This morning I gave the keynote at a leadership offsite for the 300 top managers of a major bank’s IT division. The bank’s technology division faces many of the same challenges as its peers, including effectively servicing a diverse set of segregated business units, each with very different business models, and managing the outsourcing of technology services to a global array of providers. The offsite’s key theme was relationships, because they are absolutely central to the success of the individual employees, the division, and the organization. In particular, building effective partnerships with its service providers is critical to its ability to deliver value to the business.
My presentation, titled Leadership for the Future, covered the imperative of collaboration in a global, commoditized world, how to lead partners into collaborative relationships, and how to leverage networks to create value. In my concluding section on creating success I drew on some of the research that Tom Davenport presented at the Network Roundtable conference in Boston this April (his presentation is here), where I also gave a presentation about my recent research into networks in high-value relationships. Tom, from both his own research and drawing on earlier research at Bell Labs by Robert Kelley, found two key determinants of high-performance. I drew on Tom’s material and fleshed it out with some of my own work to identify three interrelated drivers of both personal success and organizational contribution.
High performing knowledge workers:
Actively build networks. There are five key attributes of the networks of high-performing individuals.
Diversity: Knowing many of the same kind of people is not very valuable. Having connections with a broad range of different kinds of people means you are more likely to find resources you need, and to generate innovative perspectives.
Awareness: One of the primary aspects of a valuable network is being aware of the expertise of others and who you can draw on when required. This doesn’t necessarily mean being buddies with everyone; it means knowing what people’s capabilities are.
Visibility. Your capabilities need to be visible to others. Again, this doesn’t require being highly social. If others are not aware of what you can do, you will be isolated in the organization and you will not be able to contribute according to your abilities.
Dynamic. Personal networks should be continually evolving. You continually need to be forming new relationships, and sometimes moving on from others. Change is at the heart of successful networks.
Investment. Building networks requires investment. Developing relationships needs spending time with people to build mutual knowledge and respect, and maintaining relationships also requires time. However the personal and business benefit of that investment is immense. It is something you have to make time for.
Take initiative and calculated risks. Robert Kelley found that the single greatest determinant of high-performance was taking calculated risks, particularly in going beyond the boundaries of the usual job definition or expectations. This requires imagination and considered action.
Learn and develop relevant expertise. In an increasingly specialized world, we cannot rest on our existing expertise. We must continually learn. This needs to be strategic, in that we decide in which domain we wish to be world-class, and work at developing that expertise. This learning draws extensively on our networks – the people we know are the source of our greatest learning. True high performers have technical expertise, industry expertise, and discipline expertise, such as in project management or other critical business practices. If your expertise is limited to one of these domains, your skills are at strong risk of becoming commodtized.
The slow pace of change in distribution channels
By Ross DawsonBusinessWeek reports that Apple is readying release of move downloads from its iTunes site, pitched at $14.99 for new movies and $9.99 for back catalogue. At the same time, it says, WalMart is actively lobbying Hollywood studios not to allow Apple to provide these downloads. Wal-Mart’s actions are said to have included threatening not to sell Disney’s High School Musical for a period, subsequent to Disney releasing it initially exclusively on iTunes. Disney is apparently the only studio signed up for the iTunes movie releases, with the others on the sidelines for now. Wal-Mart has clout with the studios, since it accounts for 40% of DVD sales in the US, which is one of their most important revenue sources.
This is an oft-told tale, in which the shift to new and more efficient distribution channels is blocked by incumbents who have the power to slow progress. In this case Wal-Mart’s actions seem to be on the border of US anti-trust legislation. However its ability to generate revenue for their wholesale providers gives it enormous power to influence. Notably, Wal-Mart is also said to be readying its own movie download site, so it recognizes that the shift to the new distribution channel is inevitable. It just wants that shift to happen on its own terms. Of course Apple and Wal-Mart are hardly the only players in this market, with an array of pretenders to the online movie distribution market, notably Amazon.com. The primary bottleneck here is that any distribution rights have to be approved by the studios, and it really has to be all of them for a download site to become predominant. Apple has the Disney relationship and access to a ready market of buyers, Wal-Mart has existing distribution channels, others have different offers. As in so many other cases, the incumbent will try to shape change to its favor. Yet there is little reason to think that Wal-Mart has what it takes to be a big success in the online distribution market. One other thing to note is that Wal-Mart only stocks the very top selling DVDs, so studios can gain revenue from their hits but nothing else. Online distribution, such as on iTunes, enables them to generate revenue from their entire list. As the Long Tail story tells, there is gold beyond the hits.
