Social Capital Value Add

Okay, so do you find Craig Newmark and the Hilton sisters hot or not?

This post is my contribution to the CluetrainPlus10 project, in which 95 bloggers are commemorating the 10-year anniversary of the Cluetrain Manifesto by reflecting on the 95 theses of this seminal social media marketing work.

thesis #70. If you don’t impress us, your investors are going to take a bath. Don’t they understand this? If they did, they wouldn’t let you talk that way.

Corporations (for profit) are a pretty incredible form of human organization don’t you think?  It seems to me that they were originally formed to enable groups of people to take actions together in ways that were previously not common.  The corporate form let groups enter into contracts, own things and most importantly it enabled people to treat risk differently.  Leverage.  Scale.  Risk is a big part of innovation.  It is related to rewards.  It is how we get ahead, isn’t it?

This form of organization has proven to be very effective at creating wealth.  It is responsible for lifting more people out of poverty than any other approach.  Even still, eventually we end up asking how is this wealth creating form of organization accountable to the rest of us?

The call for regulation is getting attention these days.  Does anyone think that any group of policy wonks is going to get in front of a mammoth like Google and many corporations like it that are way around the curve on investing in and understanding the power of data and networks?  Regulation is important but don’t you think it addresses practices after giant shifts have occurred and there is a new status quo to code into the system?  I think a more important and achievable check at the early stages of new practices is developing greater accountability to markets.

Being accountable to customers is one form of market accountability.  But all boats rise in a flood.  If a company is fortunate enough to be doing enough of the right things and it is connected to the context of an inexorable global trend they can grow like crazy and ignore their customers.  Or they can completely disregard all of their potential customers and new streams of revenue and just hang onto the ones that come easily. Nice little business.  Everybody is happy, except the folks at Tribune.

It could be worse, one could be totally free of direct responsibility for production of product or service and still able to live off of the spoils of corporately created wealth and the attention and power that access to capital affords (are they hot if they are not heiresses?).

In any event, some people at the top of Tribune, the banks and a lot of other major corporations lost the plot recently, but does anyone feel like these corporations are not accountable to the market?  They seem to be getting hammered by the market the last time I checked.

Looking back over the last ten years and reflecting on thesis #70, we now have many examples that investors suffer when companies do not adjust to the network era.  But do investors fully understand this and reflect it in their analysis of the future prospects of a company?  I think the answer is no.

I think this is a big part of the problem at the heart of the #smfail thread that recently evolved out the of the Business of Community Networking  conference in Boston and Web 2.0 Expo in San Francisco.

Howard Lindzon has part of the answer. He says, “it’s time for some Venture Capitalist’s and founders with balls to take some real chances and lead change.”

For whatever reasons, folks like Bill Gates and Clark/Andreesen and Jeff Bezos engaged with public markets, became poster children for embracing change for all of us, created a lot of wealth for a lot of people, scaled to the global challenge/opportunity and they changed what investors look for in a company in the process.

A Twitter, Facebook or Craigslist IPO would have similar effects IMHO.

But I don’t think that the real answer is “out there” with other people.  It is not the responsibility of a few to provide leadership for the rest of us anymore.

Any so-called social media expert can help stop the Web 2.0 Swan Song.

1.  Stop selling social media as a cheap alternative to television advertising.  If something is better it is worth more.  If a television campaign is worth $1-million then doing social media right is worth $1.2-million.  Go after those deals and you will quickly find your self sitting across the table from senior executives, rather than junior managers. (Real quote within last month, from real director level employee in Canadian operations of a brand you know and trust: “We are not adopting social media, and if we were that decision would not be made here, it would have to come from a senior level executive in the US office.)

2. Stop waiting and advocating for some sort of “executive buy in”.  Yes, leadership from the top will help, but it will be the little success stories or implementations that start small but spread memetically that draw in the senior execs as champions.  Who is hosting corporate changecamp in NYC?

3. When you do get into the CEO suite, don’t propagate the “Giving Up Control” myth.  Telling a middle-aged executive who has fought half of their life to get where they are that they need to give up control is quite the “conversation” killer.  Worse - it is not the truth.

4. Let’s put an end to the arrogance of looking down on the way corporate types speak.  Excessive PR is one thing but let’s recognize that if we want investors to understand the imperatives of the new economic model, we need to make the effort to convert our “conversation” into terms and language that they can act upon.

The shift to common perception shaped by broadband empowered social networks is accelerating and the dominant source of shared perceived value for the last 50 years, broadcast media, is in rapid decline.

Ultimately the ability to maintain margins is dependent on a shared perception of sustainable difference in value between price and costs.  That means that brand value, around 50% of big company corporate valuation, is at risk of evaporating.

Broadband connectivity is set to triple every six months and it is the key driver.  The broadband trend, along with mobile communications & GPS integration is eliminating the boundary between the virtual worlds & the so-called real world, establishing the link between broadband empowered people and stable future earnings.

Should the “conversation” go something like that?

Part of the problem is that a cross-disciplinary solution is required.  It really takes collective input from a variety of experts to arrive at a satisfactory answer.

