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Third Industrial Revolution?


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My presentation on value creation though internet-enabled 2D and 3D spaces for a group of executives in December 2012.

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Third Industrial Revolution?

  1. 1. March 2013
  2. 2. "...when the rate of change outside an organization is greater than the rate of change inside, the end is near...." Jack Welch…
  3. 3. 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 today
  4. 4. Did You Know: Shift Happens 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?
  5. 5. Growth Time Information and knowledge Human absorptive capacity Human capacity cannot keep up… Adapted from Cohen & Levinthal 1989
  6. 6. A Big Bang in the Information Universe 2.7Bln daily comments and ”likes” on Facebook 500Mln daily posts on Twitter and Weibo combined 200k videos uploaded to YouTube daily, Tomas Larsson, 2012
  7. 7. Big Data is now big money Tomas Larsson, Sep 2012 the-sexiest-job-of-the-21st-century/ar/1
  8. 8. ”No one knows everything, everyone knows something, all knowledge resides in humanity.”networks Adapted from Lévy 1997 Six degrees of separation - Milgram, 1967
  9. 9. 3.74 degrees of separation! Source: Facebook Aug 2012 5 mln active monthly users in Sweden
  10. 10. Multiple relationships @padday,
  11. 11. Growing social media landscapes
  12. 12. Social Media – the connected world Engagement Commerce Analytics Influence Platforms - Integrators Enterprise Consultants Social-Local- Mobile Gaming Mahaley 2012
  13. 13. People > 45 years becoming more active Edison Research, 2012 - US-based study % age group with personal profile on any social networking website
  14. 14. 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
  15. 15. 67% in USA do not follow a brand in social media and for those who do, no one brand dominates Of 332 responses Edison 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?
  16. 16. Creation > curation 46% Creators: Create and post photos, videos, etc. 41% Curators: Find and post photos, videos, etc.
  17. 17. The wisdom of the crowd Closed Expensive Complex Accurate Open Inexpensive Simple Close enough Hinton 2007 Accurate Up-to-date
  18. 18. 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?
  19. 19. Where have the traditional sources of sustainable competitive advantage been? #1 Innovation Networks of relationships Brand & Reputation FIRM Kaye 1993
  20. 20. #1 Innovation Networks of relationships Brand & Reputation FIRM T Where are tomorrow’s sources of sustainable competitive advantage? Teigland 2010
  21. 21. How Wrapp’s friend-to-friend marketing platform drives sales Converting online relationships to offline sales
  22. 22. The “Open Innovation” Opportunity Cloud – Powered by technologies Mahaley 2012
  23. 23. Mahaley 2012 Crowdsourcing product and service innovations from customers
  24. 24. Open innovation in high tech For 10 years IBM has hosted “ideajams” on specific challenges, i.e., text-based chats with hundreds, even thousands of contributors from inside and outside IBM. “The 2006 Innovation JamTM brought together >150,000 people from 104 countries and 67 companies. 10 new IBM businesses were launched with seed investment of $100 mln.” Mahaley 2012
  25. 25. Open innovation in health care DEMO! Mahaley 2012
  26. 26. Exploitation Improving existing value creation activities Exploration Developing new value creation activities Adapted from March 1991
  27. 27. Into the future…. Who develops it? Who manufactures it? Who finances it?
  28. 28. 30% profit margin in commodity business
  29. 29. sketchstreet
  30. 30. From clothing to home products….
  31. 31. Open innovation in automotive design/production “Local Motors is the place for people to create influential vehicles together.”
  32. 32. The Firm The Collectivevs 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
  33. 33. “Open source” … not just about software anymore
  34. 34. OpenSimulator: A value-creation ecosystem Academic Entrepreneur Hobbyist Large Firm Non-profit Local Public Federal Public Research Inst SME Employee Periphery Teigland, Di Gangi, & Yetis 2012 USD 5.5mln in development costs
