MacroWikinomics E-Book

Don Tapscott

• Herausgeber: Atlantic Books
• Kategorie: Fachliteratur
• Sprache: Englisch
• Veröffentlichungsjahr: 2010

Seitenzahl: 881

Beschreibung

The sequel to the international #1 bestseller, Wikinomics. Wikinomics showed how mass collaboration was changing businesses around the world. MacroWikinomics takes it beyond the boardroom to show how the mass collaboration is revolutionizing the way we live, work, and create. The era of the monolithic, self-contained, inwardly focused corporation is over. In Wikinomics Don Tapscott and Anthony D. Williams showed how the internet is changing the way the very smartest business managers think about structures and strategies in the 21st century. Now, in MacroWikinomics, they demonstrate how this revolution in thinking is spreading outwards to other sectors - from education and scientific institutions, to entertainment and media, to government and democracy. MacroWikinomics is a groundbreaking and definitive look at achieving success for a new century, a new media, a new generation and a new economy. LONGLISTED FOR THE 2010 FT AND GOLDMAN SACHS BOOK AWARDS

Leseprobe

Also by Don Tapscott & Anthony D. Williams

MACROWIKINOMICS

Rebooting business and the world

Don Tapscott &

Dedicated to the entrepreneurs and social innovators

First published in the United States of America in 2010 by Portfolio, an imprint of Penguin USA.

First published in hardback and airport and export trade paperback in Great Britain in 2010 by Atlantic Books, an imprint of Atlantic Books Ltd.

Copyright © Don Tapscott & Anthony D. Williams, 2010

The moral right of Don Tapscott & Anthony D. Williams to be identified as the authors of this work has been asserted by them in accordance with the Copyright, Designs and Patents Acts of 1988.

All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior permission of both the copyright owner and the above publisher of this book.

1 3 5 7 9 10 8 6 4 2

A CIP catalogue record for this book is available from the British Library.

Hardback ISBN: 978 1 84887 719 1 Airport and Export Edition ISBN: 978 1 84887 720 7

eBook ISBN: 978 0 85789 276 8

Printed in Great Britain

Atlantic Books An Imprint of Atlantic Books Ltd Ormond House 26–27 Boswell Street London WC1N 3JZ

www.atlantic-books.co.uk

CONTENTS

I FROM WIKINOMICS TO MACROWIKINOMICS

1. Rebooting the World

2. Five Principles for the Age of Networked Intelligence

II RETHINKING THE FUNDAMENTALS

3. Opening Up the Financial Services Industry

4. Bootstrapping Innovation and Wealth Creation

III REINDUSTRIALIZING THE PLANET

5. Reversing the Tide of Disruptive Climate Change: A New Global Power Emerges

6. Wikinomics Meets the Green Energy Economy

7. The Transportation Revolution: Moving Around in the Twenty-first Century

IV LEARNING, DISCOVERY, AND WELL-BEING

8. Rethinking the University: Collaborative Learning

9. Science 2.0: Igniting Knowledge Creation in a Networked World

10. Collaborative Health Care

V TURNING THE MEDIA INSIDE OUT

11. The Demise of the Newspaper and the Rise of the New News

12. Inside the Future of Music: Prosumers Take Center Stage

13. The Future of Television and Film: Just Another Cool Internet Application?

VI REBOOTING THE PUBLIC SQUARE

14. Creating Public Value: Government as a Platform for Social Achievement

15. The Rise of the Citizen Regulator

16. Solving Global Problems: Beyond the Nation-State

17. Fighting for Justice: User-Generated Freedom from Tehran to Rangoon to Beijing

VII CONCLUSION

18. Ground Rules for Reinvention: Making Wikinomics Happen in Your Organization

19. Leadership for a Changing World

Acknowledgments

Notes

Index

I

1. REBOOTING THE WORLD

On Sunday, January 17, a full five days after a devastating earthquake struck Haiti, a text message sent from a cell phone in Port-au-Prince was translated from Creole into English and posted on an interactive crisis mapping site that was being closely monitored by emergency responders. The text was a cry for help from a survivor and it appeared to have been sent from beneath the rubble of one of Haiti’s largest supermarkets. By that time, the odds of finding survivors had diminished sharply and many in the emergency relief community were giving up hope. The situation on the ground was dire indeed: without access to food or water some tens of thousands had already perished beneath the immense piles of concrete strewn across the city. But the text message posted online suggested a miracle: could the person who sent it still be alive? Was it possible they made it through the excruciatingly long wait for help? An American search-and-rescue team raced to the scene to find out. Many hours later, after having cut through several feet of concrete, the rescuers had a horrible realization: the body being pulled from the rubble was that of a child. The small, frail frame of a seven-year-old girl emerged from the supermarket wreckage, deeply shaken and barely alive. The little girl, overwhelmed with relief and emotion, recounted her terrifying experience to her astonished family. She had managed to survive on a small ration of leathery fruit snacks, and a whole lot of hope.

It was a glimmer of light in an otherwise tragic story. Indeed, few people will soon forget the horrendous damage inflicted by the magnitude 7.0 earthquake that struck near Port-au-Prince on January 12, 2010, causing more human misery and economic damage than any earthquake on record. In a mere forty-five seconds of seismic contortions, an astonishing 15 percent of the nation’s population—1.5 million people—was rendered homeless. Tens of thousands were dead, and hundreds of thousands more were injured. Any semblance of the usual infrastructure emergency crews depend on (roads, hospitals, water, sanitation, electrical power, and communication networks) was obliterated. Vast regions of the 250-year-old city utterly toppled.

The ruthless and indiscriminate wrath of nature’s forces, however, was just a prelude to the real misery. Circumstances on the ground made life astonishingly difficult for first responders. The sea- and airports were congested and there were too few trucks to transport supplies and no safe place to store them. No one—not the army, the government, or the aid community—had a clear picture of the full scale of the catastrophe unfolding around them. There was confusion about precisely which supplies had been received, and in what quantities. There was also a lack of coordination among aid agencies and other entities about which people and areas to prioritize and how to overcome this logistical nightmare. This initial lack of coordination, in turn, left Haiti’s earthquake victims (already among the poorest people in the world) utterly destitute, without food, water, or clothing, separated from their loved ones, and many in desperate need of medical attention. Yet, out of the rubble, and in the face of tremendous suffering, came a powerful story of how an ad hoc team of volunteers from around the world came together to concoct an information management solution that far surpassed anything the official crisis response team had mustered, including the world’s largest emergency relief organizations, the U.S. State Department, and even the U.S. Army.

