IN THE CLOUD

THOMAS KOULOPOULOS

Living

in the
Cloud
THE 21ST CENTURY GLOBAL MEGATREND
A SHORT E-BOOK BY THOMAS KOULOPOULOS

Foreword

LIVING IN THE CLOUD

An Image of Change
The image of the world floating
in its singular beauty against a
backdrop of infinite blackness
forever changed the way we
perceive ourselves.
Seeing in literal terms that we
were so small, so connected to
each other, and yet so very
alone in the cosmos, was the
moment when the idea of
globalization became real.
For the decades since weve
talked about being green, the
global village, the flat world. Yet,
whatever your favored
euphemism, its genesis was

somehow spawned by that

single image.

changes taking place. When we

think about how we will deal with
these and the many other
challenges that face us, one
image already stands out as a
metaphor for the way we will
work, live and play.

Images have power, they create

gravity for ideas, and they
simplify the complex for all to
understand. Change needs a
billboard to broadcast its
message, a meme that acts as a Its the image of an amorphous
container for its many parts.
swirling chaos of people and
technology connected across all
So what image will define us
boundaries; myriad forces in a
going forward into the 21st
constant state of flux, disruptive,
Century? There are many that
powerful beyond measure, and
come to mind; perhaps an
nearly impossible to harness upside down globe with Asia on yet.
top or the picture of melting
icecaps. But these are only
It is the image of The Cloud.
partial images of individual

LIVING IN THE CLOUD

When familiar patterns are disrupted, it seems that the

disruption always comes from outside of the most likely
candidates for change.

Breaking Free
reakthroughs are rare.
Because we build so
much of our view of the
world around existing ideas, it is
difficult to break free of them.

But structures also hinder us.

They narrow our field of view
and limit our options; they
establish boundaries of
acceptable thought. Most of all,
they set our expectations for
It's the reason you can drive
what is possible and what is
down any street and identify the not. In short, structure stifles
decade when each house was
innovation.
built. You can do the same with
nearly any photo - polyester
What's truly amazing is how
leisure suits; must be 1975.
quickly we develop these rigid
Structures and patterns define
assumptions of what the right
us, our lives, the way we work, way to approach a problem is,
and the way we interact. In
and how soon we abandon the
short, we need structure and we creativity needed to view the
like it!
problem in a new light.

We easily convince ourselves

that no amount of creativity can
solve familiar problems. It's why
we doubt the radical nature of
innovation. Whether its the
radio, the telephone, the light
bulb or the iPod, we are
absolutely oblivious to the
impact these innovations can
and will have on us and the
extent to which they will change
the way we look at and
experience the world.
When familiar patterns are
disrupted, it seems that the
disruption always comes from
the most unlikely candidates for
change. As though only a virgin
set of eyes, untainted by the
knowledge of what will not
work, are the only ones
foolish enough to see the
opportunity change can
cause.
While we are surrounded by
these kinds of unlikely
successes, we never cease
to be amazed by them.
Amazon redefines the way
books are bought and sold;

What is The Cloud?

It's an organization for the disruption of structure.

LIVING IN THE CLOUD

Picking Patterns
Google redefines the way we
learn; Apple redefines the way
we experience music. In each
case an outsider that stood no
rational chance against the
incumbents, overtakes them by
light years. Like an amnesiac
with no long-term memory, we
awe at the phenomenon, no
matter how many times we
experience it.
In todays world the level of
complexity and the sheer
magnitude of the problems we
are dealing with demand that we
break free of the structures that
have limited how we approach
and how we solve problems.
Otherwise, we are quickly going
to find ourselves the victims of
complexity rather than its
masters.

will soon connect and define

more of the world than any other
political, social, or economic
organization.
The Cloud is the first megatrend
of the 21st Century. Its a trend
that defines the way we will
address virtually every other
challenge we face for at least the
next 100 years.

What is The
Cloud? Its a
framework for
the disruption
of structure. A
place where we
will all live,
work and play
in the 21st
Century. Its
where nearly
35 million
Seeing Clouds from Both
people already work. Its where
Sides
your kids are when they dive into
online play. Its where you meet
So what does this have to do with and make friends in social
The Cloud?" Simple. The Cloud networks. Its where companies
represents the consummate
go to find the next big idea. Its
disruptor to structure; a pervasive where political campaigns are
social and economic network that won and lost.