With a seed investor and a few precedent setting corporations we could all get involved in an open source approach to making the business case to investors in a meaningful way.  Call me if you have $200K and want to get started.  I will send you the proposal.

Read the other posts in the CluetrainPlus10 project.

1. Markets are conversations. Christopher Locke, Mystic Bourgeoisie, Entropy Gradient Reversals, @clockerb

2. Markets consist of human beings, not demographic sectors. Simon Kendrick, Curiously Persistent, @curiouslyp

3. Conversations among human beings sound human. They are conducted in a human voice.Keith McArthur, Rogers Communications, keithmcarthur.ca @keithmcarthur

4. Whether delivering information, opinions, perspectives, dissenting arguments or humorous asides, the human voice is typically open, natural, uncontrived. Shel Holtz, A Shel of my Former Self, @shel

5. People recognize each other as such from the sound of this voice. Dave Fleet, Davefleet.com, @davefleet

6. The Internet is enabling conversations among human beings that were simply not possible in the era of mass media. Jose Leal, wikiDOMO Blog, @jaleal

7. Hyperlinks subvert hierarchy. Chris Brogan, Chrisbrogan.com, @chrisbrogan

8. In both internetworked markets and among intranetworked employees, people are speaking to each other in a powerful new way. Mitch Joel, Six Pixels of Separation, @mitchjoel

9. These networked conversations are enabling powerful new forms of social organization and knowledge exchange to emerge. Neville Hobson, nevillehobson.com, @jangles

10. As a result, markets are getting smarter, more informed, more organized. Participation in a networked market changes people fundamentally. Ed Lee, Blogging Me, Blogging You, @edlee

11. People in networked markets have figured out that they get far better information and support from one another than from vendors. So much for corporate rhetoric about adding value to commoditized products. Andy Beal, Marketing Pilgram, @andybeal

12. There are no secrets. The networked market knows more than companies do about their own products. And whether the news is good or bad, they tell everyone. Dan York, Disruptive Conversations, @danyork

13. What’s happening to markets is also happening among employees. A metaphysical construct called “The Company” is the only thing standing between the two. Lauren’s Library Blog @laurenpressley

14. Corporations do not speak in the same voice as these new networked conversations. To their intended online audiences, companies sound hollow, flat, literally inhuman.  C.C. Chapman, CC-Chapman.com, @CC_Chapman

15. In just a few more years, the current homogenized “voice” of business—the sound of mission statements and brochures—will seem as contrived and artificial as the language of the 18th century French court. Tom Ewing, Freaky Trigger, @tomewing

16. Already, companies that speak in the language of the pitch, the dog-and-pony show, are no longer speaking to anyone. Steve Dodd, B2B Selling with Social Media Technniques, @steve_dodd

17. Companies that assume online markets are the same markets that used to watch their ads on television are kidding themselves. - Jason Griffey, Pattern  Recognition, @griffey

18. Companies that don’t realize their markets are now networked person-to-person, getting smarter as a result and deeply joined in conversation are missing their best opportunity. Ivan Croxford, The Fumoir, @croxy

19. Companies can now communicate with their markets directly. If they blow it, it could be their last chance. Kyle McInnes, BlackBerryCool.com, @blackberrycool

20. Companies need to realize their markets are often laughing. At them. - Tom Nixon | @tomnixon

21. Companies need to lighten up and take themselves less seriously. They need to get a sense of humor. Jay Moonah from Wild Apricot, Media Driving, @jmoonah

22. Getting a sense of humor does not mean putting some jokes on the corporate web site. Rather, it requires big values, a little humility, straight talk, and a genuine point of view. Colin McKay | Canuckflack | @canuckflack

23. Companies attempting to “position” themselves need to take a position. Optimally, it should relate to something their market actually cares about. tamera kremer, (3i), @tamera

24. Bombastic boasts—”We are positioned to become the preeminent provider of XYZ”—do not constitute a position. Anthony Power, Power Points, @apowerpoint, Post here.

25. Companies need to come down from their Ivory Towers and talk to the people with whom they hope to create relationships. @sclapp, Sharon Clapp, librarywebhead

26. Public Relations does not relate to the public. Companies are deeply afraid of their markets.  Heather Yaxley, greenbanana, @greenbanana Post: http://greenbanana.wordpress.com/2009/04/28/public-relations-does-not-relate-to-the-public-companies-are-deeply-afraid-of-their-markets/

27. By speaking in language that is distant, uninviting, arrogant, they build walls to keep markets at bay. Karen Russell, Teaching PR, @KarenRussell

28. Most marketing programs are based on the fear that the market might see what’s really going on inside the company. Brenna Flynn, com.motion, @b2therenna, Post: http://www.causeacommotion.com/2009/04/cluetrainplus10-project-most-marketing.html

29. Elvis said it best: “We can’t go on together with suspicious minds.” Post: Elvis was right Pete Burden, www.peteburden.com, @peteburden

30. Brand loyalty is the corporate version of going steady, but the breakup is inevitable—and coming fast. Because they are networked, smart markets are able to renegotiate relationships with blinding speed. Kevin MacKenzie, mack-musings.blogspot.com. @mackenstuff