At the heart of the volunteer effort was a small Kenyan-born organization called Ushahidi whose crisis-mapping site allows users to submit eyewitness accounts or other relevant information in a disaster situation via e-mail, text, or Twitter—and then visualize the frequency and distribution of these events on a map. Ory Okolloh, a prominent Kenyan lawyer and blogger, first came up with the idea in 2008 when violence erupted in the aftermath of Kenya’s disputed election. After hearing many disturbing reports of rape, looting, and murder from friends and family across the country, she suspected that the government and the official news agencies were grossly underreporting the violence. The proof came when her own vivid reporting on her blog Kenyan Pundit triggered a flood of e-mails and texts from hundreds of Kenyans who had witnessed or experienced violence first-hand. The volume of reports soon overwhelmed Okolloh’s ability to authenticate and document them using her blog, so she sketched out the basic parameters of an Internet mapping solution, and with the help of some fellow Kenyan technology whizzes, built the Ushahidi platform over a long weekend. Within hours of its launch, the site was collecting user-generated cell phone reports of riots, stranded refugees, rapes, and deaths and plotting them on a map, using the information supplied by informants. For the first time, interested parties could see at a glance which areas of the country were experiencing trouble. Indeed, the site collected more testimony with greater speed and broader reach than the media or the local officials, except in Ushahidi’s case there was a big difference: Okolloh didn’t have government grants, official mandates, formal command structures, or elaborate communication protocols; just a loose group of committed individuals under effective grassroots leadership harnessing rudimentary open-source technologies to help those in need.

When disaster struck Haiti two years later, Ushahidi’s director of crisis mapping, Patrick Meier, sprang into action. Meier had been enjoying a quiet evening watching the news at his home in Boston. It was 7:00 p.m. when he first learned about the earthquake. By 7:20, he’d contacted a colleague in Atlanta. By 7:40, the two were setting up a dedicated site for Haiti on the Ushahidi platform. By 8:00, they were gathering intelligence from everywhere, in a global effort to crowdsource assistance for Haiti.

Since the majority of incoming text messages were in Creole, they needed a translation service. And since most reports lacked sufficient location details, they needed a way to quickly identify the GPS coordinates so that incidents could be mapped as accurately as possible. So Meier reached out to dozens of Haitian communities for help, including the large diaspora in Boston. Soon hundreds of volunteers around the world were using Ushahidi-Haiti to translate, categorize, and geo-locate urgent life-and-death text messages in real-time. Many of the volunteers spent weeks on end on their laptops in a dimly lit school basement in Boston that Meier converted into a makeshift situation room. Although located some 1,640 miles from the scene, the volunteer crisis mappers used Skype to relay critical information about the location of potential survivors to search-and-rescue teams on the ground in Port-au-Prince. They responded to requests from the World Food Program and the aircraft carrier USS Carl Vinson in the middle of the night. And to better link calls with specific GPS coordinates, they even got direct access to DigitalGlobe’s high-resolution satellite imagery and to the U.S. Army’s video footage from military drones. By the time Meier’s group had honed their process, text messages were being translated into English and posted online just minutes after they left a mobile phone in Haiti. And as a result of their dedication, Ushahidi’s crisis mappers found themselves center stage in an urgent effort to save lives during one of the largest relief operations in history.

“If a relief worker from the Red Cross has a field office in the neighborhood of Delmas,” says Meier, “they could subscribe to Ushahidi to receive information on all reports originating from their immediate vicinity by specifying a radius.” Not only were responders able to specify their geographic area of interest, but they could also select the type of alert, say collapsed buildings, medical emergencies, food shortages, or looting. Now as the focus shifts from crisis relief to rebuilding in the years to come, Meier thinks Ushahidi’s crisis-mapping tools could just as readily be used by Haitians to hold crisis-relief organizations, private contractors, and the local government accountable for higher standards than have been the norm during the many years of failed efforts to lift the impoverished Caribbean nation out of poverty. Indeed, this everyone-as-informant mapping heralds some pretty profound changes as the wiki world revolutionizes the work of humanitarians, journalists, and soldiers who provide aid and assistance in some of the most unforgiving circumstances imaginable.

In the old crisis management paradigm, big institutions and aid workers parachute into a crisis, assess the situation, and dispense aid with the limited information they have. Most aid organizations don’t have good systems for sharing information, and certainly don’t like ceding turf or marching to the beat of another organization’s drum. The resulting fragmentation leads to poor decision making, redundancy, and confusion, and often to wasted money and wasted opportunities.1 To make matters worse, the end recipients of disaster relief are almost always treated as helpless victims and passive consumers of other people’s charity. This makes for perversely compelling television drama (so-called disaster porn temporarily boosted CNN’s ratings by 95 percent), but it fails miserably in delivering results. Indeed, a report produced by the International Federation of Red Cross and Red Crescent Societies following the international community’s response to the 2004 Indian Ocean tsunami highlighted the need for better coordination as well as victim participation in future disaster relief efforts to help ensure that the needs and interests of disaster victims are not sidestepped in the rush to implement solutions.2

The new paradigm for humanitarian efforts turns much of the conventional wisdom upside down. Rather than sit idly waiting for help, victims supply on-the-ground data using cell phones or whatever communication channels are available to them. Rather than simply donate money, a self-organized network of volunteers triages this data, translating and authenticating text messages and plotting incidents on interactive mapping displays that help aid workers target their response. And rather than just forge ahead with narrow institutional priorities, new communication channels like Ushahidi enable the whole emergency relief ecosystem to operate like a coherent entity. Sure, a lot could go wrong with this distributed model. People could get the address wrong or exaggerate their situation. But as data accumulates, interactive crisis maps can quickly reveal emerging patterns and vital information in an emergency situation: How many miles inland did the tsunami kill? Which roadways are passable and where are the closest temporary emergency wards? Are the incidents of violence and looting broadly dispersed or concentrated around certain neighborhoods?

