Introduction to Key Terms: Business Model, Business Ecosystem, and Transactions

During the course of the two grants mentioned in my introductory post, our project team convened numerous “stakeholder sessions” across Northeast Ohio in an effort to encourage participants to generate business ideas and use the tools we offered to build them into business cases. In a pattern that repeated itself several times, attendees would have exciting ideas for businesses that played into their skills and captivated their interest in the session, but died along with the conversations after the meetings were over.

A likely reason for the high drop-off is the result of having given thoughtful consideration to the question, “How can I make a profit with my idea?” Or another way to ask the question is “How can I sell the value I deliver for a price that covers the expense I incur for delivering that value and have extra left over as a reward for me taking the risk and succeeding? The answer to that question is a business model. And if I can’t come up with a business model that fits with my idea, then I can’t make a case for it. Simple.

How could so many innovative and compelling ideas raised during the stakeholder sessions not find compatible business models to see them through to start-up? No doubt, there are several contributing factors to this outcome, not the least, of which, is that many of the ideas, which sounded good when first given voice, just didn’t pass muster under closer scrutiny. But what we also found is that how wide the net a person casts to vet an idea with others defines in large degree whether the idea continues toward fruition or dies on the vine.

In effect, almost any idea has the potential to connect with a social network of the countless, nameless many who represent all walks of life and all manner of means, and garner sufficient support to forge the idea into a full-fledged business. It is an application of Barry Commoner’s First Law of Ecology— “Everything is connected to everything else”— to commerce. The result is a business ecosystem.

From this perspective, a business ecosystem encompasses and interconnects all resources and assets as well as all participants be they customers, owners, employees, investors, suppliers, advocates, etc. Given this, how one draws the boundaries for a business ecosystem, defines who participates, and then positions an idea into it, influences the development of viable business models. The more expansive and inclusive the business ecosystem, the more options there are for a serviceable business model to ensue.

This raises the question, “Why do the qualities of expansiveness and inclusiveness contribute to more clarity rather than more chaos?” We found that, as in a natural ecosystem, the business counterpart thrives on an abundance of flows. Only instead of water, air, nutrients, etc., the flows in commerce consist of inputs, outputs, information, and know-how. And when these flows converge at specific points in time and space, an exchange of value, or transaction, occurs using an agreed to medium of exchange.

A business model organizes transactions so that “I sell the value I deliver for a price that covers the expense I incur for delivering that value and have extra left over as a reward for me taking the risk and succeeding.” More participants, more flows, more mediums of exchange, more value generated in a business ecosystem drive more transactions and, with them, greater odds that a business model will surface that develops a worthy idea into a successful business.

With these three terms as tags, look for future postings related to them that appeal to our grant experiences…

Originally posted to Sustainable Local Economic Development by Steve Bosserman on Monday, August 6, 2012

Business Model Development within a Local Economy

A business model illustrates how an organization or combination of interdependent organizations sustains itself based on certain output metrics.

Furthermore, a business model addresses the basic question of concern by anyone starting or expanding an organization: Is the amount people will pay for the perceived value of the products and services delivered by this organization sufficient to cover its operational expenses and sustain it?

Consideration of this question begins with the posting, Business Models for a Local Economy, which outlined five key characteristics of business models for a local economy. In summary, these are as follows:

  • Universal participation by community members
  • Initial focus on meeting the needs of community members without fail
  • Integration across all value-added steps from the point of consumption back to the points of production
  • Utilization of community assets and resources without reliance on outside funding
  • Application of performance metrics that deepen the resolve to establish a fully functioning local economy, spur creativity and innovation to find business solutions, increase the rate and degree of adaptiveness, and significantly improve the odds of long-term sustainability

The first two have links to previous postings that offer more detail. This post focuses on the two in bolded italics.

