21st Century economics: No straight Lines

March 6th, 2010

Umar Haque is not a shy retiring wall flower and his recent post confirms that observation – but I don’t disagree with his perspective either.

And this is because in Technological Revolutions and Financial Capital Perez writes, about technologies cluster and ultimately create a surge of change, this is what Haque is alluding to,

A technological revolution can be defined as a powerful and highly visible cluster of new and dynamic technologies, products and industries, capable of bringing about an upheaval in the whole fabric of the economy and propelling a longer-term upsurge of development. It is a strongly interrelated constellation of technical innovations, generally including an important all-pervasive low cost input.

A great surge of development is defined here as the process by which a technological revolution and paradigm propagate across the economy, leading to structural changes in production, distribution, communication and consumption as well as to profound and qualitative changes in society.

And that is exactly whatt is happening. I think Haque’s findings are sound – and make sense. I agree that a No Straight Line approach to what we make, how we make it and who we make it with is; different, better, faster, more human, more sustainable, less costly than the heavy process silo approach to business that has dominate our world for the last 150 years of so. I explored these ideas at MIT (podcast) a few years back and with Nokia (video) and more recently at The Do Lectures.

But I also think this point of view is important, as expressed by William Powers and Perez,

New technologies do not come out of nowhere, they are human inventions in the first place and they succeed or not to the extent that they met fundamental human needs. So it is no accident that all of what we define as 2.0 is centered around, as Howard Rheningold says, human talents for cooperation. Not something that legacy industrial and media companies want to hear. The nature in this context is different, its multifaceted and blended. Where reputation, identity, “I” Needs “We”, craftsmanship, commerce etc., becomes the fuzzy logic so hated by bean counters and straight line thinkers.

Local Motors, TxtEagle and Grow VC (examples here) are also examples of the re-engineering of business that a No Straight Line approach can deliver. So what happens when push economics becomes pull and networked economics, a report by the Aspen Institute, put together by David Bollier got my neurons humming in 2006.

Indeed as Jay Burton Rogers, founder of Local Motors says,

You cant be nimble if you tool big!!

Time to Reboot. We are today, as social philosopher Richard Sennett argues; seeking too recover something of the spirit of the Enlightenment on terms appropriate to our time. Indeed, Stephen Heppell considers the 21st century to herald the ‘learning age’. In the 20th century, he argues, we built big things (railways, universities) but the focus for the 21st century is ‘helping people to help each other’. In his view, “The old stuff won’t do any more”. And the sooner management wakes up to that fact, the better.

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