As I was preparing to teach the Amex case to my MBA class, it occurred to me that they have created a pattern that could work for others. They have tak the social part seriously. Let me explain.
Each initiative helps connect people or organizations that would like to be connected to solve a common problem. Take their Twitter Sync approach. The first thing to realize is that there are three parties to this strategy. First is Amex, then there is the social platform provider Twitter and finally there is a sponsoring company like Whole Foods. The Amex approach has a clear benefit to each player. Twitter gets more subscribers from a plan that requires consumers to Tweet using the Whole Foods hash tag. Whole Foods gets to sell more products. Amex users use their credit cards to get a discount on their purchase.
Social media is about forming relationships. In this case, Amex has forged a unique ternary relationship between Whole Foods, Twitter and Amex. There is a clear and tangible value proposition for each entity in the relationship.
In terms of business value, the propelling technology is provided by Amex. IT systems from Amex augment human intellect by helping consumers make choices and fulfill them without much human intervention. This is the secret sauce -- minimal change to human behavior.
The same pattern is present in their Small Business Forum idea. The fundamental notion is that small business like to connect and help one another. This creates a relationship between an online forum, Amex and small businesses. Everyone benefits from this arrangement. Small businesses learn from each other. Amex can learn about new products or where they can improve their products and services. The Amex membership provides the sense of community for the participants. It is quite possible that they will introduce third parties to provide products and solutions that meet the needs of the members. Once again, IT systems within Amex provide the magic potion that makes this work.
In summary, the repeating pattern is understanding what customers need to do socially. These social goals exist even prior to the arrival of social media. The next steps are to set clear goals, forming partnerships and adding technology to be the enabler that augments human intellect.
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This morning NPR's OnPoint was discussing drones. The guest was talking about the many experiments that were taking place and the threats to privacy. I was left with the feeling that it was not a good thing. However, one must remember that the early experiments are typically first order, obvious and lame. We need to keep doing these and testing them in a sandbox and socializing these technologies. If done carefully, we can cultivate an emerging technology without violating legal, ethical and moral boundaries.
It is interesting that this is another technology that emerged into public scrutiny from military uses. PBS NOVA channel had show on drones that showed how it was used to track hostile vehicles and people. The ability to simultaneously process or track many objects before zooming in on one is a great application of technology. This requires the integration of imaging, GPS, database management and querying tools. The military is discovering that drones are a more cost effective way of launching missions against enemy combatants.
With the arrival of the cloud, big data and analytics, lab experiments, civilian and commercial users are conjuring up novel uses for the technology and testing the acceptable boundaries. Some exciting applications are firemen using this technology to scout burning buildings, search and rescue missions, pipeline inspections, and securing large land areas.
As with any emerging technology, proper use will require training people with new skills. Gamers may be a natural fit for flying these drones, new visual and pattern recognition algorithms and policies for data storage and retrieval.
Get used to saying "It's a Bird.. It's a Plane.. It's a Drone.. It's ..."
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Today I had the opportunity to moderate a panel on breaking down barriers for the Babson Entrepreneurship Forum. Some of you ased me for the opening remarks I made about major technology trends. Here you go...
1) Augmenting Intellect: Peter Drucker heralded the arrival of the knowledge economy where knowledge will be the key resource and the knowledge worker will be dominant. When this is combined with the emerging technology of today, the possibilities for innovation and growth expand dramatically. In the old world, productivity gains of 1 or 2x were considered huge. In the new world 50x and 100x gains will be seen. The key driver here is re-use of infrastructure facilitated by developments like cloud computing, Facebook and Google.
2) Borderlessness: Every business is now a global business. Customers can find you globally, suppliers from across the globe can meet your demands, and employees can be sourced from a global marketplace. The challenge faced by entrepreneurs is in their ability to navigate these marketplaces. Entrepreneurs will also need to create an online identity to gain a reputation to attract investors and employees.
3) High Stakeholder Engagement: With the arrival of technologies like the internet and social media, companies are constantly inundated with information from all sides. Making sense of this information by separating signal from noise is turning out to be a key differentiating capability. Here is where emerging technologies like big data and analytics can prove to be very helpful. In addition, this feedback culture can propel an era of experimentation and pivoting that will favor the agile.
4) Era of Networks: Firms do not compete alone these days. They either act as platform providers for their ecosystems or join one of the platform providers. Each player in the ecosystem will provide a key component to fulfill a customer value proposition. Determining their role and selecting the right ecosystem will prove to be critical.