The previous posting, “Does Your Community Meet the Needs of Its Members?,” stressed the importance of community members knowing the following:

  • Are any community members hungry; homeless; living in unhealthy and unsafe conditions; or are they confronted with no paid work; illness; limited healthcare, and inadequate life skills to influence their circumstances?
  • How do you and your community keep score on needs met?
  • What are you and other community members doing to impact the scorecard?

The results of this survey assist community members to focus their creative energy on conditions and circumstances that warrant their collective attention. Such an overview enables them to quickly define those opportunity spaces wherein the community has the most to gain. This quickly leads to the development of robust and dynamic business models that undergird the development of business cases for clusters of interdependent businesses and community-based organizations. Those clusters have the potential for significant impact according to the scorecard metrics of the community. Furthermore, when loaded into a portfolio they offer opportunities for members to reinvest in their community and manage the launch and expansion of clusters.

In effect, community members take ownership for their sustainability. To do so entails the development and application of business models that increase community asset utilization while prioritizing the introduction of essential work modules.

The following diagram builds on a basic framework introduced in the previous posting. Both illustrate the flows of work functions and assets required to prepare infrastructure projects and business clusters for launch, provide the means to carry them out, and track results through a system of output metrics. However, the one below describes each flow in more detail and establishes the relationships between them.

In order to add value, an organization solves a problem or meets a need or frequently, does both. As mentioned at the outset, a business model shows how the organization does that and sustains itself.

The problem to solve in a local economy is how to conduct efficient, affordable distribution of needs to the points of consumption or use. The term “last mile” as a descriptor originated in the telecommunications industry during the 1990’s to describe a situation where, despite the relatively short distance (the “last mile”) between mainline fiber optic cables and subscriber homes and businesses, the installation costs prevented connections. In other words, the efficiency of the global economy did not reach into the communities, neighborhoods, and rural areas that lacked the infrastructure to make the connection given the prevailing state of technology. It required the development of another solution, wireless, for instance, to solve the last mile problem.

A similar “last mile” problem exists in the local economy whether it is the delivery of food, energy, housing, education, health care, etc. Organizations execute work modules in each of these that add value throughout the integrated steps of preparation, processing, waste recovery and reinvestment in year-round and cyclical production. But getting those products and services delivered to the point of consumption and assuring their utilization by the vast majority (80-90%) of community members is a challenge. The infrastructure of food carts, commercial kitchens, electric-drive vehicles, battery exchange stations, anaerobic digesters, modularized do-it-yourself (DIY home construction kits), experience-based learning, accessory dwelling units (ADUs) for eldercare / healthcare, etc. is not in place. The local economy is in the same situation as many areas in the U.S. 10-15 years ago when looking for affordable ways to have high-speed Internet access. That last mile can be a killer!

An infrastructure of integrated work modules itemized above solves the last mile problem. It also inspires the development of a long list of potential business and non-profit organizations required to fill the gaps. This is where the assets and resources of the community are brought to bear on interdependent business and support organization clusters so they take shape and continue along their paths to successful start-up and build-up.

The development of a business model or number of interrelated business models guides the association of assets / resources to work modules as they deliver across the last mile to consumers. The purpose of the model is to show how to execute the work functions required to meet needs and keep the organization sustainable. The steps in business model development include the following:

  • Identifying where assets and resources are located in the community (Maps)
  • Aligning the assets and resources so they support the mission of the business cluster in the most efficient and least costly manner (Models)
  • Monitoring what happens during operations of the newly aligned cluster in order to anticipate issues and opportunities before they become crises or target them quickly if they surface unexpectedly (Information)
  • Applying practical experience, theories in practice, and action frameworks through human engagement and embedded intelligence to resolve problems, improve operations, and course correct if appropriate (Know-how)
  • Loading a cluster of interdependent businesses and support organizations required to meet needs, add value, generate revenue, manage costs, and assure sustainability of operations for all involved into a community investment instrument (Portfolio)

The bottom line is that for a business model within a local economy to be effective and sustainable the consumers’ needs must be met; businesses and support organizations must collaborate to contain costs; and the value-added steps from consumption to production must be integrated to conquer the last mile. And there’s one more… The final key characteristic, application of a common set of performance metrics to help community members keep their investments on track, will be addressed in an upcoming post.

