Finder and Resource Finder
  • Providing updated satellite imagery and maps of affected areas to illustrate infrastructure damage and help relief organizations navigate disaster zones
  • Supporting the rebuilding of network infrastructure where it has been damaged to enable access to the Internet
  • Donating to charitable organizations that are providing direct relief on-the-ground

Read more about past efforts.

If you’re interested in this kind of thing then register now for Social Innovation Sydney Unconference 13 Aug 2011.

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Some thoughts on making change: it starts with us #gathering11

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Since I’m in transit to New York to speak at the 140Conference about Twitter, Community & Social Innovation David Hood had planned for me to join in Gathering11 from a distance using the power of technology. However, due to what can only identified as #EPICFAIL on the technology front from both sides of the Pacific, that didn’t happen. In any case here are some of my thoughts on where change really starts.

I’ve been thinking about this topic of envisioning pathways to change and it has really brought home to me the fact that change is personal and particular as well public and general.

The sayings “as above so below” or “as within so without” seem to be good starting point for envisioning pathways to change. As Mahatma Gandhi told us “we must be the change that we seek in the world”.

This is a very confronting message. It faces each of us with admitting the possibility that to make change we need to start with very intimate kind of personal change from within.

It means admitting that we are not perfect. And it means, by corollary that other people are not perfect. It also means that to effect change we might need to start in a small and quite humble way, rather than in a grand and important way.

All great change starts small. And we must not be afraid to look to micro levels to commence a great change journey.

“All difficult things have their origin in that which is easy, and great things in that which is small.” Lao Tzu

Too often we are intimidated by the scale of the end result that we seek to achieve. And we and are sometimes transfixed by the difficulties. Instead, it is important to break down the elements of the change journey. We need to work out what is the one thing that we can do today to move us towards the desired outcome.

Every great human enterprise commenced with intent and commitment from a small number of people. Every great movement for change in the world started with one step. However, those that achieve their goals do so by constant focus and daily effort.

Just as a seed doesn’t grow into a healthy plant without careful husbandry, so to our dreams for change will not manifest unless we do the work.

“History consists of a series of accumulated imaginative inventions.” Voltaire

Another thing to consider about change is that one individual alone can rarely achieve it on any scale. To make change we need other people. And it is through the ability to bring other people to our cause that force is given to our intent.

But as we bring other people to our cause they will bring their own perspectives. And these perspectives can change our intent and purpose.

However if we block ourselves off from receiving those different perspectives then it can also stop the flow of people gathering with us to create the change we seek.

This comes back to that notion of personal humility as an important component of envisioning and creating change.

Accumulating the best inputs from all who have joined up and committed to making change is important. And it is important from two perspectives: respect for our fellow travellers, and to improve the content of our ideas and plans for change. Adding other people’s wisdom to our own can help ideas to evolve much faster than we alone.

“A system is a network of interdependent components that work together to try to accomplish the aim of the system. A system must have an aim. Without the aim, there is no system.” W.E.Deming

Now let’s turn to the nature of the macro changes we might envision. Each of us is a part of the many systems that we participate in. When envisioning change we need to contemplate the systems that we are participating in and upholding.

We need to go back to first principles and to discern the aims of the change we envision. And it is also importent to understand the means we intend to use to create the change envisioned.

One thing that I have learned over the years is that Aldous Huxley was right: “The end cannot justify the means, for the simple and obvious reason that the means employed determine the nature of the ends produced.”

Thus it is important to be very clear on both the what and the how of the change process.

Making change in a human being or in a society is not a trivial thing. It should not be undertaken lightly. Change is unpredictable and its results are not always certain. That is why it is so important to begin with us, the individual changemakers, and to form clear intent and be very clear on the means to be used to effect that change.

Also making change happen is a social activity and depends upon other human beings. The ability to create and nurture relationships is critical.

It really does start with us.

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Changing the world, ideas, action, rethinking reality & the rabble-rousing ways of @umairh

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One of the people who is vocal in his calls for change in how we do things in our westernised societies is Umair Haque. His work is worth reading whether or not you agree with his perspective.

