Review of Don Tapscott, 'The Digital Economy, Anniversary Edition'

Don Tapscott, The Digital Economy, Anniversary Edition: Rethinking Promise andPeril in the Age of Networked Intelligence, New Foreword by Eric Schmidt, New York: McGraw Hill, 2015 [Pub Date: October 27, 2014]

I first read The Digital Economy in 1997, two years following its initial publication and after I had completed Don Tapscott’s next book, Growing Up Digital.  At the time, I was teaching in and directing a postgraduate Media Studies programme that ambitiously sought to combine the study and practice of more traditional media, particularly narrative film, documentary, and television, with new media theory, digital production and even design principles.  It was a heady pre-Millennial moment of experimenting with increasingly widespread digital technologies and of musing on the potentially world-changing possibilities they seemed to represent.  

Fittingly, The Digital Economy ranged widely from practical issues of managing and implementing technologies to more far-reaching questions about where they might enable individuals, businesses and society to go.  In an early chapter, Tapscott distinguishes between business process reengineering and business transformation – and how taking that latter, more ambitious step required an openness to change.  While an important distinction in terms of business, of course, the clear implication concerned a more general willingness to accept and participate in larger-scale transformation, of individual, economy, and society.  The book then went on to offer probing yet accessible discussions of the import of analog versus digital, the arrival of smart products, the need for overhauling talent management and learning, the ascendant roles of IT and CIOs in organizations, and many more topics in order to portray an emerging future. 

One of Tapscott’s gifts has been the consistent ability to examine such topics in detail while also conveying but not overstating their greater significance.  As a prolific and consistently insightful analyst and commentator on the digital transformation, his work falls, for me, into four overlapping areas of interest: (1) the “net generation” to which he’s devoted several books starting with Growing Up Digital; (2) mass collaboration, openness and sharing, probably most familiar from his 2006 bestseller, Wikinomics (co-written with Anthony D. Williams), and its recent sequel; (3) the more explicitly business-focused books, beginning his earliest publications on office automation and clearly elaborated in the 2003 The Naked Corporation; and his integrative writings on the digital society and economy, of which The Digital Economy is still the most penetrating.  Whatever the specific object of discussion or analysis, though, the wider contexts and deeper humanity of technological, business and social change remain an unmistakable priority for him.   

Re-read today, that balance and breadth still set apart The Digital Economy.  Contemporary analyses of all things digital, particularly in business and management writing, tend to lack his sensitivity to broader human or social contexts – at least contexts expressed with balance and without hyperbole.  In the original chapter on leadership, Tapscott opens with a quote from Internet pioneer Vint Cerf about the Internet being “like the wilderness of the Wild West,” both inevitably awaiting the imposition of systems and civilization but always retaining “some interesting wilderness areas to visit.”  That metaphor was ubiquitous in the late 1990s.  Yet the opening section of the chapter, in which he discusses how difficult are paradigm shifts and journeys into the ”wilderness” of the unknown for “leaders of the old,” remains as valid as ever a commentary on human nature and the challenges of profound change.

To Tapscott’s credit, little of the new material is self-congratulatory.  The Preface to the Anniversary Edition offers a valuable summation of the book’s major ideas and the extent to which they have come to pass – or not.  Throughout, the new commentaries preceding each chapter provide valuable extensions and illustrations from the last twenty years of the nascent ideas proposed in the original text.  The updates on the “The Internetworked Business” chapter, for example, draw on insights (specifically, the seven business models) from Wikipedia in order to frame the importance of developing and implementing a coherent strategy for advancing the social economy, workplace, and marketing.

Tapscott also rebuts critics who claim he has been a digital Polyanna by downplaying or ignoring the “dark side” of the transformed economy.  Especially compared with some of his mid-1990s contemporaries, the tone and treatment of possible digital futures in these pages is balanced.  Recalling many of the visions of the time, both utopian and dystopian and often charged with Millennial hope or uncertainty, The Digital Economy was less a futurist tract than an exploration of social and economic possibilities grounded in actual (or emerging) technologies and human practices.  That the author foresaw accurately so much of what has developed in the years since the book first appeared is testament to his sensitivity to the ways businesses, societies and especially people engage new technologies and change more broadly.