More to come…

Originally posted to Sustainable Local Economic Development on Tumblr by Steve Bosserman on Saturday, September 4, 2010

Business Models for a Local Economy

Whether you want to go into business within the global economy to satisfy customer wants in markets around the world or a local economy to meet the needs of community members close to home, an effective business model is essential. However, a business model that applies in the global economy is different than one in a local economy. Why?

Two Economies:

The global economy is driven by people’s insatiable desire to have more than what is required to sustain their lives. In contrast, a local economy is focused on meeting the basic physiological (food, water, energy, housing, and clothing) and safety (security, education, and health) needs of its immediate members. In the former, I can live without it, whereas in the latter, I can’t.

In a global economy, customers have two choices: first, do they want something, in general—a car, for instance; and second, do they want a particular item within that general category—a specific car by make, model, year, and other specifications. Any number of factors influence customers in their decisions to buy at all and, if so, which ones. As a result, in the global economy, customers rule.

In a local economy, the market is automatically defined as all who live in the immediate area. The common factor is that everyone must have food to eat, water to drink, air to breathe, shelter as protection from the elements, energy to heat and cool the home, and clothing to wear outside. In addition, everyone must have a reasonable measure of security, means to manage their health, and access to education opportunities so they can better care for themselves and contribute to the sustainability of their local community. The capacity of a local economy to sustain community members predicts how well and for how long those members can participate in the global economy. As a result, in a local economy, the community rules.

Two Business Models:

Given the emphasis on customer choice, a successful business model in the global economy is one that:

  • Anticipates customer readiness for proposed products and services
  • Strengthens company readiness to deliver to customers
  • Adapts quickly to customer reaction and responses to what’s delivered

The net result is to establish and maintain a competitive edge among countless others who want the same outcome for their companies.

For further insights on the development and use of adaptive business models in the global economy, consider Steve Blank (@sgblank) an excellent resource. Steve brings his extensive firsthand experience in building early stage businesses to bear through informative posts about entrepreneurship, start-ups, and applied business principles on his website. Business models is one topic he treats particularly well. In his posting, “What’s a Startup? First Principles,” he describes what is a business model and how to apply it. He also contrasts it to business plans, an analysis he carries forward in a later posting, “No Plan Survives First Contact with Customers – Business Plans versus Business Models.”

In a local economy, community members can choose to source their needs from suppliers far afield from their community. However, to do so puts at risk long-term sustainability due to interrupted supply lines. As a consequence, business models for a local economy offer attractive choices to members so they can meet their needs from local sources.

Although its emphasis is primarily on food, the report, Why Local Linkages Matter: Findings from the Local Food Economy Study, sponsored by Sustainable Seattle through a community development program, Building the Local Food Economy – A Call to Action offers insight into business models within a local economy.

Key characteristics of business models for a local economy include the following:

  • Universal participation by community members
  • Initial focus on meeting the needs of community members without fail
  • Integration across all value-added steps from the point of consumption back to the points of production
  • Utilization of community assets and resources without reliance on outside funding
  • Application of performance metrics that deepen the resolve to establish a fully functioning local economy, spur creativity and innovation to find business solutions, increase the rate and degree of adaptiveness, and significantly improve the odds of long-term sustainability

As indicated by these qualities, business models that deliver the basic needs of community members within a sustainable local economy are quite different than those that satisfy wants of customers throughout the global economy. Given the importance of these local economy business models, they warrant further attention. Look for more details in future postings.

