Digital Marketplaces Unleashed
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8.1.4 Typical Factors to Fail with an Application
If the users are overly challenged by the possibilities of an application, or if they feel overburdened by the mass of information, they will be irritated; the app will never be used again or de‐installed immediately.
Applications, which push their way into the foreground, will be found to be troublesome by users. In the meantime, there are many smart phone users, who have moved away from Android, because this annoys them immensely: being constantly confronted by unasked and unwanted messages on their device, which bring no noticeable use or advantage. Here, the digital industry must understand that it is no longer dealing with undiscerning users, but increasingly with digital natives, who know exactly what they want and have a deep understanding of what is technically viable today.
8.1.5 Mature User
Users have become more demanding. The demands on mobile devices, smart phones, tablets and their apps have risen exponentially during the last few years. Not so long ago we were happy if we were able to surf and mail on our cell phones, but today we expect a fully‐fledged computer, equipped with OS and apps, which organize and optimize our everyday life with one click, anytime and anywhere.
8.2 Work and Private Aspects
How do our behavior patterns vary in association with digital media, when we navigate through our private everyday life, or move through our working world? Are there any differences at all?
8.2.1 More Stakeholder, More Complex Demands
How does cooperation between employees happen today and how do digital technologies and media change future collaboration within a company? In this case, the situation is similar to the everyday and private aspects: about the direct and instantaneous added value of a new technology or mobile application, which decides success or failure. Only in this case, contrary to the private world, there is a far larger variety of stakeholders, usually with diverse interests, diverse duties, and diverse benchmarks for the qualification of added values.
Concretely, this means that the meaningful deployment of digital technologies in the enterprise environment places even more complex demands, than already exist in the consumer market. If it is only left to the IT departments to try to do justice to the digital transformation, with however much enthusiasm, boundless innovation and much know‐how, efforts of this kind, nevertheless, are doomed to fail.
8.2.2 Strategy vs. Culture
Only if the corporation dares to admit that it doesn’t know the perfect route itself – vertically and horizontally – and that it needs cooperation from all departments and employees, then it is able to move into the digital age 4.0. The underused networking potentials, which sound so enticing using the buzz word “Industry 4.0 and digital transformation”, can only be identified and utilized by interdisciplinary working groups.
8.2.3 The Importance of Culture
In plain language, however, this also means that a revolutionary philosophy and culture change needs to take place within the company. Management Guru, Peter Drucker, once said “Culture eats strategy for breakfast” [1], s. Fig. 8.2.
Fig. 8.2Culture eats strategy for breakfast
This “old” realization suddenly becomes red‐hot when we talk about the digital transformation in our working world and when senior staff wants to successfully drive the digital transformation within their department or the entire company. Company culture is certainly not the panacea for the sick and lame patient, but it can unleash cascading effects, which are necessary to excite the employees to take new digital paths.
Company culture gives the initial impulse to embark on the path together in order to find and invent a new and suitable work place of the future together. In the implementation, however, there are a number of stumbling blocks. The enterprise not only has to take new paths technologically, but organizationally and process‐oriented as well. There must be a collaboration of teams and communities, which are interested in a genuine and profitable digital transformation for all interested parties and the corporation. The immediate and direct involvement of workers’ councils must not be neglected in this process.
8.2.4 Collaboration and Humanization of Work
Here, it is necessary to get across to the employees that it would be fatal to oppose or be skeptical towards digital transformation, simply because of the technical changes necessary. After all, ultimately a genuine digital collaboration, in combination with the associated company culture, is precisely what workers’ council committees always demand – collegial cooperation and humanization of work.
8.2.5 Success or Failure
Ultimately, the success or failure of the “digital revolution” in a company, is decided by the end user (employee). If he or she sees reward (added value), if he or she utilizes the newly created digital features of the employer, not only will there be wide acceptance, but excitement in the way the potentials of industry and work 4.0 can unfold in the entire corporation. That means Aristoteles continues to be right in the enterprise environment, as well. The reward principle determines our actions, whether we want to or not: faster results, less annoying and unpopular work, simpler communication and collaboration, more agreeable working environment, better working conditions (analog or digital, real or virtual, offline or online) or more (free) time, is all true “bait” for our actions.
