Donal Reddington on mass customization, crowdsourcing and digital manufacturing

Book Review: Wikinomics

Wikinomics, or to use its full title “Wikinomics – How Mass Collaboration Changes Everything” is a chronicle of how traditional collaboration – in a meeting room, a conference call, even a convention centre – has been superceeded by collaborations on an astronomical scale.

Cover illustration of Wikinomics

The book opens by telling the story of Goldcorp Inc., a mining company that was on a downward slope due to strikes, lingering debts, and an exceedingly high cost of production. The company’s fifty year old mine in Ontario was presumed to be nearly exhausted. Goldcorp CEO Rob McEwen, a newcomer to the mining sector, approved $10M of investment in additional exploration. Results were positive, with test drilling suggesting large new deposits of gold, but pinpointing the exact locations of the gold was proving to be an insurmountable challenge for Goldcorp’s employees. By coincidence, McEwen attended a conference where the subject of Linux, the open source computer operating system, came up for discussion. McEwen had an epiphany – why not adopt the open source model for Goldcorp’s mining activities? This is exactly what he did. In March 2000, the “Goldcorp Challenge” was launched with $575,000 in prize money. All of Goldcorp’s geological data was published on the company website, with an invitation for anyone to contribute their knowledge on how the gold might be located within the 55,000 acre property.

By the time the process was completed, entries arrived from geologists, graduate students, consultants, mathematicians and military officers. The contestants had identified 110 possible targets on the property, of which over 80% proved correct. Since the challenge was inititated, eight million ounces of new gold deposits have been found, and Goldcorp has moved from being a $100M company to being a $9Bn company.

Goldcorp is perhaps one of the best examples of how a business can benefit from breaking down the walls which exist between it and the outside world. The traditional thinking has always been that research is secret, and only trusted employees should be involved. However, the success of community-based activity for non-commercial projects like Linux and Mozilla has presented new possibilities and a new outlook for many companies, who are re-thinking their traditional viewpoints on how they interact with customers, competitors, and the world at large.

Don Tapscott and Anthony D. Williams, the authors of Wikinomics, build a convincing case for the benefits of breaking down barriers between business and potential outside sources of competitive advantage. They highlight the growth of new movements that are both a cause and a reflection of this new thinking. Firstly, the Peer Pioneers, most typically associated with free software projects such as Linux, but who have applied open source principles to create a multitude of products made of bits – in other words, information products. These include the many millions of contributors to open encyclopedia Wikipedia, and collaborative projects in many different areas of software development and scientific research.

Another development gathering pace is the ‘Ideagora’ – a marketplace for ideas, where questions can find solutions and solutions can find questions. Williams and Tapscott suggest that it is comparable to a classifieds site like, except rather than job ads and personals it posts a list of ideas and inventions that are ‘for sale’ or ‘wanted’. Examples of ideagoras are (which was new to me) and (featured on this site here recently (and again).

The next trend highlighted in Wikinomics is the growth of ‘Prosumers’. This term will be familiar to anyone who has studied mass customization. Originally the term was coined by Alvin Toffler in his book ‘The First Wave’, and referred to the ‘producer and consumer acting in concert’. It was sometimes used to label those customers who sought out mass customized products. However, Williams and Tapscott use the term differently, to describe the growing number of customers who are prepared to ‘hack’ products and adapt them in ways never envisaged by the producers. Wikinomics notes that the idea of amateur innovation goes back many years.  A perfect example is the story of how hot-rodding of cars developed in the late 1940′s and 1950′s.  Today’s amateur innovators have the advantage of the web where, instead of just sharing an idea with their neighbour, they can share it with thousands of fellow product hackers through online communities.

Examples of prosumerism today include communities that have grown around platforms such as Lego Mindstorms, the Apple iPod, and the Toyota Prius.  In many cases, after initial reluctance, the producer has engaged with these communities and involved them in the official innovation process.

Next up in this gallery of trends are a group of people called ‘The New Alexandrians’.  The original Great Library of Alexandria is reputed to have contained volumes on all the scientific knowledge then known.  Now, in the period of the fastest and broadest accumulation of human knowledge ever known, there is a new generation of Alexandrians who are again collating all the knowledge that exists.  These Alexandrians range from Google to librarians at institutions such as Harvard, Oxford and Stanford, who are scanning thousands of books and turning them into bits.  Along with media of all varieties, these digitized books will be sewn together into a universal library of knowledge and human culture.

This Alexandrian culture is also giving rise to a new age of collaborative science.  As Tapscott and Williams state:

“The emergence of open-access publishing and new Web services will place infinite reams of knowledge in the hands of individuals and help weave globally distributed communities of peers.  The rise of large-scale collaborations in domains such as earth sciences and biology, meanwhile, will help scientific communities launch an uprecedented attack on problems such as global warming and HIV/AIDS.  All considered, leading scientific observers expect more change in the next fifty years of science than in the last four hundred years of enquiry.”

Many different examples of scientific collaboration projects are described in the book.  Projects like the Human Genome Project, and all use collaborative open source techniques to advance biological and medical research.  In  documenting this trend for a wider audience, Tapscott and Williams are providing a very effective rebuttal to those who have suggested that participants in open source initiatives are only interested in electronic gadgets.

Wikinomics also examines the ‘Platforms for Participation’ – the technical environments that have been developed to facilitate user innovation and interaction.  In many cases, these are application programming interfaces (API’s), developed by the likes of Google, Amazon and eBay, that enable small businesses and individuals to build innovative applications never envisaged by the companies themselves.  Such platforms do not just exist in the commercial sector.  Many not-for-profit organisations have built systems that examine publicly available data (in the U.S. at least) on pollution, crime and social cohesion.

The book also looks at what the authors call ‘The Global Plant Floor’.  This examines the possibilities for digital fabrication.  It also examines the possibilities for open architectures (i.e. an open basic design to which components of various kinds can be added, such as that used in personal computers) to be used in many other industries.  The book profiles the Lifan motorcycle company, that uses an open basic architecture on its motorcycles, which means that components from many different sources can be used without changing the basic design.  Tapscott and Williams use the example of Lifan to dismiss the idea that peer production is only suited to creating information-based goods.  They note that if physical products are designed to be modular, then, theoretically at least, large numbers of lightly co-ordinated supplies can engage in designing and building components for the product, much like the thousands of Wikipedians add to and modify Wikipedia’s entries.

The book rounds off with an examination of the ‘Wiki Workplace’.  This, as you can imagine, is a working environment which places far greater levels of reliance on staff to contribute towards organisational development and innovation in business process.  It is very hard to argue with the ideas put forward, especially when one reads the the account of how Geek Squad, an IT home-assistance service, has applied them to its business.

Personally, I have found books that deal with the trend towards peer production and open collaboration models to be interesting, but sometimes lacking in flow and not always easy to read.  Wikinomics is both informative and entertaining – it’s actually enjoyable to read.  I must admit that I got a little bit of satisfaction from the account of Lifan’s use of open architectures on motorcycles, as I had suggested something similar for the auto industry a few months ago.  Of course, few would believe me when I say I hadn’t read the book first.

Business books tend to go out of date quickly.  However, I expect that Wikinomics will be read for generations to come as a chronicle of how many of the existing assumptions about business fell away to be replaced by a new, distributed and collaborative approach  in the early 21st Century.
The authors and publishers of Wikinomics have adopted the open collaborative strategy themselves:  An addition to the book, called the Wikinomics Playbook, has been compiled using peer production techniques and is expected to be published shortly.

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