31. Networked markets can change suppliers overnight. Networked knowledge workers can change employers over lunch. Your own “downsizing initiatives” taught us to ask the question: “Loyalty? What’s that?” Blake Medulan, blakedot.blogspot.com @thebdot

32. Smart markets will find suppliers who speak their own language.@debworks http://debworks.blogspot.com/2009/04/cluetrain10-number-32.html

33. Learning to speak with a human voice is not a parlor trick. It can’t be “picked up” at some tony conference. Bob LeDrew, Flacklife @bobledrew

34. To speak with a human voice, companies must share the concerns of their communities. Keith Burtis, keithburtis.com - @keithburtis

35. But first, they must belong to a community. @LizStrauss - Successful-Blog.com

36. Companies must ask themselves where their corporate cultures end. Matt Moore engineerwithoutfears @innotecture happy endings

37. If their cultures end before the community begins, they will have no market. Farah Qasemi, The Burgundy Rants, @efcue

38. Human communities are based on discourse—on human speech about human concerns. Mathew Ingram, http://www.mathewingram.com/work/2009/04/28/cluetrain-human-speech-human-concerns/ @mathewi

39. The community of discourse is the market. Tim Walker, hooversbiz.com, @Twalk

40. Companies that do not belong to a community of discourse will die. Toby Greenwalt, theanalogdivide.com, @theanalogdivide

41. Companies make a religion of security, but this is largely a red herring. Most are protecting less against competitors than against their own market and workforce. Maddie Grant

@maddiegrant  [post coming soon]

42. As with networked markets, people are also talking to each other directly inside the company—and not just about rules and regulations, boardroom directives, bottom lines.

43. Such conversations are taking place today on corporate intranets. But only when the conditions are right.

44. Companies typically install intranets top-down to distribute HR policies and other corporate information that workers are doing their best to ignore. Nancy Dowd, The ‘M’ Word.

45. Intranets naturally tend to route around boredom. The best are built bottom-up by engaged individuals cooperating to construct something far more valuable: an intranetworked corporate conversation.

46. A healthy intranet organizes workers in many meanings of the word. Its effect is more radical than the agenda of any union. Connie Crosby Intranet Apocalypso http://crosbygroup.ca/blog@conniecrosby

47. While this scares companies witless, they also depend heavily on open intranets to generate and share critical knowledge. They need to resist the urge to “improve” or control these networked conversations.

48. When corporate intranets are not constrained by fear and legalistic rules, the type of conversation they encourage sounds remarkably like the conversation of the networked marketplace.

49. Org charts worked in an older economy where plans could be fully understood from atop steep management pyramids and detailed work orders could be handed down from on high. Mark Federman What is the (Next)  Message?

50. Today, the org chart is hyperlinked, not hierarchical. Respect for hands-on knowledge wins over respect for abstract authority. Michael Stephens, tametheweb.com, @mstephens7 http://tametheweb.com/2009/04/28/hyperlinked-libraries-org-charts-the-human-voice-ten-years-of-the-cluetrain-manifesto/

51. Command-and-control management styles both derive from and reinforce bureaucracy, power tripping and an overall culture of paranoia. Omar Ha-Redeye, LawIsCool, @OmarHaRedeye

52. Paranoia kills conversation. That’s its point. But lack of open conversation kills companies. Malcolm Bastien, Open Mode, @MalcolmBastien

53. There are two conversations going on. One inside the company. One with the market.    http://bit.ly/CluetrainWizard - “CluetrainPlus10 and The Wizard of Oz”, John V Willshire, @willsh

54. In most cases, neither conversation is going very well. Almost invariably, the cause of failure can be traced to obsolete notions of command and control Michael Karesh @TrueDelta

55. As policy, these notions are poisonous. As tools, they are broken. Command and control are met with hostility by intranetworked knowledge workers and generate distrust in internetworked markets.

56. These two conversations want to talk to each other. They are speaking the same language. They recognize each other’s voices.

57. Smart companies will get out of the way and help the inevitable to happen sooner. - Mike Russell, PlanetRussell.net/blog, @planetrussell

58. If willingness to get out of the way is taken as a measure of IQ, then very few companies have yet wised up.  Helene Blowers, LibraryBytes - The secret is in letting go @hblowers

59. However subliminally at the moment, millions of people now online perceive companies as little more than quaint legal fictions that are actively preventing these conversations from intersecting. Andrew Goodman, Traffick.com & Page Zero Media, @andrew_goodman

60. This is suicidal. Markets want to talk to companies. Danny Whatmough @dannywhatmough

61. Sadly, the part of the company a networked market wants to talk to is usually hidden behind a smokescreen of hucksterism, of language that rings false—and often is. Nancy White @nancywhite

62. Markets do not want to talk to flacks and hucksters. They want to participate in the conversations going on behind the corporate firewall. Andrew Cherwenka, Trapeze, @andrewcherwenka

63. De-cloaking, getting personal: We are those markets. We want to talk to you. Ian Capstick, MeidaStyle.ca, @iancapstick