Given an open platform and a complement of simple tools, it turns out ordinary people can create effective new information services that are speedier and more resilient than traditional bureaucratic channels. Yes, one can argue that tales of heroic volunteer efforts are not particularly unusual. Disaster situations do tend to bring out humanity’s finer traits. What is remarkable is that the Ushahidi-Haiti project might have taken a government agency with loads of money a year or more to execute. Yet, thanks to social innovators like Okolloh and Meier, the crisis-mapping community rallied to pull it together in a matter of days with absolutely no cost to the taxpayer.

Indeed, the story of how Ushahidi got started, and where it’s gone since, reveals a great deal about a powerful new form of economic and social innovation that is sweeping across all sectors—one where people with drive, passion, and expertise take advantage of new Web-based tools to get more involved in making the world more prosperous, just, and sustainable. Okolloh created Ushahidi in crisis; it never crossed her mind to patent or monopolize it. Knowing that computers are out of reach for most Kenyans, Okolloh made sure Ushahidi could work on cell phones.3 And in the absence of venture capital backing, Okolloh used open-source software and allowed others to reuse her tools for new projects. To date, the versatile platform has been used in Africa to report medicine shortages; in Gaza to track incidents of violence; and in India and Mexico to monitor elections. The Washington Post even partnered with Ushahidi in 2010 to map road blockages and the location of available snow blowers during the infamous Snowmageddon, D.C.’s largest snowfall in nearly a century.

With every new application, Ushahidi is quietly empowering millions of ordinary individuals to play a larger role in everything from democratic decision making to crisis management to protecting public health. In doing so, Ushahidi highlights a profound contrast between a set of deeply troubled and stalled institutions that revolve around industrial age thinking and hierarchical organizational designs versus a new set of bottom-up institutions that are being built on principles such as openness, collaboration, and the sharing of data and intellectual property. This new model of collaboration and social production goes way beyond disaster relief efforts to affect the modus operandi of virtually every institution in society, including government, education, health care, science, finance, and international diplomacy. These industrial age institutions brought us mass production of goods, mass media like newspapers, radio, and television, mass education and learning for everyone, mass marketing and mass democracy and government in which elected officials produced and distributed laws and services. As a mode of production the industrial economy was infinitely superior to what came before it (the agrarian craft society), dramatically advancing wealth, prosperity, and the standard of living for many. But this was a centralized, one-way, one-size-fits-all mass model controlled by the powerful owners of production and society.

Now because of the new Web the old industrial models are all being turned on their heads. There is now a new engine of innovation and wealth creation and a powerful new force that radically drops collaboration costs and as such enables communities to collaborate on shared concerns, endeavors, and challenges. Greater openness in innovation and science, for example, is creating more economic opportunity for citizens and businesses that learn how to tap into global innovation webs. In the fight against climate change, ordinary people are forging a mass movement to bring greater consumer awareness and a sense of community to making ordinary household and business decisions that can reduce our carbon footprints. In education, leading universities are breaking down their ivory towers and building a global network for higher learning—a rich tapestry of world-class educational resources that every aspiring student on the planet can use and return to throughout his or her lifetime. Innovators across the public sector are harnessing the Web to generate more productive and equitable services, bolster public trust and legitimacy, and unlock new possibilities to co-innovate solutions to local, national, and global challenges. Put it all together and it becomes increasingly clear that we can rethink and rebuild many industries and sectors of society on a profoundly new, open, networked model. Indeed, for the first time in history, people everywhere can participate fully in achieving this new future.

In our previous book, Wikinomics (Portfolio 2006), we called this new force “mass collaboration” and argued that it was reaching a tipping point where social networking was becoming a new mode of social production that would forever change the way products and services are designed, manufactured, and marketed on a global basis. But, in the four years since penning the idea, it’s clear that wikinomics has gone beyond a business or a technology trend to become a more encompassing societal shift. It’s a bit like going from micro- to macroeconomics. In which case, wikinomics, defined as the art and science of mass collaboration in business, becomes macrowikinomics: the application of wikinomics and its core principles to society and all of its institutions. Just as millions have contributed to Wikipedia—and thousands still make ongoing contributions to large-scale collaborations like Linux and the human genome project—there is now a historic opportunity to marshal human skill, ingenuity, and intelligence on a mass scale to reevaluate and reposition many of our institutions for the coming decades and for future generations. After all, the potential for new models of collaboration does not end with the production of software, media, entertainment, and culture. Why not open-source government, education, science, the production of energy, and even health care? As we will discover in later chapters, these are not idle fantasies, but real opportunities that the new world of macrowikinomics makes possible.

A TURNING POINT IN HISTORY

When the economy crashed in 2008, it cost American taxpayers trillions of dollars. Faced with a historic market meltdown, the worst recession in three generations, plus government guarantees that exceed the cost of every war the United States has ever fought, American taxpayers are understandably furious. It is pretty much the same story around the world. Many people are reviving calls for updated regulations, more government intervention, and even the breakup or nationalization of the big banks. In the meantime, the lingering effects of the financial meltdown threaten to engulf not just companies but entire countries in a sovereign debt crisis. In early 2010, Greece appeared unable to make good on its debt payments to worldwide bondholders. The fear about state defaults quickly spread to Spain, Portugal, and Ireland in a fiscal domino effect that jeopardizes all sixteen nations sharing the euro as a common currency. Governments everywhere are awash with unprecedented and potentially unsustainable debt. The United States looms largest, with Congress contemplating a budget that by 2020 would nearly double America’s national debt, to $22 trillion—twice the size of the U.S. economy.4 Clearly we need to rethink the old approaches to governing the global economy. But rebuilding public finances and restoring long-term confidence in the financial services industry in the United States and other nations will require more than government intervention and new rules; it’s becoming clearer that what’s needed is a new modus operandi based on new business principles like transparency, integrity, and collaboration.