An exercise in breaking out of

patterns that I've conducted with
tens of thousands of people is
nothing more than a sophisticated
Rubin Vase, an image of the
perfectly symmetrical vase
oscillates between that of a dark
vase and two white faces.
My version shows a short
animation of a
silhouetted girl
spinning. I ask
viewers to tell me
if she is spinning
clockwise or
counterclockwise.
Half see her
spinning clockwise
and half see her
spinning
counterclockwise.
It's what comes
next that's
startling.
Less than 15% of observers can
change her direction. The rest of
us are just stuck. Once we pick a
pattern there is little we can do to
change it - even when we know
the pattern exists only in our
mind.

LIVING IN THE CLOUD

In the Cloud all communications

are weighed by the value of their
influence on the individual.

A War of Influence
What weve talked about so far
may seem radical, but it doesn't
even come close to defining
how disruptive The Cloud will
be.
In its simplest terms The Cloud
is the new context for business
and society. The Cloud is at the
same time the enabler of
terrorism as well as its antidote.
The Cloud is the underlying
driver of the destabilizing shift in
power from the industrialized
world to the developing world
and also the mechanism by
which the entire world will
develop a new equilibrium over
the next 50 years.
The Cloud is big. It isn't a trend
or a fad. This is the evolution of
a new human order whose
structures and patterns, for just
about everything, will challenge
our notion of the familiar.

You may need phones to run a

business, but you don't build
your business model around
them.
In fact, The Cloud isn't about
any one technology. E-mail,
instant messaging, social
networking, and
crowd sourcing may
all make it easier to
define how parts of
the cloud connect
but they don't define
how it behaves, and
it's the behavior of
this new world order
that we most need to
understand.

For instance, think

about the process of
viral marketing,
which changes the
most basic tenets of
how markets are
influenced by new
But don't confuse the Cloud with products and ideas.
the Internet. The Internet is just Using viral
a way to connect. It is no more
marketing is not
relevant to the Cloud than
new, Orson Welles
phone service is to how you
used it very
build a business or an economy. effectively in 1938 to

wreak havoc and cause outrage

among listeners who thought
they had been manipulated by
Columbia Broadcasting.
However, Welles had a platform.
If you intend to market your
products in The Cloud the notion
of a platform becomes

But don't confuse the Cloud with

the Internet.

LIVING IN THE CLOUD

You Cant Plow a Cloud

meaningless. The power of your
message is determined not by
the scale of your platform, but
by the scope of your influencers'
networks. In other words, my
blog may have as much impact
as largest companys PR
program.
In the Cloud all communications
are

weighed by the value of their

influence on the individual.
That's a difficult concept to fully
appreciate. Think of it this way,
traditional marketing is like
plowing snow, the larger your
plow the more snow you can
move. If you try to plow through
a cloud youre wasting your
time.
Clouds don't plow
well. To move a
cloud you need
to cause every
single molecule of
water to move individually
in order for the cloud to
move collectively.
This subtle but profound shift in
the behavior of the Cloud is
going to influence everything
about our lives. As individuals it
will determine how, why and for
how long we will work. As
organizations it will define
how we hire, build teams,
partner, form alliances,
compete and go to market. As
academic institutions it will
determine the nature of the
classroom, how we teach, and
the role education takes in

building knowledge and careers.

For nations and economies it
will define the balance of power
and trade that has always been
at the heart of global stability or,
as is just as often the case,
instability.
But The Cloud is still an evolving
phenomenon. Consider that
there are nearly 7 billion people
on the planet, yet only 500
million even remotely qualify as
knowledge workers; that is
people who make a living based
on the use of their minds over
their muscle. 80% of the world's
inhabitants still make less than
US$10/day. And, lest we believe
the Internet is somehow
changing all of this overnight,
only 1.7 billion, just over 25%,
have access to an Internet
connection.
Imagine running your company
with just 25% of your employees
talking to each other. Yet that's
precisely what we are doing on
a global scale. Despite all of the
talk about the flattening of the
world, jobs moving offshore to

LIVING IN THE CLOUD

Despite all of the talk about the flattening of the world, jobs
moving offshore to developing economies and the increases
in productivity brought on by technology and the internet,
we are still in the dark ages of employing the world's talent.

Tapping the Other 90%

developing economies
and increases in
productivity brought on
by technology and the
Internet, we are still in
the dark ages of
employing the world's
talent. In other words,
we are still using plows
to move ideas.

our collective capability

and developing a level
of creativity and
ingenuity without any
precedent. Describing
The full impact
that The
Cloud
will

health care and the

Internet are creating a
workforce unlike any
other in the history of
mankind, with the
potential to be
amazingly

problems of the
moment.

