This post is adapted from a presentation I gave at Xerocon Denver 2015. In it, I talked about the progression our economy has made from agrarian, to industrial, to service, to knowledge, to what I believe is here in some industries, and now surfacing in the accounting industry — the creative economy. See this link if you’d like to read the full text.
If you look at our nation’s history, you’ll notice the progression from survival (agrarian economy), to possessions (industrial economy), to freed up time (services economy), to intellectual pursuits (knowledge economy). Some of you may recognize the parallel to Maslow’s hierarchy of needs. I suggest we as a society, and as an economy, are moving our way up that hierarchy.
So what comes next? I believe there’s a new age brewing — it’s been around for a little in the broader market actually. But I believe our field, accounting, is now entering the creative economy. In this landscape, it’s not acres, it’s not physical capital, it’s not hours, and it’s not even intellectual property that governs the economic paradigm: it’s our ability to tap into the human capacity to imagine and create. That’s what the market will reward the greatest. And that’s why the largest taxi company doesn’t own a single vehicle (Uber), one of the largest lodging companies doesn’t own a single building (Airbnb), and the largest content company doesn’t have any journalists (Facebook).
The next ten years or so, I believe, will be a drama between the characters of Knowledge (we’ll call him Kevin), and Creativity (we’ll call her Cora) — something I call, “The Tale of Two Economies.”
The opening credits of this story have the camera zooming into planet Earth from outer space. As it gets closer and closer, faint sparks of lights are seen, and then lines tracing back and forth between them. It’s… the Internet (daun daun don). In some ways, the Internet is decimating the knowledge economy, by democratizing access. Knowledge is no longer stored in silos whose contents are parceled out for money. Instead, it’s everywhere, it’s diffuse (which means “everywhere”), and it’s constantly growing.
There’s a few direct consequences of this. One, is that specialized knowledge is more in demand, and so niches are on the rise. Two, is that synthesizers are more in demand — those who can combine and build on top of the information superhighway (read: Uber). And three, a particular customer value is ascending in relative importance: the value of transformation – or being able to change somebody’s state from where they are, to where they want to be. So there’s three business strategies for you right there: specialize, synthesize, and transformize. 😉
But let’s storyboard this tale together a little further. Imagine we’re sitting in the Pixar studios brainstorming room…up on the wall are concept art sketches…on the left, those for the knowledge character, Kevin…and on the right, those for the creativity character, Cora.
- So on the left, is a square frame tacked to the wall, picturing Kevin sitting across his desk from his customer, dispensing professional advice to his client. And on the right, is a square, showing Cora sitting beside her customer at a table asking questions and listening, to uncover the unknown unknown.
- Next step down on the left, a frame showing Kevin in his office late at night, trying to make sense of a customer’s figures from last year so he can prepare an accurate return by the deadline. And on the right, a picture of Cora and her customer looking at a screen projection of how they’re designing what her customer’s return will look like next year when it’s filed.
- On the left, is Kevin filling out at timesheet on his computer at the end of the day, living out the maxim that time is money. And on the right, is Cora sitting in a lounge chair at her offices with sketchbook in hand, looking out the window as she considers what will best get that customer to their goal. She’s living out the maxim that change is value.
- And in the final frame, we see Kevin standing at the head of a room announcing a new initiative to his employees, and the ten-point plan for its success. And the on the right, we see Cora sitting at a table with her teammates, pointing in a particular direction, and tapping into their creativity to figure out how to get there.
Is the film coming into focus? This drama is already starting to play out, and if you’re reading this, you’re likely a Cora. But how will you recognize other Cora’s? Well, I’ve got a checklist, I’m an accountant after all:
- She’ll be planning her team’s project capacity out for the next six months, not logging their historical hours.
- She’ll be developing a frictionless platform for her team and customers to collaborate through, not a one-way publishing platform to disseminate information through.
- She and her customers will talk about success at their quarterly meetings not only in terms of dollars, but also in terms of progress along a path to a purpose.
- Each change in her firm isn’t a massive shift done every couple years to keep from falling behind, but rather smaller continual adaptations over time that more and more fulfill a vision of the way things should be.
- She’s developed processes that are open to discovery and creativity with her customers, not products that are one-size-fits-all to be sold to as many people as possible.
- Her metrics don’t include utilization, realization, and job costing, as if her team were a factory. But revenue per capita, research & development spend, and customer lifetime value, as if her team were a garden.
In short, Cora realizes it’s not just reference tools, but construction tools. Not just what you know, but your ability to bring it to life. It’s our ability to imagine, and to create, that defines the creative economy. And those who develop the skills of the creative economy, are poised for quite a ride.
(As originally posted on the Thriveal blog.)