An entrepreneurs social network can also prove to be vital. As they meet people, they need to cultivate them to be part of their network by being good citizens within their networks. This can help them weild their digital influence to test, source and conceptualize new ideas.
The stories from the three speakers -- Seth Priebatsch, Abby Fichtner and Keya Dannenbaum -- epitomizes the ideas presented above.
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Over time Indian IT has become the preferred vendor for companies trying to gain operational efficiencies. While this has been good to them, it has also resulted in strategic convergence or lack of differences that make a difference. We are left with a set of commodity service providers that are worldclass in what they do. One thing that I noticed during my visit with IT companies this time was the emphasis on business model innovation and a focus on the user experiencce.
Since the clients of IT companies live in a highly competitive environment, they have to constantly innovate. They are now asking their IT services partners to help them with that innovation. While the back office services and infrastructure management are going well, IT services vendors are doing more. IT vendors are now focusing more on the user that the product. Innovation is taking place at the user interface level, platform services level and ecosystem management level. the goal is to provide solutions that talk to an user experience rahter than just a technology solution.
Take the case of TCS. They have created a patented user interface labeled cubbuzz. This UI provides a very intuitive cube metaphor as a way to render information to the users. If we think of this as a rubik's cube, you can use 64 potential regions to render information. They think of each region as a perspective for a user. Users have the ability to choose what they want to see in each region. One of the most interesting features of the idea is the anlytics component. Since every interaction between the user and the cube is captured and stored on the cloud, TCS can analyze it and use that to improve the interface, For example, the system learns and suggests content groupings for each face of the cube. In addition, by using color codes and motion, the volatility, timeliness of the information can be displayed as an overload on the same UI. While this is in and by itself innovative, TCS is also planning to take it one step further and used APIs to drive additional innovations on top of the UI. For example, they are encouraging customers to develop skins on their APIs and sharing that with partners. They also sponsor contests for apps developed on top of this API and display winners on leaderboards and distribute prize money.
HCL has an advanced technology lab where they have developed platform based services for an insurance company. The interaction with the services can take place on any device -- iPad, Android or iOS devices. All the applications run on a cloud and are delivered as a SaaS model to clients. The SaaS model allows clients to pay for just what they use while getting the rewards of innovation that has been spurred by other companies using the platform. This platform has the potential to move HCL to a different business model. The same can be said for Cognizant's knowledge platform. These platforms have started to deliver increasing returns to both CTSH and their clients. The technology mediated networks and e-mentoring opportunities that this platform has supported is allowing Cognizant to lead in this arena.
Finally, I noticed an huge improvement in how companies are using ecosystems. The first generation of usage was characterized by companies working with partners just in case a customer asked for a particular service. For example, many of then had relationships with Oracle and used that to sell services. While this was good for gaining business, it resulted in the product vendors like Oracle gaining all the power, The next generation of ecosystem use was just in time. Based on the need for a project, companies were able to exercise relationship options to use for that project. Internal communities of expertise at HCL is a good example of that. The CoEs have developed use cases where they bring partners to demonstrate any idea (say Social, mobile, analytics and cloud) to a client. The client is focused on the use case and does not have to worry about the technology.
The most advanced application of the ecosystem idea was demonstrated by the EBI group at HCL. In their mind, innovation ecosystems are different breed. They take the SMAC stack and use that to add intelligence to the existing applications at the client site. This requires them to create a management consulting layer within the organization and use these knowledge workers to drive innovation on projects. Once the vision for the client is complete, they use their strengths in infrastructure planning and partnership management to custom fit a business model and use case for a client.
Overall, there is strategic convergence but I still see some innovative ideas breaking through. IT India is at a crossroads, it is doing quite well if we use decades as a time frame to assess. If we look at it for the long haul, it is at great risk if the operational efficiency argument continues to dominate. What we do not want to be studying is the relics of once bygone era of glory days where Indian IT was the biggest game in town. We want to think of it as a sector that keeps reinventing itself to grow and dominate by being an adaptive entity.
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For a recent workshop on software ecosystems, I did a keynote that summarized the way we have developed ecosystems for several companies. I have captured most of the highlights in the paragraphs below.
Determine industry structure: When starting the research on a industry, it may typically start with a company and its set of competitors. For this set, it is important to identify the value chain of activities that deliver something of value to customers. These value chains or stacks can typically be found in industry publications. This industry structure can help the analyst create a list of companies that are recognized as the major platform providers in an industry.
