Macrowikinomics presents lessons for the world of nonprofit organizations, education, government, interpersonal relationships, communication, media, and commerce. It's a must-read -- a thought-provoking book that will convince you that the world we live in has already shifted and that we've all reached the point of no return: we live in a WikiWorld and we all must become WikiCitizens, WikiBusinessPeople, and WikiCollaborators. You'll also come away with ideas for how to embrace this massive shift and make it work for you and your business.
Design + Develop + Distribute: Now Unmarried for Market Leadership
In the history of capitalism and commerce, nothing has been more fundamental than the notion that the best path for businesses to achieve competitive advantage was to come to market with better widgets: designed by the company team, developed by the company team, and distributed by the company team. In that universe companies created and marketed widgets that became popular, and companies achieved market domination through broad distribution. Greater ideas were a secret weapon, and history proved that Ford's model T, Sears' catalog, IKEA's furniture, Bayer's aspirin and Apple's iPod -- all concepts that traded in the currency of developing, owning, and protecting better and proprietary products -- would be the blueprints for business success for more than a century.
Enter Don Tapscott and Anthony D. Williams, authors of Macrowikinomics, and get ready to flip your fundamentals off-center. Be prepared to rethink your assumptions, completely, and take a closer look at your business strategy. Read this book -- right away -- and then go for a very long walk to think about how your company needs to refocus its game plan for achieving competitive advantage. Tapscott and Williams make the case that we're all moving forward into a world where crowd-sourcing, instantaneous global connectivity and collaboration, data transparency, and a general shift toward democratization of what was once proprietary ownership of ideas is about to replace individual invention as the secret sauce that will lead to competitive advantage. In other words, the world has already become a WikiWorld, and we have to equip ourselves to play by a new set of rules.
In a nutshell, Macrowikinomics presents the fascinating history of the forces that led to Wikipedia (a huge encyclopedia of information populated by volunteers around the world), Linux (an open-source software community), Procter and Gamble's "Connect & Develop" initiative, Novartis' open publication of their diabetes studies, Galaxy Zoo's 75 million astronomical classifications populated by volunteers, Napster's music engine, the X Prize (where contests spur the competitive spirit for invention of unmanned vehicles and other innovations), and InnoCentive (a company that crowdsources ideas to create a "many minds" approach to product development). These forces began as tiny waves in the sea of commerce, where a decision to relinquish complete control and ownership of an idea in favor of a community of input, refinement, and development led -- in subtle and not-so-subtle ways -- to an openness in the sharing of data, substantially greater degrees of transparency, a major expansion in the reach of research and development efforts, community-designed products, and ultimately the creation of a new rulebook for business leadership.
Macrowikinomics begs the question, "If community is involved in reviewing, creating, designing, and contributing to the invention and distribution of widgets, what are the respective roles of the company, the entrepreneur, and the corporation?"
Early Wiki Signs Snowballed into a Seismic Shift in Collaborative Muscle
Looking back on the world of commerce, Tapscott and Williams point to a couple of seminal events that set the forces in motion for what has now become a Macrowikinomic world. First, Wikipedia itself. Taking its name from the Hawaiian word for "fast" (wiki), Wikipedia invited individuals who were experts on a given topic to post in an online encyclopedia and open the entry up for anyone in the world to revise and improve the entry, creating a repository of 17 million articles, all written in a style that attacks the old notion that the relative value of a handful of encyclopedia writers and editors trumps the collective wisdom as creating the superior encyclopedia of knowledge. In fact, the crowd won -- giving us better content, more global reach, instantaneous peer review -- and the new rules for the power of collaborative creation were set in motion.
The Tapscott-Williams team also points to forces like Linux, an open-source software community, where code was not hoarded and protected, as was the case in traditional information technology models. They address a fundamental set of new issues about who will thrive and who will die in this new Wiki world order:
"(Linux) continues to raise a number of important questions...If thousands of people can collaborate to create an operating system or an encyclopedia, what's next? Which industries and which aspects of society might be vulnerable to mass collaboration and which organizations might be positioned to benefit? Should smart managers try to bury the phenomenon, the way the music industry has tried to quash file sharing? Or can they learn to exploit the creative talents that lie outside their boundaries, the way technology giants like IBM, Google, and others have harnessed open-source software?" (Tapscott and Williams, Macrowikinomics (New York: Portfolio Hardcover, 2010), 69.
