Wednesday, November 11, 2015

Resource Sharing - An Emerging Trend

In few articles, some of the emerging trends in the current scenario were discussed. The McKinsey article articulated the the emergence of cloud based services, where organizations no longer needed to invest in physical IT infrastructure. Some the recently successful technical startups have been the early adapters of such service and the big players have been late in realizing it. The rise of Airbnb overtaking the traditional hotel business was also discussed in one of the articles.

This trend might appear that utilizing pre-existing resources and paying for such services is an emerging trend. But taking a step further and viewing it in a Macro level, we can see the emergence of Resource Sharing as an highly emerging trend. Quite few successful companies have used resource sharing as their core model and are becoming successful at a tremendous pace. Few of them pose a serious threat to big players in their respective Industries.

Uber with its model of  utilizing individual's cars, poses a serious threat to the conventional cab agencies. The resources that is shared here is cars that they don't own. The individual driving their own cars for Uber, share their resource(car) which would have not been otherwise efficiently utilized. Airbnb uses a similar model, where individuals efficiently share and utilize their housing space and get paid for it. The high usage of car pooling, in recent years as an alternative to conventional transportation is fast emerging.

This trend is not only adopted by new players.Some big players have also been adopting to these trends in some manner. AT&T has been advertising its data sharing plan to its customers within a family plan. In India Bharti Airtel has been advertising to share even the talk-time between connections in a group plan.

From the industries perspective, this addresses the issue of effective resource utilization . From the Customers perspective, it might appear that they are keen on saving the costs and hence are quick followers to such new models. But in reality customers also want to save more on their time than the costs. In this fast paced world, time is becoming scarce and people utilize technologies that enables them to do save their valuable time. In case of Uber people use its service mainly to save their waiting time for cabs.In case of car pools , people want to save the transit time to conventional transport services and they want to travel during the time of their desire. This model provides a symbiotic advantage for the both businesses and customers.

This model should be quickly adopted by big players, otherwise they are at the risk of losing their market share to such innovative companies that have resource sharing as their core model. The fundamental equation is shifting from 'producers to consumers' to 'resource holders to service providers to consumers'. This paradigm shift, if not now will be the game changer of businesses in the forthcoming years.

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