We Need to Completely Rethink How Business Operates Using Social Media

On March 10, 2010, In The Book, By Tac Anderson

Writing a bookI’ve mentioned the book I’ve been working on. I’ve actually made considerable headway on the weekends (except I can’t come up with a good title to save my life) and thought I’d share my current working summary. I’d love to hear your feedback.

I am looking for examples where social technologies have been used by companies to build trust, retain  knowledge, foster collaboration and spur innovation. If you or your company have any good examples please leave me a comment or shoot me an email: tac@newcommbiz.com

Social Media has brought about a groundswell of change that has swept the business world up in its wake. Antiquated processes, organizational structures and technologies  have kept companies from staying tuned in and engaged with customers and employees, to say nothing about keeping up with smaller, nimbler competitors.

No one can dispute that the Internet has radically reinvented the financial drivers and restraints of  traditional business models. It has lowered almost every barrier to entry in almost every industry. What the Internet has done to business models, the technologies behind social media are doing to the rest of business.

For the first time since the universal adoption of the org chart and the inbox (the physical not the digital one) we have the opportunity to fundamentally rethink how a business is run and what the various stakeholders of a company are and do. Customers don’t just buy products, they are helping companies ideate, design, develop and then sell products. Partnerships between two companies in a supply chain are no longer one dimensional relationships. Partners can also be competitors, customers and shareholders. In the very near future the way we recruit, retain and manage employees today will seem medieval.

The social media revolution is on the verge of creating truly social businesses. This change is being driven by the forces of: Trust, Knowledge, Collaboration & Innovation. These forces have become so important that have become there own form of capital. And like monetary capital they follow the same laws of capitalism and the free market. Until now companies have tried to govern these new forms of capital like a controlled market when what is needed now is a free market approach. Like in a free market, the rights of the owners must be protected but the free trade of capital must not be restricted.

The truly social business will be fully realized when social technologies are leveraged to build collaborative relationships across all company stakeholders.  By leveraging social technologies in an open and transparent way businesses will regain and build more trust among stakeholders. This increased trust is a necessity to creating greater shared knowledge, which the same social technologies have the ability to capture, organize and distribute at a yet to be seen level of efficiency. By building collaborative relationships with all company stakeholders using social technologies, businesses will be able to quickly create and capitalize more innovation.

No business has fully achieved this seemingly radical state but many early revolutionaries have developed pockets of deep expertise and experience. While many companies and their employees believe that the lack of adoption of these new technologies is hindering this quintessential state, the fundamental barriers are the outdated structures and process that have existed inside corporations since before the Internet. It’s time to stamp out the last bastions of resistance and remove those barriers and get out of our own way.

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Innovation and Disruption, What’s Holding You Back?

On March 7, 2010, In Biz, By Tac Anderson

I have stated before that, while I don’t know the guy and have never met him, Marc Andreessen is probably the entrepreneur of my generation that I most admire.

Today I came across a post on TechCrunch where Marc is quoted as saying that Old Media needs to burn the boats. I love this type of bold strategies. When Cortes came to Mexico he burnt the boats so they had no choice but to conquer, Marc says media companies need to do the same thing. The post is short and well worth your read but here’s my favorite quotes.

We got to talking about how media companies are handling the digital disruption of the Internet when he brought up the Cortes analogy. “You gotta burn the boats,” he told me, “you gotta commit.” His point is that if traditional media companies don’t burn their own boats, somebody else will.

Everyone knows this true (even if they don’t admit it). At some point physical media will be too cost prohibitive to create at the mass market level. Print will be the new vinyl.

Andreessen asked me if TechCrunch is working on an iPad app or planning on putting up a paywall. I gave him a blank stare. He laughed and noted that none of the newer Web publications (he’s an investor in the Business Insider) are either. “”All the new companies are not spending a nanosecond on the iPad or thinking of ways to charge for content. The older companies, that is all they are thinking about.”

