We have moved …

I’ve moved this blog over to self-hosted wp site … I hope you check us out at http://www.socialcapitalvalueadd.com.

The eBook is available there too.

thank you!

Michael

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“Introducing Social Capital Value Add” is 8th most demanded proposal in ChangeThis history

Thank you to everyone who voted for the “Introducing Social Capital Value Add” proposal at www.changethis.com and to the conference organisers, twemes, friends and connections who tolerated many appeals over the last month.

“Introducing Social Capital Value Add” topped the list for the month with 380 votes.  That is almost 200 more than the second place idea and it is the 8th most demanded manifesto proposal in ChangeThis history.

If everything goes well, the “Introducing Social Capital Value Add” ChangeThis manifesto should be released to over 20,0000 “influencers” in September.  Sign up to the SCVA email list or grab this blog’s RSS feed to help develop SCVA thinking and get a copy of the manifesto upon release.

I had more than one person tell me that voting for the proposal felt a lot like voting in a national election, “I don’t really know what I am voting for, but I am voting because <insert name> told me to.” 

Anywhoo, I am grateful for the support.  It ain’t like winning America Idol er somethin’, eh, so I don’t want to come off as makin’ too much fuss about this, but to be honest it does mean a lot to me.  From the moment I headed off to Paris last summer I have been dedicated to taking this idea as far as I can.  Now I am working to follow this idea as far as I can.

I am developing SCVA case studies with publicly traded corporations.  If your company or client is interested in collaborating on this please get in touch.

The fact that many of the votes came through personal connections is a very pure illustration of the value of social capital. 

At the same time, getting to the right metrics to measure social media and social network valuation are very hot topics right now.  Technology’s most influential blogger, Mike Arrington, made a post over at TechCrunch a few days ago entitled, “Modelling the Real Market Value of Social Networks” and has received over 160 comments.  There are hundreds of messages flying around on these topics in the list serves and forums that I visit and at least part of the support for my proposal may evolve out of a need for corporations to get a handle on the risks to earnings associated with social media and a general desire to make the corporate form more socially motivated.

So we shall see where this all goes …

Again, I hope that I am not coming across as making too much of all of this.  If you want to do something really meaningful please hit this link and click up a few votes on the Harvard Business Review List of Breakthrough Ideas for 2008 in support of “Sick Transit Gloria”.  Mark Kuznicki, Eli Singer, and Jay Goldman have evangelized the “camp” approach to collaboration that started here in Toronto.  You can read more about that here.  It is working to improve the transit experience in Toronto and can be applied to any challenge.
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Mark Zuckerburg: looting block party or catering service?

Nic Hodges has a thoughtful post up down under.  Thanks to John Maloney for flagging it.  Nic says,

“If Mark Zuckerberg turned up to your neighbourhood and started throwing you crazy block parties, while at the same time mining your backyard for gold, wouldn’t you want a cut of that gold?”

I agree with and have explored many of the same concepts Nic touches upon in his post. 

I agree that social networks are not owned.  But social network software services like Facebook are privately owned so there is a transaction: service for terms of service.  A problem can emerge when companies like Google and Facebook and others are becoming so entrenched in social networks and our old watchdogs like government and journalists are not motivated or equipped to help us bring the implications into focus.

I believe that the most important thing that we can do to cope with these potential problems is to establish the link between social capital and corporate valuation, to motivate corporate competition, bring into light the true sources of value and make them accountable to investors, markets and users/consumers.  Then the regulators and press gallery will be all over it.

Social networks can not be owned.  Agreed.  That is why I think it is very useful to distinguish social capital from social networks.  I think social capital, i.e. the resources that are embedded in social networks are intrinsicly individual assets.  (Note: the corporation is a form of individual).

By investing in a connection with you, I get flow of information, the exertion of influence, certifications of individual social credentials and reinforcement of individual identity and recognition.  Hey! Smells like social media to me.  That is why I think of social media as a new, scaled up form of social capital that has emerged since 2004 when broadband overtook slow connectivity in the USA.

Aggregation of individual returns result in collective assets and properties such as trust, norms, reputation, authority, sanctions, culture, network structure (open, closed, density, clustering, diameter, average path lengths, degree distribution, bridges, weak ties, betweenness and other forms of centrality, etc.) and location (structural holes, structural constraints, etc.), which are extrinsic variables that contribute to the formation, access and use of social capital. 

