The document discusses trends related to the third industrial revolution including collaborative innovation, the sharing economy, cryptocurrencies, crowdfunding, and distributed manufacturing. It notes that these trends are challenging traditional institutions and models of value creation as knowledge becomes more distributed through open networks and platforms. Organizations will need to both explore new collaborative models and exploit opportunities in these emerging areas to remain competitive in the future.
6. “Old” Film from 2008
Did You Know: Shift Happens
http://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 leadership challenges do these
trends lead to?
8. 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?
9. People
• “Net generation”
• 24x7 “mobile” workforce
• Knowledge via MOOCs
• Sharing not consuming
• Sustainability
Technology
• Broadband access
• The Cloud
• Mobile phones
• Internet of Things
• Big Data
• 3D printing
• Robotics/AI
• VR/AR
Open Source
• Software
• Hardware
• Physibles
Convergence of…..
Finance
• Microlending/microfinance
• Crowdfunding/equity/P2P
• Non-fiat cryptocurrencies
• Mobile money/payments
10. If the rate of change on the
outside (of an organization)
exceeds the rate of change on
the inside, the end is near....
-Jack Welch
11. Increasing pace of change
From 1920s to 2010s
− Average lifespan of S&P 500 company fell from 67
years to 15 years
From 2000 to 2010
− 40% of companies on Fortune 500 list replaced
Predictions
− In next few years, 70% of Fortune 1000 companies to
be replaced
− By 2020, >75% of S&P 500 companies do not exist
today
− By 2025, >45% of Fortune 500 companies to be from
emerging markets
Fast Company, McKinsey & Inc
12. ”Bitcoin has made me interested in
issues like finance and money – things
that I never thought about before. Now
I am really curious and questioning
why things are the way they are in the
finance world….and wondering what
can I do to change them.”
- Bitcoin 2014 Conference Attendee
14. In just a few years in Sweden alone…
Company Founded Business
Klarna 2005 E-commerce payment services
MyLoan 2006 Loan broker
Trustly 2008 Online payments
TrustBuddy 2009 P2P lending
iZettle 2010 Mobile payments
FundedByMe 2011 Crowdfunding, crowd equity
Kivra 2011 Digital mailbox
Tink 2012 Personal finance
Safello 2013 Cryptocurrency exchange
KnCMiner 2013 Cryptocurrency mining equipment
Toborrow 2013 P2P lending for companies
15. Banks’ share of wallet is rapidly shrinking
International Entrepreneurs
Nordic Entrepreneurs
Nordic Banks
Pay, Save,
Lend, Insure
16. What is Crowdfunding?
Accumulation of small investments in individual
projects by large number of individuals (the
“crowd”) via or with help of Internet and social
networks (De Buysere et al., 2012)
Picture: FundedByMe
17. Four forms of crowdfunding
Form Benefits for funders
Donation-based Donation Intangible benefits.
Reward-based
Donation or pre-purchase
Rewards in addition to intangible
benefits.
Equity-based Investment
Return on investment if company
does well. Rewards sometimes also
offered and intangible benefits may
motivate too.
Debt-based Loan
Repayment of loan with interest.
Alternatively intangible benefits if loan
given interest-free.
Ingram & Teigland 2013
18. Local Stockholm success story:
Flippin’ Burgers
Money raised:
SEK 36,502 /
€4,000
Number of
investors: 186
Date funded:
September 2011
Sector: Food
21. P2P lending in the US and UK…
• USD 3.8 bln in personal
loans since 2007
• USD 750 mln growth
each quarter
• Now offering business
loans
• Strategic alliance with
Union Bank
23. Democratizing innovation
through access to capital
Kickstarter
• Women 13% more likely to to meet
crowdfunding goals than men
• 67% of women-led technology
ventures reached goals vs 30% of
male-led ventures
Indiegogo
• Women 61% more likely than men
to meet goals
• Women account for 41% of projects
that meet goals
http://online.wsj.com/articles/kickstarter-closes-the-funding-gap-for-women-1407949759
24. Bitcoin = The power of community +
open source + internet + CPU
• Developed by self-organizing community of thousands of
“strangers” across globe
• Not one but many motivations (intrinsic, extrinsic)
• 91 bln SEK in circulation vs SEK 44 bln of Bitcoin in five years
• Approx USD 6.2 bln in circulation (Sept 2014) and 70,000
daily transactions
http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2263707
26. Bitcoin – one of many cryptocurrencies
Currency Code
Year
Est.
Founder(s) Active Website PoW PoS
Bitcoin BTC or XBT 2009
Satoshi
Nakamoto
(pseudonym)
Yes N/A Yes No
Ripple XRP 2013
Chris Larsen
& Jed
McCaleb
Yes ripple.com No No
Litecoin LTC 2011 Charles Lee Yes litecoin.org Yes No
Peercoin PPC 2012
Sunny King
(pseudonym)
Yes peercoin.net Yes Yes
Dogecoin DOGE 2013
Jackson
Palmer
& Billy
Markus
Yes
dogecoin.co
m
Yes No
Namecoin NMC 2011 N/A Yes dot-bit.org Yes No
Mastercoin MSC 2013 J. R. Willett Yes
mastercoin.or
g
No No
Primecoin XPM 2013
Sunny King
(pseudonym)
Yes
primecoin.or
g
Yes No
32. No one knows everything,
everyone knows something,
all knowledge resides in nheutmwaonrkitsy..
