<B>Global Communities: The next step for doing business in the 21st century</B>

José Mario Álvarez de Novales. Professor. Instituto de Empresa

22 February 2006

Since the beginning of time, men have satisfied their needs through the creation of economic systems, including the nation-state, the European Union and the global economy. The next system is already taking form; global communities.

Since the dawn of humanity, man has sought to satisfy his needs through a variety of ways. In the beginning, the economy was tribal and quasi-nomadic and made few distinctions between the members of society. They all hunted or gathered food, and everyone enjoyed the fruit of their collective labour. For this system to succeed it had to avoid both over-activity and innovation, otherwise its members ran the risk of over-hunting one year and perishing the next. What’s more, the system limited the number of group members.

Through time, however, this system gradually proved to be inadequate because it was closed off and stagnant. Thus,another more widespread concept appeared: the feudal-family fidelity system. Multi-tribal by definition, it allowed many of its members to specialise. But the economic circuits of the system were conditioned by the clientele system, meaning only a fraction of the products actually made it to the market. In other words, the system was still not open to outside influences.

Next to appear was the national-guild model. This system was comprised of a group of individuals living within a nation of extensive borders. Here people were granted licences to create guilds. As the nation was fairly large, the market grew big enough for the exchange of goods to take place. However, with the passing of time, the population gained greater know-how and production expanded, increasing the need for markets larger than those of an average-sized nation. This paved the way for macro-nations, such as the European Union, which is characterized by its clear market-orientation. The founding of the EU was an important step towards the creation of a genuine global economy, where the activity of companies no longer revolves around a single nation. Furthermore, know-how becomes scientific and, consequently, multi-purpose, meaning a company can use the same technology within a variety of sectors and the concept of industry is rendered obsolete. The world undergoes a process of deregulation and markets open up.

The new vehicle for value creation: global communities

It would be easy to conclude that globalization has brought humanity to the end of time. However, this is not the case. Many companies have discovered a new vehicle for creating value; global communities or groups of people who share a common project. These communities recognise the professional capacity of their members, who organize themselves around their many needs (learning, selling, purchasing, etc.).

There are many well-known cases of communities. One example, is that of programmers who, for various commercial and technological reasons, have developed free software. Similar cases also exist in other industries, such as in film, where communities have developed movies belonging, say, to The Star Wars saga without the help of George Lucas.

At first, companies were unaware of just how useful communities were. But later they learned to take advantage of their know-how for employing and selling products, etc. Today, communities are often made up of groups of companies that pool their know-how, discuss strategies, debate problems, set standards, prepare computerised trading platforms and do business. They use blogs, wikis, forums and other computer channels that enable them to work as a team with people from all over the world.

The complexities of the individual

What are the possible shortcomings of this system? The most notable involves the complexities of understanding and optimising the multidimensional nature of the individual. I may be interested in my role in the region in which I live or in the regions in which my current or future clients are located. I also may be concerned with my sector or with those of my clients or suppliers or with the role I wish to play or with the sector in which I want to work or in thousands of other things. I am me, with multiple talents, skills and projects.

That's why, at Instituto de Empresa, we have created a number of global communities with our alumni and professors. They cover many lines of business and are open, like today's world, to companies and experts who have reached their goals through merit, and who are recognised by their fellow community members. The objective of this program is quite simple: to do business in the 21st century.

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