E-Business and the "New Economy" - Dysfunctional Aspects

“The atom is the icon of the 20th century. The atom whirls alone. It is the metaphor for individuality. But the atom is the past. The symbol for the next century is the net. The net has no center, no orbits, no certainty. It is an indefinite web of causes.” (Kelly, 1998, The Power of Decentralization Section)

Whether it be economic security relating to the nature of supply and demand or the securitization of transactions, within any type of economy, the fear of security, or its lack of, is always a governing concern.

When eBusiness promotes the coined economy as a young period of prolonged and increasing growth, or is considered a benefit to consumers and businesses in all matters of commerce, a fallacy is born; and thus, a dysfunctional aspect of the “New” can birth a series of questions. Such as, can the growth of technology maintain a pace with demand? Can supply meet demand with more securitized infrastructures? Can our dependence on technology affect business? Or simply, can demand keep up with technology? The expanding of businesses into ecommerce, the globalization of goods and services, and the growth of technology that allows it to be so dependent on, are all fundamentals of the New Economy. As eBusiness is implied toward this growth, and as Kelly states, is the fashion of how “we are connecting everything to everything” (1998), the speed of this growth can imbalance the distribution of supply and demand, and most importantly, affect the human lifecycle. So what are the dysfunctional aspects promoted by eBusiness?

As the theory states, business should focus on those areas of its operation which are critical to its success and where it has a competitive advantage. Other areas of its operation should be outsourced, typically, using technology as a facilitator. (Wikimedia Foundation, 2008, The Theory Section). In the U.S., human jobs are cut due to technological replacements; and other areas are often outsourced in other economies. Typically, if technology can increase efficiency and savor low costs over humans, technology wins and sometimes similarly, businesses win as well. As discussed in the supply chain discussions, when traditional businesses expand into ecommerce, supply chain information management is often replaced by technological infrastructures. Although the placement of new technologies can birth new employment opportunities and job functions, the once savvy craftsman is left in the cold. Although technology can limit errors and maintain transaction effectiveness at enormous speeds, the demands for securitization and governing laws linger as lagging concepts. For example, to this day, online perpetrators have used technologies as a medium of conducting illegal acts. And similarly, some of these acts aren’t governed by a worldwide cooperative set of laws. Schneider states, “when businesses begin operations online, the traditional measures of effects—and the laws that have been developed using those measures over many years—do not work very well.”

Overall, the dysfunctional aspects of the “New Economy” that are promoted by eBusiness are securitization of occupations/information and an alarming growth rate of legal/ethical concerns that laws are having difficulty in judging/governing.

References:

Kelly, K. (1998). New rules for the new economy: Chapter 1: Embrace the swarm. [Electronic Version]. Available from the Kevin Kelly Web Site: http://www.kk.org/newrules/contents.php

Schneider, G. (2004). Chapter7: The Environment of Electronic Commerce: Legal, Ethical, and Tax Issues. [Electronic Version].

The Theory. (2008). The new economy. Available from the Wikimedia Foundation, Incorporated Web Site: http://en.wikipedia.org/wiki/New_economy