The last few days I’ve become increasingly obsessed with where the global economy is going and it’s effects on the labor pool. After days of contemplating the large number of variables I now believe that a leisure society is inevitable, short of global catastrophe. Futurist and optimists have been dreaming about it for years, but I think we are likely to see it in our lifetimes, regardless of how bankrupt governments and social programs become in the interim.
One undeniable trend that almost every business guru agrees on, is that companies will have to become increasingly accountable and transparent to their investors and more responsive to their customers if they want to survive. As the power of the network grows, making it possible for more real-time information of a companies operations, the Board of Directors and the CEO are going to increasingly become accountable to investors and customers until they are almost superfluous in the organization. The current juggernaut of centralized and corporate behemoths, obscene executive salaries, and hierarchical organizations cannot withstand the power of the network much longer. I think the massive swindling is happening in part because of fear of their inevitable demise.
HERE IS HOW
Imagine you have two publicly traded companies that are both competing in the same sector.
One of these companies is completely transparent throughout the entire enterprise – finances, hiring/firing, supply-chain, everything is open for review. One possible way to visualize this is to imagine a sophisticated 2D/3D real-time interactive animation display of every area of the companies operations. You could tell exactly how many people are working where, who is being hired, fired, expenditures for everything from trash bags in the company lunch room, to how much is being spent on advertising. All of it will be completely displayed in dynamical real-time techni-color graphics. The second company is just like most any company now doing business as usual (circa 2003).
In this competitive environment, the first company will be far more likely to attract investors than the second, but more importantly the first company’s functioning will be so transparent to the people running it that clear communication and knowledge will available to everyone, even the customers and investors. Such a company will make it very easy for anyone to communicate, ideas to be exchanged across company lines, problem areas to be easily identified and resolved. The level of innovation and efficiency, not to mention the very attractive capital inflow from investor confidence, will easily out compete a company more worried about keeping things secret – regardless of whether its their books or intellectual property.
With the proliferation of RFID, good or bad, it will enable everyone, you and me to identify every product that we buy and automatically, and in real-time shopping mode, purchase only those products that come from companies who adhere to our ethical/corruption index, details of which I have blogged about earlier:
These types of measurements would be made via decentralized, ad-hoc, smart mobs in conjunction with individual reputation systems. So, not only will you be able to vote with your pocketbook, but also you will be able to make informed, even ethical consumer decisions based on people you trust. I can see this web-of-trust rapidly superceding top-heavy “consumer” capitalism, transforming it into a bottom-up grass-roots participatory capitalism.
As time goes on, and it won’t take long in this nanosecond, increasingly automated and accelerated economy for this ecology of transparent companies to fine tune the very essence of what a company/economy does. By definition the economy itself will become utterly response to investors and customers who increasingly become the same person. These so-called ad-hoc transient companies will increasingly blur the line between one company and another, employees and investors, customers and executives, that such distinction will become meaningless. No longer will we have distinct “solid” and separate companies and consumers, but an evolving complex decentralized ad-hoc network of capital, people, ideas, innovation and wealth responding in real-time to the people it serves. It will mark the end of the corporation as we know it and the beginning of a truly support economy.
These responsive, transparent companies will become the economic and wealth producing engines that take all of us participants, along with their increasing automation into a full-time leisure economy. Already we are seeing massive outflow of labor to India and elsewhere. This unfortunately is the result of the power of the network. However, it’s only a matter of time before even the cheapest of labor will no longer be necessary. More and more of the economic engine will become automated. It’s inevitable, always has been. Initially such displacement could be very painful for a large number of people. However, these transparent companies won’t survive if they are not responding to it’s customer base. And without customers the company itself doesn’t survive. So it will continue to make products cheaper and cheaper, continually improving the ease of investment, making it increasingly easier to move your money where its most needed and where it will provide the largest return. Everyone will be making less money from lack of employment and things getting cheaper, but everything will be getting cheaper at the same rate. So my theory is this time, this inevitable global depression will result in a leisure economy for everyone.
Oh, and green companies will out compete polluting companies, simply because they are more efficient. Such distinctions are not sensitive enough yet to tip the scale, but the real-time transparent economy will make every last shred of efficiency matter. End result, green and environmentally friendly companies win out.