Six degrees of
separation
- Milgram, 1967
Adapted from Lévy 1997
33. 105 emp
350+
Partners
43,900+
Community
members
15,000+
Customers in
130 countries
• Content management software, #1 in media industry
• 250,000 sites in 170 countries
• Customers: UN, FT, WSJ, Vogue, Hitachi, 3M, BMW
• 105 employees in 9 countries (US, Europe & Asia)
Teigland et al., 2014 forthcoming
34. eZ’s platform for building identity and
competence throughout its ecosystem
eZ Software
development team
35. Where have the traditional sources of
sustainable competitive advantage been?
FIRM
#1
Innovation
Networks of
relationships
Brand &
Reputation
Kaye 1993
36. T
Where are the sources today of
sustainable competitive advantage?
FIRM
#1
Innovation
Networks of
relationships
Brand &
Reputation
Teigland 2010
38. Threadless
A platform for global community collaboration
Est. $30 mln sales
30% profit margin in
commodity business
20 employees but a
24x7 global “workforce” of
2.4 million
No internal R&D or
sales & marketing
42. Innovation in automotive design/production
“Local Motors is the place for people to create
influential vehicles together.”
http://www.youtube.com/watch?v=azCRuwtE_n0
46. DIY 3D printing becoming more commonplace…
http://openfabpdx.com/fffiddle/
47. “Made in Africa” 3D printer (Togo)
crowdfunded through Ulele
Winner of International
Space Apps Challenge
http://www.engineering.com/3DPrinting/3DPrintingArticles/ArticleID/5712/E-Waste-3D-Printer-to-Mars.aspx
49. 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
50. What’s around the corner?
24x7 Global Internet Collaboration + Open Source + 3D Printing
$60,000
$150
Available for free
download on
http://mashable.com/2013/02/13/robohand/
Where is
the firm?
51. Leading into the third industrial revolution
Part I Background
Part II Collaborative Innovation
Part III The Sharing Economy
52. What is the Sharing Economy?
Range of services that facilitate peer-to-peer
transactions through the Internet
USD 335 billion by 2025 in top five sectors
https://www.youtube.com/watch?v=LWD-I5qPCfw
55. Global platform for local community collaboration
Launched June 2010
USD 17 bln valuation
43 countries globally
Uber
Limited physical assets
UberPop, Uber Rush, ??
59. Bitcoin – so much more than a “coin”
From dumb to smart money
Underlying Bitcoin protocol holds real
transformative power
Transfer property rights (e.g., shares,
certificates, digital money) fast,
transparent and very securely.
http://thenextweb.com/insider/2014/02/15/bitcoin-platform-currency/
60. 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
61. Thomas Jefferson (1816)
“Laws and institutions must go hand in hand
with the progress of the human mind.”
The problem is that the human mind itself
can’t keep pace with the advances that
computers are enabling.
http://wadhwa.com/2014/04/15/mit-technology-review-laws-and-ethics-cant-keep-pace-with-technology/
64. Institutions
Challenges to institutions?
Emergent Collective
E.g., Central Bank
~ Long-standing financial
institutions and regulations
vs
E.g., Bitcoin Community
~ Emergent collective of users across
globe connected through internet
Teigland, Yetis, Larsson, 2013
http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2263707
65. Increasing pressure due to variety of
new financial instruments
Forces for change
• Cryptocurrencies
• Community
currencies
• Crowdfunding
• Microfinance
• P2P lending
• Sharing
The
status
quo
Forces for stability
• Governments
• Central banks
• Multinational
financial actors
• Legal system
• Mindset
68. Internal corporate crowdfunding
iFundIT
More than 300 participants
Entry-level workers to VPs
Given $2,000 to invest over 8 week period
Choose internal projects in which to invest
70. Some questions…
What basic assumptions about value creation will
no longer hold?
What opportunities are there for your company
related to the future of money, collaborative
innovation, and the sharing economy?
What strategic challenges are there within the
nearest 2-3 years in connection with the future of
money, collaborative innovation, and the sharing
economy?
What will you do tomorrow at work as a result of
today’s discussion?
71. Exploitation
Improving existing
value creation
activities
Exploration
Developing new
value creation
activities
Adapted from March 1991
72. What’s around the corner?
24x7 Global Internet Collaboration + Open Source + 3D Printing
$60,000
$150
Available for free
download on
http://mashable.com/2013/02/13/robohand/
Where is
the firm?
73. Models of Knowledge Creation
The Firm
E.g., Microsoft
~ Built by employees within
organizational boundaries
vs The Collective
E.g., OpenSimulator
~ Built by users and distributed
freely regardless of affiliation
Teigland, Di Gangi, & Yetis 2012
74. Moving into the Third Industrial Revolution?
O’Driscoll 2009
75. From the mobility of goods
to the mobility of financial capital to …
Teigland, JVWR, 2010
...the “mobility” of labor?
76. 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: http://www.euroversity.eu/
78. Some things do not change
Innovation Exchange
Exchange Trust
Trust Relationships
Relationships Interaction
79. If you love knowledge,
set it free…
Robin Teigland
robin.teigland@hhs.se
www.knowledgenetworking.org
www.slideshare.net/eteigland
www.nordicworlds.net
@RobinTeigland
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