64. We want access to your corporate information, to your plans and strategies, your best thinking, your genuine knowledge. We will not settle for the 4-color brochure, for web sites chock-a-block with eye candy but lacking any substance. Aerin Guy @aeringuy

65. We’re also the workers who make your companies go. We want to talk to customers directly in our own voices, not in platitudes written into a script. Kate Trgovac mynameiskate.ca @mynameiskate

66. As markets, as workers, both of us are sick to death of getting our information by remote control. Why do we need faceless annual reports and third-hand market research studies to introduce us to each other? Tom Demers WordStream Blog @tomdemers

67. As markets, as workers, we wonder why you’re not listening. You seem to be speaking a different language. monica levy. http://www.monicaonmarketing.blogspot.com. @mjlevy

68. The inflated self-important jargon you sling around—in the press, at your conferences—what’s that got to do with us? San Antonio Byline Blog @clgoodman

69. Maybe you’re impressing your investors. Maybe you’re impressing Wall Street. You’re not impressing us. Tony Goodson www.tonygoodson.com @tgtips

70. If you don’t impress us, your investors are going to take a bath. Don’t they understand this? If they did, they wouldn’t let you talk that way. Michael Cayley www.socialcapitalvalueadd.com @memeticbrand Craig Newmark - Hilton sisters, Hot or Not? CluetrainPlus10

71. Your tired notions of “the market” make our eyes glaze over. We don’t recognize ourselves in your projections—perhaps because we know we’re already elsewhere. Doc Searls @dsearls

72. We like this new marketplace much better. In fact, we are creating it. Joe Kraus, @jokrausdu, http://www.nuthingbut.net/2009/04/we-like-this-new-marketplace-much.html.

73. You’re invited, but it’s our world. Take your shoes off at the door. If you want to barter with us, get down off that camel! mr heretic, @mrheretic

74. We are immune to advertising. Just forget it. Jane Shkolnik @jshko www.blurtheline.ca

75. If you want us to talk to you, tell us something. Make it something interesting for a change. Duane Brown, Creative Traction, @duanebrown

76. We’ve got some ideas for you too: some new tools we need, some better service. Stuff we’d be willing to pay for. Got a minute? Michelle Sullivan, Michelle Sullivan Communications, @msullivan

77. You’re too busy “doing business” to answer our email? Oh gosh, sorry, gee, we’ll come back later. Maybe. Gina Lijoi, http://wordondigital.blogspot.com, @ginalijoi

78. You want us to pay? We want you to pay attention. Eden Spodek, Bargainista, @EdenSpodek

79. We want you to drop your trip, come out of your neurotic self-involvement, join the party. Sarah Prevette, @sarahprevette

80. Don’t worry, you can still make money. That is, as long as it’s not the only thing onyour mind. Beth Robinson, Inventing Elephants, @bethrobinson Response posted at http://www.inventingelephants.com/beyondmoney.html

81. Have you noticed that, in itself, money is kind of one-dimensional and boring? What else can we talk about? Rebecca Leaman, Wild Apricot, @rjleaman

82. Your product broke. Why? We’d like to ask the guy who made it. Your corporate strategy makes no sense. We’d like to have a chat with your CEO. What do you mean she’s not in? Michael O’Connor Clarke, Uninstalled, @michaelocc

83. We want you to take 50 million of us as seriously as you take one reporter from The Wall Street Journal. Ged Carroll (@r_c, renaissance chambara) posted here and here

84. We know some people from your company. They’re pretty cool online. Do you have any more like that you’re hiding? Can they come out and play? Dan Wilson, @wilsondan wilsondan.co.uk

85. When we have questions we turn to each other for answers. If you didn’t have such a tight rein on “your people” maybe they’d be among the people we’d turn to. Reid Givens @reidgivens reidgivens.com

86. When we’re not busy being your “target market,” many of us are your people. We’d rather be talking to friends online than watching the clock. That would get your name around better than your entire million dollar web site. But you tell us speaking to the market is Marketing’s job. Danny Brown, danny brown - social media pr and marketing for the conversation age - @dannybrown. Post now live: “We’re Your People Too”.

87. We’d like it if you got what’s going on here. That’d be real nice. But it would be a big mistake to think we’re holding our breath. Joe Buhler, buhlerworks, @jebworks Post live on Marketing on the Smart Web

88. We have better things to do than worry about whether you’ll change in time to get our business. Business is only a part of our lives. It seems to be all of yours. Think about it: who needs whom? Nick Gadsby @nickbjorn of Lawes Consulting READ MY ENTRY @ Dark London

89. We have real power and we know it. If you don’t quite see the light, some other outfit will come along that’s more attentive, more interesting, more fun to play with. http://hessiej.wordpress.com/2009/04/28/cluetrainplus-10-thesis-89-we-have-real-power-and-we-know-it-if-you-dont-quite-see-the-light-some-other-outfit-will-come-along-thats-more-attentive-more-interesting-more-fun-to-play-with/, http://twitter.com/hessiej