Originally posted to Sustainable Local Economic Development on Tumblr by Steve Bosserman on Sunday, August 29, 2010

Business Development in the Ohio Local Food Systems Collaborative

This is the first in a series of postings to the Ohio Local Food Systems Collaborative (OLFSC) about starting and sustaining a business in local food systems. These postings have several not so ordinary characteristics:

  • They are about real business opportunities in real neighborhoods
  • The process of developing these opportunities and the resulting content are shared openly on the OLFSC website
  • They invite OLFSC readers to comment, critique, and challenge assumptions and extrapolations posted in order to make the outcome better for all
  • They encourage OLFSC readers to generate ideas and develop plans for businesses they eventually setup in their local areas

Before heading into the business opportunities, clarification of business concepts and terminology is in order…

A Firm Foundation and Ongoing Adaptation

The purpose of any business is to deliver value to the customer. The primary objective of a business is to make profit. In terms of value, this means the amount the customer pays for value delivered (revenue) surpasses the amount invested by the business to provide that value (capital and operating expenses). The ultimate goal of a business is sustainability over the long-term. Again, from a value standpoint, a business is sustained when a sufficient percentage of the profit is reinvested to continue to develop and deliver what is deemed of value by customers so that they continue to pay for it.

What is of value to the customer (idea generation)? How does one deliver that value profitably and in a sustainable manner (business planning)? These are the primary questions addressed at the outset of an entrepreneurial effort. Idea generation and business planning combine vision of a preferred future with a framework for action that brings that vision into reality. These two, working in concert with one another, provide the firm foundation upon which all successful businesses are launched.

Delivery of demonstrated value to the customer requires taking action according to the business plan (business plan execution). Of course, changes in conditions and unforeseen circumstances during the delivery cycle warrant a certain degree of flexibility in executing the plan as it is put into play (adaptation). The capacity to sense and respond, learn and adapt is the hallmark of a business that survives start-up and embarks on sustainability.

The main points outlined above equate to key steps in establishing a successful business:

  • Generate ideas
  • Develop a business plan
  • Execute the plan
  • Adapt plan to “lessons learned” during execution

These four link vision with problem-solving to deliver demonstrated value to the customer. Because of the significance of the dialectic between vision and problem-solving in business success, future postings in this series will delve more deeply into the working relationship between the two. And in keeping with the commitment made in the opening statement of this posting, the focus of the upcoming OLFSC postings will be “real business opportunities in real neighborhoods”.

Originally posted to Local Food Systems by Steve Bosserman on Wednesday, May 28, 2008 10:30

Oil Addiction and the Business Case for Change

One responsibility that comes from communicating with readers through media such as blogs is to define terms as they are going to be used in various postings and follow-up by consistent usage of those terms according to their stated definitions. In this instance, three terms are offered for consideration in this and related postings about business opportunities: business case, business model, and business plan.

Wikipedia defines “business case” in the context of an existing business wherein certain changes are being considered. While this is certainly a useful construct in project management practices, it need not be limited solely to that purview. It is also a valuable tool for entrepreneurs to draw upon when determining start-up possibilities or expanding an existing business far beyond the boundaries and scope of its original charter.

Business cases lead to “business models.” A business model is the approach a business intends follow in order to generate revenue, control expenditures, and make a profit. More than one business model is possible in response to strong business cases. The challenge is crafting and adopting an appropriate business model that leads to a successful business within a given set of circumstances. It is a bit like playing chess and determining the opening one is going to use based on personality and temperament as much as intellect, skill, and experience. Determining and applying business models in response to business cases spawns creative experimentation that typifies entrepreneurial efforts.

A “business plan” covers comprehensive information, in-depth analysis, and detailed description about how practical application of the business model is accomplished successfully over time. Putting a business plan together demands that one think past overly optimistic assumptions about revenues and underestimates of capitalization costs and operating expenses. This exercise brings a critical level of discipline to choosing a business model. And if support from others is required to get the business going, a business plan is an excellent communication medium through which one’s attention to detail and exercise of due diligence is documented.