The financial system is not the only institution that’s in desperate need of a makeover. The sparkling possibilities described above contrast sharply with the precipitous decline of the industrial economy as a whole. Many of the institutions that have served us well for decades—even centuries—seem frozen and unable to move forward. Sure, the industrial economy brought us three centuries of unprecedented productivity, knowledge accumulation, and innovation that resulted in undreamt-of wealth and prosperity. But that prosperity has come at a cost to society and the planet. And it is clear that the wealth and security enjoyed in advanced economies may not be sustainable as billions of citizens in emerging markets aspire to join the global middle class. If we continue on a business-as-usual path, today’s global instability will surely increase. Indeed, we believe the world has reached a critical turning point: reboot all the old models, approaches, and structures or risk institutional paralysis or even collapse. It’s a question of stagnation versus renewal. Atrophy versus renaissance. Society has at its disposal the most powerful platform ever for bringing together the people, skills, and knowledge we need to solve many of the issues plaguing the world. And if this book shows anything, it’s that good things happen when we, as individuals and as organizations, seize the opportunity to contribute our ideas, our passion, and our creativity. The question is whether the world is ready to truly embrace the social and economic innovations that this collaboration could unleash.

This may sound like a fairly radical perspective, but it’s one that mainstream voices increasingly endorse. None other than Time magazine recently saw fit to ring the alarm bells over the trouble it sees on the horizon. In a special feature on the ten ideas that will define the next ten years, Christopher Hayes asserts that it is twilight time for the elites. He says, “In the past decade, nearly every pillar institution in American society—whether it’s General Motors, Congress, Wall Street, Major League Baseball, the Catholic Church or the mainstream media—has revealed itself to be corrupt, incompetent or both. And at the root of these failures are the people who run these institutions, the bright and industrious minds who occupy the commanding heights of our meritocratic order. In exchange for their power, status and remuneration, they are supposed to make sure everything operates smoothly. But after a cascade of scandals and catastrophes, that implicit social contract lies in ruins, replaced by mass skepticism, contempt and disillusionment.”5 So what are we to do in the wake of this broad-based implosion? This new decade, Hayes suggests, will have to be about reforming our institutions to reconstitute a more reliable and democratic form of authority.

In fact, the evidence is growing daily that a powder keg of sorts is in the making. Fifteen million people between the ages of fifteen and twenty-four were out of work in North America and Europe as of this writing. There was 25 percent youth unemployment in France and Italy. In Spain, 45 percent of young people were jobless. At these levels, we are talking about structural unemployment for the whole generation and the picture ain’t getting any rosier. Youth jobs are likely to be the last to come back after the recession and research shows that prolonged periods of unemployment can have lasting effects on one’s career prospects as skills and education quickly get dated. The risk that a large cohort could fall behind has policy makers questioning how they’re going to prevent a “lost youth generation” from becoming one of the recession’s long-term casualties. Is there a way forward? Don’t look to the government or the big corporations for the answers. The Kauffman Foundation’s analysis of recent U.S. Census Bureau data shows that companies less than five years old create nearly two thirds of net new jobs in America.6 In other words, if the U.S. economy is going to have a sustained recovery in jobs, it will be up to entrepreneurs to lead the way.

Indeed, as the global economic crisis forced companies in every sector to cut their costs to stay alive, many began to see that hunkering down, while necessary, was insufficient for long-term success. From manufacturing to retail, smart managers have begun to initiate long overdue changes to their structures and strategies. It seems there is growing consensus that we are finally entering a very different economy. Economist Robert Reich asks, “What will it look like? Nobody knows. All we know is the current economy can’t ‘recover’ because it can’t go back to where it was before the crash.” Instead he suggests, “we should be asking when and how the new economy will begin.”

The upheaval is now spreading to other sectors—from the universities, health care, and science to energy, transportation, and government. Many old media empires are crumbling. The continuing collapse of many newspapers in the United States is a storm warning of more to come. As of this writing in May 2010, the Tribune Company, owner of the Los Angeles Times and Chicago Tribune, is bankrupt, as is the owner of The Philadelphia Inquirer. The Rocky Mountain News and Seattle Post-Intelligencer are gone, and the San Francisco Chronicle and others are in deep trouble. The New York Times’ debt has been downgraded to junk status and lovers of the “paper of record” (like us) are on a deathwatch, wondering how many more months it can service its debt. Magazines are in trouble too, and your favorite has probably never had such a dearth of advertising.

Basically, the Internet has destroyed the business model for print. Compared to the massive physical plant of, say, The New York Times, online newspaper The Huffington Post has almost zero “printing” and distribution costs. The New York Times employs over a thousand people in its editorial department alone. HuffPo employs sixty and a volunteer roster of thousands of writers. As a result the site is thriving with 20 million readers. Journalism will surely survive, just not in its present form. Whether core journalistic values like objectivity, quality, and truth will prevail remains to be seen. And how will journalists make a living?

Around the world, health care systems are under severe stress, but none more so than in the United States. In 1960, the United States spent only 5.2 percent of GDP on health care. By 2009 that number had risen to 17.3 percent, which means America now spends more on health care than it does on food.7 The underlying causes are complex and include factors ranging from the expansion of medical possibilities, thanks to new technologies and research, to demographic and lifestyle factors such as aging populations and poor diets. Such spending levels might be justified if the system delivered superior results, but many indicators point to the contrary. Despite being the world’s largest spender, the United States ranks forty-ninth out of 224 countries in health care performance, with disproportionately lower life expectancies and higher levels of infant mortality than other rich nations like Germany and Japan.8 Meanwhile some 46 million Americans with inadequate or nonexistent coverage fear an encounter with the health care system as much as, if not more than, they fear getting sick in the first place. Even those with “good coverage” are often poorly protected. A study by Harvard researchers found that medical problems caused an astonishing 62 percent of all personal bankruptcies filed in the United States in 2007. But even more surprising was that 78 percent of those filers had medical insurance at the start of their illness.9

Factor in high levels of administrative inefficiency, and it is clear that current models of health care are unsustainable. If the current growth trajectory continues, health care costs will nearly double to $4.5 trillion in less than a decade, eroding carefully orchestrated tax and social security systems and plunging the nation further and further into debt.10 While politicians tinker with funding models, physicians and patients increasingly recognize that only a deeper transformation in the way society promotes physical well-being and cares for the sick will be sufficient to safeguard the system. As Dr. Michael Evans, a physician at St. Michael’s Hospital in Toronto, put it, “today’s health care institutions are like the old media: centralized, one way, immutable and controlled by the people who created and delivered it. Patients are passive recipients.” In the new model, patients become more like partners—they self-organize, contribute to the total sum of knowledge, share information, support each other, and become active in managing their own health.

