Emerging Twenty-First-Century Techonomic Business Models

Technologies based on the first three laws of twenty-first-century techonomics
empower us to conduct commerce and shape the organizations in new ways. New
business models are developing that were neither conceivable nor feasible a decade
ago. It is instructive to study thriving, industry-leading companies that have pioneered
new models, leveraging emerging technology into lasting economic advantage.
Some of these companies make and market high-tech items, while others do
not, but all of them use technology in alignment with twenty-first-century
techonomic trends to make numerous aspects of their business more effective,
including:

• Minimizing inventory
• Meeting specific customer desires
• Minimizing operating cash requirements
• Increasing operating hours
• Increasing number of outlets
• Deploying capital more wisely
• Globalizing production and support
• Magnifying per employee transactions
• Streamlining and focusing marketing methods
• Eliminating traditional middlemen in the sales/distribution channel
• Eliminating retail overhead
The following sections give concrete examples of successful businesses and how
they are using technology to rewrite the rules of competition. These businesses are
applying the laws of twenty-first-century techonomics to their great benefit. Others
must understand and apply the same laws if they are to survive in the competitive
marketplace.

The philosophy of supply and demand has guided free-market economic thinking
for the last two centuries, but Adam Smith developed these principles before the
advent of mass production, heavier-than-air flight, computers, satellite communications,
and the Internet. Humankind now has the ability to manufacture any product
in a quantity that exceeds demand. We can market any product to the entire planet,
and distribute any product ubiquitously, from any location. Now, deployment of
resources to provide a return on investment should be determined as much by
competitive positioning as market need. Without a strategic and defensible competitive
advantage, gains in today’s marketplace are short lived. A competitive advantage
can be continuously improved by productive utilization of emerging technology in
innovative products or in transforming the marketing and distribution channels.
Entirely new methods of cash management are also made possible by understanding
and implementing the first three laws of twenty-first-century techonomics.
Many successful companies are learning to manufacture only when demand
arises and minimize the time lag between demand and fulfillment. The dance of
supply and demand is orchestrated by wise use of technology, market positioning,
and deployment of capital. Technologies are selected based on how they support the
efficient production of products/services and defensible market positions based on
company assets (intellectual property, distribution network, trade secrets, mind share,
etc.). These defensible market positions are what Jim Collins, author of
Good to Great, calls the “Hedgehog Principle.”

The armored, spiky ball into which a hedgehog
rolls itself when threatened affords a nice metaphor for a highly defensible
market position!

As we examine the following business models, we shall use techonomic metrics
to reveal reasons for success of each business. The techonomic thought process is
embodied in this approach: study a company or organization and its fundamental
marketplace, understand how its business model functions at its core, and create a
measurable quantity that combines a technology and an economic contribution to
track the company performance. Learn to apply the techonomic approach to your
own endeavors, and you will become more effective in your decisions for deploying
resources.