Umair Haque / Bubblegeneration

Wednesday, January 18, 2006

Managing the Edge, Simulation Economy Edition

Learning to manage the new modes of coordination that exist outside the boundaries of firms is no mean feat - it's much bigger than simply publishing (which is just the most visible example).

Consider this example - "gold farmers", or essentially, organized arbitrageurs, on WoW. How can firms "manage" this?

It's not enough just to kick them out; the economic forces at work are powerful, and create strong incentives for arbs to keep on arbing at even a relatively large cost to themselves.

What's needed, I think, is a deep understanding of how different these new modes of coordination - in this case, a virtual economy - really are from firms. You can't really "manage" them - at least in the traditional sense of the word. That's the starting point - and it's why more corporate players find themselves unable to create value at the edge.

-- umair // 3:50 AM // 0 comments

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