Business & Industry Transformation, an opportunity for a new business practice

The world – including business, industry, markets, consumers, economies, and the demographic landscape – is changing at a rapid pace. Everything is changing due to globalization, free movement of capital and social factors. In the last decade, new economic powers have emerged, challenging established structures. New corporate giants have emerged too, taking over new market spaces. Industries have been transformed by disruptors’ business models (take the music industry for example). Today, your most important competitor may not even exist in your industry yet. There is massive competition between industries.
Think that Google, Facebook, and Twitter are less than 15 years old (Google recently celebrated its 15 years anniversary). The internet has radically changed our lives. It all started with fixed-network and dial-up services and the best is yet to come with mobile broadband networks in the era of the Networked Society.

The question is what’s next and how do we get there? Do we master the ongoing change process or are we just going with the flow? Are we going to reproduce the same economic concept of open-ended consumption or are we still able to change the course towards a model with more societal development that tackles fundamental social problems while still creating economic value.

By the end of this decade, we will be more than 8 billion humans on this planet. According to our recent Mobility Report, there are over 6.4 billion mobile subscriptions worldwide today, with 130 million new net additions coming in the first quarter of 2013. The economic model we have today is not sustainable. We must start seriously redefining it!

Considering its broad impact on the business landscape and the resulting transformation of industry, the Networked Society represents a tremendous opportunity for a new business practice. It has never been so easy and so ‘cheap’ to start up a new business. Through the increasing number of connected devices, combined with high-performance mobile broadband infrastructure and cloud technology, a large amount of data is now available for processing. This information is helping to prevent disasters, fight poverty, and empower women in poor countries. The sky really is the limit for sustainable business innovations that generate profits for shareholders while at the same time creating significant value for society.

Thankfully, we are starting to see, here and there, initiatives that are driving change towards this mindset. Here are a few examples:

• The shared value initiative spearheaded by Harvard professor, Michael E. Porter.

• A number of institutions have started providing MOOC (Massive Open Online Course). Both MIT and Harvard joined forces to launch the not-for-profit, edX, a free and open online platform. You can imagine the impact that this initiative would have on student communities in Africa. Students who historically couldn’t even afford to join an African school, suddenly can follow a curriculum at one of the most prestigious school on earth. And all of it for free! And all over a mobile broadband network.

• The Coca-Cola Company with partners, NGOs and companies, launched a water purification system housed within the community center to help provide communities in need with access to safe drinking water and other basic necessities. Through this commitment, they aim to deliver 500 million liters of safe drinking water, while promoting greater local development in communities that need it most.

• And finally, Ericsson has made the commitment to step up efforts to meet the Millennium Development Goals. This is based on a strong belief that ICT can make this happen and is happening through a multitude of actions and collaborations. Here are just a few:

• Together with Refugees United, we have developed an application for mobile phones that help to find missing loved ones who have been separated by conflict or disaster – sometime for years.
• Another example is Ushahidi, a website that was developed using crowd sourcing to map reports of violence that occurred in 2008 in Kenya following the country’s 2007 elections.
• Active participation in UN Broadband commission with co-writing the report on Transformative Solutions for 2015 and beyond.

These examples are just a few of the reasons I truly believe that the Networked Society can be a driver of economic growth and societal development in this all communicating world.

This post has been published simultaneously on the Ericsson Networked Society Blog.

Amsterdam bicycles make the city smarter

From its humble beginnings as a 13th-century fishing village, Amsterdam today is a major hub for business, tourism and culture and has a long and well-respected tradition in the arts. In this post I’ll talk about some of Amsterdam’s ambitious plans for making urban life smarter.

A little history about Amsterdam: In 1323, the city owned the exclusive right to import beer from Hamburg while at the same time the herring trade grew rapidly allowing fishermen to increase profits. In 1602, the Dutch East India Company was founded which the city owned a majority share in. The 17th century was a period of unprecedented prosperity during which Amsterdam underwent massive urban development resulting in, among other things, its famous canal system. Art also flourished during this time and the number of artists, art dealers, as well as the amount of art produced, grew enormously. Amsterdam had become a thriving cultural city, producing masters such as Rembrandt van Rijn, Johannes Vermeer and Jan Steen.

Today, Amsterdam is a metropolis of more than 800,000 inhabitants (excluding the suburbs) with nearly 12 million international tourists visiting the city in 2012. It is also a smart city, where fiber, broadband and LTE networks are widely deployed and where anyone can enjoy free Wi-Fi access anywhere in the city.