This is the stuff that we need to zero in on developing, measuring and valuing at this point – not just page views, unique visitors, CPMs which are all broadcast paradigm metrics.

P.S. I love Michael’s comment over on Nic’s post, “We are all becoming Paris Hilton”. 

Check out Lin, Nan, “Building a Network Theory of Social Capital” ©1999 INSA, Connections 22(1):28-51, see pp.28-31 for compact history of social capital.
 
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Web 2.0 Swan Song?

If you are reading this post you likely already understand that social media is “game changing”. The challenge ahead is to make this case to seasoned decision makers in boardrooms globally.

Perhaps it is because I watched as the public relations profession worked over the last 20 years to attempt to tune the corporation into being more socially motivated. Perhaps it is the lingering fear of the first Internet bubble. But every time I read a blog post about what is better Twitter or Plurk or see a debate raging about whether one has to be a blogger to “get” social media, I hear Johnny Depp as Hunter S. Thompson and this song in my head (sorry – not every time and minus the first 51 seconds, heh, heh).

I don’t want this second wave of the internet coming to crest before crashing through the boardroom door. The prospect of changing the dialog about Web 2.0 and social media is what prompted me to start down the the path of writing “Introducing Social Capital Value Add” last May.

SCVA is a management method rooted in accepted financial theory that connects the pioneering intellectual enterprises of social capital and social network analysis to value based management and the priorities of marketers. SCVA proposes that we establish the link between social media and corporate valuation, in a way similar to the connection made between brand and corporate value in the late 1980s.

Investors and managers need to access the risks to future earnings and stock value associated with social media. When we evangelize Web 2.0 and social media in these terms … risk, future earnings and stock value … the focus will change from saving a few thousand dollars on a web campaign and the quest for that elusive viral story. This is the opportunity to stress the commitment, investment and special management methods required to develop the social capital that underwrites long term success in the networked age.

Over the last month many people have joined in to support the idea of “Introducing Social Capital Value Add” at www.changethis.com/proposals. Thank you very much. It is not over yet. Voting closes sometime, probably end of day, June 19th. It might not come together tomorrow.

The odds are against this prospect of changing the dialog. I must admit though, the process of engaging as many people as I can about these issues and the response has been inspiring.

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Pubcamp – Help ChangeThis

Welcome if you are an attendee or organiser of Pubcamp. 

This is a simple call to action. 

“One the key points in the history of brand management was the whole “Barbarians at the Gate” period, when the link between brand value and corporate valuations was established, touching off a wave of corporate deal making. Deals like Nabisco and Kraft commanded the headlines but the main outcome was the broad realization in global boardrooms that brands are a top priority. They require commitment, investment and special management methods.” – from the Canadian Marketing Association blog, Friday, June 13, 2008.

It is time to link social capital to corporate valuation. Social Capital Value Add is a management method designed to connect the pioneering intellectual enterprises of social capital and social network analysis to value based management and priorities of marketers.

It is designed to help that teenager you are all talking about speak the grown up language of the corporate boardroom.

You can help usher in SCVA by supporting it at www.changethis.com/proposals (voting ends in 24 hours).

Thank You Canadian Marketing Association

A post went up today on the Canadian Marketing Association blog covering ChangeThis and making an appeal in favour of “Introducing Social Capital Value Add“.

Thank you to Jennifer Morozowich and to CMA for your support.

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MESH, UnMESH – the danger of social capital

I guess a little grass is good. It gets you thinking. As I was out in my yard mowing the lawn, digging up the flower beds, planting … the Florida, the MESH, the bonding and bridging social capital … it came together for me in a moment.  Shall we see if I can piece it together for you again in this post?

A couple of weeks ago I attended Canada’s biggest Web conference, MESH08 at the MaRs Discovery Centre in Toronto. Thanks to Mark, Rob, Michael, Stuart and Matt. It was a great event!

Coincidently, I bumped into Richard Florida while he was walking into his office at MaRs, KD Paine & Joe Thornley were leading the social media measurement meme during the week and I received word from ChangeThis.com that their editorial board has selected my idea to link social media to corporate valuation (vote here till June 19th).