We put a lot of our

hopes into the notion
that the more people
who are on the net the
more ideas that will flow
from it. Perhaps, just
maybe, one of those
ideas will solve our
The fact is that all of the
problems. One wellinnovation and
known Chicago
achievement we have
economist has even
experienced, up until
proposed that we need
now, has involved a
to grow world
ridiculously small
population to increase
fraction of humanity's
the odds of just that
potential. Research and have
happening! The Cloud
development,
is not just about
would
education, and access be
throwing more brains at
connected
to the resources
the problem. That's an
paramount
across social and
needed to develop and to explaining the effects
interesting idea, but it's
national
boundaries.
exploit ideas has been of jet lag to a 17th
linear. The Cloud is
And that workforce is
a closely held asset. It
exponential in its
century, horse-bound
not
only
growing
in
real
is reminiscent of the
impact, it has a
traveler.
terms, as population
anecdote about how we
multiplier effect that
increases,
but
it's
use less than 10% of
goes well beyond the
The good news is that
growing exponentially
the capacity of the
power of any collection
we are already seeing
in
terms
of
its
ability
to
human brain. The
of skills. What we lack
the impact of The
reconnect itself in
Cloud is about tapping Cloud. Investments in
is not brains but the
whatever
manner
is
into the other 90% of
ability to connect ideas.
higher education,
needed to solve the

LIVING IN THE CLOUD

Playing Dice
We need to stop
playing dice with our
future and start
leveraging the power of
this wealth of ideas.
This means putting in
place the processes
that innovation needs in
order to thrive. We
need to go beyond the
fundamentals of an
Innovation Zone, which
I talked about in my
previous book, to build
a global Innovation
Factory that will
produce an engine for
connecting, driving
and developing new
ideas.
In many
ways
there is an
amazing
parallel

the Cloud is increasingly made up of an aging

demographic in developed countries, which creates a
talent pool of free agents that will radically alter the
notion of retirement by working long past traditional
boundaries of "old-age."

between The Cloud and

much of the
advancement during
the early part of the
20th Century, which
began as an
experiment in small
business and
collaboration. Globally,
there was an amazing
rush of upstarts, which
leveraged each other.
In large

part its the reason that

there is so much
contention around the
ownership of 20th
Century inventions like
the internal combustion
engine, radio,
telephone, and
television. Ideas flowed
freely in the early days
of patents. The result
was the most
prosperousperiod
inthehistory of
mankind. We put
in place the
political,

organizational, legal
and educational
cornerstones to scale
this era of invention, we
protected intellectual
property and formalized
methods for teaming
and partnering. The
model worked for the
problems and
challenges of that day
and age. But it no
longer works for the
complexity of todays
problems.
In addition, The Cloud
is increasingly made up
of an aging
demographic in
developed countries,
which creates a talent
pool of free agents that
will radically alter the
notion of retirement
by working long
past traditional
boundaries of "old-age."
It's proven that as
workers age the
likelihood of their

LIVING IN THE CLOUD

becoming free agents also

increases; while 25% of those
working under 50 are free
agents, the rate increases to
40% of those over 50. This just
adds to the ocean of
entrepreneurs that will flood the
market and challenge all of our
notions of work and employment

What is it about the lack of

resources and capital that is so
essential to creating a fertile soil for
good idea to grow and thrive?

creating an amorphous
innovation Cloud always
available and on-demand to
solve the worlds greatest
problems. This will only occur if
it is empowered and enabled
beyond hopeful serendipity.

How does this contribute to The

Cloud? Well, the greatest ideas
rarely come from where we
most expect them, large
companies and labs. Sure,
discovery may be facilitated by
the scale of large player, but that
is not where most discovery
starts. Instead, big ideas come

LIVING IN THE CLOUD

Weather clouds themselves are a fascinating metaphor

for our discussion. Clouds, despite what many of us
were taught in grade school, do not form simply
because of evaporation.

The Perfect Storm

from outliers of the current
market. In fact, it's
counterintuitivebut the biggest
companies today started in
times of economic recession.
They were strapped for cash
and they were extreme outliers.
Yet they altered markets and
socialbehavior. What is it about
the lack of resources and capital
that is so essential to creating a
fertile soil for good ideas to grow
and thrive?