8.2.6 Real Added Values for the User
In order to produce a positive balance of resonance it is, however, not enough to simply give the employees digital tools. Besides the digital spaces, for example enterprise social media, new analog spaces must be created. The new collaboration tool alone does not produce appreciable added value for the employees unless it is embedded sensibly in a total work 4.0 concept: a total concept which doesn’t only drive digital aspects, but which cleverly networks these with working place economy, innovative room architecture, working time models, conferencing systems, work‐life‐balance concepts, and the new design of production facilities and office space. The employee has to be at the center of this – the person as an individual with her or his individual world. Digital applications need analog partners in the real working and private world so that they can be an experience with real added value for the user, s. Fig. 8.3.
Fig. 8.3Henry Ford (1863–1947). An American industrialist and the founder of the Ford Motor Company
8.2.7 Digital Germany
Regarding the digital transformation in Germany, the EU Digital Commissioner, Günter Oettinger indicated: “We have lost the connection”. Is this true? Has Germany already missed the digital transformation bus?
“75 years ago Konrad Zuse presented the first functional computer in Berlin: the Z3. The pioneering country of the past has turned into a follower. We are suffering from the symptom of neophobia – the fear of the new” [2].
I consider these views to be exaggerated and, ultimately, they only mirror a part of the truth. Germany also boasts successful start‐ups and companies which have actively devised digital change, recognizing the potential of these new technologies (e. g. Scout24, KaufDa, Jimdo, reBuy, daWanda, QYPE, Sport1, SoundCloud, etc. …) However, there could be far more companies, IT departments and organizations, which could follow the digital transformation in a smart, fast and safe fashion, if they were only courageous enough to more precisely analyze, adapt, and implement the already tested recipes for success. Nobody has to reinvent the wheel – neither the analog nor the digital one.
Aristoteles 4.0!
Perhaps another quote from Aristoteles may gain significance for enterprises and entrepreneurs if they do not want to miss the boat with the ever‐increasing velocity of the digital transformation: “The beginning is half of the whole”.
References
1.
C. Keese, Silicon Germany, Wie wir die digitale Transformation schaffen, Mün
chen: Albrecht Knaus Verlag, 2016.
2.
P. Drucker, Culture eats strategy for breakfast.
© 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_9
9. Blockchain – the Case for Market Adoption of the Distributed Ledger
Marco Streng1
(1)Genesis Mining, Reykjavik, Iceland
Marco Streng
Email: marco.streng@genesis-mining.com
9.1 Introduction
History is marked by great technological leaps. Inventions change the world and the way we live in it. The wheel revolutionized travel; the telescope placed us in the galaxy; the airfoil let us fly. But the casual observer of history will miss some of the most formative discoveries and inventions of the last 10,000 years because they are not so tangible as an engine or a medicine. And yet a handful of discoveries have been foundational to human progress. High on the list of overlooked historical turning points is money: where it comes from, how it has evolved, and how it has shaped the world. It is important that we trace the history of money because its story is the story of value and how we establish what it is and how we transfer value from one individual to another. If we follow the story of money, we arrive at Blockchain.
9.2 A History of Money
It is a mind‐boggling idea to think of a world before money, but there was one. Simple trade was the only means of exchanging goods and services. But here we see the origin of the idea of money because two individuals trading items that are not exactly the same must decide how to determine what they are worth. At the core of money is the idea of mutually determined worth. Whatever civilization first decided to assign value to an abstract object or substance in order to better facilitate trade truly changed the world.
Money has experienced numerous iterations over the last several millennia. Historians have discovered societies that decided finely polished stones would be their currency and others that used furs and skins. Camels and sheep were assigned a particular value in some tribes and could be used as a form of currency [3]. Money began to assume the form and function that is most familiar in today’s economy when central governments began to issue currency. These early currencies were stamped coins made of different metals, commonly gold or silver [4].
Currency opened the door for banking because a banking institution could keep a ledger of how much currency an individual had deposited. Banking opened the door for credit, credit facilitated enormous capital investments, and economies began to grow on a massive scale.
9.2.1 Currency Today
In the year 2016, currency has been obfuscated. The common man touches real currency far less frequently than even ten years ago. And the currency itself means something different than it did a hundred years ago when the U.S. Dollar was backed by gold. Today, the entire world is functionally operating on a highly sophisticated system of IOUs. When an individual swipes their bank card to make a purchase at a grocery, the only change is the exchange between computer servers of some data that says money has been transferred from on person’s account into another’s [5]. But in real terms, those digits reflect paper currency somewhere, and that paper is meaningless unless everyone agrees to its value. Its value actually fluctuates as a result of a thousand influences, including inflation, interest rates, speculation, the performance of other currencies, and more.