Many initiatives for making the city smarter have been launched in recent years. One of them is the Amsterdam Smart City (ASC) spearheaded by the Amsterdam Economic Board, the City of Amsterdam and various private business interests. It’s a partnership between businesses, government, research institutions and the citizens of Amsterdam to develop the Amsterdam Metropolitan Area into a smarter city.

ASC connects the needs and wishes of users, residents, government and business and provides a platform for testing innovative products and services. By establishing the Amsterdam Metropolitan Area as an urban living lab, ASC has made it possible for businesses to test and demonstrate innovative products and services.

Many of these projects have already been launched. One of the most original is Ring-Ring. Amsterdam is known for its biking tradition (there are more bicycles than inhabitants in the city) and cyclists make a significant contribution to city health, clean air, social interaction, improved accessibility and a more pleasant public space. Ring-Ring rewards every cyclist for each kilometer cycled! With an innovative technique, the smartphone app counts all the cycled kilometers (Fkm) automatically. Each Fkm = € 0.10. The Fkm that are saved can be redeemed, using the app, at a Ring-Ring affiliated connected business, which are good for making purchases or for getting discounts on products or services.

This is a great example of innovation – empowered by ICT, technology and people – in order to reduce carbon emission and make the city life much better.

This post has been published simultaneously in the Ericsson Networked Society blog as well.

Here’s how ICT makes Jakarta gets smart

With a population of about 9.6 million, Jakarta is the largest city in Indonesia as well as its capital. It’s the country’s economic, cultural and political center and is experiencing rapid urbanization even in the peripheral areas. It’s the most populous city in Southeast Asia and is the tenth-largest city in the world. In short, it’s a megacity – full of hope, optimism, generosity and cultural diversity. In this post, I’d like to take a closer look at how ICT is helping to make Jakarta a smart city as well.

In 2010, the Indonesian telecom market hit its saturation point. With 278 million subscribers, Indonesia is the 4th largest mobile market in the world and the world’s top-ten 3G market. The rapid adoption of smartphones has pushed mobile operators to become key players in the internet sector. By 2015, it is foretasted that smartphones will represent around 40 percent of all handsets in Indonesia. Mobile operators are pushing data services with big advertising budgets – a move that has been helped by declining device and subscription prices.

Like most megacities, Jakarta is struggling to meet the transportation needs of its people. Frustration with Jakarta’s traffic congestion is a daily discussion point for Jakartans. First-time visitors are confronted with the problem the moment they leave the airport. A taxi driver told me once that the average car speed in the city is less than 10 km/h.

Many initiatives are already ongoing to tackle transportation and traffic problems. Of course, additional investment in transportation equipment and infrastructure is needed but these problems can often be solved, or at least mitigated, by providing real-time visibility into traffic elements in order to dynamically optimize existing transportation resources and inform users of the state of traffic in the city.

But who can provide and process this large volume of dynamic data other than ICT sector? With a widespread mobile broadband network, an information system could dynamically push location-based information to city dwellers and commuters as part of a smart mobility ICT solution. However, Jakarta citizens and commuters also need to be engaged, informed and held accountable for this change as well.

Another interesting case is power supply availability. Electricity is not evenly distributed throughout Jakarta. Street vendors use illegal and dangerous electricity connections while working at night. The state electricity company, PLN, is piloting a new program where street vendors can buy small, affordable amounts of electricity through a coin-operated device. When they run out, they can top up with another coin, like using a pay phone. By adding M2M features to the device, PLN will be able to operate its smart wireless device remotely and collect usability information in real-time.
However, a smart city isn’t just about ICT and technology. it’s also about human and social capital, and about educating the urban population. To be successful, a smart city initiative must be a inclusive and democratic program that is embraced by Jakarta’s citizens. That is how citizens can together shape their future.

From an ICT and business perspective, big data analytics, cloud-based services, and M2M-enabled services that intelligently provide real-time inputs will adequately provide smart ICT solutions. New business models between utility and technology providers can be developed to offer these integrated services. Funding mechanisms will be needed and governmental and public-private partnerships are probably the most suitable project models.

Jakarta, the smart city, is a very promising market for service providers. It’s a city that will rely on these providers’ ability to innovate and tap into each other’s industries while taking on multiple roles in the ecosystem.

This post is also published here on the Ericsson Networked Society Blog.