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The Intangible Economy

A historic convergence of humanity, technology and social connectivity has disrupted, upended and rendered ineffective traditional models of the way we work, generate revenues and create value. The industrial age is dead and we have already entered a new economic age. The rules of the game have changed. People and organizations are seeking lives with purpose.

Value generation today is driven primarily through intangibles. Up to 80-90% of the market cap of publicly traded companies is determined by investors' confidence in the differential capacity of leadership teams to learn, adapt and innovate ahead of the competition in order to optimize customer relevance, experience and advocacy, quality, value differentiation, surprise and delight. An organization's value is directly associated with its relevancy to stakeholders.

The same is true for all organizations today regardless of sector, scale or industry—whether public or private; profit or not for profit.

In the new normal of the global marketplace, soft-side, human variables—focus, culture, agility, talent, collaboration, creativity, connection and experience—determine value far, far more than the classic flow of goods and services. Innovation and collaboration trump competition. To be sure, tangibles still matter, but differentiation and value lie solidly within the realm of technology facilitated, human-centric intangibles. For the modern competitive enterprise, optimizing the human side of the business equation is essential for sustainable success.

Competition has never been more intense, change more constant, disruption more frequent or the battle for market share, more intense. Those who cling to traditional models of value creation lose. Those willing to step outside comfort zones and go all into the intangible economy win. Winners in the intangible economy think differently and work smarter.

This post first appeared on my LinkedIn profile on February 10th, 2015.


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