The arbitrary nature of currency and the compounding effect of modern, computerized banking has so radically changed the common man’s understanding of what money is that monetary disasters have occurred. One does not have to look far to find a fiat currency that is defunct, its money worth less than the paper it is printed on. How does such an event occur? Centralized institutions that distribute fiat currency can and do lose sight of the central tenant of money: mutually determined value. When they print money without restraint to meet their own financial needs, it undermines that premise. Repeated failures on the part of governments to respect that relationship has given rise to a new era of money.
9.3 Cryptocurrency
Currency’s most modern iteration is cryptocurrency. This form of money is not fiat money, meaning it is not issued by a central government. It also is not physical – not made of a rare earth substance or printed and distributed in any form. Cryptocurrency is digital, residing on servers all over the world. The most prominent one is called Bitcoin, and the hundreds of others are collectively referred to as Altcoins. While the subject of this paper is not about any of those currencies, we have taken this discussion to this point because it establishes the foundation for the technology that powers crypto currencies. That technology is called blockchain.
9.4 Blockchain
Blockchain at its core is a decentralized authenticity mechanism. When a legal contract is signed today, perhaps for an asset like a building or a car, that transaction is authenticated by witnesses who sign their names and are legally responsible for verifying the transaction took place. In an abstract sense, they are attesting to what reality is or is not. Blockchain is capable of accomplishing the same ends, that is proving what is real and what is not, but in a technologically advanced, decentralized fashion.
9.4.1 Blockchain Technology
When Blockchain is described as being decentralized, a number of attributes are being considered. To begin with, Blockchain is a public ledger, meaning that it is a framework that logs and publicly displays every transaction it processes [6]. Of course, it does so in an encrypted and anonymous way, but when anything is encoded into the Blockchain, it can be verified in the public ledger. As such, the authentication element is decentralized, empowering everyone who sees or uses a particular Blockchain to be witnesses to a thing or transaction.
Additionally, the technology relies on a diaspora of servers to store information. There is not single server containing the keys to all of the information stored on the Blockchain, making the intelligence of the public ledger decentralized in a physical sense as well. This in itself is an important piece of the security that makes the technology nearly unbreakable. Its encryption and decentralization make it as secure as any method that currently exists for storing and transacting information.
Blockchain’s encryption technology is inherently a one‐way street, meaning data is locked away and can only be accessed by keys which users generate. Bitcoin has had great success with this security apparatus in which users transfer Bitcoin by verifying keys to confirm exchanges. The public ledger is an added verification mechanism for ensuring the global security of the currency.
9.5 Market Use Cases
The conversation about Blockchain is happening at a moment in modern history that is uniquely volatile. Technology is not only globally connecting people, it is making those connections more tenuous than ever before. Friction points are materializing in areas as obvious as immigration and as remote as health records and voting in civil elections. In all of those cases, there is a conflicting demand for privacy and transparency, a balance that is poorly managed by most of the systems currently operating today.
9.5.1 Voting
This year may well see one of the most controversial not just in U.S. history, but because of its far‐reaching implications, world history as well. Whoever is elected to lead the world’s largest economy, there is no doubt that cries of voter fraud will be heard in key states and voting districts, just like there have been in every election in recent memory. These recurring doubts about the legitimacy of the electoral process undermine the democratic process and leave the door open for subversive control of outcomes. Blockchain is a viable solution to the problem of voter fraud. The public ledger would allow anyone to see and count the votes. Furthermore, because each vote would require the authentication of the vote cast
er, voter fraud could be solved at the same time.
9.5.2 Personal Records
The number and importance of the records we keep is growing. Any given individual in a first world economy is likely to have extensive medical records, identification documents, tax documents, legal papers, and more. These all must be kept in their original form and transferring them is a laborious process that leaves the owner vulnerable to identity theft or worse. It is puzzling that in a world that is almost completely digital, the core of the global economy and people’s most important records are still kept on printed paper. Blockchain facilitates a completely secure transfer to an entirely digital world in which records are encrypted and secured by user‐generated keys, yet also easily transferable without risking their security. It is not utopian thinking to suggest that the entire segment of the global economy dedicated to issuing and verifying records could be replaced by various applications of Blockchain technology.
9.5.3 Currency
It is a misconception to think that Bitcoin and other Altcoins are the only currency application of Blockchain. By contrast, Blockchain technology has the potential to integrate with traditional fiat currency in numerous ways. In fact, this area is already being explored by numerous major banks, which are looking for ways to improve their processes and compete with increasingly popular cryptocurrencies. Financial applications of Blockchain technology are likely to be the use cases that achieve the most success in the coming years and pave the way for broader adoption.