An earlier posting, “Addicted to Oil,” points out that such a level of dependence drives concern for quantity and quality of the addictive agent and consequences of use for the addict and the social systems that support the addict. It also turns up the heat in the addict’s thinking to consider the possibility of not succumbing to the powers of the addictive agent and choosing an alternative path of recovery. The foundation for an addict’s travels to a clean and sober life is a totally different structure and behavior than the basis for the one that supported the addiction. It requires significant sustained commitment to move from the addictive structure to the clean and sober structure. And there are many bumps in the road that test commitment and resolve. This is an act not to be taken lightly.

Recovery from oil addiction entails securing energy from renewable sources rather than fossil fuels. This is a costly route to take since the current global system is setup to generate, deliver, and consume energy from fossil fuels, not renewable sources. To make the switch requires a considerable investment of time, money, and talent to develop and apply the technologies that will make renewable energy system feasible. Such investment will not happen without the assurance that there is a business case for doing so.

Making the shift from fossil fuels to renewable energy sources requires a business case based on irrefutable evidence that not doing so will result in highly undesirable consequences. In recovery, the addict must “reach bottom” before beginning the long ascent out of the dark pit. With oil addiction that point is reached when the realization that to continue unchecked is simply an untenable position. In other words a “tipping point” is reached from which there is no turning back.

In a December 22, The New York Times 1 editorial by Thomas Friedman entitled “And the Color of the Year Is…,” he writes:

We reached a tipping point this year — where living, acting, designing, investing and manufacturing green came to be understood by a critical mass of citizens, entrepreneurs and officials as the most patriotic, capitalistic, geopolitical, healthy and competitive thing they could do. Hence my own motto: ‘Green is the new red, white and blue.’

It appears that in the minds of some the point of no return from black to green has passed. Regardless of how far beyond this point we are, it is safe to conclude that business opportunities in the renewable energy sector and the proliferation of business models and plans they spawn are nigh. We are taking first, but strong steps out of the black hole of addiction along the green path of recovery. And this growth in business possibilities will not remain within the realm of the energy sector alone. Due to the tightly woven interconnections among them, the fuel, food, feed, floriculture, and fiber industries as a whole will be transformed. A budding renaissance for agriculture is in the making. Stay tuned for more!

Originally posted to New Media Explorer by Steve Bosserman on Friday, December 29, 2006

  1. Original posting to the Stop Global Warming website is no longer available online

Localize – Link – Globalize: A Closer Look at India

In my previous posting about Mukesh Ambani’s ambitious plans for Reliance Retail, Ltd., he intends to “revolutionize” two sectors: farming and retail in the process of establishing this new business. His plan to “invest more than $5 billion by 2011 to put both the farms and the stores on the road to modernity, connect them through a distribution system guided by the latest logistics technology, and create enough of a surplus to generate $20 billion in agricultural exports annually” is a bold statement of the speed, scope, and degree to which he will attack the prevailing system. No doubt this will have an impact – revolution does that, although there are often unintended consequences!

Usually, “revolutionize” in the context of agriculture means introducing labor-saving, automated, integrated mechanical and biological systems that eliminate the need for human participation. This accomplishes three things: reduces the cost of the operation by taking people out of the equation; displaces people who are no longer needed in support of agriculture so that they are compelled to do something else; and lengthens the distance between the point of agricultural production and the point of consumption of food, feed, fiber, or fuel. This approach was effective during the last century in those areas of the world where human labor was needed to power the growth of the industrial sector. In fact, the mechanization of agriculture and the subsequent displacement of people from farming and rural areas was a perfect complement to the growth of industries in the urban centers. Is the world ready for more of that?

The last thing countries with the most populous cities in the world need is more people migrating from the less populated rural areas to the urban areas. Further overcrowding of already overwhelmed infrastructures helps no one and contributes further to decline in the quality and even sustainability of life. Still, with nowhere else to go and no hope where they are, relocation to the cities is often the only recourse people have in these circumstances.

