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?