This is a sequel of the prequel and an absolute must (long)read.
Following the launch of Meta and the reference to a Metaverse, several articles have already been published. One is a bit more stimulating than the other and that also prompted me to investigate. So, also for this second part, I stepped into a DeLorean for a journey Back into the Future (and this time I took the 2021 DMC12 model).
“The way I see it, if you’re gonna build a time machine into a car, why not do it with some style?” - Dr. Emmett Brown, ‘Back To The Future’.
What I have learned is that a Metaverse goes much further than the virtual reality world that many refer to and that the former Facebook with Oculus also responds to by rebranding into Meta. It may be a turning point in our digital evolution, but it is more than VR, it is also about a mindset,a culture and even a possible paradigm shift. As an innovation optimist and market analyst, even I was surprised by the world of possibilities that will open up for us on the one hand, but also by the stark contrast with today's frame of reference on the other.
The word "metaverse" generally refers to a virtual world that is outside, on top of, or an extension of the physical world. The word was coined in a 1992 dystopian sci-fi novel, Snow Crash, written by Neal Stephenson. – Source: Mashable
Innovation, Work, HR & Technology in the 21st century
When we apply the theory "Diffusion of innovations" accordingto Rogers to HR Technology, which takes into account adoption rate vs. time vs. market share, we have to conclude that there are not one, but more innovation waves since the turn of the century. These also appear to be going faster and faster, and that has an impact on HR.
When we step into our imaginary Delorean and take a look at the past, present and future, we see that in each wave there are various dynamics and elements that have caused a new wave of innovation to be launched, again and again.
But what if those dynamics and elements cause a chain reaction that already pioneers a whole new wave and a whole new world? And what if that world doesn't work with the conventional standards of today?
In this diptych, we take a further look at those waves of innovation during the digitization of HR and zoom in on that new world – which extends beyond what Zückerberg would have us believe and for a reason too. To make the evolution and the contrast clear, we work chronologically. As we just got back from the first two waves in part one, we will take the imaginary 2021 model DeLorean to take a look at the third wave of innovation.
Wave 3 – Web 3: Splitting up and gamifying work
Expanding the current world and supplementing it with a virtual one. It's not Mark Zuckerberg's idea, certainly not. That virtual world already exists, virtual reality is only the tip of the iceberg. What is under the tip of the iceberg may not yet be widely accepted and consists of various elements and dynamics that, taken together, could mean "the Metaverse".
We will elaborate on seven of those elements or dynamics below the visual of current innovation waves, impacting the future of work.
1. Digital Nomads
The children of the Digital Natives (GenZ?) hang out today after (during) school on Snapchat, on TikTok, in Roblox, in Fortnite. The internet is therefore what the social life of these Digital Natives largely revolves around. It is their own safe virtual world and this certainly has consequences in attitudes and expectations towards later – just as the platform economy has sharpened consumer behaviour (see part 1).
As technology seeps further into our lives, it also causes enormous behavioral changes. At the same time, we see a huge aversion to institutions and authority as these young people grew up in the aftermath of the 2008 financial crisis.
Today's young adults saw their parents working within "the system" only to lose their jobs and/or be in financial uncertainty after this crisis. As a result, they are now not interested in "renting out" their time or working within the system; they are interested in learning and using their skills, drive and intuition to determine their own destiny.
The term Digital Nomad comes from this generation:"Digital Nomads are people who use telecommunications technologies to creatively earn a living and live their lives in a nomadic way. Such employees often work remotely from abroad, coffee shops, public libraries, co-working spaces or recreational vehicles. " They are keen to have self control.
During the GameStop craze, one user literally commented on the r/WallStreetBets subreddit:
"This is the first time we've all literally been allowed to decide our fate."
He had defeated the system, or so he thought.
This generation does things in an unconventional way and uses as a justification the attitude:
"Where am I? Where are you?" – based on a statement from an anonymous developer from the gaming- and blockchain industry, who waved expensive stuff and bragged about money on his internetvideo, in response to some people who criticized his unconventional way of life. The guy turned into a meme, representing an entire (hidden) generation.
2. Consumption becomes creation
In the near web3 future, people can not only escape the real world by helping to build a new one, they will also be rewarded for it! As the internet evolves, it also becomes more participatory. People playfully grow from passive consumers to participating creators.
The internet has already created new career opportunities and an increase in the number of freelancers (see part 1). Mainly the gaming industry focuses on the Creation Economy by breaking down work, but others also.
Pioneering companies are already cultivating robust ecosystems for (freelance) creators to their brand or product. Applications such as eg. Airtable, Figma, and Notion all have marketplaces where developers can build and share their creations. Low code becomes no code and almost anyone can become an entrepreneur by creating something that knows value.
