The Entrepreneurial Web
Concepts and Strategies for E-Commerce
Table of contents
Bloodstains on the carpet
Part one begins, like any good detective story, with a mystery. The bloodstains on the carpet of this mystery is the evidence that many managers and executives in the corporate world don't seem to be getting to grips with the ideas and principles of e-commerce and e-business. The Internet appears to be a disorganised wilderness, with more noise than value.
These first three chapters look at the changes in attitudes that may be necessary as the transition is made from the Industrial Age to the Information Age. It explains how the organised business environment of the Industrial Age is rapidly being replaced by a fast changing chaotic environment where the firmly established rules, procedures and protocols of conventional Industrial Age strategies may no longer be valid. Perhaps they are even counter productive.
It is proposed that the new environment of the Information Age will need business strategies more usually associated with entrepreneurs: where opportunities are anticipated and exploited in a highly competitive business environment full of unknowns and unpredictable chaos.
Anomalies and enigmas of the Information Age
The observation of Sherlock Holmes
Where then do we start to look for an alternative?
Learning on the fly
Forward planning in the Information Age
Using emergence to win at poker
Industrial Age reactions to Information Age ideas
A conceptual divide
The old ways don't work now
The transition into a new Age
Deduction, induction and paradox
An example of Industrial Age attitudes
The way of the Industrial Age
What is the alternative to the Industrial Age way of thinking?
Dealing with a complex environment
The Information Age is not about technology
In the land of the blind the one eyed man is king
Corporates and entrepreneurs: contrasting mind sets
The Zen thing
The mathematics of Zen-ness
What type of playing field is the Internet?
Zen-ness from Chaos Theory
A real life example of chaotic turbulence
The ubiquitous role of the exponential
Looking for clues
Part one set the scene of the detective story. It presented a daunting environment: too much information, little order and no logical framework for decision making.
Part two is about looking for clues as to how to deal with this environment. It begins by considering new ways to think about a dynamically complex world where it is impossible to have all the answers. Like the detective in any detective story, this involves stumbling around, looking for any clue that offers a pointer towards a solution.
The main characteristics of the world of the Information Age are: complexity; uncertainty; unknowns; unknowables and intense competition. Such conditions are not unique. These conditions have existed in certain areas before the advent of the Internet. Two of these areas are examined here to see what strategies the professionals in these worlds are using to deal with conditions of uncertainty and complexity. Chapter five looks into the world of investment and finance, where uncertainty, chaotic and unpredictable events are coped with every day of the week. Chapter six looks at the way complexity is managed in the arcane world of computer programming.
Stumbling around looking for clues
It isn't possible to understand the Internet
How do you get into the game?
The square one position
The first inklings of a strategy
Searching for a strategy
Thinking about thinking
Clues from the world of investment and finance
Into the world of the professional investor
The enigmatic nature of interest rates
Discounting for risk
Spreading the risk
Examples of spreading the risk
The resolution of some paradoxes
The strategy of an IT department
Clues from the World of computer programming
Object oriented thinking
Top down object oriented design
Object oriented techniques in the world of computer programmers
Out of the hands of the technical specialists
What is an object?
An Object oriented software product
Viability of breaking up a project into small objects
The Christmas tree light problem
Abstractions and strategic thinking
The human brain doesn't appear to come as a standard package that works the same way for everyone. Some people have a flair for mathematics, others cannot get to grips with it at all. Some find foreign languages easy to learn, others find them impossible. Some people find talking and discussion easy, others become tongue tied or can't get the words out before the conversation has moved on. Some can write down their thoughts clearly, others have difficulty composing even a simple letter. Some people are naturally good at art or music, others can't draw to save their life or have absolutely no ear for music. Some people have a sense of direction, while others can turn just two corners and become hopelessly disorientated.
Probably humans have evolved this way because it then becomes essential for them to co-operate with each other. Partnerships and groups are formed on the basis of benefiting from each other's special abilities and compensating for any deficiencies. Co-operative groupings are always favoured by the evolutionary process, so, it is not surprising that this oddity of everyone having different types of brain has evolved as a survival characteristic of our species.
