Capitalism as a Metaphor

This post is being revised as a page – The Book: Social Media Trifecta
All posts related to this topic are filed under the category, The Book.

This is a thought I’ve been chewing on for a while. I often get a variation of the same question: “How do you monetize new media/Web 2.0?” or “How do you measure the ROI of new media/Web 2.0?”

Every business manager in America should ask this question. After all we are all (most likely) Capitalists. To answer the above question I’d like to expand your thinking about Capitalism.

Capitalism is the belief that the more freely you distribute capital the more capital is created.

While this isn’t the official definition of Capitalism, I have cleared it with several economic professors. It works for my analogy.

Now I would like you to think about a few variables as they relate to new media. I call these the “New Media Trifecta.”

Trust – New media is a great way to build trust with your stakeholders (however you wish to define them). One of the biggest objections I hear to using new media is one concerning trust. “How do we know customers won’t leave a bad comment?” “How do we know our employees won’t say the wrong thing?” These are issues of trust.

Ultimately if a company wants their customers and employees to trust them, they first have to demonstrate trust in their employees and customers.

Just like Capitalism, you have to spend capital to make capital.

Knowledge – Most companies interested in the uses of new media are considering it in conjunction with their knowledge workers: marketers, managers, engineers etc. So I believe it is safe to say that most companies would like to see better use of the knowledge inside of their company.

As one manager said to me, “I don’t care about what’s in their reports, I want to know how they came to their conclusions.”

That’s the real knowledge you want to share in your organization. How do you do that in today’s environment with employees scattered around the globe in various job functions? Once again new media can greatly assist this process.

It usually takes a cultural change to properly use these tools. It requires people to do a “brain dump” at the end of the day, or after a meeting. It requires people to take a short amount of time to become familiar with the tools.

What you are trying to do is create a learning organization. You want employees to freely share their knowledge with each other. Applying the Capitalism metaphor here; the more knowledge distributed around your organization the more knowledge is created.

Innovation/Collaboration – Finally in my third example; collaboration is the currency spent, innovation is the capital created.

I don’t want to delve into the vast array of research surrounding innovation, but I do want to pull out one common thread:

Increased collaboration will result in increased innovation.

The more you allow your employees to collaborate with co-workers in other departments, counter parts in partnering companies or even customers (gasp) the more innovation will be created in your organization.

How do you do this without taxing your existing knowledge workers time and resources? Web 2.0 technologies are cheap to deploy and allow for time shifted collaboration. Who says all collaboration has to happen face to face or at the same time? Setting up internal blogs, forums and wikis allow people to collaborate when it’s convenient for them.

So I’d like to turn around the ROI question now. How do you measure increased Trust, Knowledge and Innovation? Can it be measured in dollars? Should it be?

About Tac Anderson

Social media anthropologist. Communications strategist. Business model junkie. Chief blogger here at New Comm Biz.
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  • http://www.metageek.net Ryan Woodings

    Great post! The value of time-shifted (and easily searchable) collaboration is a huge boon to small and large companies alike. I seem to get stuck on implementation…. it seems that most web 2.0 tools are meant for public sharing and not for private sharing amongst a small group. For instance, internal blogs are great, but how do you protect the confidentiality and still allow for tools like Google Reader to pull the RSS feed from those internal blogs?

  • http://www.metageek.net Ryan Woodings

    Great post! The value of time-shifted (and easily searchable) collaboration is a huge boon to small and large companies alike. I seem to get stuck on implementation…. it seems that most web 2.0 tools are meant for public sharing and not for private sharing amongst a small group. For instance, internal blogs are great, but how do you protect the confidentiality and still allow for tools like Google Reader to pull the RSS feed from those internal blogs?

  • http://www.workingbizwords.com Peggy Jordan

    Great concept, Tac. The connection between collaboration and innovation is really key, and new media tools make a great means of sharing knowledge, building trust, and — dare I use this poor worn out word? — empowering people to collaborate and be creative. Thing is, it takes some training from gurus like you to use these tools for the maximum return. Maybe possible metrics for measuring ROI could be the level of participation, number of team members using the tools, number or entries and contributions, an increase in the number of new ideas/inventions being tried? More employees smiling more of the time?

  • http://www.workingbizwords.com Peggy Jordan

    Great concept, Tac. The connection between collaboration and innovation is really key, and new media tools make a great means of sharing knowledge, building trust, and — dare I use this poor worn out word? — empowering people to collaborate and be creative. Thing is, it takes some training from gurus like you to use these tools for the maximum return. Maybe possible metrics for measuring ROI could be the level of participation, number of team members using the tools, number or entries and contributions, an increase in the number of new ideas/inventions being tried? More employees smiling more of the time?

  • http://www.newcommbiz.com Tac

    Ryan there is no perfect fit for that. Hopefully Google makes some changes that allow Google Reader to become the enterprise aggregator of choice as well.

    Thanks Peggy. There are definitely things to measure, it’s just a matter if it’s the right measurements for the C suite.

  • http://www.newcommbiz.com Tac

    Ryan there is no perfect fit for that. Hopefully Google makes some changes that allow Google Reader to become the enterprise aggregator of choice as well.

    Thanks Peggy. There are definitely things to measure, it’s just a matter if it’s the right measurements for the C suite.

  • http://www.wbsonline.com Business Financing Guru

    Ryan- Web 2.0 small business tools ARE usually meant for public sharing but that doesn’t mean there aren’t tools out there that can’t do what you need them to. And yes, google does need to work on that…

  • http://www.wbsonline.com Business Financing Guru

    Ryan- Web 2.0 small business tools ARE usually meant for public sharing but that doesn’t mean there aren’t tools out there that can’t do what you need them to. And yes, google does need to work on that…

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