Chapters on this page
NetWork Capitalism is about creating a better and more meaningful world worth living in. As the successor of contemporary Industrial Capitalism it represents second generation Capitalism. By rethinking Capitalism as we know it, NetWork Capitalism reinstalls the magic bond between being successful as a company and raising the level of well-being in society at the same time.
NetWork Capitalism is set up along three simple ideas: to keep what is good, to alter what is wrong or outdated and to add what is missing. That's why NetWork Capitalism unconditionally includes Adam Smith's three basic institutions; the right of private ownership, freedom as the economy's coordinating mechanism and a limited but important role for governments.
However, whereas first generation Capitalism considers ever more efficiency and productivity to be the key drivers for progress and prosperity, NetWork Capitalism rejects the absolute dominance of both. Instead NetWork Capitalism institutionalizes two new key drivers; the capacity to establish high value multi-stakeholder networks and the ability to engage in meaningful stakeholder partnerships.
In today's networked economy for a company to be successful it is far more important to be capable of creating high value networks and to have the ability to engage in mutually beneficial partnerships than it is to raise efficiency and productivity.
True entrepreneurs that succeed in both strongholds of NetWork Capitalism not only define the success of their company, they also drive progress and prosperity within society. Of course ever more efficient production remains important. Yet, its social economic value is marginalised. The capacity to increase efficiency and productivity has evolved into becoming merely a commodity. It no longer makes the difference when it comes to uplift society towards the next level of well-being.
Six guiding principles
Only renewing Capitalism's core drivers for success is not enough. As the downside of first generation Capitalism revealed, it is necessary to make Capitalism more well-balanced. That's why NetWork Capitalism introduces six guiding principles.
Guiding principle 1: Purpose
The purpose of NetWork Capitalism is to raise the general level of well-being in society. This means to increase happiness, social mobility, healthcare standards, access to education, financial maturity, cultural awareness, clean air and water, healthy food, freedom to travel, safe and liveable habitats, and last but not least, freedom to master your own destiny.
Guiding principle 2: Economic value
The economic value of a company is the sum of its financial/tangible value, its intangible value and its social value. Successful companies make these three values interdependent via a sustainable business model so they can increase them in coherence.
Guiding principle 3: The role and responsibility of entrepreneurs
Entrepreneurs have been, are and will remain the most important contributor to innovation, progress and prosperity. Given this role entrepreneurs have the moral obligation to enhance the prestige of free entrepreneurship and make sure their own behaviour does not call for government interference, additional laws and regulations or any other kind of non-value adding intervention.
Guiding principle 4: Innovation
True innovation has two distinctive features. It disrupts the existing status quo and must always result in increasing economic returns for both the innovator as well as its stakeholders.
Guiding principle 5: Competition
In order to be the inexhaustible source of energy that fuels economic growth, competition should be based on strength, qualities and integrity. Without these three elements competition is degraded into what is called cheating.
Guiding principle 6: Profit
Profit is a manifestation of success, a reward for taking risk and indispensable to do investments. However, only if stakeholders support the legitimacy of a profit, then it also strengthens an organization's license to operate.
Even though NetWork Capitalism is only in its early stages, first round results already have a huge positive impact on both societies and economies. Nevertheless, the bottom-up and grass-rooted reinvention of Capitalism will take time, because it requires to unlearn what has been institutionalised in over 200 years. A soft layering of a handful of new ideas on top of the enduring premises of today's Capitalism won't work. That's been tried before.
As long as we continue to regard economic growth solely from a financial perspective the current global economic crises will last.
To challenge the common held belief that faster, cheaper and bigger production equals progress and prosperity means to question deeply rooted behaviour in doing business. And at the same time it requires to be open towards and explicit about what a more meaningful world worth living in actually looks like. By incorporating the leading ideas of NetWork Capitalism companies can succeed in both and become the winners and heroes of 21st century and beyond.
So, don't wait. Be a pioneer. Go do it. Live NetWork Capitalism and be successful!
And remember, when the steam engine launched Industrial Capitalism in 1769 it took 55 years before the first railroad was in operation, 110 years before Thomas Edison's light bulb saw the light and over 140 years until the first T-Ford rolled out of its production facilities. Imagine what the world will look like after 55, 110 and 140 years since the birth of the Internet in 1989!