According to our report, the last 250 years of economic development have been remarkable. In the most advanced economies, it's closer to a twenty times increase. All the more striking when you consider that throughout the 130,000 years of human existence prior to that incomes probably multiplied by no more than three times.
It is innovation and entrepreneurial spirit that has driven this positive change. Great entrepreneurs like Richard Arkwright, Andrew Carnegie, Henry Ford and Eiji Toyoda transformed the world by finding revolutionary ways to produce goods in much greater quantities, to a far higher quality and with a wider diversity. In effect, they helped humanity get much, much better at generating value for itself.
Now a whole new way of doing business is emerging once again. The power to generate value, which was always the preserve of the entrepreneur and their business, is shifting to the consumer. Millions can now download products when, where and how they want them. Consumers now make their own content and share it online.
This SGV era and the associated entrepreneurial ethos will be highly disruptive. The 'creative destruction' wrought in publishing and the music business, for example, are a taste of what is to come. Ultimately this will generate a new leap forward in living standards and quality of life but there will be casualties along the way in the form of bankruptcies, unemployment and insecurity. There is also the risk that a very strong emphasis on entrepreneurialism could lead to an unreflective and destructive individualism.
The response is not to resist self-generated value or the new entrepreneurial spirit but to embrace it while also keeping a critical eye on its negative implications. Those implications must be addressed with just the same innovative and entrepreneurial spirit as is being applied in the commercial world.
This report recommends the following:
- Be highly supportive but not entirely uncritical of the spirit of enterprise, which may be emerging as SGV gathers pace.
- We need to explore how in this new world of value, political hierarchies can be rethought to restore some of their lost legitimacy.
- Identify new foundations and processes to strengthen collaboration.