However, with much more serious problems looming, fretting about the future of U.S. health care could seem like a luxury. Water, or more precisely the lack of fresh water, is shaping up to be a catastrophe for humanity. About 2.8 billion (or 44 percent) of the world’s population lives in regions where fresh water resources are under severe stress. This troubling figure is set to rise to 3.9 billion by 2030.11 As yet, nobody has determined exactly how the world’s need for fresh water will be met. The challenge is so immense that we will need some of our smartest minds focused on finding solutions before water shortages erupt into conflicts.

In a time of growing capacity and wealth, our world is a very unequal place. Some countries—like China and India—have been immensely successful at lifting a large percentage of their populations out of poverty in a short time period. But vast regions of the world have not shared in this prosperity. Around the world, ten children die of hunger every minute. Nearly one quarter of the global population struggles to eke out an existence on less than two dollars a day. Is it acceptable that such a large share of humanity has been entirely bypassed by the modern world? And how long can this imbalance persist?

The demise of the Cold War was supposed to bring an era of lasting peace. Yet the world is seemingly less secure than ever, despite the $1.46 trillion spent on defense on an annual basis.12 The Faustian nuclear standoff between the superpowers of yesterday’s bipolar world has been replaced by a volatile powder keg where rogue nations and rogue groups inch closer to having their own personal weapons of mass destruction. Rather than an improbable rain of missiles we are confronted by the real possibility of a backpack or courier package delivering the toxins or explosive power to destroy a city.

Then there is the most daunting of challenges: weaning the world off its dangerous addiction to fossil fuels and building a new green energy economy that can sustain human civilization for centuries to come. At the current pace of development we are still decades away from truly mass-market deployment of any clean energy solutions, let alone all of them. “You easily spend 10 years maturing a new technology from the lab to a first commercial plant. And that’s just the beginning,” says Peter Voser, the CEO of Royal Dutch Shell. “It usually takes another 25 years for this new energy type to conquer 1 per cent of the global market.”13 Biofuels are reaching that mark about now. Wind could do so by 2015, twenty-five years after the first large-scale wind parks were built in Denmark!

It’s true that investment is set to increase. China has recently ramped up its investments in green energy technology to the tune of US$9 billion per month according to some accounts.14 Al Gore is challenging the United States to produce every kilowatt of electricity through wind, sun, and other climate-friendly energy sources within ten years, an audacious goal he hopes the Obama administration will embrace. Even people in the green power industry are calling it “ambitious.” But one thing is increasingly certain: it will take a new way of thinking about the challenges and opportunities associated with the green energy economy—including an unprecedented level of transparency, collaboration, and technology sharing—to bring changes like these about.

It’s easy to see these issues as isolated, but in fact they are highly interrelated. Excruciating levels of poverty provide a fertile ground for extremism.15 The failed states in which many of the world’s poorest live provide a safe haven in which terrorists set up base camps and hijack oil tankers to fund their nefarious deeds. Speaking of oil, the world’s unrelenting addiction to its diminishing supplies is sowing the seeds of deeper global instability in the years to come, not to mention the environmental ruin inflicted by catastrophes like the Gulf of Mexico oil spill. And if that’s not already bad enough, runaway climate change could displace hundreds of millions of people, creating a permanent state of emergency that will make the tragic events in Haiti seem like a mere warm-up exercise for the international community.

But is the international community up for the job? Arguably not, according to Klaus Schwab, founder of the World Economic Forum, which recently launched an ambitious Global Redesign Initiative to develop new institutions for global problem solving. “Our existing global institutions require extensive rewiring, and a fundamental shift in values and political culture is vital if we are to foster the global cooperation necessary to confront contemporary challenges in an effective, inclusive and sustainable way,” he says. He’s right. Decades of economic development, integration of product and service markets, cross-border travel, and new technologies enabling virtual interaction have created a world that is much more complex and bottom-up than top-down. People increasingly perceive their interdependence and seek ways to express it outside of formal national political structures. When the United Nations was founded in 1945, for example, there were only a few dozen nongovernmental organizations (NGOs) in the entire world. And they sure didn’t have a seat at the table. Today, an estimated 100,000 such organizations operate internationally in virtually every field of human endeavor. The upshot, argues Schwab, is that the world’s citizens “have become more aware that global problems require global trusteeship and that efforts to solve problems solely through traditional negotiating processes, characterized by the defense of national interests, are inadequate in the face of critical global challenges.” Large international organizations like the United Nations and the World Bank now recognize that NGOs can powerfully influence the marketplace and the public sector—either as high-profile challengers or as partners in finding new solutions.

Such inflection points have come before. John Gerard Ruggie, director of the Center for Business and Government at Harvard University, warns that history can repeat itself. “The lesson that capitalist countries needed to combine the efficiency of markets with the broader values of community . . . did not come to them easily. It took the calamitous collapse of the Victorian era of globalization—into worldwide war, followed by extreme left wing revolution in Russia, extreme right wing revolution in Italy and Germany, militarism in Japan, the Great Depression, unprecedented financial volatility and the shriveling up of world trade.” Ruggie, who served as a special adviser to former UN secretary-general Kofi Annan, thinks the new era of globalization requires a new social contract. Unregulated free markets, he warns, could spawn another series of cataclysmic events if adequate social and environmental protections are not somehow embedded in the global economy. In other words, the efficiency of markets must be combined with the values of community to sustain a viable global society. The institutions that established the historic social bargains that underpinned post–World War II prosperity (i.e., national governments, business associations, and organized labor) are no longer the right ones to help rebuild the global economy or fashion a new form of sustainable governance.