In large part it is because these

situations foster collaboration
and networking, creating a
connection between like minds
and similarly impassioned
people.
We can see this in the way that
social networking is altering the
way we work. The impact of
these grassroots movements is
just starting to make its way into
how we do business.
Most people
discount
social

networks as a symptom of
distracted youth and out-of-work
professionals, but the ability of
these networks to scale is
incredibly powerful - much more
so than many large companies.
The formation of these groups in
The Cloud is rampant and
constant. Problem solvers
reconstitute themselves around
challenges as and where
needed. The result is an
inversion of the power structure
from powerbased on organized
scale to power based on
disorganized networks.
The Cloud is the culmination of
all of this connectivity.

We are experiencing a democratization of

ideas without precedent and with little sense
for how profound the shift may be.

LIVING IN THE CLOUD

Placeless Work
The Perfect Storm
Clouds in nature are a
fascinating state of dynamic
disequilibrium; water
molecules suspended in a
constant tug-of-war.
Clouds are tenuous
relationships between
separate but temporarily
aligned partners. They are
filled with violent currents,
which are rapid and
unpredictable, and, of course,
in their ultimate form, clouds
are among the most
destructive and violent forces
in nature. Tiny water droplets
with near zero potential on their
own can be nature's most
ferocious element when
combined, especially when
combined quickly!
The same is true of The Cloud
discussed in this e-book. In the
absence of the neat and tidy
structure of a traditional
organization. The Cloud is
unpredictable. Because of its
rapid growth in interdependency

and connectivity for the past 50

years we have been navigating
directly into the midst of a
perfect social and economic
global storm.
Four fronts are converging on
each other creating The Cloud
and also a sea change in how
we work and how we create
value.

First, Placeless work. The

growth of the Internet, and
worldwide investments in higher
education, have created a global
innovation factory seething with
new ideas and collaboration.
Marketplaces for knowledge
workers such as Elance,
LiveWork, and Amazons
Mechanical Turk are all
providing work to people around
the globe. At the same time,
idea markets such as
Continued on Page 14

Work 2.0

LIVING IN THE CLOUD

Jason isn't employed, at least not in any

contemporary sense of the word...and that's just the
way Jason likes it...

Riddle me this...
There's an old
riddle that goes
something like this;
I leave home, take
three left turns and
return home. So
where do I work?*
Here's a more
current version.
Jason Alexander
got up for work
today. He put on a
pot of coffee and
curled up on the
couch with his
laptop. He logged
onto his desktop
and began where
he left off yesterday, at the
kitchen table, solving the
problem of using algae as an
alternate energy source.
However, Jason isn't employed,
at least not in any contemporary
sense of the word. Yes, he gets
paid for his work, but only when
his solutions are accepted. The
rest of the time Jason pays his
own way. No fringe benefits, no

paid vacation, no employer paid

health insurance. And that's just
the way Jason likes it; because
that also means less uncertainty,
less company politics, less
structured work time, no
commuting, and lots of success
that is entirely his own.
His work exists everywhere and
nowhere in particular. He finds

assignments by taking on
challenges from intermediaries
such as Innocentive and Nine
Sigma, who cast a global net for
solutions to problmes that
traditional R&D departments
can't solve. Or Jason finds
projects on eLance and
Livework, marketplaces that are
like eBay where companies and
individuals find talent without

Work 2.0

LIVING IN THE CLOUD

In the same way the 19th and 20th Centuries were typified by
the transportation and movement of people and goods, this
Century will be all about the movement of work and ideas.

The Greatest Generation of Work

movement of work and
ideas.

regard to who does the work or

what their formal pedigree is.
Good ratings and a good fee?
Then youre hired!
Jason never leaves home,
avoids office politics, and never
gets laid off. So where does he
work? Jason works in The
Cloud.

More and more people around

the globe are working in The
Cloud and many more will. In
fact, the greatest shift that will
happen over the course of the
21st Century will be in the
movement of jobs to the cloud.
In the same way the 19th and
20th centuries were typified by
the transportation and
movement of people and goods,
this century will be all about the

However, the shift to The

Cloud is not just about
technology and
globalization. It's also
about uncertainty. The
more connected the world
becomes the more
uncertain the results of
our interactions will be.
Our traditional structures
for problem solving are
just unable to keep up
with the new rate of
complexity and
connectivity. We need
something radically
different and that is exactly what
Jason is becoming a part of - a
cloud of resources that are
always available and always
ready to solve problems.

*The answer to the riddle is a Baseball Diamond, (which, of course, youve figured out by now)!

LIVING IN THE CLOUD

We can plug into work and workers as easily as we turn on a

television and surf channels. Work has become weightless,
moving without friction to wherever a need exists.