Funds management and investment in the modular economy
By Ross DawsonLast week’s 25th anniversary issue of BRW focused on the future 25 years forward, so not surprisingly included interviews with both Richard Watson, Chief Futurist at Future Exploration Network, and myself. The extensive interview with Richard was a fun and broad-ranging discussion on the future of technology, which unfortunately is not available online. I was interviewed for an article on the future of superannuation (the British/ Australian term for retirement plans). One of the points I made was about living longer healthy lives, the shift to flexible working structures, the blurring of the age of retirement, and the need for legislative structures to adapt to these changes. What I think was the more interesting issue I raised was about how investors will need to seek new investment vehicles.
There is no question that we are shifting to an increasingly modular economy. Technologies such as web services and Web 2.0 are creating an intensely modular online and application environment, in which elements are combined at will. These technologies, together with the modularization of business processes, and easy flow and integration of processes across organizational and national boundaries, are creating a truly modular economy. The ultimate unit of the modular economy is the individual. Certainly there will be many reasons for organizations to exist in the future, not least in those industries that require significant capital. However as the economy inexorably shifts to the intangible, an increasing proportion of value will be created by aggregations of individuals or small organizations providing knowledge-based services, that mesh with other organizations large and small in economic networks. In many cases they will require little capital, and thus there will be no or little need for investors. Stockmarkets can only function effectively with large, highly capitalized companies that have highly liquid shares. Already the proportion of the economy that investors can reach is limited to fairly large companies, at most one third of the economy. It is likely that an increasing proportion of the economy will fall outside the listed sector, and thus be not directly available to investors. Much is made of private equity companies, but these focus on an extremely small subclass of opportunities. Venture capital also works within quite defined parameters, though it plays a very important role. There is a massive potential market in providing capital and services to very small participants in the modular economy, while also providing opportunities for investors to participate in this burgeoning sector. Mechanisms such as sharing in defined ways in future cash-flows of individuals or very small organizations could prove to be viable for both entrepreneurs and investors. While it is hardly a representative situation, Tom Cruise’s recent deal to fund his production company’s overheads suggests the kind of model that could be implemented on a smaller scale.
Yet more on the future of PR
By Ross DawsonThis week I was interviewed by Nicholas Scibetta, Global Director of Ketchum’s Communications & Media Strategy Network, on The New Media Transformation, looking at the implications for the PR industry.
The full interview is below. Click here to read the interview on the Ketchum site.
NS: What companies do you feel are doing a good job of playing in the ‘new media’ space and why?
RD: News Corp. is the media conglomerate that has done the best job among its peers in getting into new-media forms. This has been not only through its highly discussed acquisition of MySpace, but also its less-visible purchase of IGN [a gaming network], which recognized that video games are now part of the media space.
In the start-up space, I like Edgeio, which competes with eBay and other classified services. It enables people to publish listings on their own blog or Web site, which are then aggregated into one space so people can search for and find what they are looking for across all advertisers. One of the most important questions in the media space is whether classifieds will remain associated with traditional media. Edgeio is a very interesting experiment based on the assumption that they will be separate.
NS: What do you feel are the biggest misconceptions about working with new-media outlets and what are the three things you think all PR professionals should know before reaching out to them?