90. Even at its worst, our newfound conversation is more interesting than most trade shows, more entertaining than any TV sitcom, and certainly more true-to-life than the corporate web sites we’ve been seeing. David Berkowitz, Inside the Marketers Studio, @dberkowitz

91. Our allegiance is to ourselves—our friends, our new allies and acquaintances, even our sparring partners. Companies that have no part in this world, also have no future. Kurt Cagle, Metaphorical Web, @kurt_cagle

92. Companies are spending billions of dollars on Y2K. Why can’t they hear this market timebomb ticking? The stakes are even higher.  Sally Falkow Proactive http://falkow.blogsite.com Now live http://falkow.blogsite.com/public/item/231350

93. We’re both inside companies and outside them. The boundaries that separate our conversations look like the Berlin Wall today, but they’re really just an annoyance. We know they’re coming down. We’re going to work from both sides to take them down. Morten Blaabjerg, When The Garden Walls Come Crumbling Down - Kaplak Blog

94. To traditional corporations, networked conversations may appear confused, may sound confusing. But we are organizing faster than they are. We have better tools, more new ideas, no rules to slow us down. Robin Hastings - @webgoddess

95. We are waking up and linking to each other. We are watching. But we are not waiting.  Leigh Himel, http://leighhimel.blogspot.com/2009/04/cluetrainplus-10-thesis-95.html - @leighh

Thank you to @sagenet for turning me on to the #smfail twitter thread that was streaming out of today’s Why Social Media Marketing Fails  - and how to fix it panel at the Web 2.0 Expo.  Industry thought leaders - Peter Kim (Dachis Corporation), Charlene Li (Altimeter Group), and Jeremiah Owyang (Forrester Research) led the discussion.  UPDATE:  Thanks to Peter, Charlene & Jeremiah for linking to this post.

My comment on a post by @miaD on her Marketing Mystic blog has turned into this post here.

Mia reported “Keeping true to the spirit of social media, Peter Kim invited input for this session before the show, on his blog where folks respond to what they wanted to see at this session. Not surprisingly, it was standing room only for this brilliant panel of former and current Forrester analysts.”

Here are my thoughts along the themes established by the panel:

1. How to get culture to adopt & get C level buy in:

Demonstrate the link between corporate value & social media the way that the link between brand & corporate value was established in the late ’80s.  Brand value is now the 3rd most monitored benchmarks by CEOs (can someone help me find the link to where I read this factoid?).

2. How to make “campaigns” work:

I agree with the panel, the campaign model is wrong.  It leads to the wrong metrics (CPMs, web analytics), wrong strategy, etc.  However, cycles of activity tied to a good strategy are required.  “Campaigns” will work if they are part of corporations mobilizing their internal & external networks toward the creation & defense of enduring value … not about going viral, not about views or meaningless registrations.

3.  What Measures Matter (are right for social media):

Measures should be derived from the academic work that has been done in quantifying social capital.  Nan Lin’s network theory of social capital is a good place to start for a definition.  Social network analysis is also an important place to look for meaningful measures (see @barrywellman and INSNA for more).

4. Does social media matter?

Oh yes.  It is very critical.  That is like asking is it important that major American corporations maintain market share that is disproptionate to population as China, India and the developing world begin to project their power into global culture.  The shift to common perception shaped by broadband empowered networks is accelerating (as opposed to broadcast networks).   Broadband connectivity is set to triple every six months and it is the key driver.  The broadband trend, along with mobile communications & GPS integration is eliminating the boundary between the virtual worlds & the so-called real world, establishing the link between broadband empowered people and stable future earnings.  Ultimately the ability to maintain margins is dependent on a shared perception of sustainable difference between price and costs.  So yes - social media matters, very much, to every publicly traded corporation … in fact to everyone & it will only continue to increase in importance.

Here are some of the other recaps of the panel …

• Susan Etlinger from the Horn Group
• Jennifer Leggio, Zdnet
• Holger Nauheimer
• Shanee Ben-Zur from Voce
• The Four Fail Whales of social media, CRM Magazine

And Kate Brodock did a good wrap up of the Business of Community Networking conference where we covered similar issues last week in Boston.

Hmmm … not bad for a first attempt.  Thanks to the folks at groundreport and WeMedia who got me on the spot for this as part of the competition.

I am interested in your feedback.  Clearly this could be better, what are your thoughts?

Note: click on the “full screen” button so that you can actually read the flash cards.

I received a little good news last week. Social Capital Value Add was selected as a finalist by WeMedia from a field of 379 entries from 48 countries. Details here: http://www.changemakers.net/en-us/competition/powerofus

Thank you to everyone who supported my entry. Don’t forget to let me know if you clicked through. You might win the ticket.

I know that the rules say that the judges make the selections, not the voters but feel free to try to add comments or rate my entry here: http://www.changemakers.net/en-us/node/14479

@BeCircle tweeted this about the SCVA entry:

“@memeticbrand only after reading this http://bit.ly/14kAM did I ‘get’ SCVA. SCVA.com needs this front and center”

You see competition can make things better.  I will amend the “about” page here to incorporate the language from the submission.

