Tuesday, January 23, 2007

The Flat Earth Society

In yesterday's edition of The Times, Professor Klaus Schwab, founder and executive Chairman of the World Economic Forum, wrote about the new social order that has developed as society has been brought together by globalisation or 'the knowledge revolution'.

According to the article, "Power is moving from the centre to the periphery. Vertical command and control structures are eroding and are being replaced by horizontal networks of social communities and collaborative platforms".

Whilst Professor Schwab is predominantly concerned with the effect of collaboration on the environment, societies and culture, the same effects can be seen in the business world. Social business networks are uniting small businesses globally and giving them the capacity to compete on a much higher level than they have ever been able to in the past, through greater collaboration, the sharing of information and exchange of ideas and contacts.

In his recent article 'Trends in Business Networking', Dr. Ivan Misner, founder of the American networking organisation BNI, claims that "For the most part, big companies are clueless about building sales through the networking process. When it comes to developing social capital and the networking process, small business is king. If big corporations ever get it, watch out. But so far, they have been slow to act."

So, where is this going to lead? How far can the globalisation of small businesses really go and will they really be able to compete with the giant corporations? After all, at this time this key change does not seem to have affected the business pages of the newspapers, which still devote the vast majority of their column inches to household names.

And what needs to happen to draw bigger businesses into the networking process? They may not see its relevance to them now, but surely the key will be how long it takes for them to recognise how important it is to do more than just throw more money at their advertising budgets, and make the most of their most valuable resource, their people.

In the long term, can power really move that far from the centre in business?

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