RD: Many people associate new media with blogs and podcasts. These are part of the emerging media space, but any Internet presence that has significant reach can be considered new media. Three things for public relations professionals to keep in mind when reaching out to new-media outlets are, one, PR professionals should always be completely transparent and open in their communication with new media; if they don’t, it will swiftly boomerang on them. Two, every message should be targeted based on an understanding of their interests — you will get no respect if you contact people with irrelevant information, but you will be respected if you know what they will be interested in and why. Three, the way to engage new media is to build relationships — people in new media believe in relationships and conversations, not in press releases.
NS: What is the future of media and what is the role of both new and traditional media in PR programs, given the current media landscape?
RD: Mass media will not die — what we are seeing emerge is a continuous spectrum from traditional mass media through to small community-based conversations. For any particular client or campaign, PR professionals will have to consider where across this spectrum of media they should be investing energy to achieve results. In some cases, accessing only traditional media will be appropriate, while in others, new-media channels will be the primary target. Usually these will be complementary, especially given that traditional media increasingly takes its cues from key bloggers, and their stories can have little impact if they do not generate a discussion among bloggers.
Read more →
Microsoft’s Zune player enables social networks for music
By Ross DawsonNews is just out that Microsoft’s Zune mp3 player, due out before Christmas to compete with Apple’s iPod, will have social networking capabilities, in addition to its core features of a 30GB disk and a 3 inch screen. Zune users will have the option of using the device’s inbuilt WiFi to send and receive music, playlists, videos, and photos to up to four other players. They can either broadcast these to any Zune player within range, or only to those of their selected friends. If they have the broadcast feature switched on, anyone permitted within range will be able to listen simultaneously to what they’re listening to.
This social networking feature, together with the device’s WiFi capabilities, is the only really significant feature difference to the iPod, and it is one that actually could shift users to the Microsoft player. Particularly for young people, music is fundamental to their identity and relationships, and sharing music is truly at the heart of their social networks. Sharing around musical preferences was the initial premise behind MySpace, and while it has gone quite a bit beyond this, it was the seed and still is at the centre of the largest human social network ever to exist. However I have a few concerns about how the feature is implemented on the Zune. One is that broadcasting to four people is not enough to really enable true social networks. It makes it a little bit more a gimmick than a feature to have it so limited in scope, though it can still act as a social glue for smaller groups. Another issue is probably related, in that WiFi is very energy-hungry. I have not seen any figures on battery life with WiFi turned on, but I suspect that the device won’t be able to last very long while it is broadcasting music, making it far less mobile. It may take, sometime down the track, the use of fuel cells or alternative wireless technologies for this kind of music social networking to be a broadly used application. A final issue is that, given this is Microsoft, we know that there will be solid Digital Rights Management (DRM) in place. In fact the release specifically says that people will be able to share “promotional copies” of songs, which will be just a fraction of what people have available on their players. Given these factors, the question remains whether this feature will prove to be a key differentiator for the Zune here in an extremely competitive marketplace, but I don’t doubt that mobile musical social networking will get massive uptake at the right time, when it’s done right.
Will economic growth transcend flattening population? …keynote speech on the long-term future of investment
By Ross DawsonYesterday I did the closing keynote at the PortfolioConstruction conference. The conference, run by Portfolio Construction Forum, was for fund managers and portfolio advisors, covering many of the emerging issues on portfolio analytics, as well as the more interesting asset classes. My role was to pull this all out to the big picture, looking 10-20 years forward at future opportunities for investors. There was probably close to a book’s worth of material in the talk, so I won’t try to summarize it here – I’ll cover some of the issues raised in future blog posts and elsewhere. However I want to share the chart I kicked off my presentation with, which shows the economy over the last four centuries and the next 4-5 decades.
