By Nicole Millman-Falk
Click image to enlargeRachel Botsman, a thought leader on the power of collaboration through technology and Founder of Collaborative Lab, gave the opening keynote at digitalNow at Walt Disney World’s Swan and Dolphin, Orlando, Florida.
What does a collaborative economy have to do with associations? A lot, according to Rachel Botsman, a global thought leader on the power of collaboration through technology to transform the way we live, work and consume, and keynote speaker at digitalNow. (Produced by Fusion Productions, digitalNow is a summit for association leaders dedicated to supporting effective association management in the digital age.)
A collaborative economy is an economic system of decentralized networks and marketplaces that unlocks the value of underused assets by matching needs and haves. It is also known as a sharing economy. "A collaborative economy unlocks value in unthinkable ways," said Botsman.
Think Uber and Airbnb, for example. These new companies are disrupting traditional markets by looking at existing assets (cars or rooms) in new ways. Associations need to look at how they, too, can create value from existing assets or their "idling capacity," suggested Botsman.
Associations and this new disruptive marketplace have several things in common, said Botsman. They both depend on peer-driven trust; they both act as neutral matchmakers for their participants; and they both bring people together.
What makes an area right for disruption? What was it that customers wanted from these startups that they weren't getting from traditional companies? Botsman identified five trends spurring a new organizational start up: when customers are facing a complex experience; when there is waste; when the trust is broken between the consumer and the company offering the product or service; when there are redundant intermediaries; and when there is limited access to the product or service. "Disruption is not about slaying giants, but about creating new value for customers," said Botsman.
Nonetheless, disruption is happening at a speedy rate. "Consider that it took Uber six years to become a $41.2 million on-demand cab company. It took Hilton 93 years to build a portfolio of 610,000 rooms in 88 countries, and it took Airbnb less than a decade without ever owning a single property," she explained.
"What you see happening is an important trust shift underway. We used to have institutional trust; we are now moving to a marketplace of peer-to-peer trust," said Botsman.
There are three reactions to disruptions, and association leaders will need to decide which theirs will be. You can be an ostrich, hoping this will all go away. You can be a fighter, trying to bring down new ideas with legal action. Or, said Botsman, you can be a pioneer, "embracing change as an opportunity."
Pioneers, she further explained, unlock value in new ways. They think differently about how value is created, how it is scaled, and how it is consumed. "New technologies unlock a hidden wealth of new ways. We need to move from an old model of asset heavy to a new model of asset light," urged association leaders attending the conference.
Unfortunately, the traditional association model is a retail model, comprised of more ostriches than pioneers. Staffing for this new collaborative economy, however, requires that associations rethink the critical competencies that have typically been required.
How do associations simplify how members access our complex levels of services? "Bring in the reductionist," advised Botsman. "Associations need people who can strip things away and get into the basics. You can have a complex business with multiple layers. The simplicity must be for the customer or member experience," she explained. "Uber is very complex, but the customer just has to swipe one button. The consumer (your member) wants you to make complex things simple."
To learn more about our new collaborative economy, read What's Mine is Yours: How Collaborative Consumption Is Changing The Way We Live (©2010, Harper Business), co-authored by Botsman and Roo Rogers.
Nicole Millman-Falk is President of Millman-Falk Communications, LLC, providing content development and strategic communication services for trade associations, professional societies, and donor-based organizations. In addition to her own company, she serves as Editor for Apogee Publications, which provides turnkey association newsletters, magazines, and membership directories. She is Editor of NYSAE's InView and was Chair of the 2014-15 Awards Committee. She can be reached at 201-652-1687; email@example.com; or through her website at www.millmanfalkcommunications.com.