In late September the always thought-provoking Ross Dawson of the Trends in the Living Networks blog wrote this post on What Can Destroy the Boundaries of Your Industry. In it he recaps an article by Shoshanna Zuboff in which she identifies seven circumstances in which what she terms "mutations" can destroy the boundaries of an industry, unleashing what economist Joseph Schumpeter nearly 70 years ago termed the process of "creative destruction".
A lot has been written about how changing technology and social trends are affecting libraries, but it seems to me that the conversations in our profession about how we respond to these changes reflect an essentially evolutionary approach – adopting new services (e.g. Wifi, downloadable ebooks), or adapting existing ones (e.g. the "social catalog", mobile apps for online databases) largely within our existing paradigms and organizational models.
What struck me about Dr. Zuboff's list is that a number of the items are directly or indirectly applicable to public libraries, pointing to a future where the process of creative destruction will mean that survival will depend on our ability to forge revolutionary, not evolutionary change. My thoughts about how these forces might apply to public libraries are in red:
1. The products or services you offer are affordable to few but desired by many.
For many people this is one of the primary reasons public libraries exist – to provide affordable access to content (whether that content is found in books, magazines, DVDs, or online). This probably won't change in the near-term, but we need to be prepared for a world of, as Microsoft executive Ray Ozzie terms it in a parting memo to his colleagues, "continuous service and connected devices"… a world where content is ubiquitous, often free, and uncoupled from the physical infrastructure (whether shelves of books, buildings, or computer workstations) that are the anchor of library services today.
What will a public library look like in this world?
2. Trust between you and your customer has fractured. The average person's trust in business has been in steep decline for the past 30 years, and the distance between what today's businesses can deliver and what individuals want is only growing. This problem makes all consumer-facing industries—especially financial services, health care, insurance, autos, airlines, utilities, media, education, and pharmaceuticals—particularly vulnerable.
Libraries as institutions continue to enjoy a position of trust within in our communities (our customers) and I don't see that changing any time soon. What I do see is a growing distrust of government of all kinds, and as government agencies libraries will be swept up in what are sure to be profound changes in the way public services are organized, funded and delivered.
In another provocative blog post just a few days ago Ross Dawson wrote about the impact of "crowdsourcing" (applying the minds and talents of many) on nearly every aspect of society. With regard to government he notes that "Many developed world countries, notably US, Australia, and UK…are shifting to a view of government tasks and functions as guided and potentially even partly performed by citizens. We can finally start to believe, as it should be, that we are the government." [emphasis mine].
Whether it is citizen outrage driving changes to public employee compensation and benefits or the growing use of ballot initiatives at both the state and local level to exert direct citizen control of government activities I think we are seeing exactly the shift Ross Dawson describes.
Over time, I think even the trust libraries have built with our communities is at risk as a result of the organization structures and cultures we have built up. Libraries tend to be bastions of demarcation with strict boundaries between the citizen boards that govern us and staff, between "real" librarians and paraprofessionals, between paid staff and volunteers. These boundaries may have served a purpose at one time, but I think they will increasingly be a barrier to building and maintaining trust and to adapting to a "crowdsourced" world.
3. Your business model is concentrated, with a high level of fixed costs, a large percentage of which could be distributed, delegated to collaborators, or shifted to the virtual world. Here, too, most existing industries are deeply vulnerable.
This one really struck home for me. The traditional public library model is highly concentrated, with the vast bulk of our activities delivered by paid staff located in monumental facilities designed primarily to house and provide access to physical content/materials. More than 80% of our costs are tied up in staffing, collections, and maintaining our physical infrastructure and are therefore largely fixed.
We are already seeing some of our traditional functions and activities migrate to the digital world. The number of reference questions we answer is steadily dropping as people feel empowered to seek their own information directly online. The sharing of opinions through online customer reviews and social networking is supplanting librarian-centric readers advisory. Amazon's Kindle and Apple's Ibooks give people easy, convenient, and relatively inexpensive access to digital books while Netflix delivers movies to your home or streams them directly to your TV so you don't have any need to make use of the library's physical collection. While we pride ourselves that many of our services are "free" to the user and many those of our commercial competitors are not, the reality is that our fixed cost burden means that taxpayers pay a significant amount for our services and on a "per use" basis that cost can far exceed what a consumer would pay on the open market.
The public library model also has a huge amount of cost redundancy as, with the exception of some relatively limited resource sharing, each jurisdiction makes its own independent investment in staff, buildings, collections and technology. Contrast that to a Google or Netflix which is able to take a global approach to infrastructure and investment to optimize its fixed costs.
Beyond the obvious shift to the virtual world, we are also seeing the emergence of new models of organization and service delivery intended to reduce total costs and/or shift library cost structures from fixed to variable.
The current brouhaha about full-scale outsourcing of library operations aside, outsourcing of specific functions has become a standard operating practice for many libraries including PVLD. Outsourcing is cost-effective not only because the private sector often has a less burdensome employment cost structure than the public sector, but because it is a way of sharing investment in fixed costs among a larger number of entities.
Many libraries, again including PVLD, are finding new ways to integrate volunteers into their operations. While few have yet gone as far as Siskiyou County I think the pressure to reduce costs combined with the shift towards crowdsourcing described above and demographic trends that indicate a growing population of highly capable older adults with the time and ability to volunteer mean that the shift of work from paid public sector employees to volunteers will only accelerate.
Libraries are also partnering up with community organizations to share resources and jointly deliver services. This can range from having a community organization deliver a program at the library to truly joint facilities and operations, with the latter being much more rare.