A TIME FOR RENEWAL AND TRANSFORMATION, NOT FOR TINKERING

In his opening address to the 2010 meeting of the World Economic Forum in Davos, French president Nicolas Sarkozy remarked on the financial crisis that brought the world to the very edge of economic apocalypse. “This is not just a global financial crisis,” he said, “it is a crisis of globalization.” He called on world leaders to correct the systemic imbalances that led to the triumph of markets over democracy and justice. “In the future, there will be a much greater demand for income to better reflect social utility and merit,” he said. “There will be a much greater demand for justice. There will be a much greater demand for protection. And no one can escape this. Either we change of our own accord, or change will be imposed on us by economic, social and political crises. Either we are capable of responding to the demand for protection, justice and fairness through cooperation, regulation and governance, or we will have isolation and protectionism.”

Like many heads of state, President Sarkozy certainly means well, but he doesn’t really show the way forward. He calls for more “international cooperation” and points to the G20 as a source of solutions and new models of global governance. He proposes taxes on financial speculation to help fund the fight against poverty. He demands that the world move quickly to adopt a more robust, binding global agreement on climate change.

All of these things, while necessary, are only the beginning of what is to be done. Like most heads of state, Sarkozy tends to see the same institutions that produced the current mess as the source of solutions and stability in the future. He argues for a change in values, but still takes most of the old assumptions about how the world works for granted. For example, he doesn’t consider the fact that markets may have triumphed precisely because our models of government and democracy are broken. He doesn’t call for a complete rethink of the top-down approach to global problem solving. He merely calls for the same old elite club of decision makers, except this time with a few additional members at the table. He doesn’t seem to recognize that the new models of social innovation and wealth creation that offer genuine promise are fundamentally incompatible with his outmoded vision of the role of the nation-state in a global economy. Sarkozy proposes traditional instruments like taxes and legal agreements, but they won’t be enough. Many of the time-urgent situations we face in this century won’t be solved without a more dynamic way to marshal and fully exploit the collective ingenuity of citizens and businesses around the world.

Sarkozy is hardly alone. Most world leaders—indeed, most leaders of business and government anywhere—harbor the same old tired set of assumptions about how to solve the world’s problems. And more often than not, they seem focused on tinkering with old models rather than moving to something new and viable. Consider the dysfunctional financial services industry. Conventional policy wisdom demands more regulation over financial markets. But no one stops to ask whether the current models of regulatory oversight and enforcement are truly equipped for the job. Can a patchwork of national financial regulators—all operating in silos with a skeleton crew of underpaid and overworked employees—really be expected to exert meaningful control over a global financial system that operates at light speed and employs some of the smartest and most highly paid people on the planet? Isn’t it time for a new model of regulation: one that uses the Web to disclose pertinent information and enables a worldwide network of experts— including the thousands of analysts already employed by government regulators today—to pool their tips, risk models, and analyses in a wiki-like fashion? Sure, it would mean setting aside aspects of national sovereignty and requiring companies to disclose more information in more usable formats than they do today. Rather than cling to the status quo, we’ll argue in chapter 3 that these are the kinds of changes that we should be debating.

Climate change presents similar challenges to reigning orthodoxy about how to address global problems. The December 2009 meeting of world leaders in Copenhagen was once heralded as a defining moment for humanity and a chance to prove definitively that international cooperation can and will prevail against the challenges facing the planet. Despite years of preparation and many heads of state in attendance, Copenhagen produced a twelve-paragraph “accord” with weak targets, no details, and no binding commitments. The failure to secure a meaningful deal in Copenhagen has many questioning whether a political deal is possible at all. “The forces trying to tackle climate change are in disarray, wandering in small groups around the battlefield like a beaten army,” said one senior British diplomat.16

Many politicians and pundits aren’t even in the right card game. They want to legislate climate change out of existence with a “cap and trade” system or a tax on carbon when evidence suggests that, over the long term, nothing short of a complete reindustrialization of the planet is in order. Getting the economic incentives right is an important start. But among other things, we need to rethink transportation, adopt new manufacturing and shipping practices, pull off a dramatic shift toward greener products and lifestyles, and retool our energy system, all while devoting enormous intellectual and financial resources to protecting the world’s most vulnerable peoples and locations from the effects of rising sea levels and other consequences. Surely a little bit of political tinkering will be insufficient to achieve all of this.

In short, many of our institutions are stalled, lacking vitality, leadership, and dynamism. It’s like every last ounce of oxygen has been squeezed out, leaving a mess of deflated expectations and chronically underutilized resources. This apparent paralysis, in turn, begs some pretty fundamental questions: if the knowledge, leadership, and capability required to solve the really tough problems can’t be found in the corporate headquarters and national capitals around the globe, will it be found at all? And if so, where will the new insights and leadership come from? Indeed, if our problems are not solvable by fine-tuning existing institutions, what new models and structures should replace them? Are you, wearing your various hats as an employee, manager, learner, teacher, entrepreneur, voter, consumer, community member, or citizen of the world, prepared to take on a larger role in reinventing our beleaguered institutions? What must be done to reboot business and the world and how can you participate?

These are just some of the tough questions we tackle in this book. In these pages you won’t read of a single superficial tweak or tinker to old failing institutions. Rather, we’ll meet individuals, companies, and organizations that are forging new models of problem solving in their sectors and industries—models that rely less on central control and more on getting a self-organizing critical mass of people and organizations working to initiate small experiments and social innovations that can mushroom into pervasive changes in societal behavior. Put simply, these individuals and organizations have learned how to tap into the world’s decentralized sources of knowledge and capability using an approach that mobilizes not just the world’s largest companies and nations, but a whole ecosystem of citizens and organizations around the globe. As citizens, and as leaders within our organizations, we need to look beyond the borders of nations and think about society in broad, global terms. If our problems are global in scale, then we need to come together as global citizens to solve them. A system erected around the primacy of national and corporate self-interests just isn’t going to cut it for this century.