The original text does contain some obviously glaring misses.  A few are small and forgettable, as with the insistent use of the “Internetwork” and, especially, “I-Way” (for “Information Highway”) as the digital basis and engine of future progress.  Others, notably the significant treatment accorded to privacy issues late in the book, require fuller annotation in the new edition.  Citing “Big Brother” and (corporate) “little brothers” as threats, the conclusion in 1995 was to take greater care with the information we give away.  Two decades later, as Tapscott acknowledges in his new comments, individuals are thoroughly connected by social media, Big Data, surveillance and geospatial systems, and many other institutional networks and technologies, shifting the onus much more to institutions and owners of data to manage data and their privacy appropriately. 

The next and final chapter of The Digital Economy addresses the “new responsibilities” of business.  Here, the author writes most directly about “societal transformation” and how the many technologies and transformations he has catalogued can help re-cast the role of corporations in society and even the future of democracy.  Then, closing his retrospective comments, Tapscott writes that “this Anniversary edition is not intended to be a history text.”  Strictly speaking, he is right.  Yet when framed by the new material, the original text can still serve a very similar and valuable purpose, namely, to give an illuminating longer view of two decades of changes, small and large, wrought by the digital economy and experienced by each of us – and still to envision a future marked by immense promise and some peril. 

Recommended Readings for Creative Leaders for Fall 2014

Thus far in 2014, we have seen at least two additions to the short bookshelf of essential readings for creative leaders: Pixar CEO Ed Catmull’s account (with Amy Wallace) of building and sustaining a successful creative culture, Creativity, Inc.: Overcoming the Unseen Forces that Stand in the Way of True Inspiration; and Harvard Business School Professor Linda A. Hill’s masterful guide to leading successful innovation across organizations, Collective Genius: The Art and Practice of Leading Innovation (written with Greg Brandeau, Kent Lineback, and Emily Truelove). Other recent highlights included Connected by Design: Seven Principles for Business Transformation through Functional Integration, the outstanding work about new ways to create value through brand ecosystems, by Barry Wacksman and Chris Stutzman of the legendary creative agency, R/GA; Stanford professors Robert I. Sutton and Huggy Rao’s major study of how to build up businesses successfully, Scaling Up Excellence: Getting to More Without Settling for Less; and Arianna Huffington’s manifesto for re-defining well-being, work and success, revisionist study of talent and creativity, Thrive: The Third Metric and Redefining Success and Creating a Life of Well-being, Wisdom, and Wonder.

The fall book season is now upon us and promises further new and relevant titles. These will include analyses of marketing, China, and Google, a handful of titles on innovation, ranging from practical implementation guides to a longer history, and, perhaps most far-reaching, reflections on the changes wrought by digital technologies to individuals and society. All contain insights valuable to the work and lives of creative leaders.

1) Ulrich Boser, The Leap: The Science of Trust and Why It Matters (Houghton Mifflin Harcourt/New Harvest, September 16)

Traveling from rural Rwanda to corporate America, and from paying taxes to using technology, Boser argues that individuals are hard-wired for trust and trustworthiness and that emphasizing and restoring trust can benefit us as humans as well as our institutions and communities.

2) Richard Branson, The Virgin Way: Everything I Know About Leadership (Penguin/Portfolio, September 9)

The iconic CEO and entrepreneur, already author of a best-selling autobiography and books on business, here describes his key leadership principles like good listening, keeping things simple, remaining iconoclastic, motivating people, and having fun along the way.