They gave Al Gore more than 12 minutes when he took the WeMedia stage, but then again that was before we knew it takes just 4 minutes.

Is anyone else going to be in Miami for February 24th to 27th?

“Barabási mathematically describes networks in the World Wide Web, the internet, the human body, and society at large. Fowler seeks to identify the social and biological links that define us as humans. In this video Salon, Barabási and Fowler discuss contagion and the Obama campaign, debate the natural selection of robustness, and ask: Is society turning inward?”

The “Is society turning inward?” question is misleading in my opinion.  That headline does not really point towards the discussion that the scientists are having towards the end of this piece.  That question makes me think of xenophobes and isolationist trade policies.  In fact, the scientists are talking about the emergence of networking thinking as a dominant form in the 21st century.  They believe that our best minds are increasingly focused on our interconnectedness rather unlike the last century of learning which was primarily focused on learning about particles from quarks to the galaxies & beyond.

Hat tip to Valdis Krebs for sharing this and these related links:

http://is.gd/hpKh

PDF of Full Paper...

http://is.gd/hpMo

The transcript is here.

UPDATE: SCVA has been selected as a finalist in the Power of  Us competition! Thanks!  Make sure you let me know when you rate!

UPDATE2, Feb. 10, 2008: Toronto Community Leader, David Walsh was the winner of the ticket to the lecture & concert tonight.  He has a board meeting, so gave his ticket to singer/songwriter Michael Cavanaugh.

In Ideas Need People to Spread #1, I asked you to support a couple of initiatives … one being advanced by some friends and my submission to Ashoka’s changemaker.net The Power of Us: Reimagine Media competition.

When I received an invitation yesterday to the Martin Prosperity Institute’s upcoming “Markets Making Music” lecture & concert event featuring a lecture about the market for ideas by the Peter Munk Professor of Entrepreneurship, Ajay Agrawal followed by a Q&A session with Sellaband CEO and Co-Founder Johan Vosmeijer as well as an album debut concert performance by Sellaband recording artist Angie Arsenault a few ideas aligned …

- The Power of Us.

- Reimagine Media.

- Market for Ideas.

- “Arsenault turned to another Internet innovation and raised $50,000 from 531 “believers” spread across 34 countries”

- what goes around, comes around.

So I felt inspired to innovate a little.  I ordered an extra seat for the event in Toronto and it could be yours (or you can always give to a friend of yours in Toronto if you win).

You learn about emerging trends in the music industry, markets for ideas, see a concert and get a free copy of Angie’s CD.

All that I ask is that you go right now to this link and comment on or rate or nominate Social Capital Value Add.

Let me know once you have made that little extra digital effort.  Ideally via Twitter @memeticbrand or through a post or comment either here or anywhere on the web which it will show up in a google alert (tag #PowerofUs) or email me at michael at socialcapitalvalueadd dot com.

I have already asked a lot of people to support the idea of Social Capital Value Add.  As a result it was released by ChangeThis.  Many have supported with blog posts and tweets.

This is the most important outreach that I have done, but it is also time to get some financing.  Social Capital Value Add maybe too early to help me support my family.  The incentives, I think, are in the right places.

On February 9th, I will randomly draw the name of one digital evangelist to join in the February 10th event at Rotman.

I think a few of us from the Optimizing Business Performance event at MaRs during the day on Feb. 10th will be along for the ride.  It should be fun.

I just started following Dr. Robin Teigland on Twitter.  Get ready to be blown away … check out her slide share presentations.

She is an Associate Professor at the Center for Strategy and Competitiveness at the Stockholm School of Economics (SSE) in Sweden.  For more than ten years, she has researched and lectured on social networks and their relationship with strategy and performance.

You MUST take your time and view this presentation.

I just posted her presentation of Fad or Future: Second Life & Virtual Worlds over at www.memeticbrand.com.  It is spot on.

One of the central concepts of Social Capital Value Add is the Individual as Medium (IAM).  I also considered using the more anthropological “Social Media Man” but wanted readers to steer past the buzz words and/or gender concerns.

Which one do you like better?  I don’t care what you call it, as long as the dog brings back the bone.

I am realizing that the IAM concept may not come across very strongly in the e-book.  I dripped references to IAM throughout the e-book.  Let me try to draw them together in this post.

Perception is reality.

Shared perception requires some form of media.  I.e., thoughts must be communicated through some form of artifact whether fleeting or more resilient.  Examples include gestures, words, text, audio and visual … anything that can be sensed among parties.

For most of history, our ability to communicate was relatively geo-spatially limited.  We could communicate as far as our voices could be heard (town criers) or our eyes could see (smoke signals). Perception was very locally oriented.

Then along came technologies that Marshall McLuhan taught us to understand as Extensions of Man.  The printing press, radio and television are a few of the biggies.  These are essentially one way, broadcast forms of media. The telephone is another biggie, it is interactive & reaches far, but does not scale well to large audiences and requires synchronous connection.

McLuhan explained to us that “the medium is the message. This is merely to say that the personal and social consequences of any medium - that is, of any extension of ourselves - result from the new scale that is introduced into our affairs by each extension of ourselves, or by any new technology.”

