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April 06, 2009


Chris Ward

I think IBM OS/2 and IBM Lotus SmartSuite cleared themselves off the scene just in time to be out of the way of the 'crash'.

But what's the follow-on act to be ?

We have a Internet now. It wipes some businesses out; it grows others; and it's a great levelling force as between universities and corporations, as between the 'older generation' with assets (of uncertain capital value) and the 'younger generation' penniless but with enthusiasm, and as between individuals and their governments.

And it isn't going away.

OS/2 and SmartSuite never had any competition, did they ? Nobody ever made a profit selling personal computer operating systems and standalone office productivity software ? Or ... ?

Stephen Perelgut

I'm not sure that the current era is the same sort of change as the advent of automobiles or heavy industry. This is more about how people communicate.

Speech allows for communication from individual to individual. Writing opened the door for persistence and asynchronous conversation. The printing press changed from one-to-one, allowing one-to-many communication. The telephone erased distance and television added video.

Now, the internet, Web 2.0, and the spread of social networking tools has made another fundamental shift from monologues or one-to-one conversation to full-duplex, many-to-many conversations. And the evolution to Web3D is going to make this a fully immersive, fully synchronous conversation.

This isn't just the change from horses to trains and cars, I think it's the same scope as the Guttenberg press or the Industrial Revolution.

And, sadly, that means it doesn't speak to the current economic crisis one way or another.

Victor Yodaiken

Technology has assisted corporations to grow in power and size well beyond the ability of people to manage them and to a level where they are harmful to their employees and to the larger economy.

Leo Boeckl

I won’t argue the historic reality of technology cycles repeating themselves throughout the industrial era other than to admit my bias and say that I have supported Perez’s model since 2002 when she first published her model in the book. I have used her model to answer the question as to what time it is within the business unit where I work in the maturation of technology which we support.

Perez’s model of refined Kondratiev long waves presents our company with a kind of roadmap for the obstacles which lay ahead of us. The Inflection Point exemplified by the market crash we are all experiencing today, requires all companies to conserve cash in order to survive into the Deployment Period when an oligarchy of competitors will emerge for our industry. I think we should be confident that IBM will be one of those which survive, but how we are positioned within our own industry will be determined by what we do collectively as a company during the unwinding of asset valuations and the resulting stabilization which will follow.

Perez defines the core of this Long Wave to be one driven by the development and maturation of the microprocessor. How are we responding to the most significant developments of the microprocessor and the effects on the programming/system architecture? Virtualization is clearly the last step for the collapse of the entire system stack layers (OSI model). From the HW abstraction layer all the way up through and including the middleware and application layers. How are we positioning ourselves to provide the products and services knowing that the discrete layers which we provide today and which generate tremendous revenue for IBM, will be gone tomorrow?

I am of the opinion that how we as a company address the next few years, before cloud computing and utility becomes as standard for business computing as web browsers and Internet utilities today, how we respond with both technologies and support for the collapsing layers will determine our vitality an where we stand in our industry for the coming Synergy Phase of the Deployment Period.


Good post.Financial crisis is applied broadly to a variety of situations in which some financial institutions or assets suddenly lose a large part of their value..

Tom Foremski

We have an over supply of technologies, we now need to figure out how best to use them--that's where the innovation will be.

However, I disagree that these cycles consist of fairly regular and equal time periods throughout history. They might be similar to each other but that doesn;t mean they will be of fairly equal length.

When it comes to the microprocessor, its real potential wasn't realized until we were able to create the Internet. This potential is the ability to digitize ever larger parts of the world, including knowledge and skills, and then to easily distribute those bits back and forth.

Internet 1.0 allowed us to publish to any computer screen. Now, in Internet 2.0 (I don't use it in the conventional sense) any computer screen can publish back. We have connected up the furthest reaches of the world into a two way information communications medium. This is incredibly disruptive. We have not yet begun to witness the dusruption ahead, imho.

victor yodaiken

WSJ article shows india continues to grow because of long-term politically directed investment in the rural poor.


Speaks directly to: "She mentions three particular structural tensions that we need still to work out in order to move on: investments continue to be focused on short-term gain, not on long-term production and growth; the social system continues to foster an unstable environment in which the rich get richer and the poor get poorer; and there is too much idle money chasing and inflating assets like housing and not going into expanding the demand needed to soak up all the excess supply being produced.”

More here

David Chen

I absolutely agree that Perez's writing is relevant here. In every intro to finance/strategy/KM class, the prof points to the growth in the gap between book and market value as an indicator of the increase in knowledge as a factor of production.
Perez, in contrast, points to divergence of the exponential market value curve from the straight GDP growth curve as proof of a bubble.


I agree "Technology has assisted corporations to grow in power and size well beyond the ability of people to manage them and to a level where they are harmful to their employees and to the larger economy." that right?


Technology has assisted corporations to grow in power and size well beyond the ability of people to manage them and to a level where they are harmful to their employees and to the larger economy. I agree with your comment.


Perez is without doubt the prophet of techno-economic change. being from a developing nation (Venezuela)she has a good grasp on issues of development and economic catch-up.
her explanations are based on irrefutable facts of history and Freeman and Perez have proven their prophecies since 1980s...
but there are a few problems that still trouble me..
1- we have strong evidence that the technology life cycles have shortened and are shrinking rapidly.. does that mean the probable age of technological revolutions (esp IT revolution) would be shorter as well
2- technological diffusion has hastened, esp in IT.. if the age of a technological revolution is equal to its complete diffusion (both installation and deployment) then this revolution must be smaller
3- all revolutions originated in developed nations, and diffused to developing nations, exhaustion of one technological gold rush leads to the rise of the next wave. but in developing nations even the technologies of the previous revolutions have not been mastered, as the new waves hits and gales of creative destruction shatter the old forms, the developing nations are left with nothing but dependence and acute systemic crisis...
4- as this revolution is different from the past, first due to the nature of information technology itself, secondly due to arrival of a few NON-Western, developing nation players (Asia, BRICKS, etc) how would that effect the new paradigm. the next wave might rise from the east, or west, or both or just get canceled out when two counter currents arise from east and west.
5- the technological changes, financial and economic changes brought about by the waves or revolutions are only the visible aspects, the institutional and conceptual changes also come with the new paradigm, but after a time lag, a delay. how long is that delay,does that aftershock play a role in the 3rd and 4th quarters, how does it affect the rise of the next paradigm?
6- finally the forces of creative destruction do not always destroy the structures of the old paradigm, rather they only affect the exo-structure and are build upon the older foundation, the infrastructure,the institutions, organisational cultures, and peoples tastes and culture developed in a previous revolution, support the rise and mastery of the next. then how could a developing nation that missed a previous wave, ride the next wave?

any takers...

* Im a student of technological change at Chinese Academy of Sciences, and belong to Pakistan


Thank you. This is one of knowledge.


Thank you very much for your explanation,It makes work easier.


I agree "Technology has assisted corporations to grow in power and size well beyond the ability of people to manage them and to a level where they are harmful to their employees and to the larger economy." that right?

Muslim Social Networks

wow really a nice article and really express my gratitude to the blogger...
here i would like to share something that is really very special for the humanity because greenkonnection is the community that never descriminate the religion and most probably use the emotion and feel the differences that create the problem so i like to join such site and totally boycott the face book because the face book never give the respect to the differences.

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