Ageless, Weightless, and Complex

Continued from Page 11

Innocentive and Nine Sigma are

connecting problems to
solutions without regard for
location or even
qualifications.
Ideas are taking shape
in the least likely
places and with the
least likely people.
There is no assembly
line in this factory of
ideas. Work and
knowledge know no
physical boundaries,
traveling freely to where they
are most needed. Never before
have so many people joined to
build so much value based
purely on their ambition, energy,
and intellect. We are
experiencing a democratization
of ideas without precedent and
with little sense for how
profound the shift may be.
Second,.Ageless Work
(increased work-life
expectancy) A radically
changing demographic for work
has emerged as populations
across the world, in virtually
every major geography, have

aged and work-life expectancy

has increased
faster
than
life

experienced through the

richness of diversity and ideas
they bring to the table.

Third, Weightless Work

(extreme availability) The
world's talent has never been so
available across economies that
are increasingly tied to one
another. In this new global
economy not only do work and
value flow instantly, but they are
as ubiquitous as electricity and
phone service.
We can plug
into work
expectancy; and
workers as
with the two
easily as
likely to become
we turn on a
one-in-the-same in
television and
the near future. We
surf channels.
are aging faster and
Work has become
working longer than at
any other time in human history weightless, moving
without friction to wherever a
and yet our organizational and
need exists.
social systems are ill equipped
to deal with this inevitability. The
Thinking of innovation as a
implications of this pentagenerational mash-up are often national or a corporate agenda
in this context is as unlikely to
seen as divisive and abrasive,
yet they may also provide some work as believing that carbon
emissions can be controlled by
of the greatest fuel for
only having a handful of nations
innovation we have ever

LIVING IN THE CLOUD

The winds of change are already at a

Category 4, the storm warning has been
sounded.

Welcome to the Cloud

go green. The reality is that we
live in an entangled world where
only the tireless power of a
global innovation agenda will
provide the long-term stability
and solutions we need to solve
these problems. There exists a
tireless and limitless workforce
of innovators in The Cloud ready
to attack these problems.

employees are being tasked

with being faster, more accurate
and more efficient. In this
pressure-cooker environment,
dealing with complexity is not an
option but a
core competency for every
organization.

Buffeted by these winds of

change we need to relearn what
Fourth, Complex Work
it means to build successful
(Complexity surrounds us)
careers and businesses. Simply
The greatest challenge to every put, we have created a world
business and individual is the
rich in inventors, collaboration,
dramatic increase in complexity. and ideas. We know more,
In organizations, that complexity share more, and spend more on
shows up on computer desktops creativity than ever before. Yet
littered with applications that
our capacity to grow these ideas
dont work with each other, a
is still in the dark ages. All this
deluge of information sources,
while we most need to build
rampant growth in policies &
solutions to global problems
procedures, increased
from pandemics, to climate
regulations and compliance,
change, to energy and
and an unceasing degree agriculture, which create
of change. Yet, at the massive challenges for
same time,
our current

approaches.
The Cloud is our last hope of
evolving our organizations to a
point where we can keep pace
with the tremendous degree of
creativity and innovation
required of us in the years and
decades to come.
Here is the good news. Were
already in The Cloud. The
volatility and uncertainty of the
world are only increasing. The
winds of change are already at a
Category 4; the storm warning
has been sounded. The only
question that remains is whether
you will run for shelter in the
structures you are familiar with
or build the structures of the
future.

LIVING IN THE CLOUD

About the Author

truly deep thinkers in the arena
of technology and culture. " and
Forbes.com has called Tom a
Business Visionary with, "an
incisive view of world trade..."
#
His work has been praised by
luminaries such as Peter
Drucker and Tom Peters, who
called his writing, "a brilliant
vision of where we must take
our enterprises to survive and
thrive."
According to the late Peter
Drucker, Tom's writing "makes
you question not only the way
you run your business but the
way you run yourself."
Tom Koulopoulos is the founder
of Delphi Group, a 20-year-old
Boston-based thought
leadership firm providing advice
on innovation practices and
methods to global 2000
organizations and government.
He is also the author of eight
books, the former Executive
Director of the Babson College
Center for Business Innovation
and a past Executive Director of

the Perot Systems Innovation

Lab.
Named one of the industry's
most influential consultants by
InformationWeek magazine his
articles and market insights
appear frequently in national
and international print and
broadcast media
.
Geoff James ofCBS Interactive
Media called Tom, "one of the

Contact Tom by e-mail at

tk@delphigroup.com or on his
blog at www.TKspeaks.com