The Rise of Distributed Business

Posted by: Rob Hof on June 22, 2005

I’ve seen John Seely Brown’s talk on “innovation ecologies” a couple of times now, including today at Supernova 2005, and I think I’m finally coming to understand it. The idea is that the success of companies increasingly depends on “tapping the creativity of thousands of suppliers and their employees”—in other words, the Power of Us applied deep in corporate organizations. He cited some interesting examples, such as Toyota and the motorcycle industry in Chongqing, China (more detail on his talk and subsequent panel thanks to Ross Mayfield here and here). JSB’s conclusion, outlined in his and John Hagel’s book, “The Only Sustainable Edge”: The fundamental purpose of the firm is shifting from merely reducing transaction costs to accelerating the process of building new capabilities within the firm.

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