To me the ongoing redistribution of costs is both necessary and inevitable. The question for libraries is whether we are capable of changing radically and quickly enough to keep up with the pace of change around us.
4. Your organizational structures, systems, and activities can be replaced by flexible, responsive, low-cost networks. A neighborhood watch, citizen journalists, online peer support, and peer-to-peer reviews and information sharing are all examples.
My response to question 3 with regard to the migration of traditional library functions and activities also is relevant here, particularly since libraries, for a variety of reasons ranging from the complexity of digital rights management to the challenge of adopting new services and models while still trying to sustain the old ones, libraries struggle to provide digital services that are comparable to those available in the "non-library" virtual world in terms of convenience and ease of use.
5. There are hidden assets, outside institutional boundaries, that are underutilized but could replace your fixed costs, add capacity, or add new capabilities.
Calling them "hidden" may be a misnomer, but there are myriad assets outside of our boundaries that could be used strategically by libraries to reduce costs and expand flexibility.
At PVLD we have a number of initiatives that, while we didn't initially conceptualize them that way, upon reflection could be described as using assets outside of our traditional institutional boundaries to expand our capabilities while minimizing our investment in fixed costs. For example, the Annex uses leased retail space to expand our teen services without capital investment in new facilities and can easily be modified or shut down entirely if community needs or our circumstances change and we are slowly but steadily migrating the various computer applications that support our daily work (like email, document sharing, and work orders) from software packages that we purchase and then operate on in-house servers to free or low-cost/subscription services that are hosted by the provider and accessed via the Internet "cloud".
With staff representing approximately 70% of our cost structure, perhaps the greatest untapped "hidden assets" are the people and organizations outside of our library boundaries. I think there is a huge opportunity to extend our capabilities without increasing our fixed cost burden if we are willing to look beyond the traditional direct employment model.
Strategic outsourcing is one opportunity. PVLD has long outsourced the cataloging and processing (the library term for adding plastic covers and labels and otherwise getting a book ready to be placed on the shelf) of most of our new book purchases for the library collection and is expanding this outsourced services to other types of materials like audio books and DVDs. Last week we launched a pilot "call center" whereby we have outsourced the handling of routine telephone enquiries to a business partner. Both of these outsourcing initiatives reduce our overall costs because the investments in staff and infrastructure are shared with other customers of our outsourcing partners; convert fixed costs that are hard to shed into variable costs that fluctuate with our usage of the service and can be ended at any time; improve customer service (in the first case because if we did the cataloging and processing in-house resource constraints result in bottlenecks that delay customer access to the items; and in the second instance because our customers now have a much higher likelihood of receiving service from a real person instead of being shunted into voicemail); and by shifting less complex work to our outsourcing partners free up our staff to do higher value work.
Volunteers and community members are another underutilized asset. Most libraries have active volunteer programs but in many cases we have put fences around what is considered work suitable for volunteers (often either fundraising or relatively unskilled tasks like shelving books) and what is proprietary to staff. The question is whether this demarcation is preventing us from really making use of the talents our volunteers, who in the case of PVLD are often highly educated and skilled professionals capable of far more than shelving books. We have had some recent experience of tearing down some of the fences between "volunteer" and "staff" work, with great results. The most vivid example is the recently retired mechanical engineer who was asked to evaluate a long-standing issue with the heating and cooling (HVAC) system in the Peninsula Center Library. Our Building Engineer had not been able to solve the problem despite many attempts, and HVAC contractors told us it would cost tens of thousands of dollars to replace parts in units throughout the building. The volunteer came up with a design solution that will reduce the cost of fixing the entire building to less than what we were told fixing one unit would cost. The level of expertise that the volunteer brings is well beyond our staff capabilities.
It seems to me that the challenge for libraries is twofold – first is, to take a cliché literally, think outside the box of our institutional boundaries in order to discover the hidden assets that are available to us. The second is to change our organizational cultures so that we embrace rather than resist organizational models that integrate staff and non-staff (whether commercial outsourcing partners or community volunteers) in order to replace fixed costs or add capacity or capabilities.
6. You don't have all the tangible or intangible assets required to meet your customers' needs.
This is a hard one to call for libraries. At a superficial level the current economic crisis means that all libraries are facing resource shortages that make it difficult to meet demand for our services so the answer is no. At a deeper level the question is whether we are positioned to meet the evolving needs of our communities, and I think the answer is still no. At a minimum we don't have the ability to influence the digital marketplace so that what we are able to offer in terms of virtual services and resources is competitive with what is available commercially in terms of availability and ease of use.
7. Your end users have needs and desires that you haven't imagined and have no way to learn about. Unless you make a strategic commitment to explore I-space, you'll learn about this vulnerability only when your end users migrate elsewhere. This has already been the experience of executives in industries such as recorded music, newspapers, broadcast news, and travel.
Many libraries struggle to connect their services to real, tangible community needs (as opposed to what we think people "should" need), so exploring the "white space" of unimagined needs would be a pretty big stretch for most of us….but wouldn't it be fun?
I've written this post over several days, so it may be a bit disjointed. It's also been a great example of a quote variously attributed to novelist E.M. Forster and organizational psychologist Karl Weick -"How do I know what I think until I see what I say?" When I started writing it a few days ago I thought my conclusion would be in effect that libraries are doomed. Instead I found myself thinking about all of the opportunities to radically reconfigure our organizations so that we are part of the "creative" aspect of creative destruction rather than victims of its destructive force.
That said, I think another quote from Karl Weick is a propos - "Simply pushing harder within the old boundaries will not do" or to quote my friend and State Librarian Stacey Aldrich's encouragement to our emerging library leaders we need to "Go blow some !&*(!* up!"