He also said, “Our conventional response to all media, namely that it is how they are used that counts, is the numb stance of the technological idiot. For the ‘content’ of a medium is like the juicy piece of meat carried by the burglar to distract the watchdog of the mind. The effect of the medium is made strong and intense just because it is given another medium as ‘content’. The content of a movie is a novel or a play or an opera. The effect of the movie form is not related to its program content. The ‘content’ of writing or print is speech, but the reader is almost entirely unaware either of print or speech.”

When digital media started to really emerge with the introduction of the browser in the mid-1990s, it naturally incorporated many previous forms media.  But bandwidth, computing power and storage were still scarce and expensive.  A lot has changed since Netscape came along.

We have arrived at a point in history where the effect of IAM has been made the strongest and most intense form of media we experience because it has been given all other media as its content. The movie, the play, the opera, the newspaper, the television, the radio, commercial music, print and photographs, even the brand (a broadcast concept), have all been given over to the Individual to be reincarnated as the YouTube video, the prosumer indie, the blog, the blog comment, the forum, the Tweet, the IM chat, rating & review, the Flickr album, the podcast, the viral email and the mashup.

Real world social networks (and social network applications like email and MySpace that facilitate) are the infrastructure of these new forms of media that emit from the Individual.

SCVA argues that the effect is a new scale of social capital that marks a point of inflection for business and it is this new scaled-up version of social capital that SCVA is determined to highlight the value of.

Whereas, the network infrastructure to shape shared perception could be rented with great flexibility in the broadcast era (i.e. the 30 second spot), access to social networks is a function of social capital.

This new scale social capital is a critical corporate asset.

I spent the first half of the e-book illustrating how these entirely new scales of social capital are evidenced by new scales of the intrinsic elements of social capital which are individual assets (remember, the corporation is a form of individual).  These include: information flow, exertion of influence, certifications of social credentials and reinforcement of identity and recognition.  These are observations that are consistent with Nan Lin’s network theory of social capital, whose approach enables us to link the thinking to social network analysis and economics.

Technologies have evolved and mapped so tightly to the way humans transact, form relationships and create self-identity that it is time for business management to adopt the thinking of leaders in social network theory, such as the University of Chicago’s Ronald Burt.

Like it or not, the shift from broadcast media to IAM has implications throughout the corporate ecosystem.

Almost all of the changes highlighted in the illustration above have occurred exponentially, which is why we experience them as a sudden shift.  The “more of the same”, “everything that changes, stays the same” mentality will not derive competitive advantage from change like this.  It may not even survive change like this.

Does it not seem natural? Project and scale up the power of the individual, and that value of human connection of which we are all so instinctively aware, emerges in amplified forms as well.

In addition to the new scales of intrinsic social capital elements examined in the e-book, I would like to study further the extrinsic variables of social capital that aggregate into collective assets such as trust and network structure.  I am sure that there is similar evidence of new scale that would shed more light on social capital formation, access and use.

As I sort through the after math of SoCap08, I think that you might want to check out this post entitled, The Silver Lining in the Market Collapse: Social Capital.  It seems that the theme that Jonathan Salem Baskin & I were trying to highlight last week with our co-authored, co-posted piece entitled Looking for Leadership? Invest in your Networks? was resonating at the conference.

In short, this time of crisis in confidence is a time when business leaders are looking for answers.  It is a time of opportunity for advancing social capital thinking that so many of us are dedicated to.

I am picking up that most felt that the conference captured a gritty optimism, as signaled by the attendance of more than 600 to a first time event that was planning for 300.  While it is clear that Katherine Fulton’s presentation on the state of social capital markets was well received, I am wondering if the observation that social capital markets are at a very early stage of uncoordinated innovation was out of step with the enthusiasm of the conference?

In particular, I am wondering if there was sub-context at the conference about the forces driving a revolutionary rise in social capital that is breaking down the silos between value based management (i.e. the quest to manage sources of stable future earnings, over and above the cost of capital), social capital and social network analysis.

While there were discussions about breaking down silos, I am not picking up any thread extending Nan Lin’s network theory of social capital, that is so useful in connecting social capital to market thinking IMHO.  The money quote from Nan Lin … “social capital, as a concept, is rooted in social networks and social relations, and must be measured relative to its root . Therefore, social capital can be defined as resources embedded in a social structure which are accessed and/or mobilized in purposive actions .”  A merger between individuals, social networks and media has taken place.

In short, since broadband internet connections became more prevalent than dial up in 2004, the dominant media paradigm is shifting away from broadcast towards the Individual as Medium.  Increasingly perception and therefore stable future earnings emanate from IAM instead of broadcast or offline word of mouth networks.  Whereas time on broadcast networks can be easily rented with financial capital (i.e. the 30 second television or radio spot), access to social media networks will only be granted through social capital.

This means that managing these scaled up forms of social capital is at the heart of every enterprise right now.  Not two or three stages of maturity in social capital markets from now.

Were you at SoCap08?

Am I picking up on a missing thread to the conference?  Can you help me elaborate this?  This blog post is unfinished without the input of the organizers and attendees ….

