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Economics 2.0

Dion Hinchcliffe

Dion Hinchcliffe. Photo by Alex Dunne

Sometimes a single session at a conference sums up the good and bad points about an entire event—I had one of those times this morning. Quite appropriately given the theme for this conference, and given the current economic climate, Dion Hinchcliffe’s workshop was entitled “Highly Effective Strategies for Putting Your Business on a Recession Diet”. Hinchcliffe, according to his own bio, “is an internationally recognized business strategist and enterprise architect who works hands-on with clients in the Fortune 500, federal government, and Internet startup community”—whatever that somewhat immodest bio means in this pressure-cooker climate where even the doormen have job titles with a VP prefix (but don't get me wrong - Google Hinchcliffe and you'll see his credentials are sound).

Hinchcliffe pointed out the major shifts that we’ve seen in business over the past few years—value creation, control, transparency and intellectual property have all been subverted to a greater or lesser extent. We’re striving to make our products and services cheaper, better and more innovative. Standing in the way of these aims however are concerns around cost, disruption, risk, difficulty and dominant cultural norms – fundamentally most of these aren’t technological problems, rather they’re culturally based. In other words the usual benefit/barrier speech that evangelists drag out.

Given his livelihood depends on the “new paradigm” it’s not surprising that Hinchcliffe contended that economics 2.0 is a necessary thing if you want your business to survive in the years ahead—an understanding and extensive use of these tools must be core competencies he pronounced. The curmudgeon in me would ask whether Joe the plumber or Jill the electrician really need to (or should for that matter) spend their time doing this stuff. I totally agree that traditional business can find efficiencies by (for example) moving to online accounting, or internet banking or whatever—but I struggle with extending this to the plethora of business 2.0 products and services that exists. Those kind of thoughts however are just cause for corporal punishment here in Silicon Valley so I vainly tried to push that thought to the back of my mine!

Hinchcliffe used as an example a situation where a worker within an organisation he consulted to asked “why do I need to blog within my organisation, I have real work to do”—an understandable, if somewhat backwards viewpoint. Hinchcliffe’s answer was bullish on the value these tools bring saying that the employee “has stuff to do because he doesn’t blog”. The rationale for this viewpoint coming from the fact that the particular employee has personal knowledge about the way the organisation works, but that this knowledge is siloed and unable to be leveraged by others within the organisation. To a point I’d agree, but it doesn’t negate the fact that there is some baseline stuff that needs to be done and the addition of “new media tools” to these operations is nothing more than a productivity drain. As an analogy, if I have a drainlayer digging a trench down my drive I totally fail to see any business 2.0 tool that adds helps drive efficiencies to that activity.

Hinchcliffe dragged out a number of case studies—somewhat unfortunately the majority of them where in financial and banking organisations—again I’ll be accused of being a curmudgeon but are these not the same organisation who (almost) singlehandedly have brought global economies to their knees? And we should be following their example of how to drive innovation and efficiency? I think not …

Oh well, there’s free lunch, the architecture is fantastic and there’s always tonight’s parties to look forward to!