Mashable contained e.g. an article about "spreadsheet influencers" – people who make over $100,000 in template sales they make in Google Sheets, Airtable and Notion, among others.
Roblox developers earned a combined $300 million in 2020;
Patreon has paid out $2 billion to participants
Contributions and creations in the future will have an even more creative, broader (and more valuable) interpretation than what we are used to today. More generally, it will become easier than ever to become an entrepreneur. For example: software is becoming more and more accessible to use, with a low-code to no-code movement, the Creation Economy also is evolving and opportunities are being created.
If you have kids, they all know Animal Crossing as a VR game. From my own experience it can even be pretty educational. Now, in 2022 a game will be launched called MyNeighbourAlice: " A multiplayer builder game, where anyone can buy and own virtual islands, collect and build exciting items and meet new friends. Inspired by successful games such as Animal Crossing, the game combines the best of the two worlds - a fun narrative for regular players who want to enjoy the gameplay experience as well as an ecosystem for players who want to collect and trade NFT:s, even if they have no idea what an NFT is. "
More about NFT's later on, but can you imagine your child playing MyNeighbourAlice (instead of Animal Crossing), building a virtual world (mining blocks for smart contracts) and being rewarded in a token that can be traded for other tokens or real money? You'd better get used to the idea, because the leap forward is not that hard to take for your kid.
The gameindustry, which has an impact on GenZ and the Digital Nomads, is very consciously working with this form of playful/virtual contribution (and rewards).
3. Communities of creators
Like the creators and participantsthemselves, the communities or communities they belong to are of course scattered across the new social media (for example, there are 6.7 million Discord servers or 2.6 million subreddits...).
These communities generally align with the growing distrust of institutions. Instead of seeking comfort from the government or suitable companies, young people turn to the Instagram page, TikTok account or Youtube channel of other young "influencer/creators" - such as i.e. Kid Acid or Negin Mirsalehi and ask them for advice.
Artificial Intelligence makes it en. easier than ever to find a community with the same ideals (and unfortunately sometimes the same bias). If early social platforms like Facebook and Instagram used our real friends as proxies for our digital connections, newer platforms like TikTok and Clubhouse use algorithms to pin down exactly who we need to communicate with, who we need to follow and grow with.
Also the trend that comes over from the Gaming and blockchain industry, of rewards and grants at Hackatons, is not to be underestimated.
Do you find it difficult tohire adecent developer? There is a chance that he or she is involved in an online Blockchain or Gaming Hackathon where the prize money, grants and rewards range from a few 10k US dollars to a few Millions. These are opportunities at bitesize for Digtial Nomads.
The larger this group becomes, which responds to the increasing opportunities of a virtual world and a creative economy, the less these people will engage themselves on the traditional labour market. Eventually the world will have to adapt to their mindset, as the laws of supply and demand (of talent) will keep pushing these dynamics.
Since the supply of talent in a single world will already be limited for most companies in thefuture, these Digital Nomads with two worlds are in an advantageous position and can therefore easily take their fate into their own hands (Career Ownership). Knowing that today there are young people under the age of 25 who have already earned more money than their parents combined in their entire lives, one realizes that this generation is actually going for it and thus opposes institutions and the system of centralization.
HR gurus have been preaching for a while that career as a concept of linear progression in vertical hierarchies is no longer attractive to young, highly qualified individuals. Instead, they long for self-development and purpose. However, everyone has to make ends meet. And the safest way to make sure that still happens is to climb the corporateladder, but not with web3.
Web3 brings a whole new toolbox to make the sovereign individual a reality. Take social tokens as an example, where pioneers already sell themselves to investors by issuing personalized cryptocurrencies.
Potential application models are unlimited – holders of personal tokens may be eligible for a portion of the income the publisher generates, for exclusive content, or simply for face-to-face interactions. The success of Onlyfans shows that there are alternatives to creators delivering free content to dominant platforms (despite the explicit content sometimes).
With Web3, this trend is likely to accelerate and expand to new topics and audiences.
Community funding is another emerging source of income. Gitcoin exchanges are a glimpse of the future. It uses quadratic funding to match small contributions from community members with those from institutions and high net worth individuals. Anyone can apply for a grant with a few clicks, making the services provided contribute to the general interest of Ethereum and/or others.
Web1 or Web 1.0 was about information. The World Wide Web reduced transaction costs and made information searchable and transferable. Google was perhaps the "winner" of this first era of the internet.