CREATIVE FRICTION AT THE FRINGES OF NEW AND OLD

The good news is that while many institutions are in various stages of decline, for each we can now see the clear contours of fresh thinking, new approaches, and rebirth. Indeed, while this crisis of globalization paints a bleak picture, there is a more intriguing and optimistic story to be told—one that does much more than catalogue a long list of institutional failures; one that offers new solutions for outmoded institutions in business, government, and society. Billions of people can play active roles in their workplaces, communities, national democracies, and in global forums and institutions, too. At the same time, the new world of wikinomics gives organizations an opportunity to tap into new sources of insight and value. Closed, hierarchical corporations that once innovated in secret can now tap, and contribute to, a much larger global talent pool—one that opens up the world of knowledge workers to every organization seeking a uniquely qualified mind to solve their problem. Scientists can accelerate research by open-sourcing their data and methods to offer every budding and experienced researcher in the world an opportunity to participate in the discovery process. Doctors can collaborate with self-organizing patient communities where people with similar medical conditions share insights, provide mutual support, and contribute to medical research. As this book shows, the possibilities are literally endless.

To be sure, collaborative innovation can have downsides—including tough adjustments for industries whose business models were based on scarcities that no longer exist. Open-source software benefits some companies—particularly users—while hurting those who depend on selling proprietary wares. Health care sites can provide a rich and reliable resource for people seeking information or mutual support, but they can also sow confusion and misinformation. The Web provides an enormous asset for fostering reasoned democratic debate, but so-called online town halls frequently deteriorate into senseless banter and echo chambers where the like-minded rail against their ideological opponents.

The growing prominence of collaborative endeavors also raises a number of tough questions about the roles and responsibilities of different actors in society. Can we really rely on the self-organized masses to deliver critical services such as compiling life-and-death information in a crisis? What happens if the funding dries up or people lose interest and move on to something else? Who will take responsibility if something goes wrong, or claim success when things go right? And who’s ultimately accountable when everyone is on everyone else’s turf?

In the old paradigm, there were clear roles and responsibilities. In the new world of wikinomics, the lines between sectors and institutions are blurring. Nonprofits increasingly act like entrepreneurial start-ups. Businesses are taking on some of the functions of government. Governments are caught in a network of powers and counterinfluences of which they are just a part. And though most people recognize that problems get solved more quickly when governments, businesses, nonprofits, and citizens work together, there is still a dearth of understanding about how to make partnerships across sectors work at the pace of wikinomics.

These are just some of the genuine concerns that we will return to throughout the book. Indeed, in each sector—whether education, media, health care, energy, finance, or government—there is a mixture of promise and peril ahead. On balance, however, wikinomics offers profound social benefits, including the opportunity to broaden access to science and knowledge, impose greater transparency on financial markets, accelerate the invention and adoption of green technologies, and help make today’s leaders in business and government accountable for delivering outcomes that enhance well-being around the world. Collaborative communities not only transcend the boundaries of time and space, they can reach across the usual disciplinary and organizational silos that inhibit cooperation, learning, and progress. In doing all these things, mass collaboration provides an attractive alternative to the hierarchical, command-and-control management systems that are failing many of our key institutions.

Of course, there is the risk that old institutions will crumble before new ones emerge in their place, leading to troubling dislocations. But the creative friction that emerges from the old and new models of innovation is healthy and constructive; it demonstrates that our institutions are not static and that our dynamic and diverse societies move on, even when policies—and policy makers—lag behind. What will be of paramount importance now is laying a social and political foundation that recognizes the emergence of a new economic model whose potential has not even begun to be exhausted. Indeed, if we are serious about rebooting business and the world, then we must be able not only to talk innovation, but to do innovation and do it fast. Every stakeholder involved—not only companies operating in diverse sectors such as transportation, media, health care, and energy, but also universities, scientific institutions, and governments—must summon the courage and creativity to reinvent themselves, using technology and collaboration as an enabler, a catalyst, and a driver of change with the ultimate goal of providing better outcomes for citizens and users. This is not about tinkering at the edges; this is about devising, living, and experiencing a new model of innovation that is fit for the twenty-first century.

Changes of this magnitude have occurred before. In fact, human societies have always been punctuated by periods of great change that not only cause people to think and behave differently, but also give rise to new social orders and institutions. In many instances these changes are driven by disruptive technologies that penetrate societies to fundamentally change their culture and economy. But today’s Internet is the most powerful platform yet for facilitating and accelerating new creative disruptions. People, knowledge, objects, devices, and intelligent agents are converging in many-to-many networks where new innovations and social trends spread with viral intensity. Organizations that have scrambled to come up with responses to new phenomena like peer-to-peer downloading, free Internet telephony, or the blogosphere should expect much more of the same—at an increasing rate— in the future.

For individuals, this is an exciting new era—an era in which we can participate in production and add value to large-scale cultural, political, and economic systems in ways that were previously impossible. For large and small companies alike, new models of mass collaboration provide myriad ways to harness external knowledge, resources, and talent for greater competitiveness and growth. For governments and society as a whole, evidence is mounting that we can harness the explosion of knowledge, collaboration, and business innovation to lead richer, fuller lives and spur prosperity and social development for all.

Needless to say, these transitions will not be easy, and not everyone will come out a winner. According to IBM’s 2010 Global CEO survey, eight in ten CEOs expect their environment to grow significantly more complex, and fewer than half believe they know how to deal with it successfully.17 This is not surprising. Whenever such a shift occurs, there are always realignments of competitive advantage and new measures of success and value. To succeed in this new world, it w ill not be enough —indeed, it will be counter productive — simply to carry on with the current stimuli, policies, management strategies, and curricular approaches. So let’s use the opportunity that the digital revolution presents to rethink and rebuild all of the old approaches and institutions that are failing. Many promising solutions to issues ranging from the current health care crisis to climate change already exist at the fringes of established institutions and in the collaborative spaces of the Web. Organizations that tap this new force can claim leadership roles in a world where collaborative innovation across borders, disciplines, and cultures is becoming a societal imperative. Those that resist, or fail to get on board, will find themselves ever more isolated—cut off from the networks that are sharing, adapting, and updating knowledge to solve problems, big and small.