The historical data in the chart comes from Bradford DeLong, an extremely interesting economist at UC – Berkeley. Brad has compiled a thorough analysis of economic history since the birth of mankind, which provides a good complement to some of the more traditionalist approaches. The most evident point from the chart is the acceleration of both economic and population growth over the last centuries. In the year 2000 world population had grown to 2 ½ times its levels 50 years earlier, while in the same period the economy had grown by a factor of 10, resulting in an unprecedented level of prosperity to the individual. We are now at an inflection point in population growth. The United Nations fairly recently revised its world population forecasts for 2050 downwards to 8.9 billion, from the 9.3 billion they were forecasting earlier. Now it is not just developed countries that have low birth rates, but as developing countries progress from agricultural economies, their birth rates too are rapidly falling. Clearly a substantial portion of economic growth since the second world war has been based on population growth, and the associated demands for infrastructure and consumer goods. Barring extraordinary disasters, we know with a fair degree of accuracy what the population will be in 40-50 years. However there is great uncertainty on whether future economic growth can transcend this flattening in population growth. The swift commoditization of goods and services, driven by globalization, on the face of it makes it more difficult to drive economic growth. Yet the associated shift to a highly modular economy facilitates the servicing of needs, and exploitation of economic opportunities, particularly in shifting many poor people into early middle class. I believe that the pace of absolute economic growth in the next 40-50 years will be significantly higher than the last decades, and that economic growth per capita, as human population eventually stabilizes, will grow at an even higher rate. I’ll expand on all of this a bit later.
Will the 1% rule change?
By Ross DawsonI was recently interviewed by Mediasnackers, a neat site that focuses on how young people consume and create media. The interview, which is on the Mediasnackers site, covers a number of interesting themes, such as power shifting to the edge and edgeio, user generated content, and the shift by Gen Y to heuristic learning styles that Ross Gibson of UTS pointed out at the Future of Media Summit. I was asked about the 1% rule, which, based on research on YouTube, Wikipedia, and other sites, suggests that approximately 1% of a site’s visitors contribute content, and 10% interact in some form with the content. For those old enough to remember bulletin board systems (BBS), the rule of thumb used to be a “lurker” to participant ratio of 1:10. However there are now far more options to consume content, and clearly video and other multimedia content takes more effort to create than text comments. Undoubtedly, as generations shift a far larger proportion of people will create online content. In the US over half of teens have created and posted online content of some form. Yet it’s also important to note that 18% of American over 65s have also created content, so the gap may not be as big as people tend to think. The proliferation of online content sites is likely to keep pace with growth in content creation, leaving the 1% rule a good rule of thumb, especially for multimedia content.
Keynote on relationships in technology services
By Ross DawsonThis morning I gave the keynote at a leadership offsite for the 300 top managers of a major bank’s IT division. The bank’s technology division faces many of the same challenges as its peers, including effectively servicing a diverse set of segregated business units, each with very different business models, and managing the outsourcing of technology services to a global array of providers. The offsite’s key theme was relationships, because they are absolutely central to the success of the individual employees, the division, and the organization. In particular, building effective partnerships with its service providers is critical to its ability to deliver value to the business.
My presentation, titled Leadership for the Future, covered the imperative of collaboration in a global, commoditized world, how to lead partners into collaborative relationships, and how to leverage networks to create value. In my concluding section on creating success I drew on some of the research that Tom Davenport presented at the Network Roundtable conference in Boston this April (his presentation is here), where I also gave a presentation about my recent research into networks in high-value relationships. Tom, from both his own research and drawing on earlier research at Bell Labs by Robert Kelley, found two key determinants of high-performance. I drew on Tom’s material and fleshed it out with some of my own work to identify three interrelated drivers of both personal success and organizational contribution.
High performing knowledge workers:
Actively build networks. There are five key attributes of the networks of high-performing individuals.
Diversity: Knowing many of the same kind of people is not very valuable. Having connections with a broad range of different kinds of people means you are more likely to find resources you need, and to generate innovative perspectives.
Awareness: One of the primary aspects of a valuable network is being aware of the expertise of others and who you can draw on when required. This doesn’t necessarily mean being buddies with everyone; it means knowing what people’s capabilities are.
Visibility. Your capabilities need to be visible to others. Again, this doesn’t require being highly social. If others are not aware of what you can do, you will be isolated in the organization and you will not be able to contribute according to your abilities.
Dynamic. Personal networks should be continually evolving. You continually need to be forming new relationships, and sometimes moving on from others. Change is at the heart of successful networks.