3) Nicholas Carr, The Glass Cage: Automation and Us (Norton, September 29)

Carr, the consistently trenchant analyst of technological change who wrote The Shallows: What the Internet is Doing to Our Brains, here offers a thoughtful and sometimes disturbing account, grounded in science and poetry alike, of the ways that our increasing reliance on technology is affecting our happiness and re-shaping our humanity.

4) Lawrence A. Cunningham, Berkshire Beyond Buffett: The Enduring Value of Values (Columbia Business School Publishing, October 21)

An extraordinary portrait of the fifty direct subsidiaries of Berkshire Hathaway, investment guru Warren Buffett’s $300 billion conglomerate, told through the companies’ distinct stories and the vital values like integrity, autonomy, entrepreneurship and a sense of permanence that they, and Buffett, share.

5) Tom Doctoroff, Twitter Is Not a Strategy: Remastering the Art of Brand Marketing (Palgrave MacMillan, November 11)

The Asia CEO of the J. Walter Thompson advertising agency, Doctoroff uses characteristic wit and decades of experience to take on the twin hypes of digital media and the China market and to offer insightful principles for successful customer engagement and integrated brand marketing.

6) Stewart D. Friedman, Leading the Life You Want: Skills for Integrating Work and Life (Harvard Business Review Press, October 7)

Wharton professor Friedman, building on his excellent study, Total Leadership, uses examples ranging from Sheryl Sandberg to Bruce Springsteen to move from familiar calls to balance competing work and life commitments toward taking steps, instead, to integrate our passions and values across the domains of work, home, community, and the private self.

7) Nathan Furr and Jeff Dyer, The Innovator’s Method: Bringing the Lean Startup into Your Organization (Harvard Business Review Press, September 9)

How can business leaders better manage the uncertainty intrinsic to prototyping and experimentation? Picking up from Dyer’s bestselling guide to generating ideas, The Innovator’s DNA (written with Hal Gregersen and Clay Christensen), this new volume focuses on proven techniques that allow start-ups and established firms to commercialize ideas successfully.

8) Walter Isaacson, The Innovators: How a Group of Hackers, Geniuses, and Geeks Created the Digital Revolution (Simon & Schuster, October 7)

Isaacson, the biographer of Ben Franklin, Albert Einstein, and most recently, Steve Jobs, has penned a sweeping history of digital technologies, the computer and internet, beginning in the mid-nineteenth century, with Lord Byron’s daughter, and tracing the innovative thinking, creative leadership and energetic collaboration to the present day.  

9) Langdon Morris, Moses Ma and Po Chi Wu, Agile Innovation: The Revolutionary Approach to Accelerate Success, Inspire Engagement, and Ignite Creativity Hardcover (Wiley, September 22)

Two leading innovation thinkers and consultants (Morris and Ma) and an engineering professor (Wu) have written an excellent (and overdue) guide to how agile techniques, like process acceleration, risk management, and fuller team engagement, have fostered successful innovation for leading businesses and can be put into practice elsewhere.

10) Alexander Osterwalder, Yves Pigneur, Gregory Bernarda, Alan Smith, Value Proposition Design: How to Create Products and Services Customers Want (Wiley, October 20)

Using the same engaging visual approach as their groundbreaking Business Model Generation, which pioneered the business model canvas, Osterwalder et al focus on the most important of the canvas’ building blocks, the value proposition, and enable readers to work through seven key principles for better designing what matters to customers. 

11) Shaun Rein, The End of Copycat China: The Rise of Creativity, Innovation and Individualism in China (Wiley, October 20)

A leading consultant and commentator on the Chinese society and economy, and the author of The End of Cheap China, Rein analyzes current large-scale shifts in China from investment toward consumption, and from copying to innovation, that require a strategic re-thinking by investors and creative leaders doing (or wanting to do) business there.

12) Paul Roberts, The Impulse Society: America in the Age of Instant Gratification (Bloomsbury, September 2)

A troubling, cross-disciplinary account of how individual pursuits of consumption, pleasure, and immediate rewards, advanced by new technologies and compromised ethics, have evolved in a new and pervasive ‘culture of narcissism’ — that journalist Roberts nevertheless closes on a hopeful note of how we can pull back and change.

