New Business Models for the Knowledge Economy

Citation

Hanlon, S. (2008), "New Business Models for the Knowledge Economy", Records Management Journal, Vol. 18 No. 1, pp. 92-93. https://doi.org/10.1108/09565690810858541

This is a thoughtful, well‐executed and exciting presentation of three business models, which appropriately reflect the changing face of business activity in the twenty‐first century.

The material is presented in an accessible way, while maintaining academic rigour, business reality and a clear perspective of the societal impact of our growing world knowledge economy. Each chapter is divided in a way that allows the reader to quickly revisit aspects of particular interest or requiring further enquiry and exploration. The theoretical discussions are supported by lively, up to date case studies and anecdotes of relevant events in the business world.

The business models are examined from a range of perspectives – the technological, economic, marketing, sociological, and design. With the multitude and speed of developments in all these aspects of the global economy, it is a necessary challenge to work towards models that can reflect these perspectives. The authors examine what is meant by the term “business model” and critically evaluate past approaches to business modeling. They take the value model as a starting point. This concerns itself with the identification of successful combinations of values and reciprocal values. The authors maintain that “logical combinations [of values] reveal three ideal types of business models”. The three models – Chameleon, Innovator and Foyer – can be recognized or identified by their dominant value and type of governance.

The Chameleon model is the most traditional model posed. This has a central style of governance, where control is completely in the hands of the organization for determining strategy and business processes. The dominant value is identified as customization. This reflects the increased levels of individualization of products and services to suit differing customer needs and wants. The organization, in this model, retains its core features.

The Innovator model is where we really begin to see the movement towards a knowledge society, in organizational, economic and technological terms. Here the governance is shared between the organization, which acts as facilitator, and its customers, co‐producers and/or suppliers. While inventions have always been part of our environment, the Innovator model focuses on the process of making inventions commercially applicable. This involves knowledge, not only of the invention, but also of how to translate these into commercially viable innovations. This knowledge can come from any of the participants in this model. It is the effectiveness of the harnessing of this knowledge, which will determine the success of the application of this model. The more distributed nature of governance here creates interesting challenges for the management of records and knowledge.

In their discussion of the innovation model, the authors introduce more interpersonal values of trust, social contracts and collective ambition. They identify process in terms of knowledge learning and knowledge sharing. And they emphasize the importance of the Internet and information and communication technologies, for the application of networking strategies. The dominant value identified for this model is innovation.

The Foyer model is the most reflective of our twenty‐first century post‐modern, less structured approach to the formation of online communities. It is driven by the nature of the Internet and its capacity for very quickly facilitating communities of like‐minded people with shared aims. The dominant value here is identified as authenticity. The authors are recognizing how virtual communities are reflecting human need for meaningful interaction, reciprocation of emotional values over and above economic or political values, and the need for involvement. The success of the Foyer model is dependent on relational trust and shared identity. The issue of governance is an interesting one as the types of governance already mentioned are not as appropriate. This model is not characterized by a lead organization, in a hierarchy or network of relationships. Rather the communities are formed by a more loosely structured collection of intrinsically motivated people on a more equal footing with each other. Furthermore, the facilitator role would not necessarily remain the same participant in this model, as the community moves through the different stages involved in meeting its aims. The authors point out that different participants take on different roles, which sometimes involve a leadership role. Indeed they posit that the model cannot succeed without a leader to steer the community towards the achievement of its aims. The leader may simply emerge or change according to the stage in the process of achieving the community's aims.

The challenge here in terms of records management and indeed, information and knowledge management, is at its greatest in this Foyer model. The authors look at content management as a way of capturing the knowledge, processes and activities of foyer style communities. This is highly dependent on finding the right technology to enable this, and for the facilitator of the moment, to make available to the community. This needs further reflection and consideration.

The dynamics of each model are examined individually and later in terms of their relationships with each other. They then consider whether there are possible combinations of models, or whether there is a process of evolving from one model to another.

The models are thought provoking and stimulate challenging questions relating to knowledge management, information management and records management in the twenty‐first century.