New Economy Redux

There has been a lot of arti­cles poo-pooing the con­cept of the new econ­omy. How­ever, many seems to be miss­ing a crit­i­cal part about the changes in the eco­nomic cycle. We are cur­rently going through a period of slug­gish eco­nomic growth but peo­ple are still get­ting fired in large numbers.

Sig­nif­i­cant in the Times story is the fol­low­ing quote:

the recent increases in cor­po­rate effi­ciency appear to have cre­ated a long-term change in the level of eco­nomic growth needed for an improv­ing job market.

The times is bury­ing a huge story in this line. How did those increases in cor­po­rate effi­ciency happen?

It is my con­tention that they hap­pened largely due to the fact that a lot of the tech­nol­ogy invest­ments made in the 90s as result of the dot­com boom are start­ing to pay off. Whereas, in the past, memos were sent in paper form, and peo­ple had to talk to a lot more peo­ple to get access to sim­ple bits of infor­ma­tion, the intro­duc­tion of intranet tools and email in the cor­po­rate world have helped work­ers become more effi­cient by cut­ting a large amount of unnec­es­sary steps in the process of get­ting infor­ma­tion. Whereas in the past, one had to spend hours on the phone to get even the most basic infor­ma­tion about a prod­uct, nowa­days peo­ple just hit the vendor’s site and get the infor­ma­tion they need on their own time­line. This improve­ment in the infor­ma­tion gath­er­ing and dis­sem­i­na­tion (largely through a self-service ethos which allows your employ­ees to do more impor­tant work than just shuf­fling mar­ket­ing sheets) is just the beginning.

With the advent of cor­po­rate weblogs, we will see com­mu­ni­ca­tions between prospects con­tinue to improve, as the new tools facil­i­tate a dis­cus­sion between cor­po­ra­tions and prospects. This is an impor­tant trend that no one in the main­stream media is fol­low­ing and may just be what the “New Econ­omy” is about. It’s not about a new way of sell­ing dog food (or what­ever other bad idea received bil­lions of dol­lars) but it is about remov­ing repet­i­tive tasks in infor­ma­tion dis­sem­i­na­tion and shar­ing and increas­ing self ser­vice, which greatly improves all busi­ness process.