3.2 The Internet and the New Revolution of Communications

The torrent of marketing communications heralding the Internet as the greatest invention since the printing press is quick to point out that the initial intention of the technology is to foster new lines of communications. However, there is far less written (except in academic circles) on the effects of this technology on corporate value propositions in a greater historical context of socio-economic evolution and its relationship to international commerce. How technology alters the relationship between people, trade and the perception of value is a topic of continued debate among scholars and industry experts. The industry assumes that new communications technology will make the world a better place and commerce will flow as a natural extension of a perceived higher standard of living and increased socialization of the technology. This may indeed be true, but it would be naive to believe this scenario without first understanding the origins of technology’s role in an information society.

To begin, Lopez reminds us of man’s need to socialize: ‘Whatever his personal inclinations, economic necessity made man a social being.’^[104] As a species, humankind has an inherent need to be social. Communications between people as a means to exchange thoughts, ideas and other basic emotions has been the quest of many technologies throughout history. Greater communications between people is said to reduce the total amount of distrust between geographically separate cultures or socio-economic classes within a culture. Increased communication is said to promote goodwill and a better understanding of the idiosyncrasies found in world populations, contributing to a higher degree of cultural tolerance. During the last one hundred years, more technological progress has been made along this front than ever before. Yet, this same time period produced some of the world’s greatest political and social conflicts.

Since the Internet is quickly becoming an integral part of global commerce and business interchange, it is important to understand the intertwined roles of commerce, social structure and technology. These three converging forces have been labelled ‘convergence’, ‘progress’ and even ‘globalization’. In order to develop a perspective of socio-technological evolution, it is crucial to examine the past behaviours of people, business and governments in order to project the next step in its development.

Roman administration demonstrated the effect of a strong central government on remote conquered locations by transplanting the values and social structure of Rome over the whole of the European continent. The fall of Rome and a return to isolationist groups of people created a void in socio-economic development and effectively thwarted technological advancement for centuries. The barbarian age of the high Middle Ages reflected a discontinued social contract that shifted the administration of governing people to local lords who remained cognizant of the decadence of central government. Within these medieval communities, powerful local lords emerged as a cohesive force to maintain order and provide a mechanism for social structure. In the later Middle Ages, the rise of town governments would compete with local lords by broadening the liberties of individuals.

The underlying characteristic of socio-technological progress is the relationship between the improvement in communications technologies and developments in the economic, educational and social systems. The efficiency of the Roman administration was a direct product of the Roman road system which provided an infrastructure for communications, commerce and military adeptness. The rise in trade and improved and more frequent communications were contributory factors to the social development of the later Middle Ages, which provided the foundations for the Renaissance. The winners and losers of technological advancement – from the perspective of individuals and skills – was discussed in section 1.6. Here, however, we focus on the quality of communications, data, information and knowledge as a product of simply conducting business (Figure 3.2).

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Figure 3.2: Technological economy time line

In the twenty-first-century business, a high quality of data and information is essential to its ability to operate with an acceptable margin of profit and loss. Poor information and low quality data can effectively cripple a management team’s ability to capitalize on the resources of the organization. Although the quality of the data used and generated by a firm is rarely correlated to a corporation’s identity, balance sheets or income statements testify to the fidelity of information, thus placing an important role in understanding how a company functions.

The fidelity of corporate information is important because as technology changes, how we communicate and interact changes. In addition, alterations in our way of communicating influence the development of new products and services. As geographic boundaries disappear, economic activity becomes more intertwined, cultural aspects play a larger part in multinational product development and communications, and the issue of information fidelity is inescapable.

The industry speaks flippantly about the Internet’s profound influence rivalling that of the printing press. This impact has typically been with reference to the speed at which information is disseminated, and rarely to the quality of what is being communicated, as we have seen in the example of the ‘Wicked Bible’ in section 2.2. The replicative properties of the printing press drastically reduced the cost of labour. To illustrate the quantitative nature of information fidelity, once again we turn to the printing press:

The famous transition point in printing from the laborious handmade text to the low-cost mass production of the printed word occurred, of course, with the Gutenberg movable type press of 1440. It is important to note that this technological breakthrough was itself the product of several other technological breakthroughs – notably, low-cost paper and ink production and (introduced by Gutenberg himself) reusable molds for the type elements.^[105]

Manuscripts which once took months of labour to create could be reproduced at a fraction of the cost. Seemingly, the majority of the cost was in the initial set-up, and the cost per unit decreased as additional copies were pressed.

