In this months WIRED magazine Chris Anderson answers the question 'why $0.00 is the future of business'. His new book is going to be 'FREE' and will be published in 2009. This article is the introduction of the book.
In the article Chris talks about the way business is going to give away their products to customers. He outlines a big difference between free and cheap. When a product is cheap the buyer still has to make a decision to buy. When a product is free no decision is made and the buyer just starts using the product. One of the bigger models at the moment in the webbased world is the regular versus the premium product. The regular product is free to everyone and the premium product is available at a cost. Only 1% buys the premium but that is enough to make a profit for the company. The total operating costs of a company are realy low. Today in the online world storage and distribution are virtually free. The time it takes to start a product is almost nothing. You can make a new website or application is one day or two weeks. This is nothing compared to traditional software development cycles of more than 6 months. These companies do not employ hunderds of people. In the same issue of wired there is example, 37signals, who only employ 10 people and serve 1.000.000 customers!
If your company is going to give away some products, every strategy in your company has to be revised. You have to start using cheap production methods and knowledge management tools (eg. Enterprise 2.0 platforms). Make decisions about what products to give away and what products to sell at which price. Where are my people going to work, do I need an office? There are so many questions rising about this theme. I think it is going to set the trend for business the next years. At least in the webbased business, media and entertainment and other types of business who profit from free distribution and storage!
I already got a copy of 'The Future of Management' by Gary Hamel. I think this book and FREE are going to be complementary! The combination is going to set the standards for marketing and management in the future.
When I finished Gary Hamel's book, I will talk about the combination some more. Do you agree? What do you think about the FREE article? I would like to read your comments.
Showing posts with label management. Show all posts
Showing posts with label management. Show all posts
Tuesday, March 18, 2008
What does FREE mean to your company?
Friday, December 21, 2007
The game design attitude
The workshop about Learning from Games that Marinka Copier and I organized took place this past Wednesday. It was quite an accomplishment to have this very diverse group of people around the table in this busy week before Christmas. We had representatives from IBM, the Dutch Innovation Platform, the Utrecht School of the Arts (Game Design program) and Nyenrode Business Universiteit. So a combination of views from game design, education as well as business. And this was exactly what we were aiming for.
The basic rationale behind the workshop was that there are things to be learned from game design principles that can be applied in other settings, such as education or management. At the end of the day, everybody agreed that this is an idea that has immense potential. We arrived at some common understanding of the challenges and exchanged ideas for potential projects in 2008. More about that as soon as these ideas are more concrete.
One of the most important insights I took away from the workshop has to do with the attitude of the game designer. Game design is about building a solution on a small scale (with a focus on the things you can control), letting people play with it, observing and evaluating what happens and then adjusting the solution. Because what you are designing is not an end product but a dynamic process (basically, you are designing behavior) you need an iterative approach and constant monitoring.
The second thing that stuck with me is the different view on the world that playing, studying and designing games can give you. This view has to do with not taking rigid, old structures as a given (such as bureaucracies or hierarchies in organizations) but deliberately organizing things in a different way. Studying games can give you these insights. Once you realize there are other ways of organizing, new doors will open in many areas. Right now, gaming is the only arena where the network society is truly taking shape. What if we could expand this to other fields such as education and organizational life?
This design attitude combined with a view on the world inspired by games could be a very powerful instrument for managers. Especially when you consider that these tools may be essential if they want to use the full potential of the new generation entering the labor market.
However, my attempts to pry open the black box of the game design process during this workshop were unsuccessful. There are a few design principles that you could make explicit (such as giving meaning to meaningless actions, mystification of the rules and direct feedback) but these principles are always connected to the design practice of the individual designer. It is hard to make them explicit as clear-cut rules that a manager could use.
The basic rationale behind the workshop was that there are things to be learned from game design principles that can be applied in other settings, such as education or management. At the end of the day, everybody agreed that this is an idea that has immense potential. We arrived at some common understanding of the challenges and exchanged ideas for potential projects in 2008. More about that as soon as these ideas are more concrete.
One of the most important insights I took away from the workshop has to do with the attitude of the game designer. Game design is about building a solution on a small scale (with a focus on the things you can control), letting people play with it, observing and evaluating what happens and then adjusting the solution. Because what you are designing is not an end product but a dynamic process (basically, you are designing behavior) you need an iterative approach and constant monitoring.
The second thing that stuck with me is the different view on the world that playing, studying and designing games can give you. This view has to do with not taking rigid, old structures as a given (such as bureaucracies or hierarchies in organizations) but deliberately organizing things in a different way. Studying games can give you these insights. Once you realize there are other ways of organizing, new doors will open in many areas. Right now, gaming is the only arena where the network society is truly taking shape. What if we could expand this to other fields such as education and organizational life?
This design attitude combined with a view on the world inspired by games could be a very powerful instrument for managers. Especially when you consider that these tools may be essential if they want to use the full potential of the new generation entering the labor market.
However, my attempts to pry open the black box of the game design process during this workshop were unsuccessful. There are a few design principles that you could make explicit (such as giving meaning to meaningless actions, mystification of the rules and direct feedback) but these principles are always connected to the design practice of the individual designer. It is hard to make them explicit as clear-cut rules that a manager could use.
So more work is needed before we can start helping managers adopt a gaming mindset. I have the impression we can work on that from the platform we created with this workshop.
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