The question is: how can technology be applied in the farming sector such that the people whose welfare is dependent on agriculture are able to have sufficient quality of life centered around the principles and values they hold dear at their local community level yet be able to scale their output to meet the demand of more distant communities in need of what they produce?

One way to begin to answer this is through the e-Choupal system introduced by ITC, Ltd. to farmers throughout rural India.

ITC describes e-choupal as a system that…

…leverages Information Technology to virtually cluster all the value chain participants, delivering the same benefits as vertical integration does in mature agricultural economies like the USA.

‘e-Choupal’ makes use of the physical transmission capabilities of current intermediaries – aggregation, logistics, counter-party risk and bridge financing – while disintermediating them from the chain of information flow and market signals.

With a judicious blend of click & mortar capabilities, village internet kiosks managed by farmers – called sanchalaks – themselves, enable the agricultural community access ready information in their local language on the weather & market prices, disseminate knowledge on scientific farm practices & risk management, facilitate the sale of farm inputs (now with embedded knowledge) and purchase farm produce from the farmers’ doorsteps (decision making is now information-based).

Real-time information and customised knowledge provided by ‘e-Choupal’ enhance the ability of farmers to take decisions and align their farm output with market demand and secure quality & productivity. The aggregation of the demand for farm inputs from individual farmers gives them access to high quality inputs from established and reputed manufacturers at fair prices. As a direct marketing channel, virtually linked to the ‘mandi’ system for price discovery, ‘e-Choupal’ eliminates wasteful intermediation and multiple handling. Thereby it significantly reduces transaction costs.

‘e-Choupal’ ensures world-class quality in delivering all these goods & services through several product / service specific partnerships with the leaders in the respective fields, in addition to ITC’s own expertise.

While the farmers benefit through enhanced farm productivity and higher farm gate prices, ITC benefits from the lower net cost of procurement (despite offering better prices to the farmer) having eliminated costs in the supply chain that do not add value.”

Of course, for ITC to make this work requires a dedication to growing its business by engaging farmers as partners in making their businesses successful. ITC’s sustainability policies are based on a deep and unwavering commitment to the people of rural India: to help them improve the quality of their lives, provide them with the wherewithal to keep their families intact and grounded, and contribute fully to the betterment and sustainability of their local communities.

The effectiveness of this program on multiple fronts has not gone unnoticed. ITC has garnered several awards for the e-Choupal program namely, the Corporate Social Responsibility Award in 2004 from the Tata Energy and Resources Institute (TERI), the Wharton Infosys Business Transformation Award (WIBTA) in 2004, and most recently the Stockholm Challenge Award in May 2006.

The goal of e-Choupal is to sustain, strengthen, and scale the operations of farmers with small agricultural holdings throughout rural India. The success of this system is earmarked by farmers staying in business, improving their operations, caring for their families, and contributing to the welfare of their local communities. This outcome scores well in following the sequence of localize, link, and globalize mentioned in last week’s posting by the same title.

And there is room for more! In a country of one billion people, three-quarters of which live in rural areas the efforts of ITC and e-Choupal only touch a narrow few. Reliance Retail, Ltd. is branching out with farming and retail and is committed to build an infrastructure that stabilizes small scale farming operations rather than destroy them; in direct competition to Reliance Retail, ITC is introducing Choupal Fresh.

Then, there are companies like Bharti that partnered with the Rothschild Group to form FieldFresh Foods. They are entering the next stage of scaling up agricultural production in rural India to supply global markets. Are Indian farmers sufficiently stabilized in their newfound capabilities to remain sustainable as small businesses in light of this rapid scaling?

Andy Mukherjee writing for Bloomberg.com paints companies Reliance, ITC, and Bharti with a common brush regarding their intentions for the Indian farmers in light of a worse fate – Wal-Mart. The title of his article “Indian Food Trade Lures Reliance, Bars Wal-Mart,”1 suggests that a preferred strategy is keeping Wal-Mart at bay. Unfortunately, there are many paths that lead to premature globalization of food production at the farm level – even a seemingly healthy alliance between Bharti and Rothschild is fraught with difficulties!

