Internet revolutionPosted on December 12, 2013 | posted by:
The goal is to have no stops, no delays, no backflows, no inventories, no expediting, no bottlenecks, no buffer stocks, and no waste in small and large scale of business. The idea of no waste is called muda in Natural Capitalism by Paul Hawkin.
Having to meet all these goals seems not quite possible, though I thought of the tailoring service I had 9 years ago in S. Korea.
My mom has a mink fur jacket, which cost lots money to buy but as time passes because of the change of trends, it no longer seemed fit to her. So we were thinking, what could we do with this jacket? It has a high value in the economy, but no today. Days of searching online I found a tailor who gives a life guarantee at her service.
She came to our house and explained how it works. Her idea was quite simple yet brilliant. She will take part of the jacket and tailor a new jacket as my mom desires. In the process she will creatively cut and sew and make the rest of the pieces usable. And anytime further alterations of the jacket are needed, costs would be on her.
So we started to measure my mom, discussed what she wants, also she asked me what I would like to have if there are enough of pieces left. Three weeks later, she brought a new looking, perfectly fitting jacket to my mom and mink scarves for me from the pieces that were left.
It cost more than other services, but was worth spending money. And I still have a guarantee of service that we could use towards another trimming for my mom. In this way without wasting too much money and materials, generation to generation can have a warm jacket for winter.
What she is selling is service, not the object. She also provides a new design and brings new material; still the whole service is the same.
Bigger companies: how do they maintain this loop? In his book Hawkin suggests leasing products. The idea is that the product’s ownership remains to the company, who provides service around the product. It has been done in many cases, and thinking it also applies to real estate. I don’t know how it is in U.S., but in S. Korea it is very common to not own one’s home these days. Due to the high population of S. Korea real estate is expensive for most of people. Although having a house has been people’s dream for a long-time, rising values have made it a good investment, too. However, in recent years the prices gone down rapidly some house poor started to appear.
Instead of buying the house, long-term leasing increased rapidly. Leasing a house you would pay less tax and get more benefits like health insurance, so you don’t have to worry about pricing down the house because you will get your full money back. Also a major part of maintaining the house is onto the owner not the person who lives in it, and then you save money there too. The only thing that is hard on long-term leasers is that if the owner doesn’t want to extend the contract, you have no choice and need to move out.
Overall, long-term leasing benefits dramatically, so the demand increases in volume in the market. So the S. Korean government started to build apartments of, which they rent out for long-term lease to citizens. Later, it might become a higher percentage of the housing market.
At the bottom line, we have started to share things again: skills, services, and products, even houses. It is interesting that we moved from a family oriented sharing system to individually own products since the industrial revolution.
But now it seems to me that we started to move from having things individually to sharing as a society. It might be too big an assumption to make, but the open source based Internet may have brought this change of mentality. Since the Internet became part of daily life to us, we are experiencing an Internet revolution analogous to the industrial revolution.
 Micha Kaufman, “The Internet revolution is the new industrial revolution.” Forbes, 05 Oct 2012, http://www.forbes.com/sites/michakaufman/2012/10/05/the-internet-revolution-is-the-new-industrial-revolution/, accessed 9 Dec 2013.
+ This idea developed based on the book Natural Capitalism by Paul Hawkin