The Four Horsemen of the
Knowledge Economy in
Rural America
Southern Community Development
Educator’s Conference
May 19-21, 2004
Tampa, FL
Mark Peterson, Ph.D., University of Arkansas
Cooperative Extension Service
Maureen Rose, Darlene Garrett, and Jeff Jones
Welcome to a
River City Town
Meeting
3 Characteristics of a Good
Workshop
• Grounded in values of participants
• Connects us with each other
• Stretches us to consider new ideas
e-VISION Newsletter
• Equip community and organizational
leaders to think and act strategically – to
be successful in the global, connected
economy.
• Resources, insights, tools, and stories that
relate to the global economy
Introductions
Today and in the near future, modern ghost towns
may be created because a community has not
adapted to the realities and innovations of today’s
global, technology-driven economy.
Kentucky Science and Technology Council
Strategic Thinking
In Greek, the word STRATEGY means
the art of the general.
Strategic Thinking:
• the ability to cut through the fog of information and
activity and address those issues critical to the long
term health of your community
• is a creative, intuitive, and rational process of
thinking about your community and its future
• transcends changes in the environment
Strategic Visioning and
Planning is Important, but
Strategic Thinking is More
Important
The Four Horsemen of the Knowledge
Economy in Rural America:
Major Threats and Opportunities for Life as we Know It
THE FOUR HORSEMEN OF THE
KNOWLEDGE ECONOMY:
•
•
•
•
Relentless Innovation
Global Connectivity
Pervasive Globalization
The Triumph of Knowledge and
Technology Over Human Toil
1) Relentless Innovation
Innovation consists of the purposeful
search for changes and the opportunities
that such changes might offer.
Peter Drucker
Relentless Innovation
• Replaces current generation of goods,
services, and business models;
• Often comes from the fringe;
• Does not respect success or location;
• Accelerates the pace of change.
Examples:
* Wal-Mart
* Michael Dell
2) Global Connectivity
Broadband is high-speed, interactive, always-on,
two-way communication provided by cable
modems, telephone lines, satellites, fixed and
terrestrial wireless, and fiber optics to the home
or business. (200 kps or higher)
Broadband is not just faster Internet… Broadband
is more appropriately defined as a gateway to
information and services.
•
A Broadband World: The Promise of Advanced Services
Alliance for Public Technology and the Benton Foundation
Global Connectivity
• Knowledge and technology cross borders;
• Traditional marketing and distribution systems
bypassed or integrated;
• Barriers of time and distance reduced, allowing
work to be outsourced;
• Knowledge workers work from anywhere;
Examples:
* St. Joseph’s Hospital in Hot Springs
* Amazon.com
3) Pervasive Globalization
GLOBALIZATION – the movement of goods,
services, information, technology, labor,
wealth, and culture across national
boundaries to an extent never known
before.
Offshoring Transforms India’s
Tech Economy
• Two decades ago, India
invested in education
and IT infrastructure
• The India software
sector increased at
compound annual
growth rate of more
than 50% between 1992
and 2001
Pervasive Globalization
• Goods produced at place with the lowest cost;
• Manufacturing and “New Economy” jobs moving
to India, China, Russia, and the 3rd world;
• IT worker makes $63K here or $5.8K in India;
• By 2015, 3.3 million white collar jobs and 5-10
million manufacturing jobs will leave;
Examples:
1) Princess Diana’s Death
Princess Diana’s Death
An English princess with an Egyptian
boyfriend crashes in a French tunnel,
driving a German car with a Dutch engine,
driven by a Belgian who was drunk on
Scottish whiskey, followed closely by
Italian Paparazzi, on Japanese
motorcycles, treated by an American
doctor, using Brazilian medicines!
4) The Triumph of Knowledge and
Technology Over Human Toil:
• Working smart and harnessing technology gives an
edge over the competition.
• Shifts the value of workers from labor skills to
knowledge skills;
• Increases productivity while reducing the
manufacturing workforce;
• Permeates all sectors of our economy;
The Triumph of Knowledge and
Technology Over Human Toil:
Examples:
• Google Searches
• Diesel engines that will travel 1 ½
million miles before a major overhaul
The Internet is about business
transformation, not a web site.
Successful companies have a deep
understanding of how the elimination of time
and geography change the way we work,
communicate, and live.
