Today’s economy can be best described as the “Rebel Economy”.
People seek decentralization and democratization of power. There is a tsunami against traditional authority. And this is changing the world like never before. Let’s take a closer look at recent trends:
Bitcoin, which is a decentralized currency is at its all-time high value. It is in response to people’s mistrust in our currency system controlled by central banks. If they can print money, why can’t we? This is not the end of it. You see peer to peer lending, peer to peer insurance growing by leaps and bounds. The fundamental purpose of financial institutions to act as a trustworthy intermediary is being challenged.
If you look beyond financial services, you can see major upheaval in the way people want to work. Work-from-home has been driven mainstream by COVID, and in several functions and industries, people are seeing the benefit of the same. Many companies have declared their intent to implement Work-from-home forever already!
The gig economy has been taking shape for over two decades now in the modern avatar and is getting bigger and bigger every day. The idea is to become an independent contributor and work as per one’s own calendar, pace, aspiration, and choice. I have met so many people, who refuse to go back to work the traditional way. In fact, corporations are a complex structure, which was created to achieve scale, efficiency, and collaboration. Now, with the advent and maturity of digital technologies, the same benefits can be achieved in a distributed environment. We are seeing the advent of “Enterprise of 1”, i.e. an enterprise of one single individual. Hence, it forces us to rethink the status quo which has evolved in the last few hundred years.
Looking at the entertainment industry, indie creators are a rage. There are unknown Tiktok stars whom I have never heard of; super hit series which were hardly advertised; music sensations that are targeted towards a particular genre. In short, a major democratization drive seems to have transformed the entire industry — something that started with Napster has come a full circle with OTT and social media platforms.
In the realm of education, in many parts, traditional education led by established institutions are being outright challenged. We see homeschooling, MOOCs, Income Sharing Agreements led startups taking root; whereas we see many engineers and MBAs left unemployed.
Crowdfunding, fractional-ownership, fractional-shares are all becoming mainstream.
Moving beyond financial markets, future-of-work, entertainment, and education; we can clearly see a change emerging in the political landscape globally. Countries that allow a choice of governance through the democratic process and distribution of power through a federal structure are comparatively peaceful and progressing well economically and socially. Even in those countries, there is dissent against the control structure, as people expect more involvement, more transparency, and better governance.
So, it is clear that people in general in the 21st century are progressively demanding more ‘self-governance’. This is like turning the current representative based governance on its head across the spectrum of industries and realms.
What can be the reason for such a dramatic change?
- Access to information and knowledge has flattened the leverage few people had due to their position. This coupled with literacy rate and general evolution has played a critical role in people’s ability to understand how they are being governed, their rights, their choices, and the constraints that are put around them.
- With an ever-growing population of knowledge-empowered or hyper-influenced individuals, a faster-growing group of people is creating sub-cultures based on their beliefs. Each of these sub-cultures is very distinct in nature and contradictory to each other. With social media fuelling the feeling of the supremacy of each of these sub-cultures, tolerance for alternate ideas are low. And hence, it is very difficult to enforce one way of doing a thing on the masses.
- Lack of quality governance across the spectrum. The purpose of governance was “service”. It has gradually become “power” over a few hundred years with notable exceptions. With power comes responsibility, but when the people involved in governance does not exhibit responsibility, it creates an environment of mistrust.
These ideas cannot be generalized, and therefore the “rebel economy” is also not omnipresent in every facet of life, and in every country, or industry, or business.
So, what can you do as a business and an individual in such an environment?
- Try to create a decentralized organization giving people choices in terms of governance (in fact self-governance), tools, sub-culture, etc. Give a broad culture guide and value system to keep the tribes together, which should be explained and open to debate. Have a lot of focus on the mission, and hire people who are driven by the mission. Mission are core values are possibly the only thing that will bind the organization. And, I am not talking about the potboiler value statements.
- Hire smart people. Hire for an attitude of unlearning, learning, experimentation, critical thinking, and problem-solving. Everything else can be learned. As we move towards the “Enterprise of 1”, you will benefit from having smart mini-enterprises, which are self-governed and managed.
- Embrace flexibility by moving the focus on the outcome and ethics, and not on the process and control structure.
- Respect each “Enterprise of 1”, because your net value is a summation of these enterprises and the additional collaborative value it creates.
- Have business conversations with every individual and mentor them as an entrepreneur. They need to know what it means to be an individual responsible for themselves. Provide them a support system, and a backup to fall back upon. They should have the ability to fail and yet survive. Such coaching programs will not only help you stand out as a super-partner but also create better mini-enterprises.
- Do not try to fight the trend, but embrace it. Build on top of it.
Nothing lasts forever. It’s a cycle. A cycle of centralization to decentralization, and back to centralization. It may be unprecedented in our lifetime, but it has happened several times in history. Hence, the best teacher to navigate this crazy change around is to learn from the past.
As entrepreneurs and individuals, we shall adapt to survive. And if you are the rebel-rebel type, you can always try to reverse the flow, one step at a time, by creating your own small island. There is no right or wrong. It is all about our beliefs and how we want to achieve our goals.