And finally the part that will end any business discussion with any old media CEO:

Print newspapers and magazines will never get there, he argues, until they burn the boats and shut down their print operations. Yes, there are still a lot of people and money in those boats—billions of dollars in revenue in some cases. “At risk is 80% of revenues and headcount,” Andreessen acknowledges, “but shift happens.” You’d have to be crazy to burn the boats. Crazy like Cortes.

Radical strategies like this either get you excited or terrify you (or both).  Could you imagine the NYT or WSJ stopping all print publications and going digital only? Wow, that would be amazing. Lay off everyone connected to print and forge ahead. It won’t happen for years, maybe decades. Maybe they’ll always keep some niche print production, but eventually most printed papers will go away.

But it’s easy for us to criticize the media for not being willing to let go, but what about your business?  Every business has boats they’re holding on to. And it’s usually the part of their business that’s stopping them from being truly innovative. That’s the part of the business the startups love to attack.

In my world, agencies continue to submit to hourly billing even though it’s a pain, unproductive and not conducive to providing the best work. Marketers refuse to give up on the CPM advertising metric (cost per thousand rate advertisers charge). It’s broken and doesn’t prove any type of business ROI. These are two boats I would volunteer to ignite myself.

What are your business boats? What would be the hardest thing to give up?

Photo credit via very little dave

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Never chase a market leader. Instead start a new race.

On January 25, 2010, In Biz, By Tac Anderson

Ignore the rumors and stop chasing Apple. Forbes has a good post on innovation. The irony is that the minute you say we want to innovate like Apple, you are no longer innovating. You’re iterating.

Innovation Beyond Apple – Forbes.com

When it comes to innovation, many executives in the consumer goods industry are chasing Apple. Who can blame them? While most retailers spent the holiday season slashing prices, Apple reported record earnings by enchanting audiences with iPhones. Now, as retailers try to re-engage consumers this year, executives are trying to replicate the “Apple thrill.”

But focusing exclusively on product innovation is a mistake for most companies, say executives who gathered recently at Berglass + Associates, my company, to discuss innovation. The attendees included Richard Dickson, general manager, Barbie, and a senior vice president at Mattel ( MAT – news – people ); Melisse Shaban, CEO of Chrysalis, an incubator company for emerging brands; and Bill Brand, executive vice president of programming, marketing and business development at HSN.

Sounds much like my advice I included in two posts: Chase your Customers not Your Competition

Now that we’ve moved past The Tipping Point it’s time for everyone else to play catch up. Everyone else will want to replicate the successes other companies – and in many cases their competitors – have had. The problem is that most of these new efforts will be based on 2009 examples.

2010 is a different world than 2009.  Most companies that try to play catch up this year will be playing catch up to the wrong people. They’ll be playing catch up to their competition.

While my advice was geared towards social media use it’s perfectly applicable to any strategic decision. Never chase a market leader. Instead start a new race.

But if you really want an Apple love fest, I suggest heading over to Louis Gray and Chris Saad’s EdgeTheory Podcast (?)

louisgray.com: EdgeTheory: Apple’s Closed Approach in an Open World

In advance of all the fun and fury that will be sent Apple’s way this week, as many are expecting new hardware from Cupertino on Wednesday, EdgeTheory conversationalist Chris Saad and I talked about how Apple can be so successful with its closed, proprietary, approach when we tend to promote and hope for openness from companies we do business with on the Web.

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That’s a Stupid Idea.

On August 31, 2009, In Comm, By Tac Anderson
Social Media and Quantum Chaos?
Image by Tac Anderson via Flickr

When pushing the envelope sometimes you and the people you work with say really stupid things and come up with really stupid ideas. It’s ok to say, “That’s a stupid idea”.

  • When was the last time you said that?
  • When’s the last time you said that and the other person didn’t get offended?
  • When was the last time said that to you?
  • When was the last time you said that and were wrong? And then admitted you were wrong?

I’ve done all of that. I just wish more people did the last. I try and do all of the above more often.