UPDATE: Here is a great overview of the SoCap08 conference from SocialFinance.ca.

Here is the blog round up from Social Capital Markets Blog that I referred to:

• Securitizing Philanthropy, by Sean Stannard-Stockton
• We Are Jealous of Microfinance, by Francisco Noguera
• Pathological Collaboration, by Mark Beckford
• Plenary Tuesday Morning, by Lucy Bernholtz
• Day Two, from the Skoll Foundation blog
• Civil Capital Markets: Mike Lee on Riches and Meaning, by Haugelvin
• A Trade Association for Social Enterprises?, by Travis of the Great Bay Foundation
• Investing in Social Entrepreneurs, from the App Africa blog
• Notes, from the App Africa blog
• The silver lining in the market collapse: social capital, from the ecofrenzy blog
• Africa at the “unconference”, by Nathaniel Whittemore
• The future of social capital markets is, by Kim Wilson
• Charlene Chen on “Innovative Ways to Invest”, by Francisco Noguero
• Two Bucket Thinking - Two Bucket Standards?, by Rob Katz
• Roxanne Miller on New African Capital, by Francisco Noguera
• Conference Highlights, by Dr. Cindy Gordon
• Cindy Chen on Breaking Silos, by Rob Katz
• New Wealth Management, by Nathaniel Whittemore
• In the Hallways, the Beginnings of a Marketplace, by Sue Yun Chi
• Foreclosures, falling economies, and the Future of Philanthrpoy, by Lucy Bernholtz

A dog has been set loose in your boardroom to bark at you about how business management has changed since 2004.  The story of how it got there is a great little case study in how valuable ideas move from inception anywhere in the world to you in the networked age.

It started with a need and a Google search.

After slugging it out in the social media startup world for years, I was ready for a glass of wine.  So we packed up the family and headed to Paris.  I looked at my MBA program there as an opportunity to put to rest a nagging set of ideas about Web 2.0.  The way in which business value is created and defended has fundamentally changed, but most of the “conversation” about social media is not designed for investors and “C” level corporate management.  From an academic perspective, I was a relative amateur.

Enter a few Google searches …

I discovered a local conference on Social Networks.  Then found myself in a room of about 10 top social network theorists.  I was waaaaay out of my league, but fortunately I was able to connect with Olav Sorenson and Matt Jackson.

Olav took the time to direct my reading.  Google helped me discover additional key pieces.  Matt was encouraging and challenging.  When I finished the paper, I sent it to almost everyone whose work I had read during the formulation, looking for credible feedback.

I received encouraging notes back.  One from Al Ries, co-author of Positioning, which is a book most consider to be a marketing bible.  Top blogger Matt Ingram said the work was “valuable.”  Then Seth Godin, author of the world’s most popular marketing blog and the best selling business books over the last decade, suggested that I submit the idea to www.changethis.com, a Digg-like site for ideas that he co-founded (but no longer runs).

The editorial board at ChangeThis selected the proposal and that is when its fate moved from the hands of a few key “influentials” into the “wild.”

To be published by ChangeThis, the idea had to compete against about a dozen others and be voted to the top.  Social Capital Value Add did not become the 8th most demanded proposal in ChangeThis history because I am a famous author.  I asked my friends and colleagues to support it.  Social capital went to work.  Through a combination of support from close connections and blog entries from looser links,  the idea gets a blast to 20,000 people who care about this sort of thing as part of the 50th issue of ChangeThis (along with the great ideas of John Kotter, Seth Godin, Andrew Abela, Vince Poscente and Jonathan Baskin).

At some point along the way, the momentum has changed.  I started out trying to take this idea as far as I could.  Now I am trying to keep up with it for as long as I can.

My search has changed how information flows around me.  After months of trying to find information, information finds me through connections far and wide. Four people on three different continents alerted me to Mike Arrington’s related post.  I have wandered or been invited into online groups like Seth’s “Triiibes” where Adam Helweh and dozens of others have instantly offered their help just as quick as I can ask.

Paul Wilmott has invited me to write something to introduce SCVA in his small but influential magazine that serves the quantitative finance community and I have connected with the right folks at Dell and Procter & Gamble about reporting on how the principals in SCVA are showing up in their businesses.  I am not sure how these initiatives are going to work out yet, but they are encouraging.

UPDATE: In February 2009, SCVA was selected as a finalist among almost 400 “game changing” ideas from 48 countries in the WeMedia/Ashoka Power of Us: Reimagine Media co-petition.

Social Capital Value Add (SCVA) is an idea that started in the social media startup trenches and was connected by a Google search to experts and influentials.  Wrapped up in a Wizard of Oz metaphor and signaled by a nameless dog, SCVA is powered by the social capital of a few concerned groups and now it has made its way to you from a trusted source.  It is a management and valuation approach that has been developed as a framework to help companies understand and track the impact that communications technology is having on their ability to create and defend value.  Woof, woof.

UPDATE: The SCVA ChangeThis manifesto has been released:

http://www.changethis.com/50.05.SocialCapital