What is the collaborative economy? The collaborative economy or the platform economy is a practice driven by the internet and connectivity and built on the ability to collaborate (share resources, ideas and assets), through new business models. It begins to distribute trust and power, and enables once separate, isolated individuals and groups to co-create, meet, interact and share via online networks and peer-to-peer platforms. Companies like Airbnb, Uber, Trademe and Container Door are all examples of platform based businesses that create value collaboratively. Even traditional legacy businesses like Nike, Adobe, Ford are adopting principles of platforms and value co-creation.
According to Priti Ambani the collaborative /platform economy is based on principles that all individuals and companies can learn and grow from - its concept and applications are broad. She says this presents real opportunity for New Zealand. As a small and agile nation with a history of an inventive spirit, our country can take a role as a world leader to build applications that are truly inclusive and collaborative.
Sitting down with Priti Ambani, we discovered five key things we didn’t previously know about the collaborative economy and why companies around the country should be understanding and adopting these powerful principles.
1. The collaborative / platform economy has evolved
Priti says, “Over the last 5 years or more, we've heard the term ‘sharing economy’ many times as a precursor to the collaborative or platform based thinking. The term 'sharing economy' is a misnomer. What exists is an on-demand and access economy as opposed to the sharing economy. Sharing, in its true sense usually doesn't have a monetary component. If your "sharing" involves a monetary exchange, then it's a business.”
“What we are seeing instead is a practice to match needs and resources in more of a collaborative business model, or an access business model. When we come from here we can look at what we are doing, and how we can do it better, utilising the technology and resources through our entire company.” she says.
2. The collaborative economy mindset is a step towards digital inclusion - but we have a while to go.
Priti says, “The collaborative age gave rise to productivity online that resulted in networked crowds gaining opportunities to co-create, share, contribute online. Although this has enabled prosperity for many the benefits aren't even across society. It has led, in many cases, to digital inequality and uneven prosperity where technology companies and platform "owners" stand to gain the most out of the shared value created by crowds and collaboration. There is an opportunity to shift this balance and enable the collaborative economy to create shared prosperity and value for everyone. But this will require a rethink of how we share the value generated"
3. Collaboration can (and should!) begin internally
According to Priti, the mindset at the root of the collaborative economy is that the best ideas can come from anywhere, that resources can be shared, value can be created for everyone, and diverse stakeholder opinion and input simply makes better business sense. Adopting this mindset means adopting a more open, forward-thinking and success-oriented mindset, she says. Priti says the collaborative economy doesn’t just describe external-facing technology platforms such as Uber and Airbnb, but can also refer to internal stakeholders of a company. Collaboration is for everyone, she says.
“In fact, collaboration should be built into the ethos of a company and should start as an internal project. Most companies are looking to collaborate outside the company but aren’t looking at their own internal systems and processes. However, companies that actively collaborate within their organisation encourage ideas from all employees, and diversity of ideas means sharing process improvements, introducing new revenue models, and genuinely investing in innovation.”
“Cross-pollination, and diversity of ideas and opinions results in growth and innovation within a company,” Priti says.
4. The principles of the collaborative economy are not just for large businesses
As digital technologies fundamentally transform how we do business and what constitutes success, businesses need to be considering the importance of adopting a growth mindset, and the importance of bringing in new ideas, Priti says.
She says, “Larger New Zealand companies put a lot of importance on collaboration, but small to medium businesses tend to think it’s not for them - they think it’s too expensive, it’s a fad, or it’s diverting them from conducting business as usual. What they miss is that the fundamentals of the collaborative economy are crucial for business success.”
“As we are going through demographic shifts and changes in society, businesses need to attract the younger generation. Businesses need to be inherently open minded and forward thinking to be able to manage talent and attract the best talent, and find lasting success,” Priti says.
5. The platform / collaborative economy will become ubiquitous to business
“The collaborative economy is becoming the new norm. Even the term ‘the collaborative or sharing economy’ will become redundant because these practices will become integral to the way businesses operate. Collaborative value creation and all it entails will become the most common sense approach to doing business,” Priti says. The challenge will then be how to continue to incentivise networks and communities to continue to generate value in the digital age.
The collaborative and platform economy is one of the key topics we cover in our Master of Applied Practice - Technological Futures, with Priti Ambani and others as our key experts in this space. To find out more click here or get in touch to come in and see us in person - coffee or wine on us!
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