What follows is my January 14, 2013 Amazon.com review of Irene Ng’s latest book, Value and Worth: Creating New Markets in the Digital Economy. The review article was entitled: The Tao of Value Creation and Growth for Businesses in Our New Digital World.
Irene Ng’s lucid and accessible book, “Value and Worth: Creating New Markets in the Digital Economy,” is a remarkable accomplishment, a work that should not be overlooked (that is, it most certainly should be read!) by current and prospective business managers, leaders, and entrepreneurs in every economic sector.
As national and world economies become more and more “digitized,” the opportunities/horizons for “business value creation” are expanding at a phenomenal rate. However, identifying and capitalizing on these new opportunities (i.e., new markets served by new business models) will be very difficult or impossible if we do not “update” our own “mental software” for construing and exploiting such opportunities. Ng’s book provides such an “upgrade path,” by taking us on an intellectual journey that leads us, as business people in the 21st century, to many new, useful vantage points that will significantly influence our business planning and practice.
The book is very extensive in its coverage and development of new ways of looking at value creation, markets and business models in an increasingly digitized world, so in this review it is only possible to illustrate that with a couple of examples.
Ng explicates her own perspective on the concept of “value” vs. the concept of “worth” as foundational to all her other analysis and commentary on business in a digitized world. “Value” is that which is beneficially realized by people or organizations as “use” [of something] in one or many specific contexts (for example, I use and benefit from my mobile phone and phone service while driving home from work, in an emergency situation, etc.). “Worth,” on the other hand, is what is assessed in the act of exchange (purchase, barter, et al), most often within a market (for example, I will pay $300 for the ownership of a mobile phone and the use of the mobile communications network service). By drawing this dichotomy of “value” and “worth,” Ng clarifies the somewhat elusive concept of “value co-created in context” from the more visible concept of entering into an “exchange relationship or transaction.” While exchange relationships/transactions have undergone significant digitization over the past few decades (credit cards, electronic payments, new payment or exchange methods (PayPal, eBay, etc.), the digitization of the world of individuals and organizations using their own “agency” and “resources at hand” (including products and service they have purchased) to “co-create” “value in context” is only starting to get underway. CIT (communications and information technology), mobile platforms, and social networks and media are among the world-wide developments that are opening up the possibility to discover and create new value (in context) and additional amounts and forms of worth (in exchange)that were not possible pre-digital.
Based on these fundamental principles, Ng explores, analyzes, and explains the many different ways and different models of how value can be created in an increasingly digitized world (value which consumers or organizations and businesses can grow and realize through “use in context” and through “worth-based exchanges, including markets). Often the ways of thinking, offered up by Ng’s framework, seem to depart from those we have inherited/adopted based on our classical economics education and assumptions, but once we begin to apply the central concept of “value in use/in context,” we begin to realize that “exchange and markets” can come back into play in surprising ways.
For example, Ng discusses the (by-now-well-known) phenomenon of “big data.” Ng points out that the current conventional concept of “big data” as massive amounts of anonymous data of consumer, use, behavior patterns–that can be used by businesses to serve customers–may be limiting and sub-optimal. If there is a market/exchange structure in which consumers/users retain rights to conceal or reveal (i.e., trade/exchange their own individual behavioral information), then we might have a scenario in which total aggregate economic value and worth (for both consumers/users and businesses)may exceed the aggregate economic value and worth that could be realized if “big data” is anonymized (i.e., excludes lower levels of behavioral information about individual users’/consumers’ realization of “value in use/context”). This is just one example of the many ways the journey, which Ng accompanies us on and guides us on, brings us to new and opportunity-rich vantage points and perspectives.
“Value and Worth: Creating New Markets in the Digital Economy” is an incredible work that has been carefully and very effectively designed, for our intellectual and business benefit, by a unique, extraordinarily insightful individual who has integrated and delivered on her many years of experience and expertise as a business executive, a management science researcher/scholar, a university and business educator, a consumer, and a person. The “worth” (price) of the book is clear and established, and I am fully confident that every reader (current and prospective business managers, leaders, and entrepreneurs) will realize (as I have/am) a “value” that very far exceeds the “worth” (the monetary expenditure/payment) of the “exchange transaction,” thus yielding an extraordinary reader ROI.