Cities get a new lease of life - Future of Business

Next month (June), “Monocle” magazine, the glossy chronicler of culture and design, will publish its latest annual “liveability index”. Ranking the world’s cities in this way has become a rather popular activity in recent years. Similar lists are produced by the management consultancy Mercer, the Economist Intelligence Unit and others. Largely, though, they cater for corporations looking to decide what they should pay in living and other allowances to personnel located around the world. As such, they tend to favour smaller cities that suit families. For example, the latest EIU list is topped by the same 10 cities as took the top spots the previous year (albeit with a couple of place swaps) and seven of the 10 are in Canada and Australia, countries where – as the report points out – population densities are well below those in much of the United States and Europe.

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The Seven Keys of Innovation Communities - An Employee Innovation Model - Wall Street Journal

Most great ideas for enhancing corporate growth and profits aren't discovered in the lab late at night, or in the isolation of the executive suite. They come from the people who daily fight the company's battles, who serve the customers, explore new markets and fend off the competition. In other words, the employees. Companies that have successfully made innovation part of their regular continuing strategy did so by harnessing the creative energies and the insights of their employees across functions and ranks. That's easy to say. But how, exactly, did they do it? One powerful answer, we found, is in what we like to call innovation communities.

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The Inauthentic Community of the Modern Executive - Roger Martin, Harvard Business Review

Marshall McLuhan famously said: "We shape our tools and thereafter our tools shape us." The same, I believe, holds for community. We shape our community by choosing which actors comprise it and what roles they play. And we want to be a valued member of that community, so we adhere to its norms and conventions — our happiness depends on it. For this reason, the community we choose is critically important. If it is a productive community, it will help make us better. If it is unproductive, it will quietly but surely make us worse. So it behooves us to explore the quality of the community of the modern business executive. As mentioned in my last post, customers, employees, home city and long-term shareholders loomed large in the typical community of the 1950s and 1960s. The intimacy of these communities was aided by the more manageable scale of the enterprises of the day. GM, the behemoth of 1960, pulled in revenues that would in today's dollars ($66 billion) put it behind Archer Daniels Midland, 2009's 27th placed company, way below number one Exxon Mobil with $442 billion. In fact, only ten companies in 1960 were bigger than regional power utility Pacific Gas and Electric (#176) in 2009.

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The Case for Customer Communities

You're probably familiar with the concept of Dunbar's number. The Wikipedia entry defines it as a theoretical cognitive limit to the number of people with whom one can maintain stable social relationships. These are relationships in which an individual knows who each person is, and how each person relates to every other person.

This number is set at 150 connections. Dunbar theorizes that "this limit is a direct function of relative neocortex size, and that this in turn limits group size ... the limit imposed by neocortical processing capacity is simply on the number of individuals with whom a stable inter-personal relationship can be maintained."

Not every company caps the number of customers at 150, however. Which means that if they indeed intend to have relationships with their customers (beyond the sales person closing the deal) they need to scale up the number of people who support customers. Each of those people counts personal relationships - family, friends, past colleagues, peers, etc. - in their Dunbar number.

Theoretically, there is a correlation between the customer relationships a company hopes to have, and the number of people dedicated to cultivating those relationships. However, as Doc Searls said so well a few years back, companies are not doing that. Because "Customer Relationship Management" is about management more than customers.

This is one data point.

Lee Rainie, the director of the Pew Internet & American Life Project, says: “People who are members of online social networks are not so much ‘networking’ as they are ‘broadcasting their lives to an outer tier of acquaintances who aren’t necessarily inside the Dunbar circle.’”

Which means that since many more people are online these days, there are many more chances they will broadcast their experiences to others. People who are online can also be your customers. When people are introduced to a system where everyone has amplifiers, there may be less relationships, not more.

However, the weak ties in our network have a role and function.

As author Albert-Laszlo Barabasi explains in Linked: “Weak ties play a crucial role in our ability to communicate with the outside world ... [our friends] move in the same circles we do and are inevitably exposed to the same information. To get new information we have to activate our weak ties. The weak ties ... obtain their information from different sources than our immediate friends.”

This is a second data point.

Where is all this leading you? Perhaps you should organize your Customer Relationship Management (CRM) system around social. Today at Fast Company Expert blog we explore the question can you just add a "stay in touch" function to your customer relationships management (CRM) to make it social? Will that make it more about customers, thus social, than management?

While we consider and explore the possibility that technology could give us the ability to keep up with it all, I think there is a good alternative for companies that wish to be in service of their customers. It's called community. It takes care of Dunbar's number, and it comes with its own challenges.

First of which is the community size. You need to have critical mass in order to have enough member diversity - some will engage actively, some will watch on the sidelines, some will be somewhere in between.

From my on work with groups in school, I can tell you that between 5-7 per group is a good number. Conversations that help bridge across groups, or even help groups rotate should help with expanding relationships and broadening the trust base within the community.

For a community to sustain itself you want also to have good participation among members. That's why it's often smart to have a community facilitator. Because customers are the lifeblood of your business, this is potentially a c-role, as Connie Bensen explains.

Community shouldn't be just for the brand. It should be in service of its customers.

I used to create the content for the speaking tracks at a yearly Rendez-vous we organized at a boutique consulting firm where I worked. I just came back from a customer conference - 300 were in attendance. I had the good fortune of meeting many for the first time in person, which still makes a tremendous difference in relationships.

The event was aptly named, the future is now. There has never been a better time to make the case for customer community. And yes, your company or business should have a Chief Customer Advocate. I'd go so far as saying that this position should be in the marketing group. Which may be interesting for companies that have sales and marketing reporting into the same person.

There's plenty to think about when it comes to community. Have you built or facilitated a community or a social network? Do you consider them the same thing? Why/why not?

[a graphical representation of the Dunbar's number. A group photo from The Future is Now] 

Source: Conversation Agent

The Future of the Social Web: In Five Eras

Expect the Groundswell to continue, in which people connect to each other –rather than institutions. Consumer adoption of social networks is increasing a rapid pace,brands are adopting even during a recession,so expect the space to rapidly innovate to match this trend. Clients can access this report, but to summarize what we found, in the executive summary we state: Today’s social experience is disjointed because consumers have separate identities in each social network they visit. A simple set of technologies that enable a portable identity will soon empower consumers to bring their identities with them — transforming marketing, eCommerce, CRM, and advertising. IDs are just the beginning of this transformation, in which the Web will evolve step by step from separate social sites into a shared social experience. Consumers will rely on their peers as they make online decisions, whether or not brands choose to participate. Socially connected consumers will strengthen communities and shift power away from brands and CRM systems; eventually this will result in empowered communities defining the next generation of products.

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