Blog: Are consumers winning? March 6, 2014

How many companies face the biggest competitor yet: self-organisation!
What is the key driver behind the success of solar panel communities, peer-to-peer lending systems, local currencies, ‘durftevragen’, car sharing concepts and all kinds of other new business models? When you look at this question from the perspective of ‘current economic paradigm’ you might say that the answer is lowering costs, return on investment, access to more stuff for less or even status and coolness. But in the reality of todays’ consumer the answer is different and should be ultimately frightning to companies that play no part in these new business models. The real reason that these ‘signs of new economy’ are on the rise is not consumer behaviour driven by ‘proof points’ or ‘usp’s’, but it is a deeply rooted and new motivation under the choises that people make. The key drivers for the success and the attractiveness of these new models are about selforganization, social cohesion and freeing yourself from corporate dominance.

Consumer competition
As I’m writing this down, the first thing that comes to my mind is: ‘This does not look good for a lot of companies.’ But that does not make it less true. When I look at the projects we do and the examples we see in the world, I can only conclude that a lot of companies have a new and unexpected competitor who is bigger, more powerful and ultimately motivated: it is the consumer him- or herself and the entrepeneurs and companies that facilitate people to self organize their lives.

Strategic blind spot
Off course, we know from experience that self organization of consumers is a major ‘theme’ on the strategic agenda of a lot of big companies. But we also see the inability to translate these strategic intentions to new reality. And this is understandable. Reshaping yourself to the new motivation of consumers is not easy because it can present a real threat to current business models. For instance, in the world of healthcare insurances ‘self organisation’ means that people would gladly get rid of their policy and create their own ‘financial and moral support networks’ for healthy living. For NGO’s a competitor is no longer just other NGO’s, but people starting their own private charity. And for banks ‘self organisation’ is already a threatening reality. In 2013 Dutch banks had to acknowledge that revenues were under pressure, partially due to the growth of alternative currencies and lending-communities.

Win or loose?
The consumer doing it for himself, together with social communities, is a threat to a lot of ‘old’ business models and companies. But, as always, the opposite is also true. The new motivation towards selforganisation has given a lot of new (and old) companies the inspiration to reinvent themselves, their products and their services. We are proud to have helped some of them to make this transformation.

We believe that companies can not compete with self organisation. Instead they have to create the new business models, products and services that facilitate it. Simply because the alternative is probably losing.

By David Smith. Co-founder and owner of Perfect World Principle. Together with Jenny Elissen, launched a book on the ‘Perfect World Principle’ on July 4t 2011. Do you want more information, please drop us an email: info@perfectworldprinciple.com or check www.managementboek.nl