If you’re not falling, you’re not trying hard enough.

Whenever I’d come home with a new injury from biking, skiing, being a stupid teenager, my mom would tell me that if I wasn’t falling down I wasn’t trying hard enough.

I plan on falling down a lot more.

You’re going to see more blog posts from me (some starting tomorrow) that you may think are really stupid ideas. Please tell me so. Don’t be afraid to disagree with me or anyone else.

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What is America the best in the World at?

On July 15, 2009, In Biz, By Tac Anderson
WASHINGTON - SEPTEMBER 29: U.S. President Geo...
Image by Getty Images via Daylife

What is America the best in the World at? Innovation? Michael Mandel and my recent cab driver don’t think so.

My knee jerk reaction to this article is to think the author is an idiot that doesn’t know what he’s talking about. But I’ve learned over the years that when I have such a knee jerk reaction to stop and address my own biases because they could lead me to miss something important.

The Failed Promise of Innovation in the U.S. – BusinessWeek
“We live in an era of rapid innovation.” I’m sure you’ve heard that phrase, or some variant, over and over again. The evidence appears to be all around us: Google, Facebook, Twitter, smartphones, flat-screen televisions, the Internet itself.

But what if the conventional wisdom is wrong? What if outside of a few high-profile areas, the past decade has seen far too few commercial

innovations that can transform lives and move the economy forward? What if, rather than being an era of rapid innovation, this has been an era of innovation interrupted? And if that’s true, is there any reason to expect the next decade to be any better?

On a recent cab ride I was talking with the driver who recently moved here from India, got married and bought a house. The American dream right?

As we were talked about how the global economy would recover it became obvious that he believed the US was the key to recovery. I want to believe that but I think if we don’t do it someone else will.

He then shared with me the key to his economic recovery plan.

“Do you know what America is the best in the World at?”

Innovation of course. Right? I didn’t get a chance to answer as my driver plowed ahead.

“Spending. When Americans start buying everyone does better.”

Wow. That’s sad. If that’s the case I kind of hope we never recover.

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If Chris Anderson Can’t Reinvent the Publishing World, Who Can?

On May 25, 2009, In Biz, By Tac Anderson
Wired cover July 2001
Image by Tac Anderson via Flickr

If Chris Anderson Can’t Reinvent the Publishing World, Who Can?

This post originally ran on the Studio D blog last week.

Wired Struggles to Find Niche in Magazine World – NYTimes.com

Even as Chris Anderson makes a boatload of money of his ideas, subsequent books and high dollar speaking engagement, Wired (his editorial charge), is one of the biggest losers in the ad game.

I think Chris’s ideas are spot on. He’s a brilliant guy with some serious thought leadership. Wired is a great publication, both the Online and the print versions but can he translate great content and thought leadership into a real business for Wired? If Chris can’t then who can?

This really only leads me to two rationale explanations:

  1. Chris is to caught up in his own celebrity.
  2. Chris is hamstrung by parent company Conde Nast to implement any of that great thinking.

The third possibility is that we have yet to see Chris’ master plan in action. I’m hoping for number three. Wired and the whole publishing world (Online and print) need some innovation.

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The only thing you should be doing

On April 28, 2009, In Biz, By Tac Anderson

I originally wrote this post several months ago and it’s taken me this long to remove the excess emotion and get it to a point I thought it was ready to post. I still don’t know if it’s ready but I feel it needs to be said.

The only thing you should be doing

I don’t care if you hate your job! I don’t care if you lost your job!

I don’t care if the stock market drops to 60! (Probably should but I don’t)

I really don’t care what some reporter thinks of the market. (I quit watching the news)

I only care about what YOU & I are going to do about it! (Because let me tell you a secret, we are the only ones that can fix this mess.)

The only thing you can do is shut up and innovate. If whining about it makes you feel better then fine. Whine, but keep it to yourself and when you’re done get back to innovating.