2. FIVE PRINCIPLES FOR THE AGE OF NETWORKED INTELLIGENCE

Around the turn of the century, in the midst of the dot-com frenzy, many bold predictions were issued about how the Internet was going to revolutionize the economy and society overnight. You’ve probably heard some of these before: most physical retail would disappear; television was toast; we would all soon work from telecottages in the south of France as masses of white-collar workers fled the oppressive confines of their dull gray cubicles. That didn’t quite happen. But then history tells us that the impacts of technology-driven revolutions are often long delayed. We expect too much in the short term, but underestimate or completely miss the longer-term implications for society. That is not surprising. Culture is sticky. Old habits and old ways of working die hard. Vested interests fight the transformations unleashed by revolutionary forces so that the anticipated changes take decades, and sometimes many generations, to unfold.

When Gutenberg introduced Western Europe’s first press and printing process in 1440, for example, the world was a very different place. The sum of mankind’s knowledge was contained in oral traditions or inscribed in rare and fragile manuscripts that were closely guarded by the elites of feudal society.1 Feudalism’s rigid social structures and relatively static natural economy draped a blanket of inertia over estates, communities, and towns. Most products were made and consumed locally, thanks to a large indentured labor force that was neither paid for its efforts, nor in control of the lands in which it toiled. The elites, who jealously guarded access to knowledge, also controlled society’s institutions. Unless you were royalty or belonged to the clergy, there was no prospect of formal education and there was no such thing as reading. There was no voting and no say in political decision making. There was no freedom or economic opportunity. There was no concept of progress. Apart from family, there was merely servitude, and there was survival.

In those days, wars among medieval kingdoms were fought with cannons, large cavalries, and brute men carrying swords. But it was arguably Gutenberg’s printing press that first pierced the armor of the old established orders and gave rise to new social classes, new institutions, and new principles by which to guide them. His printing technology made possible the economical mass distribution of written materials—not just books, but also government edicts and records, maps, scientific and engineering documents, how-to guides, pamphlets, posters, banners, and flyers. Scientific knowledge, ideas, and artistic and cultural expression could be produced, marketed, criticized, revised, and preserved on an ever-expanding scale.

Many of the people who produced and distributed these new publications joined an emerging merchant class. They took on new roles as patrons of scientific research, art, theater, music, and education. They created the soul of a new age—the concept of self and the right of the individual to “ownership” of his (not yet her) own faith; and the right to consider ideas, laws, and religious edicts in a critical and free manner. As the ideas of the Enlightenment took hold, society began to create, accumulate, and harness knowledge in new ways.2 Engineers, mechanics, chemists, physicians, and natural philosophers formed circles in which access to knowledge was the primary objective. For the first time in history, knowledge about the natural world became increasingly nonproprietary. Scientific advances were shared freely within informal scholarly communities and with the public at large. The world opened up in new ways too. As European trade advanced, new knowledge was acquired from the Arab world, Africa, Asia, and the Western Hemisphere, which in turn spurred an ever-greater spirit of adventure and discovery. Open scientific communities created a new medium for intercultural exchange and places like Córdoba (Spain) provided a major cosmopolitan meeting place that helped bridge Europe and the Arab world.3

As with today’s Internet, the printing press caused calamity, confusion, and disruption in many aspects of society. Just as the printed word could be a vehicle for enlightenment, it could also spew hatred and misinformation. The nascent publishing industry met with resistance as vested interests fought change. But nothing could stop the deep changes prompted by the printing press, and ultimately every institution in society was challenged. Just as the clergy could no longer control science or medicine, the monarchs could no longer dominate every aspect of political life or grip the reins of a burgeoning capitalistic economy. Power was leaching down through social hierarchies, freed by the dissemination of information and knowledge. Eventually a rising class of informed and powerful businessmen, professional soldiers, and intelligentsia in countries like France and in the British colonies demanded a new kind of economy and new forms of rule free of the old power of the Church and feudal nobility. Through armed insurrection, they did indeed lead their populations in “changing the very warp and woof of history.”4

THE AGE OF NETWORKED INTELLIGENCE

The men and women of the Renaissance period likely had little inkling of the truly titanic changes that were unfolding around them, let alone the ability to predict where it would all end up. Nevertheless, many of their legacies remain with us today: the birth of modern nation-states; the expansion of political rights and freedoms; the rise of the university, the media, and the industrial corporation; and a Cambrian explosion of science, medicine, knowledge, and cultural expression. Clearly, the printing press can’t account for all of this. European imperialism, the assembly of large standing armies, and other powerful inventions such as the mariner’s compass, gunpowder, and the steam engine were influential in shaping the modern world. But it is equally true that one can’t begin to understand how today’s world came into existence without comprehending how a modest innovation in movable type helped broaden the distribution of power and knowledge in society.

Thanks largely to the Internet we are crossing a similar chasm today. Long-standing monopolies and power imbalances are once again being challenged as more people from more regions of the world now connect, collaborate, and compete on the global stage. Young digital natives everywhere are questioning the historic traditions of venerable institutions such as the university, the newspaper, the medical establishment, and the entire apparatus of representative government. Ailing industrial sectors such as energy and transportation are in the midst of profound change as the digital age unearths new opportunities to accelerate research and collaborate around sustainable alternatives. Old truths about how to motivate and retain human capital are proving inadequate in the face of new innovation models where organizations source ideas and the skills to implement them from a vast global talent pool.

In the long run we will look back at this period as a time when the world began a historic transition from industrial capitalism to a new kind of economy based on new principles and new ways of thinking and behaving. And while there are certainly many similarities between what is happening today and what happened over five hundred years ago, there are also some profound differences. Printing gave humanity the written word. The Web makes everyone a publisher. Printing enabled the distribution of knowledge. The Web provides a platform for networking human minds. Printing allowed people to know. The Web enables people to collaborate and to learn collectively. Printing played a key role in the rise of the industrial revolution and the creation of capitalism. The Web is now enabling new models for creating wealth and prosperity on a global basis. However, the biggest difference between the printing press and the Internet is that what took four centuries to unfold then is occurring in as little as four decades today.

The long-term effects of these shifts on all our institutions are hard to forecast with accuracy. As media analyst and author Clay Shirky put it in his essay about the impending collapse of the newspaper industry: “That is what real revolutions are like. The old stuff gets broken faster than the new stuff is put in its place.” He makes the case that even the revolutionaries can’t predict what will happen. “Ancient social bargains, once disrupted, can neither be mended nor quickly replaced, since any such bargain takes decades to solidify,” he says.5