In 2006, Jeff Howe published the article, "The Rise of Crowdsourcing", in Wired Magazine, and laid the groundwork for a new business dynamic where crowds replaced individuals as the primary business innovators and accelerators of commerce. The subtle shift from "outsourcing" -- where companies engage many people outside their company to extend their internal workforce -- to "crowdsourcing" -- where individuals who were not specifically employed to work on the problem still contributed to the solution -- chiseled away at yet another assumption about how to achieve the best business result. If the central core of a corporation relinquished control over how a new widget was created and distributed, what would evolve as the new role (and value) of the corporation?
Tapscott and Williams take us on a journey to answer that question, by tracing the roots of "Connect and Develop," the 2005 initiative declared by CEO A.G. Lafley as Procter & Gamble's radical new approach to research and development. Through that hallmark program, P&G wagered a bet that fifty percent of its new products would come from outside their hallowed R&D chambers by the year 2010. Lafley placed Procter and Gamble's stake in the ground in favor of the power of 1.8 million potential sources of crowdsourced new inventions and against its internal R&D team's ability to achieve the same level of competitive innovation. According to Macrowikinomics' analysis, this corporate crossing of the Rubicon foreshadowed lessons for all of us in the world of business:
". . . [P&G] needed to think very differently about innovation. Rather than invent everything in-‐house, no matter what the cost or effort involved, P&G could scour the globe for proven products and technologies that it could improve, scale up, and market, either on its own or with its business web. And rather than try to employ a vast multitude of researchers full-‐time. . .it could seek to leverage other people's talents, ideas, and assets quickly and move on." (Tapscott and Williams, 73.)
With this one declaration, P&G squeezed the "tube of toothpaste" that was business differentiation and created an environment where the idea itself need not be created by the corporation anymore, but by the Wikiworld. And the value in the equation squeezed away from the corporation as the sole idea generator to the corporation as master leverage king of the ideas of many.
Macrowikinomics takes the reader on a journey that connects the dots from the world of Citizen Kane, where control was central to media dominance, to the world of the Huffington Post, where 150 paid staff members serve as a central clearinghouse for two million contributions per month, many contributed by 12,000 "citizen journalists." With example after example of Wiki-‐style collaboration and contribution, this book makes the case for "new fundamentals," where the power and pull of invention is shared by many and business leaders need to learn to tap into the wisdom of the crowds to invent, discover, weigh in on, collaborate on, and virally spread ideas for commerce in the future.
No Turning Back: Citizen Journalists Have Dethroned Citizen Kane
Whether or not all business leaders embrace the signs of the Wiki fundamentals the way that Procter & Gamble have, Macrowikinomics offers us all a new set of organizing principles for what it will take to achieve competitive advantage in the future:
- Mass collaboration and mass competition are here to stay. The XPrize will continue to spur new solutions to problems and InnoCentive will lead to other companies that facilitate mass contribution to commercial challenges.
- Business leaders need to put their own internal research and development efforts up against a crowdsourced marketplace's capabilities. A product manager can use social media for input on innovations to magnify their market research, and a CEO can reach out to a global market for input on best practices.
- Heads of companies used to trading in the currency of "trade secrets" as their killer app will have to confront the inevitable power of transparency and reflect on how to maintain competitive advantage if part of the platform is open to many (like the apps on the iPad--apps developers make money and so does Apple). 4. The genie is out of the bottle and there's no turning back. Music studios will never own the music industry again: citizen journalists have dethroned Citizen Kane.
Conclusion: Tapscott and Williams Have Analyzed Today's Wiki Realities from a Compelling, New Vantage Point
Macrowikinomics provokes divergent reactions. For example, according to the book, everyone in business will be under the scrutiny of many eyes around the globe based on the immediacy of information exchange. At the same time, business leaders can use that same speed of exchange and global reach to fuel their competitive advantage.
No matter what way readers react to Macrowikinomics, they will be compelled to rethink the fundamentals of what puts their businesses at the top of the heap, and to invent a dynamic way to incorporate the power of the Wiki into their corporate vision.
Tapscott and Williams have read the tea leaves. They've built on their original observations from their 2007 bestseller, Wikinomics, and provided a context for all of us to interpret and apply the future that is now upon us. They've nailed the notion that MacroWiki principles like collaborative innovation are "killing the old-hardwired 'plan and push' mentality taught in business schools." (Tapscott and Williams, 25). Tapscott and Williams have even applied the lessons to the creation of their own book, citing the contributions of nGenera's far-reaching research community as well as hundreds of content reviewers and an online challenge that led to the name of the book itself.
These authors and business wisemen have set the wheels in motion for the next frontier in business where intellectual property goes from king to knave, and the value of a company, an entrepreneurial enterprise, or even a large corporation shifts from "we invented it" to "we discovered it, distributed it, and tapped into the consumer needs," more powerfully than the other guys did.
Read the book. Then, rethink the next decade of your business.