Our featured author this month is Don Tapscott, author of more than 20 books including, “Macrowikinomics – Rebooting Business and the World.” In demand around the world for his insights into innovation, Don talks about how emerging trends are changing the competitive landscape for small businesses everywhere.
Thanks to the rise of the internet and the accompanying digital tools, never before has it been easier to start a business. Collaborative web technologies enable individuals and small businesses to harness world-class capabilities, access markets, and serve customers in ways that only large corporations could in the past. Small and medium size enterprises, for example, can make and sell products to a global market without having to manufacture anything themselves.
One study found that the availability of open source software, cloud computing, and the rise of virtual office infrastructure has driven the cost of launching an internet venture down from $5,000,000 in 1997, to $500,000 in 2002, to only $50,000 in 2008. In the United States in 2007 (the last year that data was available) 8 million out of the 12 million new jobs were created by startups less than five years old.
As more small firms exploit the Web for new resources, they can gain unprecedented access to global markets previously enjoyed by only the largest corporations-- without the main liabilities; bureaucracy, legacy cultures, systems and old ways of working – all of which can impede innovation. And as small companies expand, they create new jobs at a faster rate than their larger competitors.
The overlying message is that the monolithic, self-contained, inwardly focused enterprise is dead or dying. For years, companies pursued acquisitions, alliances, joint ventures, and selective outsourcing in the quest to build top and bottom line growth. But in today’s economy these conventional tools are simply too rigid, and not scalable enough, to drive growth and innovation at a level that will make companies truly competitive. Successful companies today have open and porous boundaries and compete by reaching outside their walls to harness external knowledge, resources, and capabilities. They’re like a hub for innovation and a magnet for uniquely qualified minds. They focus their internal staff on value integration and orchestration and treat the world as their R&D department. All of this adds up to a new kind of collaborative enterprise—one that is constantly shaping and reshaping clusters of knowledge and capability to compete on a global basis.
Get news from Verizon about small business services and market trends that affect your bottom line. Here, you'll find tips and commentary from the Verizon small business group and other experts to help keep your business growing.