To understand how the information explosion that the Internet facilitates will result in a need for specialization in terms of web site creation and promotion, think of the image below.


This situtation brings about two key management issues:

1. Is your organization institutionalizing the process of specialization? This is also related to the concept of "feeding the edge," or of pushing value outside of your organization. Consider, for instance, how search engines like Google and Yahoo allow users to create and profit from by creating custom search engines. In doing so, they are institutionalizing specialization within one of their core competences, search. By understanding this concept, we can gain a deeper understanding of what John Hagel talks about when he says that the attention economy will result in the unbundling and rebundling of the corporation; the increasing need for specialization causes firms to push value creation opportunities outside of themselves -- if only so that this specialization can then be rebundled to create the best possible aggregation. Yahoo and Google, for instance, can aggregate (aka, "rebundle") the specialized custom search engines to improve their aggregate search engine.

2. Are you letting go of the God Management Strategy? The God Management Strategy (GMS) is a term I use to refer to managers who attempt to create the illusion of being an all-knowing deity to command authority over their employees; they use exclusivity of knowledge as the source of their authority. GMS has been immenseful successful thus far in business history, but the information explosion we are currently in the midst of is making it increasingly unfeasible. It's time is almost up.

Instead, organizations need to shift towards aggregating specialization. Consider the web to be the end of blasphemy in business; no longer will there be organizations led by individuals who lead through the illusion of omniscience, but instead organizations lead by the aggregate choices of its members.

Next time, we'll flesh out these concepts by talking about the two kinds of web workers: specialists and orchestrators, and how both of them will end up conspiring to create virtual corporations.

If you're just joining us, the start page of this mini-series on the emergence of the virtual corporation is here.