Identify Companies and their attributes: Create a list of platform providers for the ecosystem. This list can be generated by searching industry publications that run articles on emerging and established areas. One strategy to locate these articles is to use del.icio.us or Googles search engine. In the case of the M-payment ecosystem, MIT Technology Review ran a special issue on the topic and it listed all the major platform players. This list can be augmented using other sources, too. Once the list is finalized, the analyst has to visit each company’s website to create a list of partners and the types of dependencies. Most websites have a tab titled strategic alliances or partner list. These sites will also describe the type of relationship between companies – technical, marketing, licensing, etc.
Finalize semantics for nodes and dependencies: Once the data has been collected, the analyst has to prepare a file for the visualization program. This file should have information about the color and size of nodes and dependencies. Typically, node sizes are based on a company’s revenue, or number of employees. The dependencies are color coded based on the type of relationship.
Visualize, Analyze and interpret: For all our network visualizations, we used Pajek. Once we create the visuals, the typical protocol was to present it to the sponsoring organization. We would show them the core network and see if they have any insights about the companies in the core. We would create a list of companies that occupy key network positions and see if any players surprised the group. During the session it is quite common for company executives to identify a few companies that did not make the list. We would incorporate them and visualize again.
Please comment on your experience with developing such ecosystems.
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A recent MBA Newshour event at Babson got me thinking about the Kony 2012 campaign. Jason Russell and his team from Invisible Children worked really hard to become an overnight success with their Kony 2012 video. This video hit 100 million views in just six days. It brought attention to an important cause and negative publicity to Invisible Children and Jason Russell. It also taught us some interesting lessons.
With the abundance of information hitting us from all directions, people are struggling to separate signal from noise. Getting people's attention is the biggest challenge. Jason used children to draw the attention of their parents. I personally heard about this from my daughter. She insisted on me watching the video right away.
The message was also constructed as an adult explaining a complex matter to a child. There was some logic mixed with a lot of emotion. The use of words and graphics drew an emotional reaction from children.
The notion of action was also redefined. The very act of sharing was equated to involvement and action. Children are so used to social media and sharing photographs and videos. Now they used the same idea to support a cause.
Our information consumption habits are increasing dependent on the Internet and social media. The people we follow and the websites we visit regularly influence and in some cases are the sole sources for our news consumption. They are the filters to our world and help shape our opinion. Penetrating this filter bubble is key to getting attention.
An excellent infrastructure of technology mediated social networks was in place before this campaign. Invisible Children hadpre-existing support groups in schools across the country. These groups were primed to support and push a cause and rallied into action once activated.
Invisible Children also made use of technology to get the attention of influencers. Celebrities like Justin Bieber, Lady Gaga and Ryan Seacrest were targeting with Tweets. When these celebrities did their due diligence, they found the underlying support from school children. Now they were hooked and motivated to act.
There are some unintended negative consequences to drawing rapid attention. People have now put Invisible Children under immense scrutiny. Recent reports have Jason Russell is reported to have suffered a meltdown. People have questioned whether this should the most important cause for attention. Old rules still apply. Use you own moral compass for assessing such campaigns. Perform your own due diligence and verify facts before acting.
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For a workshop on wireless innovation sponsored by the wireless innovation council (WIC), I decided to sketch out the M-payment ecosystem. The list of platforms were obtained from virtualcurrencyplatforms.com and from other sites. Based on this, we (Simon Prentice helped with the data collection) put together a list of partners that were announced on their websites. The ecosystem shows that the space is still evolving. Key players have not emerged. Each platform provider is creating their own island. Verizon, AT&T and Sprint are hedging by connecting to multiple platforms. This could make them the key players in the ecosystem. Facebook has also connected to three platform providers, including AmexServe.
Some key points to consider. When considering any of these ecosystems, what are the key components necessary to support a customer value proposition? Is it being provided by the combination of the platform provider and partners affiliated to that ecosystem? Have the complementors opened their platform for third-party developers? What kinds of economic incentives do they provide? To make the ecosystem more useful, we have to keep track of network effects. The indirect network effects come from adoption by end-users. The direct effects would come from developers who use the APIs. Both these numbers should be tracked. In the mobile space, in addition to end-users and developers, we may have to track advertisers, too. These entities create positive feedback loops that result in a platform that "emerges" as the dominant one.
Based on evidence from other markets, more than one platform can emerge as dominant. Platforms that are both open and can exercise architectural control tend to dominate. Similarly, platforms that have attributes that leads to customer retention drives positive feedback loops. Google's opensocial standards is an example of how to create direct network effects by creating a larger pool of developers. Competitors can gain traction by catering to a segment of the market. For example, Facebook is big with virtual goods and they can use that to enter other areas. Multi-homing is challenging for both users and developers. Look for developments that hinder or support that strategy. Read more about platform wars and strategies in this article by Prof. Michael Cusumano.
