Christian WrobelFraport AG, Frankfurt on the Main, Germany
Jan ZadakHewlett-Packard Enterprise, Vresova, Czech Republic
Michael ZaddachMunich Airport, Munich, Germany
Johannes ZenkertUniversity of Siegen, Siegen, Germany
Malte ZuchUniversity of Applied Sciences and Arts in Hanover, Hanover, Germany
Part I
Prefaces
© Springer-Verlag GmbH Germany 2018
Claudia Linnhoff-Popien, Ralf Schneider and Michael Zaddach (eds.)Digital Marketplaces Unleashedhttps://doi.org/10.1007/978-3-662-49275-8_1
1. Preface: Humans in Digital Marketplaces
Gerald Hüther1
(1)Universität Göttingen, Göttingen, Germany
Gerald Hüther
Email: [email protected]
Considering the history of mankind, not much time has passed, since Friedrich Schiller captured the dilemma of his time in a nutshell in his famous Wallenstein trilogy: “The world is narrow, wide the mind of man”. Today, in our digitalized and globalized world, Friedrich Schiller would describe the dilemma precisely in the opposite way: The world has become wide, but our brains are too narrow for the new world we live in.
The articles in this book underline the wide range of opportunities for innovative business enterprises offered by digital technology in our global and connected world. There is no doubt that this rapid development will not only continue, but even accelerate during the next years. The most important perspectives and directions of this process are clearly pointed out in this book.
Technological innovations do not only alter our previous means of production or change economic developments, they also offer completely new instruments to academic research. The use of digital media allows previously inconceivable insights into the structure and the organization of complex phenomena. This does not only concern classical natural sciences, such as astrophysics, but also and above all the so‐called life sciences, the research of living systems from cellular and organic systems to the ecological and social systems.
The new opportunities of data collection and analysis are particularly suitable for the research of complex relationship patterns and their underlying laws. The so far prevailing analysis of isolated phenomena in laboratories will increasingly be replaced by the research of their interactions in natural conditions. Necessarily this will help to gain new insights. The last century’s predominant deterministic idea concerning the structure of living systems through genetic programs is slowly being replaced by new findings on the increasingly visible and measurable skill of living systems for self‐organization. A majority of findings and meta‐analyses show that self‐organizing relationship‐patterns are responsible for further structure formation on all levels of development of living systems: during the development of embryos, the development of brains, the emergence of ecosystems or during the formation of social systems. In the 21st century, as a “side effect” of the introduction of technological innovations, “self‐organization” has become a key term for the understanding of development and transformation processes of living beings. Also social development and transformation processes, like the cohabitation of human beings, are the expression of such self‐organizing processes.
The so called Kontratieff‐cycles describe how economic developments are placed on new foundations again and again through so called basic innovations. These can entail decades‐long adaption processes in all areas of production, consumption or trade that manifest in phases of economic upturn. Examples for technological innovations that trigger respective economic growth are the steam engine (1st cycle), steel production and the invention of the railway (2nd cycle), the innovations in the area of electrical technology and chemistry (3rd cycle), the introduction of cars and petrol‐chemistry (4th cycle) and finally, in the second half of the last century, the development of information technology (5th cycle).
However, these cycles have not only gone along with economic growth. They were always accompanied by noticeable changes to human life, especially to the cohabitation of humans. In particular these changes led to unavoidable, not intended (self‐organized) adjustment processes affecting social relationships in the corresponding era.
Currently, with the globalization and the digitalization, we are experiencing a technological innovation which is not only of economic importance but also influences all areas of human cohabitation. This time even to a previously unknown extent.
The manner how humans will live together, work together and learn from each other in the future will probably change both fundamentally and permanently. To stay with the picture of Friedrich Schiller, the brain therefore has to significantly develop further.
The key to this development are offered by the most recent findings in the area of brain science: the human brain is more vivid than assumed. The brain is able to modify, add and expand neural networks even into the old age. For this reasons humans are capable to learn throughout their whole life. And: the human brain’s structure is determined more than previously assumed by social experiences, the exchange of knowledge and skills and through collaborative design performances. It is therefore an organ that is formed by and optimized through social relationships. Whoever wants to further develop and “enlarge” his brain, or the brain of others, should to invest in social relationships, in mutual exchange and in the search of joint solutions.
