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Congress just loaned $17.4 billion to Ford, General Motors and Chrysler, but it didn’t do what it should have done—seriously mandate major changes in the distribution system of the US carmakers. Thanks to heavy lobbying, some 40 states have laws prohibiting consumers from buying directly from Ford, GM and all other car-makers. These auto franchise laws force consumers to go through car dealers. This is an unnecessarily expensive way of doing business in an age of web connection. It protects a distribution system that has a great deal of local power, but makes less and less economic sense.
Web 2.0 disintermediates the middle person in most businesses and certainly the car biz. Why can’t we simply go on line, choose our colors and options, order our car and pick it up someplace nearby, or at the factory itself?
The Tata Nano $2,500 has invented a new form of distribution system in India that bypasses most car dealerships. This cuts costs and makes the car more affordable to upwardly mobile Indians.
Thanks to the Information Technology and Innovation Foundation’s Robert D. Atkinson and Mark Cooper for the shout-out on this issue. the ITIF is doing great work in urging innovation in government. The Obama administration needs to get a much better handle on innovation before it pours hundreds of billions into the economy to pump it back to life.
This is a key moment for CHANGING the economy. We need to revive the economy by reforming the economy, using Web 2.0 technology. We need to focus on intangibles—investing in education, R&D health—not just tangible infrastructure projects.
Want to stop talking about innovation and learn how to make it work for you? Bruce Nussbaum takes you deep into the latest thinking about innovation and design with daily scoops, provocative perspectives and case studies. Nussbaum is at the center of a global conversation on the growing discipline of innovation and the deepening field of design thinking. Read him to discover what social networking works—and what doesn’t. Discover where service innovation is going and how experience design is shaping up. Learn which schools are graduating the most creative talent and which consulting firms are the hottest. And get his take on what the smartest companies are doing in the U.S., Asia and Europe, far ahead of the pack.