Telcos – What Business Are You In?

In the 19th Century, railroads sprang up all over the United States and Europe and history shows that most of them ultimately failed because they didn’t understand the fundamental nature of their business. The actions of most demonstrate that they understood their business to be that of operating a railroad. Of course, those that survived understood they were in the business of providing a service to move people and goods. These companies were able to make the natural transition from trains to planes, ships and trucks.

Telecommunications companies face a difficult decision as they see their traditional business eroded by new entrants using completely new approaches to linking people together, but how do they perceive their business? Is it:

1. provisioning infrastructure?
2. facilitating communications between people from afar?
3. enabling information to be shared remotely between people?
4. enabling information to be shared between business objects and people?

Social Networking is changing the way we Live and Work

Historically people have clustered in towns and cities because it is cheaper to transport goods than it is to transport people. Humans, being social animals, typically have a need to be with others physically. For the vast majority of us there is also a need to be able to communicate with others, whether we are near them or not. Through the ages a variety of systems of communication have been established: entire civilisations have thrived or fallen due to a communications infrastructure consisting of safe modes of transport and communication including roads and waterways, language, mountain towers, and eventually the telegraph and beyond. The Romans, for example, demonstrated the importance of this infrastructure to being able to grow a civilization we still talk about.

Companies initially arose to finance shipping ventures, where ships set off on journeys lasting months to trade goods, making fortunes at great risk by sapping the common for the rare in each direction. The workers on these ships, of course, needed to be in the one place – a sailor not on board is not of much value.

As the industrial revolution unfolded, the same techniques of bringing investors together were used to build self-contained factories where workers could manufacture increasingly complex products. These factories had their own source of power, their own distribution mechanisms, their own forms of transport. Productivity increasingly became the order of the day through machine and labour specialisation, and isolation from other companies.

Today our world is very different. We have learned to work interdependently, sharing a central supply of power that can be used for pretty much any generic purpose, sharing distribution systems, communications systems and all manner of services including things like advertising, staff training, waste disposal and statutory compliance.

Increasingly workers are able to work remotely, share jobs and rotate desks. Companies are able to outsource many things enabling them to concentrate on the things that truly make those companies special, and leave anything else to other companies with their own special skills. Rigid, hierarchical organisational structures have given way to matrix and other interesting structures. Workers who used to specialise in one repetitive task are empowered to take a more holistic role in the company.

We often hear that the future will enable us to work more from home and spend less time wasted in traffic. These are inevitable changes from a services based society and the increasing bandwidth and reliability that comes from better infrastructure. But there is more change coming to the way we live and work than that. It is happening all around us. New communications tools that social media brings us, tools like Twitter and Facebook, Chatter, LinkedIn, Quora, Ning, Yammer, WordPress and many others have the benefit of allowing people to tune into streams of information as a consumer and/or a producer in ways we really hadn’t foreseen a decade ago. The results are creeping up on us slowly, but inevitably.

So what will these changes mean for our corporate lives? For many businesses, long gone is the need for everyone to be in the same location, but more subtle changes such as our traditional relationship with one employer are likely to change. Companies specialise, and so do people. In a world where the streams of information make it possible, we are likely to see people increasingly take on fluid roles within companies, roles that morph from project to project, working on teams that are flexible and tailored to a requirement. Beyond that, we are likely to see people work for multiple organisations because the barriers to moving around will asymptotically approach zero. People, like companies will do the things that make them special, remarkable, and do them for multiple organisations. This is already true in the case of outsourcing to some extent, and the way that consultancies draw resources from a common pool elastically, but this is going to continue in many organisations.

The new modes of communication have given rise to a number of new businesses that facilitate sharing resources in ways that have exciting consequences – things like shared cars and bicycles, the so-called Internet of Things where devices can communication with each other and many others. We are gradually going to be able to recover from Information Overload because of this new way of communicating.

Looking back twenty years and seeing how futile it would have been trying to predict the way we live now leads me to the conclusion that any attempts to predict the consequences of these changes beyond the next few years is nigh on impossible, but I think attempts to do so will make interesting reading…