To illustrate the concept of information fidelity, one can examine a medieval manuscript that was subsequently reproduced in movable type. It becomes clear that the content or words had been reproduced, but the iconography, colouring and physical construction of each element on the original page are missing from the printed version. The words have been reproduced, but the elements which present indirect information on the context in which it was crafted are lost. This transition between manuscript and movable type printing is often categorized as a simple loss of aesthetic beauty. However, it is not only a matter of aesthetic beauty. Using advanced technology such as a computer and a digital microscope, one can examine the composition of the document and the details of each letter in order to develop an understanding of how the document was created and by what kind of author/scribe. Measuring the light reflectivity of the paper and assessing the density of the ink on an individual letter, one can infer, based on the way the ink ran down the letter, the angle of the table during the production of the manuscript, which can in its turn furnish us with information on medieval geometry. Similar scientific experiments can be conducted to provide a reasonable picture of the production process used by medieval scribes and illuminators. The fidelity of their production process was reflected in the finished product, most of which was lost during the printing revolution. Five hundred years from now, it would be interesting to try to understand how a company added value, developed products and fulfilled customers expectations by reading their quarterly and annual reports.

The goal of information in today’s business climate is not to be able to reconstruct the past but to direct actions in the present and anticipate the future. That said, the fidelity of information plays a vital role in allowing organizations to put information into a proper context in which decisions can be made. Although the physical elements of data such as words can be replicated with astonishing mechanical precision, at the same time information must be placed into its proper context to be valuable. In the case of a medieval manuscript, the simple aesthetic beauty of the drawings in and around the borders of the words tells us much about medieval social attitudes, beliefs and craftsmanship, most of which was discarded when the new printing press merely replicated the words. In the end, it is important to say that regardless of losing the aesthetic beauty of old manuscripts (such as the Book of Kells), and a gradual loss of the knowledge about methods of medieval writing and manuscript illumination, the impact of the printing press had one undeniably positive effect: it allowed every sector of society to have access to books. What was lost in terms of beauty was gained in terms of dissemination.

The primary issue surrounding the accuracy of information is that as new digital communities are formed and culturally diverse people interact with greater frequency, the quality of information and its cultural context may determine a firm’s success. Putting business information into its cultural, geographic or associative context is beginning to be recognized by firms such as the Hong Kong and Shanghai Banking Corporation (HSBC). The television commercials of HSBC in 2002 portray a firm which understands the cultural contextual significance of information, as they clearly point out the cultural significance of gestures that are indigenous to more than one country meaning different things in different cultures. A greater understanding of the context of information will be needed to avoid the temptation of developing one technological solution that can be applied to all people everywhere. More importantly, information fidelity has a direct influence on an organization’s ability to collaborate with itself and becomes a critical factor when interacting with other global businesses. Collaboration between individuals inside the firm and, to a greater extent, outside the traditional organizational structure, is a key element in a long-term business strategy. The next evolution of business will thrive on individuals’ participating in a connected cycle of business. Whether a firm is a supplier, an intermediary or simply a conduit for transactions, being connected and efficiently leveraging a bidirectional channel to other business enterprises is of paramount importance. During the last 25 years of technology implementations, it has been the primary goal of companies to employ technology in order to reduce operating cost and eliminate unnecessary steps in business operations. This method of using technology to automate business activities has given many organizations the desired results and in many cases a competitive advantage in their respective markets. Surprisingly, a large majority of technology projects failed to achieve their optimum implementation and, more alarmingly, an even higher percentage of these projects were labelled as failures for not reaching many of their business objectives for which they were designed. However, technologies such as the Internet, electronic commerce and innovations in desktop technology coupled with a convergence of communication technologies such as the telephone, television and the Internet are changing the way we transact business. Corporations who are early adopters to this fundamental shift in how business communicates are embracing these technologies and establishing digital pathways for customers and suppliers to engage them in new conversations. This establishment of a digital presence, which is discussed in section 4.1, and a new strategy for engaging customers in this new communications medium is similar to marketing organizations developing strategies in the early days of television, with one big exception: now geography, culture and demography do matter.

^[104]R. Lopez, The Commercial Revolution of the Middle Ages 950–1350. (Cambridge: Cambridge University Press, 1995) p. 48.

^[105]W. H. Davidow and M. S. Malone, The Virtual Corporation. Structuring and Revitalizing the Corporation for the 21st Century (London: Harper Business, 1993) p. 32.