13) Jonathan Rosenberg and Eric Schmidt, How Google Works (Grand Central/Business Plus, September 23).

Google’s former SVP of Products and ex-CEO reveal how the global tech company has grown by doing things differently, like hiring multitalented ‘smart creatives’ and leading with the recognition that ‘consensus requires dissension,’ in order to continually create new products and serve consumers in a fast-changing environment.

Review of 'Collective Genius: The Art and Practice of Leading Innovation,' by Linda A. Hill, Greg Brandeau, Emily Truelove & Kent Lineback (Boston: Harvard Business Review Press, 2014)

The Introduction to Collective Genius: The Art and Practice of Leading Innovation calls for a different kind of leader who creates organizations both willing and able to innovate.  From that innocuous opening, this new study quickly moves to engage the challenges and complexities confronting those wanting to enable innovation.  Much of the complexity is captured in six paradoxes – from “support” and “confrontation” to “bottom up” and “top down” – that create ongoing tension.  These are then summarized in a “fundamental paradox” between “unleashing” and “harnessing” the talents in an organization.  Through the dozen case studies that follow, these paradoxes demonstrate not only the potential of different kinds of leaders but the value of different kinds of thinking about leadership in fostering and driving innovation.

In less capable hands, such a reliance on paradoxes or tensions in describing leadership might reflect indecisive or incomplete analysis.  For Linda A. Hill, Greg Brandeau, Emily Truelove, and Kent Lineback, it instead conveys with evidence and assurance the complicated realities of new organizational forms and behaviors.  In fact, despite its presentation of a series of individual leaders, the book establishes a category of its own that yokes together the best of conventional analyses of leadership and innovation.  The result is an invaluable guide to enabling collaboration and collective behavior at a time when innovation and creative problem-solving are increasingly the norm.

The first major section of Collective Genius addresses how leaders create a willingness to do the hard work of innovation.  There are three major challenges here:

• Purpose: Why we exist
• Shared Values: What we agree is important
• Rules of Engagement: How we interact with each other and think about problems

Defining these elements helps to create a context in which others can innovate.  Looking at Volkswagen and Pentagram, the design agency, the authors offer practical instances of encouraging risk-taking, trying new ideas, and building solutions together to form a greater sense of community.

The second major section takes on how leaders can create the ability to do the hard work of innovation.  It is also defined in three aspects: 

• Creative Abrasion: The ability to generate ideas through discourse and debate
• Creative Agility: The ability to test and experiment through quick pursuit, reflection and adjustment
• Creative Resolution: The ability to make integrative decisions that combine disparate or even opposing ideas

Together, these organizational skills correspond to the major elements of the innovation process – collaboration, decision-based learning, and integrative decision-making.  Tracking efforts at Pixar, eBay in Germany, and Google, the authors offer examples of how practically these skills can be operationalized and also integrated with each other.  

Amidst all the discussion of innovation processes and organizational behavior, how exactly do leaders fit here?  They may be visionaries – but don’t have to be.  Even if they are, they don’t hold forth and inspire from the mountaintop.  Instead, the role of the leader is re-cast again and again in these pages.  Vineet Nayer, of HCL, is a “social architect”; Larry Smarr of Calit2, “a dot-connector extraordinaire”; and managers at Google, according to then CEO Eric Schmidt, “aggregators of viewpoints, not dictators of decisions.”  What is consistent in Collective Genius is that traditional formal authority gives way to nimble orchestration, informal facilitation, and contributions to community-building.

The real hero for Hill and her co-authors, as a result, is less the individual than the innovation eco-system.  Successful leaders, they conclude, work to create innovation environments “in which the unique slices of genius in their organization are rendered into a single work of collective genius.” Moreover, and this is ultimately the book's most illuminating lesson, that collective genius not only yields more sustainable innovation but transforms leadership itself.