book.chapter Generating digital wealth

Business webs, or b-webs, are the new engines of wealth creation in the digital economy, replacing traditional industrial-age corporations. These dynamic networks of suppliers, distributors, service providers, infrastructure providers, and customers leverage the internet for communication and transactions, crafting innovative value propositions and altering the competitive landscape of entire industries. By fostering collaboration and competition among a multitude of enterprises, b-webs generate a novel form of capital known as digital capital, which is the cornerstone of the new economy and a key factor in the lofty market valuations of internet companies. The primary challenge for businesses today is not to question the drivers of economic change but to determine how to adapt and thrive amidst these transformations. The industrial economy, characterized by a scarcity mindset focused on physical goods and services, is giving way to an abundance mindset in the new economy, where knowledge-based offerings are prevalent. Success in this new economy hinges on delivering superior value at a lower cost, a feat no single company can achieve alone. This has led to the emergence of b-webs, where companies collaborate to create added value. A b-web is a flexible network that uses the internet as its backbone, delivering new value propositions and focusing on customer value rather than production and sales. It is orchestrated by a context provider who manages customer relationships and coordinates value-creating activities. All participants in a b-web share data extensively and adhere to common rules and standards. There are five classes of value contributors within a b-web: customers, context providers, content providers, service providers, and infrastructure providers. Digital capital is transforming industries and creating wealth in new ways, adding to the traditional forms of intellectual capital: human capital, customer capital, and structural capital. In a b-web, these forms of capital are amplified as the collective resources of all participants are accessible, enhancing the capabilities of each member beyond what was possible in the old economy. To build a b-web, one must follow a six-step process. First, describe the current customer value proposition in the targeted marketspace. Second, disaggregate the businesses meeting that value proposition to identify opportunities for creating digital capital. Third, visualize a new value proposition that your b-web will offer, leveraging digital technologies. Fourth, reaggregate the necessary processes, contributors, applications, and technologies to deliver on the new value proposition. Fifth, create a value map to graphically represent all requisite value exchanges within the b-web. Finally, fine-tune your b-web mix, selecting a model and customizng it to meet your specific needs while retaining flexibility for future adjustments. Building a new b-web presents three key challenges and opportunities: managing the people involved to leverage the collective human capital, using relationship capital effectively to transform marketing into interactive communication, and selecting the right business model to ensure competitive differentiation and sustainable advantage. There are five general types of b-web business models: Agora, Aggregation, Value Chain, Alliance, and Distributive Network, each with a different organizing principle.