The disruption caused by hyperconnectivity is far-reaching and growing. Every industry imaginable has been affected. Retailers like Nike have transformed their business model from a clothing manufacturer into a lifestyle advisor. Netflix, Amazon, and Apple iTunes have found a way to change how consumers entertain themselves through media, music, and publishing. Simply put, the networked economy is forcing businesses of all sectors and sizes to expand well beyond their traditional activities.
During the World Economic Forum, attendees will work together to develop the necessary insights, ideas, and partnerships to respond to global complexity, fragility, and uncertainty that are shaping the future of business everywhere. In particular, the four-day event will encourage exploration, discussion, and even debates on these four main aspects of globalization:
- Crisis and cooperation. In a world of decentralized globalism, a new approach is needed to deliver the proper level of cooperation to address issues such as climate governance, cybersecurity, and international trade and investment.
- Growth and stability. With economic growth comes new expansionary monetary policies – especially after a financial crisis. Although greater governance protects economies from falling apart, post-crisis economies still need to be dynamic, inclusive, and resilient.
- Innovation and industry. Technological, demographic, and economic forces are profoundly transforming industries and markets globally. From the sharing economy to The Internet of Things, businesses need to make sure these industry disruptions do not disrupt their operations.
- Society and security. Uncertainty breeds a vicious cycle of distrust, polarization, and unrest. For economies to advance and grow, establishing new ways of responding to changing demands –without risking social cohesion – is clearly the new mandate.
In my view, the Networked Economy plays a key role in each of these global areas of concern. It can help optimize capital, time, and assets while reducing waste and enhancing transparency to answer the call for social responsibility and driving agility and predictability to help ensure growth and stability. However, don’t expect technology to work miracles. The real challenge is changing the business culture and work habits to seize these opportunities.
How this evolution develops depends on business leaders. They can choose to fight these changes and allow the networked economy disrupt business operations. Or, they can embrace the Networked Economy and its potential to help their employees work the way they work best.
Here are three ways the Networked Economy is transforming the Future of Work. Are you ready?
1. The employee-employer relationship is evolving
From mobile apps and cloud solutions to social media and machine-to-machine (M2M) communication, people and organizations are linked in more ways than ever before. Employees across all generations are becoming more at home in highly connected, collaborative spaces underlying the Networked Economy. In fact, they are thriving.
According to the latest “Workforce 2020” research from Oxford Economics, sponsored by SAP, businesses must embrace the whole idea of changing the employee-employer relationship to attract and leverage the best employees. No longer will bonuses, training, and family benefits alone fully incent employees. Rather, employees demand the opportunity and freedom to put their talents, expertise, and interests to the best possible use in a manner that can be integrated into their daily lives.
2. Hidden capacity is easier to find
Whenever there’s a question of capacity, some businesses normally jump to the traditional solution of hiring more workers, buying more infrastructure, or finding more suppliers. However, the Networked Economy is forcing business leaders to look inward first to find hidden capacity.
For example, we see an increasing number of manufacturing operations that are embracing the concept of Industry 4.0 – a complete integration of business operations with production systems and plant equipment. By incorporating sensors throughout the production process, operators can capture a steady stream of data to analyze their plant’s current operational status. As a result, plant managers predict the likelihood of equipment failure and identify parts that might need to be replaced. And for the rest of the business, this means reduced costs and production process that are aligned with end-to-end business processes.
3. Contingents play a more significant role
Contingent workers available at a moment’s notice are reshaping the nature of work and the structure of career development. This shift is reflected in society’s increasing ability to collaborate with each other – even if everyone is dispersed across the world in cities, remote locales, and everywhere else in between.
In a recent interview, Vivek Bapat, SAP global vice president for portfolio and strategic marketing, stated, “Work is no longer a place, but an activity. This notion that you need to live near where you work may no longer apply. Companies are increasingly able to source knowledge from anywhere that it might happen to be and at any time.”
When you consider how long it takes to fill vacated positions, this trend isn’t really all that shocking. The world goes on, and businesses must find a way to fill that skill gap now.
The Networked Economy is the engine that is powering the Future of Work. Every day, we socialize, engage, and share on the Internet. As a society, we are mobile, social, always on, and continually connected. Our lives are no longer defined by our job titles and our immediate community. Whether you’re a janitor in Des Moines or the head of a major corporations in Hong Kong, we can all participate in a global community that gives us the ability to inspire progress that leads to better business outcomes, solves greater challenges, and, ultimately, creates a better quality of life.
Explore how leaders can strengthen their situational awareness and contextual intelligence. Join us at the World Economic Forum on January 21 – 24, 2015.