Transcript Stone age of computing

World’s Electronic Market:
Opportunities for Lithuania
Dr. Vadim David Levitin
CEO
ECommerce Institute
San Diego, California, USA
Global Electronic Marketplace
SCI-TECH
Customer Demands
Changing supply chains
Global market forces
Political pressures
Global competition
New business practices
Economic pressures
Trends beyond one country's control
GLOBAL ELECTRONIC MARKETPLACE
NETWORKED ECONOMY
VIRTUAL ENTERPRISES
COMMUNITIES
COMPANIES
Market evolution
Adapted from G. Benesco and IBM
Global Electronic Marketplace
Globally-focused, World-Body-driven,
concentrates on facilitating free trade
among countries, and on the free
movement of goods, services and people
across International boundaries
Types of Organizations
Virtual Organization
Hierarchy
Organic
Network
Organic
Network
It is here!
• Virtual corporations
• Collaboration substitutes adversarial
relationships
• E-Markets
• BPO growth
BPO
2003 – 10.5% growth to $122 billion
Until 2005 -- 13% growth
Foundations of the new
Economic Model
What is Lithuania’s weight?
WEIGHT of US GDP Decreases …
VALUE INCREASES
US Economy is worth ~ 70% more every 10 years
Economy grows ~ 3% per year
Per capita output $19,404
Weighed 5,300 pounds
Per capita output $26,843
Weighed 4,100 pounds
Down 23%
Value-to-weight ratio of a pound of GDP
From $3.64 to $6.52
79% increase
Changing sources of
VALUE
Value derives primarily from
 People
 Ideas
 Information assets
Leveraging information is more powerful than
moving physical products
Lithuania’s National Information Strategy?
$ per pound
• Sand and gravel
$.002
• Cars
$6.00, average
• Computers
$168, average
• Drugs
$23,199, average
Lithuanian Nanotechnology and Laser technology?
– Money is information
– Speed dominates because information products can be
moved rapidly
• Value derives from velocity
• It is crucial to develop strategies for information
goods
• How does information strategy differ from strategy
based on “stuff”?
The next big thing…
Lithuanian Opportunity!
Wealth = Opportunity²
Mis-information Age!
How are you
DIFFERENT from,
let’s say, Julius Caesar or …
Francis Bacon?
• Sunday New York Times Newspaper: more
information than all written material available in
the XV century
• 300,000 books published every year
• 18,000 magazines in the US alone
• 400,000 scholarly journals
• ~ 3 billion Web pages
• 12,000 electronic databases
• 15,000 new products in the grocery store each
year
• 1 million marketing messages a year on the
average
Wealth creation
Industrial Revolution: Physical Manpower
Information Era: Knowledge
Networked Economy: Attention
Information consumes …
ATTENTION
Wealth of Information = Poverty of Attention
Past and Future
“The rearview mirror is always clearer
than the windshield”
Warren Buffett
Speed of light
is
too
SLOW
Stone age of computing
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Do you own a water plant?
Are you generating your own electricity?
Where does your sewage go?
Have you built your own telecommunication
company yet?
Grid
"virtual organizations" -- ever-changing groups of
individuals and institutions exploiting the
resources of the grid for a variety of purposes,
much the way that individuals in the same
household exploit electricity for their own needs
Computility!
Computility
•Internet (or intranet) becomes a computing platform
•The resources will be at our fingertips, but they will reside on
the Internet rather than in single computers or on local servers
•The Internet's "virtual computer" will be distributed worldwide
rather than existing in one place
•It will provide us with everything we need, whenever we need it,
and will enable us to coordinate our work with anyone,
anywhere, without technology conflicts
•Like power grids, computer grids will become an essential
element of our infrastructure, operating invisibly except in the
rare cases when a problem arises
A conservative estimate:
90% of global demand is not currently
satisfied by local supply!
(Bowersox, Closs, Cooper, 2002)
+
Earth’s Population growth
200,000 X per day
GD + PG = a sizeable opportunity
LITHUANIA'S VALUE WEB
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KNOWLEDGE FLOWS:
INFORMATION, PRODUCT, SERVICE, FINANCIAL
suppliers
network
Lithuanian Integrated Economy
products,
services,
human resources,
education
manufacturing,
R&D,
distribution,
infrastructure,
procurement
INTEGRATION
CAPACITY, INFORMATION, CORE
COMPETENCIES, STRATEGIC INTENT,
CAPITAL, HUMAN RESOURCE
CONSTRAINTS
distributive
network
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Is really about the Internet?
• Business Model Innovation
• Approaches not possible with
“traditional” commerce
• Destroying old models of wealth creation
• Shifting profits in most value chains
Building Relationship Webs
• Networks of:
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Suppliers
Distributors
Service providers
Customers
• Conducting business over networks, including
the Internet
• Creating value for customers and each other
• Construct EBusiness Communities
Risk?
So what’s next?
Wealth for Lithuania
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Global Electronic Marketplace
Value derived from bits, not atoms
Gold Standard – Attention
Lithuanian Value Web
New sources of wealth
ECommerce Institute
Knowledge for the changing world of e-business
Selected Clients:
•Online Strategy
•Education/Training
•Business Transformation
•Enterprise Architecture
Government of Mauritius
Government of Fiji
US State Department
International Trade Center --UN/WTO
Deloitte, Touché & Tohmatsu
Ericsson -- Hong Kong, China
Telstra -- Australia
Lucent Technologies -- Indonesia
British Telecom -- UK
Hitachi -- USA
EDS -- Australia
Tait Electronics – New Zealand
San Diego State University -- USA
Visa International -- Singapore
Herman Miller -- UK