Clearly, a Wal-Mart excursion into India would have a significant impact on the economics of farming and retailing in India. It poses a dilemma in whether to keep expanding the agricultural sector globally by building from a firm foundation of localized – linked – globalized farming operations, or prematurely opening the floodgates to global markets, compromising the system at local levels, and either becoming non-competitive due to excessive cost or entering the slippery slope of farm consolidation.

The title of a Knowledge@Wharton article, “Will Wal-Mart Succeed in India? Perhaps…But It Won’t Be Easy,”2 suggests imminent conflict with Indian retail chains and the Indian government in their unwillingness to allow direct foreign investment into the retail industry. In response, Wal-Mart has formed a joint venture with Bharti. Will that be enough to overcome native resistance? And in “Wal-Mart Pushing India to Lift Ban on Global Chain Stores” published in The Hometown Advantage by The New Rules Project, the argument is raised that large non-Indian retailers like Wal-Mart are not good for the local Indian economy because their realm of interest is with absentee shareholders, not the people of India at the local level. Proceeding further while carrying this lack of concern for the impact one’s business model has on people whose livelihoods are placed squarely at risk is catamount to unethical business practice. In this case, it reverses the preferred approach of localize – link – globalize to drive globalization first and align linkages to suck profits and resources away without stabilizing the local economies first.

The world has endured this “global first” extraction / domination model for centuries. It doesn’t work. It’s time to give it up!

Originally posted to New Media Explorer by Steve Bosserman on Sunday, September 3, 2006

  1. Original Bloomberg article, “Indian Food Trade Lures Reliance, Bars Wal-Mart,” is no longer available online
  2. Original Asia Media article, “Terms of Engagement for Wal-Mart India,” is no longer available online.

Vectors of Disruption and Sea Changes

A colleague of mine is working on a white paper about various trends affecting agriculture over the next 10 years. These futuristic endeavors are fraught with peril because who really knows what the future will hold – no one. But clients and colleagues are constantly looking for ways to talk about the future with sufficient clarity and confidence that their audiences go away having more insight than otherwise.

What can one say about the future that holds true beyond the simple inevitability that the world will end and life on this planet will cease? Not much, it seems, if one is searching for specificity. But in general, there are several points that can be made which offer a framework for consideration when looking at the future.

My previous posting discussed “push” and “pull” business models. The embedded diagram illustrated a progression from individual products / services to integrated product / service combinations.

In the diagram below, this same progression forms a backdrop to highlight an increasing integration over time characterized by solutionizing and convergence.

The objective is human equivalence as introduced in an earlier posting. The balance of this diagram sets up two critical relationships that supplement increasing integration. First, developments in nanotechnology, genetics, and robotics continue to displace people from making things. And second, as artificial intelligence becomes more robust and capable of emulating human problem-solving, human intelligence is pressed into service to address an expanding awareness of the enormous complexity within the whole of creation. In other words, human intelligence leads artificial intelligence into areas of greater sophistication, ambiguity, and choice. This accelerates the advances in artificial intelligence hastening the day when it effectively achieves human equivalence.

Between now and then, the trends to watch are directly influenced by technology operating at the molecular, atomic, and sub-atomic levels, recombining DNA, and merging the biological with the mechanical. Whether related to care and consideration for the environment, applying agricultural practices to the production of food, feed, fiber, or fuel, or raising the quality of life, all are overshadowed by developments in these three areas. In general terms, to watch the evolution of technology as it shrinks to the barely detectable, rearranges genetic structure at will, and creates androids that eventually replace us will be exhilarating, unnerving, and perhaps traumatic, but inevitable. These then, are the primary trends. All others are of secondary importance. More later…

Originally posted to New Media Explorer by Steve Bosserman on Monday, April 24, 2006