Web2 brought social and commercial platforms. Producers and consumers of information, goods and services were brought together; peer-to-peer value exchanges were born. While Web1 was primarily one-way traffic (i.e., reading Google search results), Web2 was more two-way. On Uber, you can be a driver or a passenger. Instagram allows you to post and consume content. Facebook is the dominant company born in the Web2 era.
While Web2 created tremendous value, value always went through an intermediary. Centralized platforms - Facebook, Uber, Twitter, YouTube - that monitor the data and set the rules.
Web3 is about ownership. It's about the direct connection between the creators and consumers, and eliminating the gatekeepers who got rich through brokering. Blockchain is the innovation that Web3 enables through reliable, secure transfer of value. Web3 removes the brokers and intermediaries that traditionally monopolize value. Nowadays, we "rent" music from Spotify, domain names from GoDaddy, and blog posts from Substack.
We are not real owners. And makers are often not the owners either. I.e. Taylor Swift's recent struggle to own her art.
Web3 and blockchain is about reclaiming that ownershipright and the generation of Digital Nomads is helping to build that world (the metaverse). The main differentiator in a web3 environment is that bottom-up delivery by everyone in the world is naturally associated with financial incentives. e.g. through tokens representing both financial value and business assets, providing access to fully digital governance processes.
The contributor becomes co-owner with skin in the game. No employment contract needed, no nightmares of administrators when allocating stock options to that great developer talent from i.e. Turkmenistan. In fact, there are no impediments for Turkmen high potentials who have ten projects working in parallel, have shares in each, and freely shift the focus between them.
As individual talent and communities decouple from traditional organizations, a new customer base for customized HR services is emerging. A wealth of applications are being built to cater to this target group. And the ways they're redefining HR processes will go beyond their target demographic to mainstream HR practices.
Importantly, digital identity can make large parts of current HR services obsolete for companies and help reduce biases.
As a Career Owner,with all encrypted master data securely stored on the blockchain, people can provide everyone they do business with a unique digital ID. Companies don't need to obtain information about their location, gender, race or age — or, god forbid, store it in their database. All they really want and need to share with them are the skills and experience I bring to the table.
Speaking of skills, there are blockchain initiatives supported by major players in the HCM market to pool talent data and make it available in business silos. The key to the success of such projects is that they are not designed as walled gardens, but are built on public blockchainprotocols. Only then can services be combined, e.g. a set of digital credentials with a decentralized ID solution that can also be used to provide a credit score for credit applications. This concept of interoperable applications is called composability and is a key ingredient of Web3 magic.
For HR, we have found some examples of web3 applications that make use of that proposition of Creator Career Ownership.
Ethlance.com is the first job market platform working completely on Ethereum blockchain with 0% service fees.
Rabbithole rewards you to learn about decentralized applications, how to use them, how to make them,...
Resourcenetwork.co enables mission-driven companies to provide benefits to each other’s employees at no cost
Talent protocol (in Beta) rewards investments in the development of Career Owners as they grow.
Nobelhire is a decentralized job board that rewards referrals.
(Hereby a call to Benelux web3 HRTech developers to make themselves known)
5. Organisation model innovation
Most major Web1 and Web2 companies make money from ads. For Web3, the internet is shifting from ad-based business models to commerce-based business models.
Gaming is at the forefront of this business model innovation. The approximately $150 billion sector is powered by microtransactions and virtual currencies, which accounted for 75% of sales in 2020 and will grow to 95% by 2025.
Gamers assign value to in-game purchases, and in-game value leaks to real value (for example, having status in your friend group for owning a certain Fortnite skin).
Pioneered by Bitcoin and expanded with smart contract platforms, blockchain technology is also moving from hype to real-life application at a breakneck pace. They also respond very much to the Creator Economy.
Decentralization is in the DNA of blockchain — there is no CEO of Ethereum or Bitcoin, and teams working to build and maintain the protocols are global communities that snades central leadership. The same goes for the applications built on top of the protocols. Decentralized Finance platforms or marketplaces for digital collectibles are gradually shifting to decentralized autonomous organizational models (DAO's), where team and users merge into a collective of contributors: "Do you see something that's broken? Fix it. Don't ask permission."
Digital trading and coins are aalso becoming more common:
Language learning app Duolingo has gems
Videostreaming app Twitch has bits
...and after the change from Libra to Diem, Facebook now again also offers a virtual currency called Stars – one star is redeemable for $0.01.
Gaming and social networks continue to take the lead and act as a harbinger for the future: Facebook's game makers earned $50 million from Stars in 2020, and more than 2,000 creators earn $1,000+ per month through Stars.
Also, HRTechnology is already adopting to the trend of tokenisation and help companies build their own communities of employees. For instance there is ExO that created its own digital currency and works with rewards for employees on blockchain or Etch that enables instant payroll.
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