Industrial Economy And. Connected Economy

In today’s world, where ideas are increasingly displacing the traditional physical in the production of economic value, competition for reputation becomes a significant driving force, propelling the economy forward.

The Industrial Revolution led to the development of factories for large-scale production with consequent changes in society. Originally the factories were steam-powered, but later transitioned to electricity once an electrical grid was developed. The mechanized assembly line was introduced to assemble parts in a repeatable fashion, with individual workers performing specific steps during the process. This led to significant increases in efficiency, lowering the cost of the end process. Later automation was increasingly used to replace human operators. This process has accelerated with the development of the computer and the robot.

Industrialization is a phase, and in developed nations that phase is ending. Growth in developed economies will increasingly come from industrialized economy to connection economy.

This economic crisis doesn’t represent a cycle. It represents a reset. It’s an emotional, raw social, economic reset. People who understand that will prosper. Those who don’t will be left behind.

As we stand on the verge of a new era, it’s easy to disparage the old-school industrial economy. But let’s not forget that the industrial economy gave us an abundance of material wealth we now take for granted, including many things that were unavailable—and unimaginable—in previous centuries.

What is the connection economy?
The connection economy rewards value created by building relationships and fostering connections, rather than assets and “stuff,” like the industrial economy. The industrial economy values more, better, faster, whereas the connection economy builds on who you know, what you know and how that knowledge influences your connections.

The emerging connected economy, enabled by the Internet, Networking and ever-increasingly sophisticated value-chain system, is becoming a powerful business force.

 In order to leverage this new development, companies and their trading partners are creating entirely new business environments and moving their industries in new directions. 

The future offers great opportunity for some and great risk for others. The connected economy is the new order, creating new business models, new channels, and new competitive imperatives. Traditional linear value chains are being transformed into integrated supply webs. The basis of competition is evolving from company vs company to value chain vs value chain. Winners in the connected economy will be those companies with an extended enterprise view of the value chain, a commitment to collaboration with trading partners, an emphasis on speed of execution, and a focus on core competencies.

Success will be enabled by the vision and initiative to leverage internal capabilities, the capabilities of the extended trading network, and the connectivity of new technologies to achieve speed and reliability of execution, flexibility, and responsiveness to rapidly changing markets.


As coined by Paulo Carvao, the Vice President, North America Systems Hardware, IBM, it is crucial for technology executives ready to discover how to retain and grow connected economy awareness by learning.

  1. What’s driving the shift to a Connected Economy—and who is at risk of getting left behind.
  2. Why companies embracing Connected Economy are already reaping the rewards, with 48 percent of them experiencing double-digit revenue growth over the past two years.
  3. Which Connected Economy best practices are being used to beat the competition? Learn why 80 percent say they are far better positioned than their less Connected Economy-savvy counterparts.
  4. How Connected Economy leaders are realizing their vision—for example, by investing in data-centric infrastructure and adopting open technologies and ecosystems.
  5. What the future of the connected economy looks like. Gain a glimpse into the vital role of cognitive computing in that future.
  6. How your organization stacks up against others. By attending, you receive a copy of the full HBR report: The Ecosystem Equation—Collaboration in the connected economy.

The connected economy is in your future, and I hope you will make the most of it.

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