End of the middle – a new opportunity

by Simon Terry

At the DISRUPT.SYDNEY event, in our anti-panel a confronting idea surfaced:

Does disruption mean the end of the middle?

Rapid increases in the connection, usage and mobility of information & people has consequences for intermediaries and others caught in the middle as things change. We have already seen dramatic changes and forecasts of even more dire consequences for the middle as a result of disruption. We have seen changes for:

Middle men: intermediary businesses that relied on their ability to leverage information asymmetry and their ability to scale either customers or suppliers have found that global digital connection undercuts their business model or margins.

Middle class: income inequality continues to expand. Many middle class careers were built on knowledge economy roles that are threatened by disruption. We have already seen global communication impact many middle class manufacturing roles. The rise of the project career creates new sources of volatility in middle class incomes

Middle managers: the traditional role of middle managers as shapers of information in Organisations is undermined as information moves faster and more directly and new models of decision making are born. Organisations are attacking this role with data analytics, social connection, more agile decision making and flatter hierarchies

Mid market anything: we seem to have entered an age where we can aggregate markets and people at massive scale. At the same time communication, technology has supported connection and support for vibrant niches. Businesses increasingly target the top or bottom of the market. There are fewer businesses prospering in the mid market.

Middle age: we are living longer with more career changes, facing more diversity in life stages and a much less static marketplace. What was once the beginning of a slowing into middle age is now a time of peak productivity and change.

The future of the middle

At a recent talk as part of the New Economy Summit, Mark Pesce spoke that connected markets favour direct connections. He highlighted that the connectors who prosper are those who enhance the network to the benefit of all. He is not alone in holding this view.

So how can those in the middle play a sustainable role:

Lead the networked community: the new intermediaries, the new middle managers and the new middle class knowledge workers are those who foster, lead and sustain networked communities. This is not just a role of ensuring the community meets standards & has adequate engagement. Leading purpose building and sense making is critical. Real leadership is required to ensure the network is vibrant, innovative and evoking to sustain itself. That also means balancing the role of the network in the broader ecosystem.

Build Trust and Context: development of trust to facilitate the value creation in networked communities is a high value role for intermediaries or other nodes. This may be through design of features or data sets that enhance the context of transactions and information in the network. It will also be about holding & sharing a broader systems view than transactional participants in the network. Data analytics can play a critical role in supporting trust and context but it usually can only be gained through the nodes or a network systems view.

Disrupt the System: the middle is often the weight of economic and social power in any system. The middle has enough to lose in any change and traditionally this is a force for conservatism – think of the mortgage belt electorates of politics. However, having enough to lose is also a stake in the game & resources to drive change. A stake in the game means benefit from the innovations that come with new and better models. Organisations and individuals in the middle can be the most agile and an engine of economic opportunities in disruption, if they take on that challenge.

In a networked economy, the middle is no longer a place of safety where individuals and organisations escape the pressures of either end. The middle may well be where the greatest risks lie. Individuals and organisations in the middle must think differently about their role in the disrupted system and help lead the system forward.

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