Some of his recent provocative tweets include:

Yes, really. You have the power to change the world. Consumerism, mass-made junk, greed? The fantasies you’re sold–so you never use it.
Source: @umairh

History may have been ruled by crooks and sociopaths. But, thanks to those who came before us, today doesn’t have to be.
Source: @umairh

We can debate endlessly whether every leader in history has been a crook or a sociopath, or not. The bigger point might be…
Source: @umairh

Our forebears fought for generations to give us a gift: to create a future better, wealthier, stronger than theirs.
Source: @umairh

They fought to create things like democracy, markets, justice, opportunity, reason, equality, liberty.
Source: @umairh

I’d say these are among the greatest achievements in human history. The fundamental institutions–the building blocks–of prosperity.
Source: @umairh

Today, we use them to “consume” mocha-venti-lattes, Jersey Shore, and fast fashion. Instead of bettering them–we’re squandering them.
Source: @umairh

I think that Umair is right. If we want to change the world it will be necessary to stop doing some things that we do now, to stop thinking the way we think now, and shift our attention and activity towards different things.

That’s one of the reasons I’ve been focusing on Social Innovation Sydney and our combination of BarCamps and StartupCamps. The plan is turning new ideas into action and creating real life social networks to enable it.

What are you doing to change the world?

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Inspired and delighted with people's willingness to work for positive change #sibsyd

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I’m exhausted after a busy weekend and totally inspired by the people I just spent the weekend with!

We held the first Social Innovation Sydney Startup Camp this weekend. It was great to see so many people willing to work together in an open and collaborative way on developing social innovation projects.

It really inspires me with hope for the future of our world to see people join together, starting as strangers, and collaborate on social innovation ideas so effectively.

There’s a nice round-up of Startup Camp from @lucyjjames on her blog: day 1 and day 2; and a some feedback from the participants on Social Innovation Sydney.

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Innovation: operational excellence is not a path to sustainable growth

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I’ve been thinking about innovation a great deal lately and am fascinated by how many people confuse two different kinds of innovation.

The two different kinds of innovation are:

  1. continuous improvement – the drive for operational excellence, which is driven by optimising existing business processes and products (in the Six Sigma world the DMAIC approach is used for this kind of change)
  2. step-change innovation – creating new ways of thinking, new products and new ways of doing things (in the Six Sigma world the DMADV or DFSS approach is used for this kind of change)

It often seems that the revenue and cost impacts of these two different kinds of innovation is little understood.

The former, optimisation, generally has the effect of reducing costs. This is an admirable thing and is always worth doing.

However, I sometimes think that we are in danger of optimising the customer service and humanity completely out of our business operations by focusing so much on cost out initiatives.

The second kind, step-change innovation, is more focused on new revenue opportunities. This is the lifeblood of any business, it is not sustainable to keep taking costs out of the business and merely optimising the existing business and products.

Sustaining innovation within existing businesses is hard. Academics have been researching for years seeking the secret sauce of innovation so that we can pour it into our businesses and succeed according to some formula.

But it is not that easy. Innovation is hard. I’ve done it from inside of large organisations. New ideas are difficult to achieve consensus upon. New products are hard to bring to birth when everyone is already doing well with the existing products. It is hard to get people to buy into change unless there is a substantial reason to get their attention.

Everyone is usually running hard to keep up and to meet the current KPIs and the last thing they need is some crazy innovator trying to stop them from getting business as usual done.

Innovation is risky and entails the possibility of failure.  It is important to ask ourselves how we can make this risky business of innovation work for our particular organisation.   A key factor is how failures are treated.  Another important factor is allowing some time out of normal business to build the innovation idea into reality.

In my experience innovation within a successful existing business is only possible with the help, protection and support of highly engaged senior executives.  Every time I’ve tried it without this type of support it’s been almost impossible to survive the political tension between innovation, business as usual and meeting existing KPIs.

However, there is one certain thing.  Operational excellence and continuous improvement are not the way to grow a business.  But they are a great idea for freeing up some funds to invest in step-change innovation that creates new business models and new products.  Thus it is important for an organisation to make space for both kinds of innovation.

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Science communication and social media #media140au

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Attending the Media 140 Conference in Brisbane today. The tag line for this conference is “exploring the impact of social technologies on science communication” and it explores some of the issues and challenges facing science communication today.

