The New Economy Called Sharing Economy
Exclusivity is out. Collaboration is in. Working together is the new way of doing business which brings us to the concept of sharing economy. What does sharing economy mean? As kids, we were taught early on that sharing is an essential part of being. The definition of sharing that we knew back when we were starting to learn about numbers and ABCs is no different to the idea of sharing when referring to the sharing economy.
Uber, Airbnb, Grab, ebay, Fon, HomeAway, and Elance – do any of these companies ring a bell? These are just some of the growing number of sharing-focused businesses that are shaping today’s industries and economies. Companies built on collaborative ecosystem and sharing management culture are transforming businesses and the way people deal with daily life and work situations.
The rise of social media
Admit it or not, social media has become a part of the daily lives of most people. Unlike traditional communication tools, social media offers a two-way communication stream that allows people to be proactively engaged in discussions and the decision-making process. Social media is a tool aimed at collaboration and sharing. Imagine how easy it is to order food, look for a job, shop, book trips and appointments, join organizations, and even set-up a date right at your fingertips. Years ago, we were stuck with lengthy paper processes, charged with exorbitant fees, and even traveled miles away just to do such things. And today, social media has become a fundamental element of the sharing economy as witnessed in the companies mentioned earlier. The advent of social media has changed people’s perception and attitude towards others. Since then, people have become more willing to open up about their lives to strangers as seen on a lot of vlogs and social media posts. People are more engaged and unafraid to share their opinions and recommendations. Subconsciously, these are behaviors that can very well be attributed to the idea of sharing. What started out as a simple idea of sharing information turned into something even bigger – the sharing of resources.
If you don’t evolve, you dissolve
Why do we need to understand the sharing economy? Why does it matter to us? If we are just mere consumers and not into the business and technical side of the sharing economy, then why should it matter to us? The answer is simple. Life is chemistry. Everything around us affects us. And if we don’t evolve and adapt to changes, we will get left behind and stop growing. We need to understand the basic principles of sharing economy because we are a part of it. Our contributions, no matter how small, make all the difference collectively. A deep understanding of this emerging economy can lead us to better opportunities, allow us to reach new horizons, and provide us foresights that will allow us to make strategic decisions. We can’t just always be on the receiving end all of the time. It would be an irony to benefit from an industry that capitalizes on sharing but could not receive its fair share of time, resources, and efforts from the people it caters to.
So, you want to be a part of the sharing economy?
What does it take to be a part of this emerging economy? Just like in any other business or venture, we set values and traits that help us succeed in our undertaking. The values and attributes required in a typical business are no different with the values and traits one needs in the sharing industry. Sharing-focused businesses operate on trust, transparency, accountability, cooperation, open-mindedness, and the willingness to adapt to changes, innovate, and constantly feed your mind with knowledge. Apart from these values, it’s also necessary to come up with a strategic plan for your planned shift to a sharing-centric economy. How will a sharing economy affect your existing business model? Are you well-prepared for disruptions and the transition? Have you thought about the mindset of your market? You need to consider these questions on your planned economic shift. And you need to integrate all the values mentioned earlier in answering and creating solutions for such questions.
Entrepreneurship that creates opportunities for all
The sharing economy is empowering entrepreneurs and reshaping how they do business. Entrepreneurship is evolving because of peer-to-peer marketplaces. Pooling together, sharing resources, and reducing overconsumption or unnecessary purchase of things are redefining the concept of community-building in the perspective of a sharing economy. What sets the sharing economy apart from the traditional economy is its ability to provide business opportunities for all. In a traditional set-up, only those who have enough capital to build or buy apartments or condo units can actually sell or rent out these places. Imagine having an unused room in your apartment that’s just building up dusts and cobwebs. Thanks to the sharing economy, you can now have your room easily rented.
Is it sustainable or not?
This leads us to the question on whether this kind of economy is sustainable or not. Yes and no. Like all things, the sharing economy has its own pros and cons. When it comes to sustainability, it will depend on how we treat and view it today and in the future. It could be sustainable because it creates jobs for people and reduce the unemployment rate but it’s not sustainable for governments because of loss of tax revenues. Will sharing-centered enterprises last long if the number of similar businesses rises? Will it still be sustainable socially and environmentally speaking? The answer will depend on how a business sees the opportunities in challenges. Again, it all boils down to the values mentioned earlier, especially one’s open-mindedness, and willingness to adapt to changes, innovate, and constantly feed their mind with knowledge. These are what will make the sharing economy successful and sustainable.
Patrick Roupin is an expert in innovation, design, strategy & entrepreneurship.
Ashrefunisa Shaik is an expert in organizational transformation & sustainability.