3 A New Economic Order: From Binary Company to Binary Economy

As we saw in the last chapter, globalization and new business models have changed the work world dramatically. Even as value activities are disaggregated and distributed globally, based on the cost of performing each one, entrepreneurs are taking advantage of technological advancements to foster new business models and change the way value activities are performed. Together, these developments signify a new economic order called the Binary Economy, which naturally emerges as more companies transform into Binary Companies. With the advent of the Binary Economy, a vast chasm opens up between opportunities and rewards available to solution providers and to solution replicators. Over time, a smaller group of highly talented, creative technical professionals tend to dominate the solution-providing role while the vast majority of technical professionals, many of whom work in newly industrialized countries like China and India, function as solution replicators. As more firms adopt this new binary model, the economy as a whole becomes binary, meaning a few highly trained and motivated STEM professionals are responsible for most of the solution providing, while a vast majority of other STEM professionals migrate to the Replication Solutions role. As globalization takes hold, the entire binary model for the companies and the economy migrates to a single unified model.