A Framework for the Collaboration Economy
by Rick Goings
The global economy is changing. The old engines of job creation are stuttering. The jobs gap is rapidly widening, threatening stability in societies around the world. Corporate structures, meanwhile, are creaking or failing – disrupted by technology that is leveling the playing field between small businesses and big enterprise. This is not a slow economic evolution, but – as I have argued before – more like a tectonic rupture along the three fault lines of technology, talent, and demographics.
The result of this transformation: We are moving into a post-corporation world, with an economy based not on hierarchies, but collaboration. Let me be clear: neither big business nor small enterprises are dead. However, they will have to change – to provide employment, and to survive.
The transition to this Collaboration Economy will not be easy.
- Too many people are not equipped to thrive in it.
- Too many companies cling to their old hierarchies and sclerotic supply chains.
Without support, they will not succeed.
The entrepreneur is dead. Long live the entrepreneur.
Our world doesn’t have a jobs crisis. Instead, there are not enough opportunities to earn money. We know that job creation by decree doesn’t work; it’s unaffordable and pushes people into dead-end jobs. So when jobs are scarce, entrepreneurial opportunity is critical. We have to help people identify the skills they have, teach them the skills they lack and equip them for work they love.
However, tell most people that they should become an “entrepreneur” and they panic. That’s because in the public mind, “innovators” and “entrepreneurs” are mythical beings riding the unicorns of Silicon Valley. The media and pundits have created an unrealistic image of what an entrepreneur does and what innovation means.
Being an entrepreneur is not about coding apps or closing a funding round. We have to bring expectations back to a human scale. A Chinese homemaker in Chongqing, a young school leaver in South Africa’s Diepsloot township, or even a Ph.D. in Santiago de Chile will struggle to be the next Mark Zuckerberg. 90% of the world’s population under the age of 30 live in emerging markets. They can’t all find work by boosting their SAT scores in STEM subjects (Science, Technology, Engineering, and Mathematics).
If we want to help people enter the Collaboration Economy, we have to reposition the “innovation bar.” Inventing flying cars and better rockets is great, but not everybody has to be a tech entrepreneur. Let’s celebrate new business concepts and the gig economy as well, because they can also offer meaningful careers, especially ones which don’t require tech training.
Moreover, if we break down the tasks of running your own business, people quickly say: “Hang on a minute, I can do that.”
I recently visited our teams in Indonesia and China. When you hear the stories of these women, regardless of their background, they have what it takes to be a real entrepreneur.
Like entrepreneurs the world over, they have three basics in common:
- Tools: People need the right tool set, both regarding technology and fundamental business knowledge.
- Formula: An excellent idea does not make a successful business; it helps to have a simple, consistent and scalable, proven method, while those with a genuinely original idea may need mentorship to turn that spark into their formula.
- Mindset: That’s arguably the most important ingredient. Entrepreneurs need some grit and confidence. With the right support, this mindset can be learned.
Success in the collaboration economy needs these three basics.
Young people can get this help fairly readily. Adults are usually left to their own devices. No wonder that many start-ups fold within four to five years. Passionate people may run them, but they lack a formula and business tools.
For the Collaboration Economy to thrive, we need to give everybody a chance to learn these tools, find the right formula and get the mindset – so that they can earn an income. Uber is a taxi company that has no taxis but a successful formula. Not long ago I met an older woman working as an Uber driver. She used to clean houses. Now she earns more money and has more flexibility. “Now I can pick up my granddaughter from school,” she told me. She knew how to drive, so didn’t need to learn anything new. What she needed was a successful business model.
In China, we now have 5,500 Tupperware studios. When I speak to our entrepreneurs, it’s evident that their success comes from a combination of tools, formula, and mindset – especially non-cognitive skills.
The Collaboration Economy is taking shape, whether a “formula”based on business models like Tupperware’s, or the ability of entrepreneurs to plug into technology ecosystems like Uber, or -locally -companies like Orahi in India, PortoLeve in Brazil or SafeMoto in Rwanda. They all draw their strength from the entrepreneurial grit of thousands of businesses and individuals.
There’s probably never been a better time to be an entrepreneur. People can right-size their business because they can be agile and scale – all the way from having a gig to growing a big enterprise.
Companies as conveners
Where does that leave traditional businesses? Once there was a corporate staircase, from sole traders up to multinational giants, and entrepreneurs trying to climb it quickly realized: Mount Everest had nothing on it. Now this staircase has been transformed into a sliding scale, where technology and new ways of working have removed much of the friction. Small companies can be as powerful as their biggest rivals, and the giants can be as nimble as tiny competitors.
However, many businesses are held back by their old hierarchies and cumbersome procurement processes. If these firms hope to succeed in the Collaboration Economy, they have to disentangle themselves from their rigid ways of working.
They have to identify their core business, the source of their competitive advantage. It’s only here that they’ll win. Everything else can be left to outside specialists – to their collaborators in the Collaboration Economy.
This kind of set-up, powered by a clever and open procurement process, is especially attractive for emerging markets. They have already managed to leapfrog whole generations of technology – using mobile solutions instead of landline phones and traditional banking. They can do the same with corporate models.
Many large enterprises, meanwhile, will realize that they are lumbering under the weight of vertical integration. To win, they need to be exceptionally nimble.
Too many of them are trapped, however, in the momentum of their corporate structure. Bosses and boards fear failure and focus on quarterly performance, compliance, and efficiencies. They don’t scan their strategic horizon for the next big shift. When they fail, it’s often because their strategy was looking backward and inward.
Ultimately, the company of the future has to be a collaboration tool; a platform or ecosystem underpinned by a set of values and a core business model. Companies have to become the conveners of the Collaboration Economy and help people plug into their business.
The economic fault lines are rupturing already, everywhere. We can protect ourselves against these jolts if we equip both individuals and corporations with the frameworks necessary to build the Collaboration Economy.
About the author:
Rick Goings is Chairman and Chief Executive Officer of Tupperware Brands Corporation, a leading global marketer of relationship-based selling. The portfolio includes not only Tupperware, but multiple beauty brands including Avroy Shlain Cosmetics, BeautiControl, Fuller Cosmetics, NaturCare, Nutrimetics, and Nuvo Cosmetics brands.