In case it is true that every living system reorganizes the relationships of its members until the perpetuation of the regarded system is ensured with a minimal input of energy, it is possible to predict how the future coexistence of human beings, considering digitalization and globalization, will develop at the beginning of the 21st century. The former friction losses that were part of the traditional relationships, in other words, the enormous expenses of energy and resources that are used to maintain our current way of cohabitation, has to shrink. New digital communication technologies and learning programs can be considered helpful instruments in this regards. However, the key to the transformation of our present (energy intensive) relationship culture might be found elsewhere and is more of a fundamental nature: As long as humans treat each other like objects to achieve their own goals and objectives, those communities create too much friction loss and thereby hinder themselves to evolve their existing potentials.
As a result we infringe against a generally valid principle concerning the development of the universe that has been identified by atomic physicists. That this is about the progressive opening and development of opportunities. Gregory Bateson already reminded us that there is no opportunity to change the nature, except one comply with it. But in order to comply with human nature, we need to know how it works.
With their research neurobiologists made a huge contribution to answer this question. In a nutshell their discovery points out: humans do not exist as individual entity, just as much as the brain does not exist without the body. In order to mature as humans beings and to become the designers of our own lives, we need other humans, we need communities where their members consider each other as subjects instead of objects of their own expectations and valuations, objectives and intentions, measures and orders. This makes it clear, where digitalization might finally lead us to. What remains uncertain, is the question when the actors and designers of this digitalized World recognize that this world persist over time, if it offers a familiar and comfortable feeling to people. This can only be offered through the satisfaction of the deepest human need for solidarity and security on one side and autonomy and freedom on the other side. “Digital marketplaces unleashed” could help to transform the world into a global village. And Schiller would be right again. However, it would be better if the unleashed digitalization increases the diversity and richness of the world and its cultures into the unknown. In this case Schiller would need state: As long the world is widening, the brain can never be narrowin
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© Springer-Verlag GmbH Germany 2018
Claudia Linnhoff-Popien, Ralf Schneider and Michael Zaddach (eds.)Digital Marketplaces Unleashedhttps://doi.org/10.1007/978-3-662-49275-8_2
2. Preface: Digital Society? The Great Transformation21
Fredmund Malik1
(1)Malik Institute, St. Gallen, Switzerland
Fredmund Malik
Email: [email protected]
2.1 Digital Society
2.1.1 From the Old World to a New World
Globally, economies and societies are going through the most fundamental change in history. We are experiencing the displacement of the Old World, as we have come to know it, by the New World, which is still largely unknown. It is the origin of a new order and a new societal functioning—a new kind of societal revolution. I called this process “Great Transformation21” in my book about “Governance” back in 1997. It will change almost everything: What we do, how we do it and why we do it—and, lastly, who we are. In just a few years almost everything will be new and different: How we manufacture, transport, finance and consume, how we educate, learn, do research and innovate; how we share information, communicate and cooperate; how we work and live. That will also change who we are.
A new dynamic order is forming, and—more importantly—so is a new mode of functioning of society and its organizations. Digitalization is one of the most powerful of several major driving forces. Its full potential will be exploited by an equally powerful force which is a new kind of management, governance and leadership. It is the system‐cybernetic kind of managing complex systems. As I will later show, both have much in common since they had their birth at the same time and in same place.
The Great Transformation21 is the reason why ever more organizations—in the business as well as in the non‐business sector—operate in a zone of excessive challenges. The origin of bureaucratic paralysis and ossification lies in the obsolete methods of conventional mechanistic management. Today’s organizations prevent solutions and even contribute to the intensification of crises with their growing inability to master complexity. Digitalization on the one hand is aggravating the difficulties and on the other hand it will be one of the major solutions.
All the social mechanisms that make organizations function will change fundamentally and irreversibly—worldwide. Millions of organizations of every kind and size will have to adapt and be rebuilt, as they no longer meet the new standards. Across the generations, people will be required to rethink and relearn.
2.1.2 The Map of Growth, Uncertainty, and Creative Destruction
Change in itself—even big change—is not unusual. There is always improvement, adaptation, innovation and also disruption. Here, I am talking not about any kind of change but about a very specific kind of change, the kind that will replace the existing with something new according to a pattern. We are talking about substitution. The famous Austrian economist Joseph Schumpeter called this kind of change “creative destruction”. With that, he put in words the basic law of change that also governs evolution in nature.
My paradigm of the Great Transformation21 is two overlapping s‐curves (Fig. 2.1). My research into this pattern goes back to the late 1970s. In the graph, the red curve represents what I call the Old World. The green curve represents the New World and the foundations of tomorrow’s world.