Between Third Tuesday & MESH, I bumped into a lot of people.  I appreciated the chats with David Crow, Jonas Brandon, Scott Pelton, Michael O’Connor Clarke (ain’t he the best!), Jeremy Wright and Duncan Hill.  And as usual, I really enjoyed savouring new connections.  Reconciling Dragon’s Den, Sean Wise, Will Pate and VenCorps as consistent was fun.  David Jones & I connected through our ‘hood.  I am worried. Tamara Kremer might be more fun than me and Collin Douma has already taken the “Johnny Cash of social media” spot.  Networking on the patio through tech star Amber MacArthur to stir up the attentions of Mark Kuznicki was memorable.  Learning more about Radian 6 was key and of course, my personal favourite random media effect … the Mike Kelly, Mike Cayley human alliteration (heh, heh – his blog is entitled “strangely entangled”).

If you have not quite caught it yet … the subject of this post is links.  Helpful, influential, supportive links.  Links that must be invested in, over time, with contribution, sharing and commitment.  Or in other words, the resources that are embedded in social connections known as social capital.

As I reflect on MESH08, I keep thinking of a Harvard Business Review article entitled “When Social Capital Stifles Innovation” co-authored by Richard Florida, Robert Cushing and Gary Gates.

Once again, I want to commend “the MESH guys” on their effort to create the premier web conference in Canada.  My wondering about “the state of the nation” in terms of the Toronto scene and innovation in Canada in general is a testimony to their success. 

So here goes the wondering bit:  Is it impossible to create an innovation led culture and economy when our baby boomer bubble is so pronounced, we underfund startups, the venture capital market is shallow, small populations, small markets and a “branch-plant” mentality of scarcity breeds local hypercompetition?

I don’t think so, but Florida, Cushing and Gates serve a cautionary note.  “Relationships can get so strong that the community becomes complacent and insulated from outside information and challenges. Strong ties can also promote the sort of conformity that undermines innovation. Weak ties, on the other hand, allow a basic level of information sharing and collaboration while permitting newcomers with different ideas to be accepted quickly into the social network. Thus, social groups with weak ties could be expected to encourage innovative thinking.”

I don’t think Toronto (or Canada) is yet taking full advantage of our diversity, but I am hopeful that we are moving in the right direction.  Events like MESH08 and Third Tuesday help (on a different front) by connecting our tightly bound community through weak links to people like Marshall Sponder, Natalie Johnson (Shel says she gets it), Rohit Bhargava and David Gratton (great moderator!).  Panelists – you must really feel like “the new kid in town” when everyone rushes you at the end of your session.

At some level, perhaps the point is – who cares?  Once you understand the Gladwell/Wattsinfluencers-shminfluencers” thing,  but that is a whole other post. 

Brian Uzzi has found that striking a balance between bonding and bridging social capital is the best formula. So perhaps a couple of ideas that may be useful for any community that wants to steer clear of the dark side of social capital …

When a peer tries to innovate, makes a major move, attempts to reinvent an industry, risks financial and social capital and personal ego, a tightly bound social network can either help their fellow lobster out of the pot, or drag them back into the boiling cauldron.  A mentality of false scarcity and local hypercompetition can breed indifference or satifice driven criticism.  On the other hand, mobilizing in support of efforts to build global success stories enriches the home town crowd over the long term, digg it!?.  I am not suggesting a free pass, just a healthy awareness of the pros and cons of a tight social network and enlightened self interest when it comes to the weak links that are so valuable.

Wrt MESH specifically, maybe somehow broadcasting the twitter tweme on public monitors or projecting it can open up the amazing (but exclusive) dynamics of the back channel or the video shot during the conference could be played in the common area to create some feedback loops.

And perhaps there are some ways to bring in even more value packed outsiders into the conference? 

Music, advocacy, Club Penguin, StumbleUpon, Social Media and the Enterprise – I think that the content already meets the new standards for meetings and conferences that make them worth travelling for.  May be some strategies ontop of that great content like:

–  giving each panelist 5 free tickets and asking them to bring a posse of out of towners,

– coordinating twemes and a skype swarm with a sister conference, or, (UPDATE: Here is an example of someone getting going with that sister conference idea mentioned above: http://www.futureexploration.net/fom08/)

– raising the price to $1200 per person but including free air fare (airfair?) scholarships from anyplace in the world.

Just a few half baked thoughts.

Oh, and Jacquelyn, thank you! I don’t take links lightly and I really appreciate this one.

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