Your new job is to innovate in *every* aspect of your life. Don’t do things better (because the things we’ve been doing don’t work anymore) do them differently.

Unemployed? Innovate in your desired field and create a company that employs others.

Still employed? Don’t put your head down and do your job better because better isn’t enough.

Don’t wait for your boss to give you permission. Innovate now!

Don’t wait for the budget (there is none). Innovation is free.

Have the next great idea but don’t have the time? Innovate around time management.

Have the next great idea but don’t have the money? Innovate how to do it with little/no money. (You don’t even have to innovate there lots of people have done it before.)

If at any point you read something in this post that made you think about how this didn’t apply to you or because you have some special circumstance, you can’t be innovative, start over from the top and read it slower this time.

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Twitter: the last bastion of Web 2.0 Innovation

On February 19, 2009, In Comm, By Tac Anderson
Image representing Twitter as depicted in Crun...
Image via CrunchBase

“Why won’t people shut up about Twitter?”

I’ve heard this question a lot over the last 2 years. I’ve even said it a time or two. So why do we obsess about Twitter?

Remember the good old days (3-4 yrs ago)? Before Social Media it was just New Media (Chris Garrett’s still holding on to that one). Then EVERYTHING was 2.0. Remember last year, or even two years ago, when everyday TechCrunch or ReadWriteWeb would write about 10 new cool startups or Web apps that really made you stop in amazement or got you excited about the space? It was Nirvana for those of us with Shiny Object-Syndrome.

Better Faster Monetizable

Now most of the stuff we see is itterative innovation on what someone else did 2+ years ago (how many buzz monitoring tools do we need?). People are making things better, with better UI and faster. It’s the old better-faster-cheaper scenario, except they can’t do cheaper because it’s all already free. I guess now it’s Better Faster Monetizable.

The 3 things that still get people talking daily are Facebook, the iPhone and Twitter. Why? 3rd party apps. Facebook less so these days and even the iPhone is loosing some buzz, but Twitter app buzz is still going strong and we’re just getting started. I think Facebook and the iPhone are loosing steam because how exciting is throwing sheep and iFarting? Temporarily amusing, yes but there’s no business advantage to be had there.

When will it end?

People are just now starting to realize the power of Twitter (honestly I don’t think anyone, including the founders have totally realized this). But with each new Twitter app that comes out we start to see a glimpse into the ecosystem that will someday be realized. Whether you believe Twitter will be the next Ma’ Bell or not there is no denying now that the Twitterverse will be huge.

Don’t get me wrong there are still some other cool products/apps out there: FriendFeed is the what Twitter was 2 years ago, Zemanta continues to amaze me every week and I’m sure we’ll see more in the months/years to come. But right here, right now and for at least the rest of 09 Twitter is the Prom Queen.  You’ll notice that my reference to Twitter has graduated from the crazy girlfriend to the Prom Queen (not mutually exclusive BTW).

Right now Twitter doesn’t have a business model. In fact they are quick to dispell rumors that they are even working on one. Right now it’s all about what’s possible. And NOTHING get’s innovators going like possibilities without thought of monetization.

And honestly, while I’m all about business models, it’s still fun to not think about that and just marvel at how cool something is.

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Creative Interactions Lead to More Innovation.

On December 22, 2008, In The Book, By Tac Anderson

A personification of innovation as represented...Image via WikipediaThere isn’t a CEO alive who doesn’t think more innovation is a good thing and something that their organization needs more of it. The problem is, no one’s really sure how to maximize it in a cost effective manner.

We all have vague notions of where it comes from and there is no shortage of research on this very topic. I’ve spent the last several years combing through the books and research and in a very general way I’d like to summarize what I think most of them are saying.

Increase creative interactions. The general consensus also seems to be that outside influences create better innovation than influences we are already well aware of.

Unlike my previous two capitalism metaphors innovation is not actually the capital. Innovation is the product that is purchased with the capital. The capital is creative interactions.