Any platforms or companies missing from the picture? We have a total of 191 companies and 19 platforms represented. In the figure below, diamonds represent platforms, ellipses represent complementors and link color denotes different types of alliances (financial, strategic, developmental, marketing, etc.)
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I had a very interesting experience preparing a couple of new topics for my graduate class discussions. The two topics were Professional Digital Strategy and Gamification of Business. In both cases, after I decided to pursue it, I created a Powerpoint presentation and put it on SlideShare. I then let my Twitter followers know that I did that. Later I identified a few influencers on Twitter and told them about it. These influencers had a large following on social media and they brought my presentation to the attention of their followers. I also made sure that I used tags on SlideShare.
Readers who viewed the presentation sent their comments to me via email or left it as feedback on SlideShare. Each response led to revisions of my content. Since my presentations dealt with technology related topics, I had responses from technology vendors (after my presentations reached a critical mass of audience of over 1000 views). In the case of my presentation on Digital Strategy, I was able to use some of the responders themselves as examples to make my point. My presentation on gamification has been viewed over 1800 times so far and revised 25 times in a week! Before I presented Digital Strategy to students, I had over 1800 people view and propose changes to my presentation. In many instances, suggestions came from experts in the field. In earlier times, I would write a paper and present that in a conference or journal to get feedback and in many cases classroom presentations were not subject to such rigor.
Availability of social media platforms like Twitter and SlideShare have altered the landscape dramatically. I find the engagement and interaction encouraged by these platforms to be very rewarding. Faculty get to signal to the world about what they are doing within their classrooms. Students get material that has been qualified by many experts. The community benefits by the sharing of the content. In the digital age, relevance and reputation is highly influenced by the use of social platforms to prepare for sessions. What has been your experience? Do you see other benefits or drawbacks to this approach?
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I recently had the opportunity to present in workshop for Babson/Wellesley/Olin faculty. My topic was Digital Scholarly Identity and I used this presentation. The main focus of the presentation was on how scholars can broaden their impact using digital media and also get recognized for doing it. For scholars, impact is a combination of academic and practitioner recognition. Schools may allocate different weights to these factors, but they consider them important and recognize faculty for their impact.
In today's environment faculty have additional channels to make an impact. Social media platforms like blogging, Twitter and community platforms have the potential to help faculty influence the world. This, however, requires scholars to build a reputation online. Reputation can be built by putting out thoughtful, original content at a regular frequency. This content should drive people to action.
Communities are the new avenues for exhibiting and building one's expertise. Take Stackoverflow, for example. Today it is widely used by programmers to post and answer questions. In the process, they earn points that build their reputation within their community. This reputation could help them get new jobs or to get promoted. Similar communities will crop up for academics.
Scholars like Andy McAfee and John Gallaugher have been great at using this new channel to influence their communities. While the newer generation of scholars have adapted well to the digital world, the older generation is still struggling with the basics of these new platforms.
What is needed is a recognition of scholars who are good at using these new channels to build a reputation and impact the community. Rating systems like Klout, Indeed and others are useful in measuring the influence of users in general. What we need is tools customized for scholars. These tools should combine traditional and the new social metrics to create a combined score for impact.
Wonder if there are schools that currently recognize the use of these new channels for measuring impact.
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It would be interesting to study the value proposition offered by cloud computing from a stakeholder perspective. This would require us to look at cloud computing from the perspective of a customer, investor, employee, supplier and society.
From a customer perspective, cloud computing enables a company to provide its services based on how much they get used. This is great for consumers who are afraid to get locked-in. Customer can use (and get billed) for just what they use. Investors like cloud computing because they don't get into a deep hole by their fixed costs commitments to IT. This avoids the theory of escalating commitments -- just because they have made investments, they do not have to continue on the same path. If they feel that the ROI is bad, they can abandon the project. Employees prefer cloud based applications because they allow them to use the latest and greatest in technological developments. In addition, they are independent of the hardware devices. In fact, they can access their content and data from any device. Suppliers prefer to work with companies that provide transparency to their supply chain data. This allows them to collaboratively plan their resource management. Finally, society may benefit from green operations supported by cloud vendors.
My colleague Erik Noyes and I just wrote a case study on Appirio that highlighted the value of cloud services to Appirio. We will be undertaking this new study and interviewing entrepreneurs and investors to learn about the value proposition offered by cloud computing.
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