A thought about the modular economy

I had a thought about the “modular economy”. Look at the entertainment industry, where large groups of totally outsourced skills come together to work on a project – no permanent infrastructure, largely modular, with almost granular participants – single people coming together on massive projects.

This sort of “network economy” or “modular economy” has been going on since the beginning of the film and music industries. The question being, how did other people in those industries actually find out who did the good work? The simple answer, CREDITS.

At the end of every film, on the liner notes of every CD, you see the names of the people who put it together, mainly so that they can get jobs as a result of their good work on that project.

So – what of the future? The current trend in outsourcing is that many companies are adopting this “network economy” framework. Some things, such as web design, are clearly credited on many company websites. But what of integrated back end outsourcing in industries such as call centres, logistics, payroll management and royalties?

We may well see an entire movement towards orgnisations decoupling their businesses into discrete units. Might we see a complete disaggregation of skill sets, following Michael E Porter’s “Value Chain” – where organisations adopt a mix of people, process and platforms (digital tools) to outsource vast swathes of their functions beyond the obvious ones.

What of builders? We often see signs on building sites which relate to the plumbers, electricians and tilers. What of permanent credits? Are we going to see the names of workers etched into concrete (literally)?

The irony of outsourcing (although a great thing), is that while it costs less to have a firm who does nothing but one task handling that task on behalf of your business, the thing is it could result in those firms having to adopt marketing and administration infrastructures just to get follow up business, thus lift the costs…

Constantine Frantzeskos

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