Thursday, January 26, 2012

The New Factors of Production and The Rise of Data-Driven Applications

For the last ten years, I’ve been partially obsessed with the notion that the formula for creating economic value needs to be updated. I’ve worked in the technology industry for 26 years and I’ve seen information systems radically change the landscape of competition and value creation. My most recent article on this topic appears in Forbes under the same title as this post.

Because this article represents just a fraction of my thoughts on this matter, I’d like to revisit the basic premise, which is captured in the excerpt below, and then describe how some of my current experiences at Jaspersoft corroborate this newly posited IT-driven economic theory.

“Classical economic theory describes three primary factors, or inputs, to the production of any good or service: land, labor, and capital. These factors facilitate production, but do not become part of the end product (as a raw material would). While these three factors have been much discussed and extended at different points in economic evolution, I believe that they, in any of the advanced economies of the world today, are vastly antiquated.

Sometime even prior to this new millennium, the primary factors of production have now assuredly become: Time, Information and Capital. I submit that the primary relevance of land and labor has diminished, not completely but measurably, from their prominence during agrarian and industrial economic times. In a sense, owning land and employing lots of people no longer highly correlate to a valuable and successful enterprise. Although in certain industries these two factors will remain prominent (think mining and energy production, for example). By and large, land and labor have yielded to two more important factors – time and information.”

I was very pleased when Silicon Angle asked to speak with me about my background and the thoughts that led to this newly posited IT-driven economic theory as well as the contributions Jaspersoft is making to this new economic landscape. I discussed how Jaspersoft’s mission is precisely to help its customers compete on the basis of time and information.

“From its very start, Jaspersoft was determined to build and advance the industry’s most modern, flexible, and scalable Business Intelligence (BI) software. To do this, we consciously chose the open source model of development and distribution, believing that the power and principles of community involvement and broad usage would prove continually more valuable (and it has). We knew time would be important to our business model to rapidly compete in a crowded software category.”

Jaspersoft focuses on delivering its modern BI software to those who are best suited to create value from it. We call these individuals “BI Builders” because they possess a powerful confluence of knowledge about data, analytics, and business (process, function, industry, etc.) that truly yields new value from insight. The result is thousands of commercially available software applications that include Jaspersoft technology. These software applications power the world and deliver faster, more effective insight into data. Jaspersoft’s open source model affords these applications very high quality reporting and analytic capabilities at a very low cost, so our customers create new economic value, arguably, where it could not have been created in the past.

In many ways, the BI Builder is the real hero in the equation that determines how companies can compete more effectively based on time and information. Jaspersoft simply becomes their partner and enabler.

Here’s a chance to continue this dialog at the intersection of economic theory and information technology. I offer an open invitation for comments. Your thoughts are appreciated.

Brian Gentile
Chief Executive Officer

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