Peter Fingar and Ronald Aronica
The Death of “e” and the Birth of the
Real New Economy
Breakthrough Solutions – Projects and
initiatives that lead to major advances
in your community, organization,
or personal life.
Breakthrough Solutions for a Connected Economy
• Based on 10 Principles for Strategic Leadership
and Innovation
• Equips community and organizational leaders with
the knowledge, skills, and tools to prosper in this
new era.
Martin Luther King did not say,
"I have a strategic plan."
Instead, he proclaimed:
"I have a DREAM," and he created a
movement that changed the world.
Source Unknown
The moral obligation of
leadership is to think beyond
your experience and plan
beyond your tenure.
Edward D. Barlow, Jr.
Creating the Future, Inc.
Jackson County, AR
• New Vision Newport has met in the old courthouse in
Jacksonport, the railroad depot in Newport, and a bank
solutions center on Front Street.
• In 1872, the Cairo Fulton Railroad approached Jacksonport, a
thriving river town of 3,000 people, stating they would build a
depot and railroad to Jacksonport for $25,000.
• Turned down, the railroad built the railroad to Newport,
population 200.
• Today Jacksonport has a population of 250, and Newport has a
population of over 6,000.
The Rest of the Story
• A young merchant who started a Ben Franklin
store on Front Street was turned down when he
sought to renew his lease.
• So he and his family moved to Bentonville, AR,
where Sam Walton created the world’s largest
corporation.
• What do you think has happened to Front Street
in Newport?
• What do you think has contributed to that?
• By the way, the trains no longer stop in Newport;
they just pass through.
e-Community –
a community that takes full
advantage of information
technology, the Internet, and
broadband connectivity to
prosper in the New Economy
Industrial Era – Knowledge
Based Economy Continuum
Stage I
Lack of
awareness
of the digital
age
- changes
taking place
- impact of
those changes
Stage II
Beginning to
use digital age
technologies
to accomplish
tasks of the
industrial era
more efficiently
Stage III
Increased
effectiveness
as the nature
of your work
changes and
your
infostructure
develops
Stage IV
Major changes
take place in:
-org. structures
and cultures,
- infostructure,
- the nature of
your work
Stage V
New kinds of
organizations,
new kinds of
work, and
new kinds of
leadership
Five Digital Divides
Digital Divide #1: Language, Reading
Literacy, and Computer Skills - language,
reading literacy, and computer skills to use the
Internet
Digital Divide #2: Internet Literacy - understand
the potentials of the Internet and begin to
transform their businesses or organizations
Digital Divide #3: Access to the Internet –
affordable access to the Internet
Digital Divide #4: Access to Broadband –
affordable access to broadband
telecommunications, and
Digital Divide #5: Broadband Literacy –
understand the potentials of broadband
connectivity to transform their businesses or
organizations
Dial-Up vs. Broadband
Dial-Up Connection
Hi-Speed Connection
at 24 to 56 kbps
at 524 kbps to 10 mbps
No
Yes, if desired
Yes
Yes
1 hour
10 seconds to 3
Applications/Features
* Always on
* E-mail
* Time to download a 10 mb file
minutes
* Web surfing
Slow
Fast
* Streaming video
No
Yes
* Video conferencing
No
Yes
* Immediate stock / news updates
No
Yes
* On-line gaming
No
Yes
On-line interactive classes
No
Yes_____________
Adapted from Talaman Corporation (2001)
Strategic Thinking
River ================= Big Rock
City
Metro Area
Interstate highway
Duluth
London
Hong Kong
Houston
Chicago
Blacksburg
Hot Springs
Big Rock
River City
San Francisco
Beijing
Des Moines
Memphis
Broadband connects River City to the world
New Capabilities With Broadband
1) Broadband connectivity greatly reduces the
barrier of distance and time, allowing you to
participate 24/7 in the global, connected economy.
2) Broadband allows you to expand your
market to the world.
3) Broadband allows you to create an on-line
community of interest.
New Capabilities, continued
4) Broadband allows you to collaborate with
suppliers, customers, and partners from all over
the world.
5) Broadband allows you to create an interactive
web page for information, education, business or
entertainment of your customers.
6) Broadband allows you to respond to the interests
of individual customers in a robust manner.
New Capabilities, continued
7) Information technologies (GIS, GPS, and RFID)
allow you to track and allocate scarce resources in
physical space with a high degree of precision.
