Presentation: Transcending commoditization in professional services
On December 5 I am giving a “View from the Top” online presentation to US and European members of the Association of Executive Search Consultants on Developing Knowledge-Based Client Relationships:The Key to Avoiding Commoditization.
There is no question that commoditization is one of the most powerful driving forces in the global economy. While this has been starkly obvious in product markets such as textiles and manufactured goods, commoditization is also fundamentally shaping professional service industries.
If clients believe that professional firms are replaceable, then they are commodities. Even if firms boast top talent and long-standing relationships, it is self-deception if you believe no-one else can do the work. The ‘black-box’ style of professonal services that relies purely on expertise is dated, and encourages clients to shop around. Ultimately the only thing that cannot be replicated and commoditized is a deep, collaborative, “knowledge-based” relationship. The field of competition for professional firms is increasingly the ability to build these high levels of engagement with their clients. This requires, among other capabilities, building effective networks to deliver value to their clients.
The slides for the AESC session are below (as usual, do not expect these to make complete sense without my accompanying presentation):
For more detail you can download chapters from Developing Knowledge-Based Client Relationships: Chapter 1 on the big picture of professional services and knowledge-based relationships, and Chapter 6 on implementing key client programs.
The acceleration of open business: 2007 is the turning point
In my 2002 book Living Networks I wrote about the gradual shift to open accepted standards. Earlier this year, in the context of the social network battles, I wrote Is the trend to openness accelerating? Social networks as an inflection point.
I think we can now safely say that the trend to open business is inexorable, and that in hindsight, we are quite likely to point to 2007 as the turning point.
The latest is the extraordinary news that Verizon Wireless will introduce an “Any Apps, Any Device” option for its customers in 2008, allowing them to use any phone runnning any application. There are sceptics, but because there is the real potential to attract new customers and thsu create competitive advantage, this massive step is likely to create followers, shifting the industry.
Let’s review just a few of the other steps towards open business in the last six months:
May:
Facebook opens its developer platform
September:
New York Times online goes open
October:
Google launches Open Social
Path 101 established a ‘naked start-up’
November:
Google launches Open Handset Alliance
Murdoch says he will open up access to Wall Street Journal Online
Verizon Wireless announces open access
The attack of the killer online clones: how to keep ahead
The availability of online services exchanges has been changing the nature of the online development business for a couple of years. Over two years ago in a blog post titled The rise of online services exchanges I described how sites such as elance.com, guru.com, rentacoder.com, and getafreelancer.com were globalizing services and tech development, and rapidly commoditizing fees to get work done.
Today Techcrunch has written about someone in Turkey who is asking on getafreelancer.com for a clone of Tangler.com, and is willing to pay $1500 for it. In an interesting coincidence, I caught up with Martin Wells, CEO of Tangler, at an event at Stanford University on Thursday evening, and we were talking about the online service exchanges, though more with a bent to getting work done.
Daniel on DRM finds other people looking for clones of Digg, eBay, Twitter and other leading online sites. I’m surprised that this is seen as noteworthy. None of this is new. Well over a year ago I saw over a dozen requests for Digg clones on Rentacoder. Has this resulted in the demise of Digg? Hardly. There are a few factors at play here.
The first is what the commentators today have focused on: the bidders are rather unlikely to create a worthwhile clone of these online sites for what they are getting paid. It shouldn’t be too hard to emulate a fairly simple site like Digg, though the rich functionality of Tangler is a bit more of a handful. Certainly you can’t expect robust, quality code at this kind of price.
Launching the Future of Media Participant Blog
As we did last year, activity on the Future Exploration Network blog will largely shift to the Future of Media Summit blog for the next couple of months.
The Future of Media Summit participant blog will be a forum for speakers, partners, and attendees at the Future of Media Summit 2007 to discuss the issues covered at the Summit before, during, and after the event. When you register for the event you will be given a login and instructions to post on this blog.
Last year we only launched the participant blog for the Future of Media Summit 2006 at the time when the actual event kicked off, so we garnered a range of comments during the event itself, then a very healthy and extremely interesting discussion between the event participants in the month after the event.