  35. 35. Into the future…. Who develops it? Who manufactures it? Who finances it?
  36. 36. 3D printing becoming more commonplace…
  37. 37. …and it’s no longer just for companies 3D scanning apps Affordable home 3D printers In stores near you
  38. 38. Open Source + 3d Printing + InternetComm $60,000 $150
  39. 39. Where is all this happening? Online
  40. 40. Access to 24x7 global workforce Matchmakers: USD 1bln industry
  41. 41. Increasing supply of freelance talent globally Global Online Employment Report Q2 2012 at Elance
  42. 42. The new market place A shift by companies from being “problem solvers” to “solution finders” Ericsson & Augur 2011
  43. 43. Shifting market logic Ericsson & Augur 2011
  44. 44. Into the future…. Who develops it? Who manufactures it? Who finances it?
  45. 45. New forms of financing
  46. 46. And even new forms of currency Mahaley 2012
  47. 47. Just when you thought you got it…. Here comes the Immersive Internet…. O’Driscoll 2009
  48. 48. What are Virtual Worlds ? Platforms for unleashing creativity and revolutionizing value creation
  49. 49. My CV •Leading a virtual team of 30 individuals from across the globe •Creating and successfully executing strategies under pressure •Managing cross-cultural conflict without face-to-face communication Building skills in virtual environments
  50. 50. The number of virtual worlds and users continues to rapidly increase ≈1.9 bln accounts ≈100 worlds
  51. 51. ≈1.4 bln VW accounts under age 16 225 mln 170 mln 200 mln 265 mln 42 mln (and 8.2 mln bought)
  52. 52. “Clearly, if social activity migrates to synthetic worlds, economic activity will go there as well.” Castronova, 2006 $14.8 billion worldwide market for virtual goods in 2012E
  53. 53. US$ 635,000 for a virtual asteroid! 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
  54. 54. Cloud party on Facebook - In beta Marketplace app and Cloud Coins
  55. 55. Education, training… Learning virtual teaming skills through experience
  56. 56. Euroversity Network  Overview − EU funded, 3 year multilateral and transversal network (LLP EACEA, KA3 (ICT)) − December 2011 – December 2014 − Project Leader: University of Hull (Darren Mundy, Luisa Panichi) − 19 partners from Austria, Cyprus, France, Germany, Israel, Italy, Netherlands, Norway, Portugal, Sweden, UK  Network Aims −Collect good practice examples in teaching and learning in virtual worlds from different subjects and national and local contexts − Facilitate transfer of core knowledge to new contexts − Provide framework for creation of pan-European virtual-world university  Expected Outcomes − Increased number of experts in virtual world education − Policy for long-term sustainability of network and its outcomes − Model for knowledge transfer − Range of dissemination events More information:
  57. 57. Training and simulation for Providers of Healthcare Delivery In hospital counseling at Univ of New England Virtual hallucinations at UC Davis Pharmacy training at Umeå U Emergency training w/ SAIC
  58. 58. Accelerating innovation to meet global needs Teigland et al. 2010 Integrating users in development process
  59. 59. Developing international entrepreneurs?
  60. 60.
  61. 61. The future of immersion…
  62. 62. Increasing pace of VW/3Di development Browser-based, hyperlinked 3D Radical interfaces Mobile Short-term Mid-term Long-term Adapted from Burden, 2012
  63. 63. Coming soon – by Palgrave Macmillan Release date April 19, 2013 Internet-Reflections-Entangling/dp/1137283017
  64. 64. Only a matter of time? O’Driscoll 2009
  65. 65. From factories to office parks to….
  66. 66. From the mobility of goods to the mobility of financial capital to … Teigland, JVWR, 2010 ...the “mobility” of labor?
  67. 67. Here today, gone tomorrow?
  68. 68. Some things do not change Innovation Exchange Exchange Trust Trust Relationships Relationships Interaction
  69. 69. Are you ready?
  70. 70. What should you think about? How to let go? How to leverage the power of networks to create value inside and outside the boundaries of the firm? How to create a sustainable ecosystem?
  71. 71. Karinda Rhode aka Robin Teigland RobinTeigland Photo: Lindholm, Metro Photo: Nordenskiöld Photo: Lindqvist If you love knowledge, set it free…
  72. 72. Interested in learning more?