The Support Economy

Citation

Goldsmith, E.B. (2003), "The Support Economy", Journal of Consumer Marketing, Vol. 20 No. 5, pp. 493-496. https://doi.org/10.1108/jcm.2003.20.5.493.5

The Support Economy opens a new conversation about an age‐old topic: what is wrong with US business and how can we fix it? The authors, a married couple, she from the Harvard Business School and he a former chairman and CEO of three corporations, contend that consumers have changed more rapidly than the corporations on which they depend. This results in a disconnect and in some cases, outright rage. Zuboff has a PhD in social psychology from Harvard University and is the author of In the Age of the Smart Machine: The Future of Work and Power, and Maxmin’s PhD is in philosophy from Kings College, London. Their backgrounds are important to point out because it reflects in their writing, which is a blend of history, social psychology, and economics. Readers looking for a conventional business book with seven steps to follow to wealth and success will not find it here. The authors warn, “This is not a dispassionate book. It expresses a theory of the future based on an analysis of the past and a diagnosis of the present” (p. 27). The most original, almost science fiction‐like feature of the book is found in Chapter 12 where futuristic federations (unique consumer support networks for families) are described.

The Table of Contents reveals a single‐chapter Introduction entitled “Bridging the chasm” followed by 11 more chapters divided into three parts. Emphasis throughout is on US applications, but there are nods to Great Britain and the global economy.

Part One contains five chapters describing the challenge: new people, new markets, and the new economy. Chapter two is very much about history, the growth of modern business, changes in family life, mass production, popular culture, and specifics such as statistics on the growth in the use of tranquilizers. Chapter three picks up the story with developments in the late twentieth century such as more women working and the concepts of rupture and mutation, the hairline cracks appearing in the system. Chapter four is about the search for meaning and self‐expression, referred to as psychological individuality (p. 100), leading to the conclusion that old organizations have failed new individuals. This theme is further explored in the next chapter which addresses the question: “What happens to the new individuals when they are spurned by the old organizations?” The answers are chronic stress and time problems played out in re‐considerations of consumption. Chapter six questions the usefulness of carpool lanes given that individuals want their own vehicles and their own time schedules. The authors also emphasize the growing importance of private sanctuaries, hence the increase in the number of amenities and the average square footage of homes across the USA. Realtors report they are selling lifestyles not homes. Anyone who has heard the sales pitch for a new seaside development will know this is true. The authors note the growth of home schooling and the use of the Internet to find personal health information as indications of an increased need for individualization.

Part Two is labeled “Crisis”. Chapter seven explores the transaction crisis that consumers and employees experience everyday. They coin the phrase “transaction value” (p. 187), which is the value that is maximized in order to produce shareholder wealth. They argue that corporations and non‐profits should put more energy into “relationship value”, meaning building deeper relationships with customers, and the way to do this is to invest in front‐line personnel and operations that lead to greater customer satisfaction. When transactions are starved – not enough resources such as time, money, skill, and authority invested – an atmosphere of not caring results. Chapter eight explores the social psychological concept of organizational narcissism, which is about the blindness that results from being too insular. To summarize, “Producers see themselves, not consumers. The new individuals remain hidden in the darkness, harboring needs for sanctuary, voice, and connection that wait to be fulfilled” (p. 244). Rediscovering this lost consumer is the subject of Chapter nine. One way companies are doing this is by going beyond traditional research methods to find out how consumers (in particular, women as major purchasers) live and use products through film, anthropological approaches, and ethnography. Zuboff and Maxmin conclude that an overhaul of capitalism is long overdue; they call for a new enterprise logic which is distinct from the standard enterprise logic, an expression of the deep structure of managerial capitalism. The new enterprise logic puts the customer in the center of the action rather than the producer.

Part three describes this new enterprise logic beginning with Chapter ten on the digital bridge, e‐commerce. In the 1990s the Internet was the new digital medium, driving innovation and expansion. Digital technologies combine computers with communications networks to bestow a transparency on everything they touch. The authors envision the digital bridge as exactly that, a bridge and not a destination. Chapter 11 (appropriately numbered) gives the 11 principles of distributed capitalism:

1. 1.

   (1) All value resides in individuals.

2. 2.

   (2) Distributed value necessitates distributed structures among all aspects of the enterprise.

3. 3.

   (3) Relationship economics is the framework for wealth creation.

4. 4.

   (4) Markets are self‐authoring.

5. 5.

   (5) Deep support is the new “metaproduct”.

6. 6.

   (6) Federated support networks are the new competitors.

7. 7.

   (7) All commercial practices are aligned with the individual.

8. 8.

   (8) Infrastructure convergence redefines costs and frees resources.

9. 9.

   (9) Federations are infinitely configurable.

10. 10.

    (10) New valuation methods reflect the primary of individual space.

11. 11.

    (11) A new consumption means a new employment.

The first principle sets the pace because distributed capitalism is derived from the principle that all value originates in individuals, “who are the source of all the cash that flows through the enterprise and its federation. Value is thus lodged in individual space and expressed in markets for deep support” (p. 323). Chapter twelve continues the case study of an imaginary family, Lillian and Carlos Acero with two young children, who were introduced in Chapter one. Lillian, a librarian (wasn’t there a Broadway musical with the hit song “Marian the librarian?”), and Carlos, a software engineer, want to “reassert control over the quality of their lives”. Now this is where the book gets original, because the Aceros belong to several federations that offer basic services. One is called SweetSupport. The Aceros use SweetSupport for their purchase, payment, and information‐management activities such as paying bills, renewing memberships, and keeping calendars. They also belong to GoldenApple (reviewer’s note: I don’t know if the authors know this or not but this is the name of the senior discount card at the national restaurant chain Applebee’s) that offers “high‐quality deep support aimed at saving, on average, 10 to 20 hours per week" (p. 350). Included in GoldenApple are personal advocates that develop and maintain relationships with individuals and play an important role in supporting complex consumption activities. For example, the Aceros have a relationship with David and his three team partners. Who is David? He is a GoldenApple advocate who has earned their trust and recommends such things as new films they may be interested in seeing. Advocate teams of two men and two women typically support 300 to 400 families. After this glimpse into a possible consumer future, the book returns to its more theoretical base, delving again into history, management, and Adam Smith.

The book is aptly named. It is about the support economy essentially exploring ways in which the economy can be more supportive of individuals and families. The authors are to be congratulated for tackling this subject, for intertwining the knowledge from so many diverse fields, and for coming up with original solutions. Is there a David in your future?