This year we’d like to build an conversation beginning before the event, and extending far beyond, so we will continue with the same Future of Media Summit blog for Summits in subsequent years, rather than create a new blog each year.
Look forward to hearing from you on the Future of Media Summit blog – please participate!
Launching the Web 2.0 Framework
Alongside our corporate strategy consulting and research work in the media and technology space, Future Exploration Network has created a Web 2.0 Framework to share openly. Click here or on any of the images below to download the Framework as a pdf (713KB).
The intention of the Web 2.0 Framework is to provide a clear, concise view of the nature of Web 2.0, particularly for senior executives or other non-technical people who are trying to grasp the scope of Web 2.0, and the implications and opportunities for their organizations.
There are three key parts to the Web 2.0 Framework, as shown below:
Web 2.0 Framework
* Web 2.0 is founded on seven key Characteristics: Participation, Standards, Decentralization, Openness, Modularity, User Control, and Identity.
* Web 2.0 is expressed in two key Domains: the Open web, and the Enterprise.
* The heart of Web 2.0 is how it converts Inputs (User Generated Content, Opinions, Applications), through a series of Mechanisms (Technologies, Recombination, Collaborative Filtering, Structures, Syndication) to Emergent Outcomes that are of value to the entire community.
Web 2.0 Definitions
* We define the Web 2.0 Characteristics, Domains, and Technologies referred to in the Framework.
* Ten definitions for Web 2.0 are provided, including the one I use to pull together the ideas in the Framework: “Distributed technologies built to integrate, that collectively transform mass participation into valuable emergent outcomes.”
Web 2.0 Landscape
* Sixty two prominent Web 2.0 companies and applications are mapped out across two major dimensions: Content Sharing to Recommendations/ Filtering; and Web Application to Social Network. The four spaces that emerge at the junctions of these dimensions are Widget/ component; Rating/ tagging; Aggregation/ Recombination; and Collaborative filtering. Collectively these cover the primary landscape of Web 2.0.
As with all our frameworks, the Web 2.0 Framework is released on a Creative Commons license, which allows anyone to use it and build on it as they please, as long as there is attribution with a link to this blog post and/ or Future Exploration Network. The framework is intended to be a stimulus to conversation and further thinking, so if you disagree on any aspect, or think you can improve on it, please take what is useful, leave the rest, and create something better.
In the Framework document we also mention our forthcoming Future of Media Summit 2007, which will be held simultaneously in Sydney and San Francisco this July 18/17. In the same spirit as this Web 2.0 Framework, we will be releasing substantial research, framework, and other content on the Future of Media in the lead-up to our event, continuing the tradition from the Future of Media Strategic Framework and Future of Media Report 2006 that we released last year. Hope this is all useful!
Five global trends for 2007
In the February issue of Voyeur, the inflight magazine of Virgin Blue, I was interviewed for an article about the major trends of 2007. The article is below – as usual allow for journalistic interpretation in the quotations…
FUTURE FOCUS
Ross Dawson is the founder and chairman of Future Exploration Network – an innovative company that helps multinational organisations understand the future technological and social changes that will affect the way they do business. Here Dawson lets us in on the top five trends that will shape our 2007.
1. Web 2.0 revolution
“What we’ve seen in the past five years is a whole new phase of the internet. One of the most important principles of this is participation – everyone can easily set up blogs, upload videos and create music and podcasts. For the first time we are not just consumers but are enabled to become creators, so we have this doubling of media space leading to a world of infinite content, of infinite entertainment.”
Announcing Future of Media Summit 2007!
Future of Media Summit 2007 is on the way! Echoing what we did in a world-first at the Future of Media Summit 2006, the conference will be held simultaneously in Sydney on the morning of 18 July and San Francisco on the evening of 17 July, linking cross-continental panels and discussion by videoconference.
The partnership document which describes the event is available below. As last time, we’re looking for partners and sponsors to help bring this fun event to the world. Let us know if you want to chat about this.