What do I mean by creative interactions? I believe it is the interactions that people have that pull them out of their current line of thinking and expose them to new possibilities. This can be interactions with people from other groups within the same company. It can be interactions with customers or employees at partnering businesses. It can also be (and more frequently is) interactions with new content.

Web 2.0 technologies enable all of these to happen more frequently and more rapidly.

Social networks like Facebook, allow people to interact with a variety of people they know on varying levels of familiarity. Twitter allows people to be exposed to conversations and often links to valuable content at a dizzying pace.  RSS and RSS aggregators allow people to subscribe to multiple magazines worth of content a day. Internal blogs and wiki’s allow people to explore what other groups and people are doing and how to learn from their mistakes and innovations. There are even a growing number of tools that enable co-innovation with customers.

Unfortunately, of the three areas I’ve talked about so far measuring the ROI of innovation investments is by far the most difficult. Coupled with the difficulty of measuring the value of creative interactions is the fear that many managers have that employees are just wasting time.

I sympathize with companies and the fear of unproductiveness, social media can be a huge time suck if you let it. But I also believe that the more dependant you are on a person to be innovative in their job, the more you have to trust them to manage their own time and the more of it you have to let them “waste”.

There is another argument for the ROI of social media and like most of my financial arguments, that I’ll get into in more detail later, is that of total cost, or Return On Total Investment (ROTI).

The simple answer to ROTI is that Web 2.0 *can be* cheap, even free.

You can deploy an open source tool or sign up for a social network for no increased cost and decide if it works without ever having to go through procurement (that in itself will speed up innovation at an exponential rate).

Web 2.0 tools and social media allows individuals to fail often and fail fast while others are deciding if something is a good idea. It also allows them to succeed where others have decided to abandon an idea because of uncertainty.

Creating more creative interactions will create more innovation. Nothing I’ve ever seen will create more creative interactions than social media. But like all innovation the value will never be realized unless their is a process in place to feed that innovation into action. This requires that all people involved in the process are familiar and comfortable with the new tools that exist.

The companies that will succeed tomorrow are the ones that enable interactions, create a process for tracking, vetting and realizing the innovations and then feed those learning’s back into the organization.

This post is part of my ongoing effort to blog the book I’ve been working on for too long before the end of the year. These are all rough first drafts that have not been edited or even proofread. Comments and patients are requested. You can follow the whole series through the category The Book

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The Key to Innovation is Failure

On May 2, 2007, In Biz, By Tac Anderson

“Fail Cheap, Fail Often”

In today’s exponentially competitive environment the key for a company’s survival is innovation. It doesn’t have to be the ground breaking innovation like the big tech companies strive for everyday. It’s the small daily innovations that cause that “aha” moment in each of us.

Innovation comes from creating friction within your organization. Not the kind of friction that leads to the Alpha Males in the room to jump up and down and bang their fists against the desk. It’s the kind of friction that comes from bringing people from different departments together to solve a pressing problem. It’s the kind of friction that comes from realizing that your organization is making the same mistake over and over again and partnering with a vendor to help stop the insanity.

With these types of innovation you are trying to do something that you as a company or even your industry hasn’t done before (if someone has it’s not innovation). For a new innovation there are no best practices. The best model is rapid trial and error. Similar to agile development, a company must rapidly prototype, test, fail, change, repeat.

“Fail Cheap, Fail Often”

The irony is that innovation requires multiple failures before you find the right solution. This flies in the face of Corporate America. New Media tools provide a perfect platform for this type of innovation. It has the ability to bring together a diverse group of people that may be geographically dispersed and because New Media tools are digital this allows for them to fail cheap.

Remember life before digital cameras? Remember how each picture had to be painstakingly agonized over, because it was permanent and expensive. Now with digital cameras you snap 4 or 5 pictures to see if one of them turned out. Online collaboration allows people to work out processes get lots of feedback and launch them on a small scale (think beta release). If it works go for a larger release and tweak it as you go.

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