Investment. Building networks requires investment. Developing relationships needs spending time with people to build mutual knowledge and respect, and maintaining relationships also requires time. However the personal and business benefit of that investment is immense. It is something you have to make time for.
Take initiative and calculated risks. Robert Kelley found that the single greatest determinant of high-performance was taking calculated risks, particularly in going beyond the boundaries of the usual job definition or expectations. This requires imagination and considered action.
Learn and develop relevant expertise. In an increasingly specialized world, we cannot rest on our existing expertise. We must continually learn. This needs to be strategic, in that we decide in which domain we wish to be world-class, and work at developing that expertise. This learning draws extensively on our networks – the people we know are the source of our greatest learning. True high performers have technical expertise, industry expertise, and discipline expertise, such as in project management or other critical business practices. If your expertise is limited to one of these domains, your skills are at strong risk of becoming commodtized.
What accelerates – and slows – the development of social networking mobile platforms
By Ross DawsonThe Sydney Morning Herald has just released an article titled Social networkers get mobilised, which examines how social networking is shifting to mobile platforms. I’m happy that the journalist used what I felt were my most important comments in my interview for the article:
and
There are a few critical points to add here. The first is that a large proportion of social networking will shift to mobile platforms. In particular, knowing where your friends are and where the action is are vital social functions, which text messaging only begins to address. This is going to be a very big market. I mentioned Imahima, which while it hasn’t grown strongly recently has a great product. Imahima was licensed by Telstra a couple of years ago in association with its deal with NTT DoCoMo, though it is not clear whether Telstra intends to do anything with it.
Second, the cost of mobile data is a critical enabler of these applications. The reason the US has leapfrogged Europe and Asia in some mobile applications over the last years, after being miles behind at the turn of the century, is that they have highly attractive mobile data plans. In most cases there is unlimited data and Internet access on an attractive plan. One Australian executive was recently showing off his mobile Internet access. I asked him what his mobile plan was, and he told me A$950 per month. This is hardly populist pricing. Australia is in danger of falling behind because of its telcos’ extortionate mobile data pricing policies. I will be beating this drum more in the future.
Third, while telcos should be frontrunners in mobile social networking, few have done well, apart from Swisscom, Switzerland’s leading telco. You may recall that Google bought the excellent mobile networking platform Dodgeball in May 2005 (and was rumored to be buying a similar service Meetroduction), which at the time seemed to indicate that Google was keen to get into this space. While O’Reilly Radar sees promise here, others wonder what Google has done with the service. In those countries where mobile devices can easily and cheaply access the Internet, mobile social networking is easy to implement. In other countries, telcos largely control access to these services, and are not exploiting what could be a great opportunity, if correctly marketed and priced.
Leda Bella Dawson is born
By Ross DawsonLeda Bella Dawson was born on 12 August 2006, exactly on schedule. We often forget what a miracle life is. One of the great things about becoming a parent is you are confronted with the extraordinary fact of two people’s genes being combined, growing for nine months inside a woman, then suddenly emerging as a perfect human being. All of the instincts necessary to feed and grow are there from the beginning. Experiencing the lifeforce of a new human is a wonderful reminder of the miracle of life.
Here are more baby photos for those interested.
We’ve had lots of interest in the name, so read here for the story of Leda.
We’re all back at home today, so back to work, and perhaps a pick up from my recent lack of blog posts, but that will be balanced with helping take care of my gorgeous daughter…
Languages of blog posts
By Ross DawsonTechnorati has released its August 2006 State of the Blogosphere report. As always, heaps of interesting information and insights, including about whether, now the blogosphere has reached 50 million blogs, the rate of doubling is slowing. Not yet, it appears. David Sifry has again taken up the theme of the language of blog posts, where English (39%) has once again taken the lead over Japanese (31%) in the last few months. Chinese (12%) is strong, while French (2%) and Korean (NR) are apparently underreported. I very much like the chart that David’s team has produced on languages of blog posts by hour of the day. It gives a better feeling for the truly global nature of the conversations. Examining European and Japanese blogging patterns shows that people tend to blog in the late evening.