Fig. 2.1The paradigm of the Great Transformation21
Between the curves, we see an area of increasing turbulences, as the old is replaced by the new. This is the critical decision zone; this is also where disruptions can take place; this is where the Old World starts dissolving and the New World begins to take shape.
This is the zone where the really difficult questions and risks of navigation and management occur. Previous key resources become increasingly meaningless; they have to be shifted or newly created.
In search of answers, we reflexively cling to old methods, although they are becoming increasingly useless. These old methods are what have caused the troubles in the first place.
Among other things, one key question is whether people in a “red” business will also be able to contribute to a “green” business, and all of a sudden it is doubtful as to whether you will have use for even your best people in the future. This zone of shifts is a black box—as it is named in the science of cybernetics, which is the basis for communication, control and navigation. It is a system which, due to its immense complexity, is incomprehensible, unpredictable and incomputable. However, with a new kind of management we are able to cope with it—just not with conventional methods.
2.1.3 Navigating into the Unknown by Systematically Misleading Signals
One basic rule of change is: Whatever exists will be replaced. Looking at it with hindsight, you know what the pattern looks like. You also know then what would have been the right decision at any given point. Standing in the here and now (Fig. 2.2), the existing information systems in our present organizations deliver systematically misleading signals as their output.
Fig. 2.2Here and now: Navigating into the unknown with misleading signals?
In today’s world, the signals tell us to continue on the red curve. To the extent that—even if we notice the green curve at all and take it seriously—our old compass warns us not to pursue that route. Only when it is too late do our old systems sound the alarm. However, by knowing the entire pattern up to a certain degree, the risk of making wrong decisions can be circumvented.
2.1.4 Needed: Three Different Strategies and Systemic Leadership
There is yet another important challenge. We need three different strategies: The first strategy is to take advantage of the red curve as long as possible. We need a second strategy to build the green curve in time to have it when we need it. And we need a third strategy to make the transition from red to green.
At this point, it also becomes evident where we need real leadership and what it must entail. True leadership is needed for the start into an unknown future, when all visible signs seem to indicate that we should stay in the past. There are such organizations that have mastered change several times in the course of their existence, mainly by making it happen themselves. Examples include Siemens, Bosch and General Electric, but not Kodak. For instance, nothing could be more useless than having the world’s best chemists in the photo industry when the substituting technology is digital. Virtually overnight Kodak’s most valuable asset—the knowledge of its top people—had become worthless. What is worse, apart from having become “useless”, these same people offered the strongest resistance to digitalization.
2.1.5 Being Ahead of Change
Just as there is a substitution pattern, there is also a strategic principle that successful companies and organizations adhere to: Be ahead of change! They actively make change happen instead of waiting for it to hit them. They take advantage of the forces of this relentless law of business—and not only business—to start into a new dimension of performance rather than fight it. They keep the initiative and determine the rules. Hence, change is not a must but a want to them. The organization itself determines what happens instead of drifting along. By outgrowing itself and its previous limits, it in effect substitutes itself. If we don’t do this, others will. It will happen one way or another—that is their maxim.
2.2 Radical New Governance Thinking
2.2.1 From the Mechanistic to System‐Cybernetic Management of Complexity
Information technology is one of the major drivers of the Great Transformation21. However, digitalization alone would soon freeze within the labyrinths of obsolete organizations and mechanistic management processes. Most probably it would just reinforce already existing bureaucracy. Successful digitalization needs system‐cybernetic complexity management. Only together will they create the ability and willingnes
s of people and organizations for fast change.
What does digitalization really mean? Properly managed it is the potential of rapidly growing interconnectedness of hitherto separated systems. And it also means doing things simultaneously which so far could only be done sequentially. As a consequence, this means an exponential increase in intelligence, adaptivity, speed and productivity. This is what challenges millions of organizations in our modern complexity society. Without functioning organizations a collapse of societal functioning looms.
The danger is real. Because the origin of most of today’s organizations’ morphology and principles of functioning reach far back into the last century. Therefore, they are ever less equipped to deal with the challenges of today’s complexity and speed. They are too slow for the transformation, too stolid, neither efficient enough nor adaptable enough.
Decision‐making processes seem paralyzed and block themselves. Collective intelligence, creativity, innovation and ability for change are lacking, as well as self‐coordination, self‐regulation and self‐organization. If we were to stick to conventional ways of thinking and methods, a social disaster would be inevitable. On the other hand, a historically unique period of prosperity on a global scale could be reached if we rethink now. A new societal order—facilitating a humane as well as functioning way of living together—could thus be created, beyond the more than 200 year old and gridlocked political ideologies.
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