There’s been a great line-up of speakers so far, with:

  • Bernie Hobbs, ABC Science (who’s doing an excellent job as Conference host)
  • Dr Andrew Maynard, Director of the University of Michigan Risk Science Center and the Charles and Rita Gelman Risk Science Professor at the University of Michigan School of Public Health.
  • Natasha Mitchell , ABC presenter of All In The Mind.
  • Wilson da Silva , Editor-in-Chief of COSMOS
  • Elena McMaster , Nanotechnology Project for Friends of the Earth Australia
  • Craig Thomler , Gov 2.0 advocate
  • Dr Craig Cormick , Manager of Public Awareness and Community Engagement for the Australian Government’s Department of Innovation, Industry, Science and Research
  • Dr Kristen Lyons, Senior lecturer in Sociology at the University of Queensland

Dr Andrew Maynard’s keynote on Social media and science communication – a load of Jackson Pollocks? was interesting and he noted his top three issues to consider for science communication:

  • Hubris – disregarding the medium because you don’t understand it. Assumed authority – old model does not work, and Control – “rather misguided theory that we can control conversations”.
  • Creating value – behaving like rockstars does not give us credibility as science communicators – remember cause & effect. Trying to mimic viral videos and blogs is not the answer need to have the good content that creates value.
  • Uncivil behaviour – feeling that we can “tell people forcefully what is right until the get the message” – ends up alienating people we need to connect with.

And a fascinating panel session on Web 2.0 or Web too far? chaired by Natash Mitchell. The panel discussed topics as varied as:

  • Online democratisation and/or demonization.
  • How to manage when the web is used to distort, misinform and distribute propaganda.
  • How anti-science ideologies and commercial agendas use the web, and how we should use social media to democratise scientific knowledge.

Media 140 Brisbane - Science Communication

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Bad idea: updating products for no real benefit to the consumer

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I’ve been a product manager and been to business school. We all learned about the cows, dogs and stars via the BCG Growth-Share Matrix (reproduced here from NetMBA).
BCG Growth-Share Matrix

But there comes a time when so-called innovation is just annoying to your consumers. That happens when you take a product that is working just fine and you “improve” it to the point where is it just doesn’t meet customer needs or wants.  This often happens when a product is no longer bringing in the revenue it did once, or when management want to increase revenue from a product.  A typical solution to this is a product refresh. The idea behind this is to take a successful product and tweak it a bit to drive better sales and it is often used as an excuse to increase retail price.

An excellent example of this phenomenon is the Berlei company who make a bra called Barely There Contour. For many years this bra has been the staple foundation garment for working women around the world. This product – while not pretty or fancy – made the wearer look good, was entirely functional and could be worn all day in comfort at work and then into the evening if necessary. The straps were extremely comfortable and it was by far the best bra to wear for a twelve hour stretch; plus it looked good under either business or casual attire.  It was a great bra for travelling in – it was a favourite to wear for sitting on a plane on long business trips.

I suspect that this product was, for Berlei, a cow as per the matrix above. And there is always an interesting decision to be made in changing products. Do you create a new product, do you enhance the old one, do you create a line extension?

In this instance existing loyal customers are faced with the “Berlei Barely There NEW REFRESHED Contour Bra“. This product refresh has not been a success from my perspective. A line extension might have been a better alternative.

What does that mean? Well it means that the once comfortable straps that used to make it my bra of choice are now painfully narrow ones that dig into my shoulders and make me conscious of wearing a bra (when it should be the last thing on my mind).

It also means that the newly refreshed Berlei Barely There Contour (BBTC) model now has straps that even when extended to their fullest length are not long enough for the bra to sit comfortably under my bust. This again is an uncomfortable feeling, and I suspect that it contributes to the digging in of the now too narrow straps.

I wore one of this new model out yesterday to meet some friends for yum cha. While sitting waiting for them to arrive I was extremely conscious of how the narrow straps of the BBTC were digging into my shoulders rather painfully, and how it was not sitting comfortably under my bust. This has never happened with the old model of this product (of which I’ve owned more than ten). I could not wait to get home and remove the damned thing.

Many friends who were fans of this product have reported similar experiences to me. In fact, one of the women at yum cha recounted precisely the same experience and asked if I’d found a viable alternative product.

It makes me wonder did Berlei actually try out this new “refreshed” model on any actual consumers? Did they have a clue why the old model of this product was one of the most popular bras?

Sadly Berlei have now lost a customer and loyal brand advocate. I need something I can put on at 6.30 am and wear all day in the office and then head out to a function in the evening after work. I need something that makes me look good and is so comfortable I don’t even notice I’m wearing it.

Thanks Berlei for “improving” this product. Hope that works out for you. In the meantime I’m looking for an alternative product. If anyone has tips on alternative products please let me know.  If anyone has stock of the old model please do let me know – I’ve got some friends who’d love to take those off your hands.

By the way I’ve got two of these new model things that will be sent back to the place where I bought them. It’s a real pity that I’ve already worn the other one. Looks like that one will be going in the bin.

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