Bearing in mind these differences in the way different brains can handle information, this next part of the book might be particularly difficult for some people to appreciate because it deals with abstract concepts. Apparently, according to many empirical studies (I can't vouch for any of them), only twenty percent of people have the natural ability to make abstractions to allow lessons learned in one environment to be be transferred to another. I don't belie that this ability is so rare, it's more likely that such methods of thinking are not adequately covered by conventional education (perhaps because teachers are typical of the population as a whole and eighty percent aren't aware of this phenomenon, so, are unable to teach it to others). Whatever the truth is, about people being able to use abstract models of thought, it does seem as if the ability to use abstractions is not universal.
Generally speaking, the people who can think in abstractions tend to be strategists. Those who can't tend to be tacticians. Tacticians and strategists work well together because tacticians concentrate on developing specialist skills and abilities that are essential for any strategist's plans to succeed. This part then is written with the strategist in mind, who will need to be able to use abstractions and mental modelling to be able to make decisions in the uncertain and complex environment of the Information Age. Tacticians will also benefit from this section because their ability to get appropriate commercial benefit from their particular area of expertise or speciality will also need to use a suitably efficient strategy.
Growing rather than planning solutions
The uncertainty of prediction
The business that designed itself
Starting in the kitchen
A serious communication problem
Abstract models to think with
Directing a bottom up design process
Strategy in the world of high fashion
It's about communication strategies
Starting with a green frog
A strategy that can ignore the unknowns
The abstraction of this model
Strategies in Hilbert space
Hilbert spaces within Hilbert spaces
Where this is taking us
Difficulties in thinking with abstract models
The difficulties caused by the green frog
Stumbling around in E-Commerce solution space
Strategies within a Solution Space
A Hilbert Solution Space where the dimensions are Hilbert Solution Spaces
Strategies for competition and co-operation
Part four looks at how to play competitive games of competition on the Internet. The conceptual model is taken from the works of the great economist, Lord Keynes, whose deceptively simple model of the business world led to the recovery of the world economy after the second world war.
The realisation that the game is about competing for co-operation sees the Internet as a place for people to use strategies to make contact with others and build up strategic relationships.
This part also looks at the efficiency of a managed team in the environment of the Internet. It shows that although a managed team is the most efficient organisational structure in the bricks and mortar world it is not appropriate for the environment of the Internet.
Competing for co-operation
Choice and competition
Games of competition
Competing for co-operation - Keynes
Applying Keynes' thinking to e-commerce
The value of an act of co-operation
Allowing for risk in contemplating co-operation
From the solution builder's point of view
From the Expert's point of view
The Industrial Age concept of a team is not appropriate for collaboration on the Internet
Why there are no examples or case histories
The puzzling post
A group does not necessarily imply a managed team
Examining the Industrial Age's approach
An event driven system
A planned approach to the fashion business
Feedback from a rich source of information
Mapping across to the Internet
The design side solution point in the environment of the Internet
The group as an information source
The Midwich Cuckoos
The supply side strategy
The dynamics of the middleman
Keeping up with technological changes
The strategy of the producers
Limitations of the managed team
The alternative to a managed team
The paradox of the unmanaged team
Mapping the unmanaged team across to a people space
The strategy of the Individual
A new perspective for the individual
The essence of game theory
A strategy for seeking co-operation
Placing a value on relationships
Replacing a team with a network
The fragmentation effect of the Internet
Creating a profitable hub
Putting the clues together
Part five is the equivalent of the final drawing room scene in detective stories, where the detective puts all the clues together. In this mystery the murder victims have been money and time: wasted on futile attempts to apply Industrial Age thinking to e-business and e-commerce solutions in the Information Age.
The conclusion is not in the form of a set of instruction that can be written down in a bullet point list. It is mental model that can be used to see the Internet for what it is: a massive connectivity that can be tapped into to vastly increase individual efficiency, power and wealth.
Inheriting knowledge and skills
A real world example of a wealth producing network of contacts
Mapping the abstraction across to the Internet
Extending the concept to information exchange
The magic of ancestry and inheritance
Parenting and child objects
The structure of the connectivity
Coping with too many experts and specialisations
What makes a good solution provider?
The optimum strategy
Summing up the situation
The two elements of a strategy
Giving yourself an identity on the Web
The strategy of the expert or specialist
The view point of the expert or specialist
Up front with the costs
Attaching to the network
Dealing with the complexity
Getting attention and co-operation
A world of groups
Living in parallel worlds
The private virtual cafe
Using the cafe