Click here to see the Future of Media Summit 2007 Partnership document
More details will be available shortly – keep posted! In particular, we will soon start to release some of the content which will be at the heart of the event – and we’re always seeking partners for creating extraordinary content about the future of media. For now, here are some excerpts from the document (excuse the corporate-speak…):
Blogs, media, parasitism, and symbiosis
This issue has been discussed before and I’ve written about it several times, though it doesn’t seem to go away. Robert Niles, editor of Online Journalism Review, has written a very interesting post titled Are blogs a ‘parasitic’ medium? He notes :
Over the past months, I’ve heard several journalists make the same comment at various industry forums: That blogs are a “parasitic” medium that wouldn’t be able to exist without the reporting done at newspapers.
Back in April 2006 I wrote a blog post on The symbiosis of mainstream media and blogs, in which I quoted from the Financial Times and commented on this idea of parasitism:
“The present round of chiselling may feel exciting and radically new – but blogging in the US is not reflective of the kind of deep social and political change that lay behind the alternative press in the 1960s. Instead, its dependency on old media for its material brings to mind Swift’s fleas sucking upon other fleas “ad infinitum”: somewhere there has to be a host for feeding to begin. That blogs will one day rule the media world is a triumph of optimism over parasitism.”
Cute metaphor. Yet symbiosis is far more apt than parasitism. Mainstream media in its online form largely gets attention through blogs. Blogs add immense value to the original articles, by identiyfing what’s important, pointing out flaws, adding other perspectives, making visible to all the conversations that stem from media pieces. Blogs depend on mainstream media, with its resources and editorial capabilities, for sure. Yet media is increasingly dependent on blogging for the direction of attention and layer of value-add created.
I later wrote about the collaborative space of blogs and newspapers, discussing how Technorati enables blog commentary on newspaper articles to be visible when you read the original article:
Newspapers and other mainstream media are still the primary reference points for what’s happening in the world, and the first pass of editorial commentary on that. Yet mainstream media increasingly feeds off the dialogue and news that surfaces in the blogosphere. News sites are also vastly enhanced by having the conversations that stem from their articles being visible to all. Anyone who wants to comment on a media story can have their thoughts available to readers globally, not just on a single site, but through an entire world of syndicated media.
In the Future of Media Strategic Framework, the central feature is the Symbiosis of Mainstream and Social Media, as illustrated by the circular flow of the cycle of media (click through for anthe downloadable diagram and explanation of symbiosis):
Robert uses a diverse range of interesting quotes to unpack the idea that blogs are parasitic. Ultimately, the most important reason that this is nonsense is that blogs are collectively a mechanism for us to discover what we as a society (or subset of it) find interesting and useful. Even if there were no useful content in blogs (which of course is also nonsense), their collective function of collaborative filtering is an extraordinary bound forward for the world of media.
Dan Gillmor also notes:
For the record, there are at least a dozen bloggers whose coverage of topics I care about do a considerably better job than any journalist working for a traditional media company.
while Howard Owen comments:
The best way to understand blogging is to blog. That’s why I say: All journalists should blog. You can’t get modern media without understanding blogs, and you can’t understand blogs unless you do it.
Innovation Timeline 1900 – 2050: what we might invent in the next few decades
Following the big success of the Trend Blend 2007+ trend map, Future Exploration Network partner organization Nowandnext.com has followed up with an Innovation Timeline 1900-2050. It represents visually (and as usual somewhat tongue in cheek) the development of innovation from 1900, starting with the tape recorder, safety razor, tabloid newspaper, aeroplane and cornflakes, and flowing up to 2050, before when we may see such fun, delightful, and useful things as baby exchanges, compulsory biometric ID, sleep surrogates, VR enhancing drugs, face recognition doors, robotic pest control, prison countries, 3D fax, gravity tube, self-repairing roads, reputation trading, individual pollution credits, digital mirrors, stress control clothing, and far, far more. Have a look and play with the ideas. It will be interesting to see whether this gets as much traction as the Trend Blend 2007+ trend map.
Click here to download the full Innovation Timeline 1900 – 2050 (pdf).
Also see Richard Watson’s blog post on this.
