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Digital Darwinism

An overview of her book by Professor Irene Ng, Warwick Manufacturing Group (WMG) Service Systems Group

Published March 2013

How has our digitised world influenced the manufacture, design and delivery of products? What will our buying experiences be like in the future – a future when no firm is too big to fail? Professor Irene Ng introduces her new book, Value & Worth: Creating New Markets in the Digital Economy, which looks at consumer products and services in a new age of technological agility.

Today’s world is dominated by the rapid advancement of digital technologies, constantly changing the way we live, learn, communicate and interact, and impacting the way we use objects and services to help us achieve our personal outcomes. Acquiring objects and new technologies has made us better at solving problems, interacting with others, and organising our lives as we become more empowered.

1953 computerDigitisation is also changing the way we buy and use products and services. It is accelerating the convergence between exchange (when we pay) and experience (when we use) products, with markets now forming closer to when we need these offerings.

Take music as an example. Previously, we believed that the only way to enjoy music was to ’own’ or buy the record or CD. This is a transaction, an exchange, and value became equated with ’exchange’ – what we got for what we gave. What we actually valued, however, was not the exchange per se, but being able to enjoy the outcomes or benefits of what we had bought – the music – through the context of its use and experience.

The importance of context

Today, digitisation allows us to enjoy music without owning a record or CD. With digitisation, music can now sit at ‘virtual’ locations such as the cloud, accessible through a device such as your computer or your mobile phone with Internet connection. By streaming the music through our devices from these locations, music is made available for us to listen to wherever and whenever we want it, i.e. in context, which is when the need is most salient, and on demand.

Crucially, we can also pay for the music when we want or need it, rather than having to buy before or after the need arises; this is where future markets could be formed - where there are opportunities for a convergence of buy and use. Digitisation enables opportunities for traditional offerings to become a resource in context, reducing time between acquiring a resource and using a resource, thus expanding demand for it.

Such impacts of digitisation are enabling fresh approaches to the manufacturing, design and delivery of almost everything. Products can now be 'incomplete', as they could embed digital interfaces for personalisation and connectivity. The old boundaries between a product, service and the way it is customised for the market, and subsequently personalised for use, are therefore shifting, and with those shifts come new insights into what we, the customers, may regard as valuable and how/when we choose to buy. The importance of individual contexts of use and experiences and a product's ability to adapt to multiple contexts cannot be underestimated.

In addition, every product is already socially connected, through the individual, with other products at the point of use, i.e. they are members of a 'value constellation'. With greater digital connectivity, connecting objects through the 'Internet of things' will result in new ways to capture value, generating new business models and creating disruptions. Since use and experiential contexts are where industry verticals converge e.g. watching TV is a constellation of media, electronics, food & beverage industries, what will emerge are horizontal or systemic business models, as companies move to appropriate economic benefits from other industry verticals by innovating their offering to serve contexts better. This is already happening with large digital companies such as Amazon, Google and Apple who now span horizontal boundaries, encroaching into other’s industries.

Products that fit lives

The emergence of new business models will be greatly assisted by individuals and a market willing to pay for deep personalisation and a greater fit of products to lived lives. Digital connectivity now allows for greater voice, empowerment and action of the person individually, and for people to get into groups to create collective, powerful and yet diverse voices. It allows us to deeply personalise everything for ourselves and to live unique individual lives even while many of such technologies are fully scalable to offer into the market.

The notion that firms create viability from serving only a subset of their customers (the segmentation issue) and having to trade off product attributes, is increasingly becoming archaic. The new way of thinking is how to negotiate digital and material boundaries to allow for deep personalisation for all individuals while benefiting from increasing returns to scale.

My book, Value & Worth: Creating New Markets in the Digital Economy, focuses on ways of considering how this might be possible. These ways will not come from existing mindsets. Rather, they will come from liberating the mind and considering how the good use of digital connectivity, overhauling the business model and re-designing a hybrid product and service offering could empower, rather than passively serve, customers. In the rapidly advancing world of digital technology, staying with the status quo is not an option. Disruption is never far off and no firm is too big to fail.

Also, humanity is facing many great challenges – looking after our ageing population, keeping our children safe, providing clean water to so many who have none, improving our health, leading more fulfilling lives, and creating more sustainable approaches to growth. We need better technologies that work well with lives.

New economic models?

In considering what individuals value about what we have around us and the way we use them, Value & Worth: Creating New Markets in the Digital Economy also provides an understanding of these contexts of value creation to propose how latent needs emerge, and to identify new exchanges that could empower individuals to achieve outcomes that 'fit' into our lives. These new exchanges could potentially evolve into new economic models - sources of wealth creation for the future.

Value & Worth: Creating New Markets in the Digital Economy is currently available as a Kindle e-book. The rights for the print version have been acquired by Cambridge University Press for all territories and languages, and the paperback and hardback editions are scheduled for release in Sept 2013. For further details, please visit:

Professor Irene NgIrene Ng is the Professor of Marketing and Service Systems and Director of the International Institute of Product and Service Innovation (IIPSI) at WMG, University of Warwick. She holds a PhD specialising in pricing and economic models for services and an undergraduate degree in Physics, both from the National University of Singapore.



Image of a 1953 computer by Argonne National Laboratory used under a Creative Commons License. Source: Wikimedia Commons.