8) Broadband allows you to build up areas that need
improvement with up-to-date technology,
outsource some functions, and build up others.
e-Community –
a community that takes full
advantage of information
technology, the Internet, and
broadband connectivity to
prosper in the New Economy
Collaborative Leaders:
• See the big picture,
• Understand what their community
contributes to the world,
• Nurture the full development of their community
and all of its citizens in the networked world,
• Identify and enable collaborative opportunities
that cross boundaries in and out of the
community,
• Exemplify servant leadership, and
• Think and act strategically.
Applications
•
•
•
•
•
•
•
•
•
Distance education, including on-line training
Telemedicine
E-commerce
E-tourism (marketing your community to tourists,
retirees, and prospective businesses,
Reducing business costs by value chain
management
Creating virtual communities, using blogs,
listservs, bulletin boards, and on-line forums
On-line collaboration
E-government and e-governance
Fundraising and advocacy for non-profits
•Videoconferencing for business, government,
and personal uses
•GIS and GPS for public safety, precision
farming, and other uses
•Telecommuting
•On-line finance
•Streaming video for public meetings, traffic
monitoring, weather, and tourist sites
•Radio frequency identification tags (RFID)
•Robust, interactive web pages with rich
community and regional content
Support Services
• Sales and service of hardware and software
• Web services – development and
maintenance
• Mechanisms for updating web pages
• Finance programs for IT
• Free or low cost computers for limited
resource families
• IT consulting
Education and Training
•
•
•
•
•
Basic computer and software training
How to use the Internet
Potentials and impact of IT and the Internet
Grantsmanship
High school computer classes tackle
community projects
• E-commerce
• E-government
• Small business development
Technology-Driven Economic
Development Strategies
• Create community technology centers for training,
videoconferencing, meetings, technical support, Internet
access, and work stations for teleworkers,
• Develop business incubators (virtual and physical)
that provide broadband connectivity, space, business
support services, and access to university resources,
• Promote the development of call or data
processing centers to employ local citizens,
• Recruit and/or grow your own knowledge/
technology based businesses,
•Connect local businesses with scientific or
technological resources from universities,
agencies, and other sources,
•Create a consortium of businesses and
educational institutions to foster more effective
technology and workforce training,
•Develop smart buildings, smart parks, and smart
homes and market them to IT savvy people,
•Connect high-tech entrepreneurs with angel
investor networks and other sources of startup capital,
• Create a regional website that promotes
businesses and communities in your region,
• Identify clusters in your area and nurture them
with IT, technology, training, and networking.
• Work with a university to identify the geographic
strategic assets of your community with GIS,
EXAMPLE: Portions of NE AR are within a day’s
drive of 12 truck assembly plants, a strategic
advantage for attracting parts manufacturers.
• Create an IT recognition program for individuals,
businesses, and organizations,
•Create a regional website that promotes regional
businesses and communities,
•Identify clusters in your area and nurture them
with IT, technology, training, and networking.
•Work with a university to identify the geographic
strategic assets of your community with GIS,
EXAMPLE: Portions of NE AR are within a day’s
drive of 12 truck assembly plants, a strategic
advantage for attracting parts manufacturers.
•Create an IT recognition program for individuals,
businesses, and organizations,
Nurture entrepreneurship and business
development through teaching how to:
• conduct market research over the Internet,
• locate and integrate with suppliers, finance,
distributors, and customers on-line,
• collaborate with resource providers and other
small business owners,
• market through their web page, e-Bay, electronic
mini-malls, and business directories,
• create a robust, interactive web site, and
• use the 4 stages of e-business.
Broadband Connectivity –
Key Elements
• Affordability
• Widespread availability in businesses, industrial
parks, government, schools, non-profits,
homes, cybercafes, libraries, and public places
• High capacity and dependability
• Available through DSL, cable modem, fiber optic
cable, wi-fi, TI, satellite, or VoIP
• Provided by private companies, public-private
partnerships, or public entities
• Public policies don’t always favor broadband
It really is a revolution and it really is big.
There are revolutions large and small, but
one this big probably hasn’t come in at
least a hundred years, and in the end we
may look back and say this was the biggest
thing since the advent of the printing press
in the mid-1400s.
Paul Saffo
Institute for the Future
If we do not take change
by the hand, it will take
us by the throat.
Winston Churchill