horsepigcow

Enjoy this fabulous discussion with Matt Mullenweg of WordPress.com and WordPress.org who told me the story of the birth and evolution of WordPress as well as his ‘secret’ to success (hint: it’s right at the end).

Thanks Matt!

I heart Zappos.com muchly and Rachael and Tony made me heart it even more. I really enjoyed talking with them about the core values that makes Zappos rock so much.

(p.s. Sorry Rachael for my misspelling in the video. I’ll get Alyssa to fix it asap!)

Oh…and btw…I finished my book. Yay me!

I was fortunate to be able to sit down in December with the amazing Austin Hill, Canadian VC and multi-time entrepreneur, to talk to him about the oldest form of economics: The Gift Economy and how Akoha.org (coming soon) fits into this. The video (embedded below) is well worth your time. Austin is a totally good soul and I’m really looking forward to the release of Akoha.

(I don’t know if you can see the video below in a newsreader, sorry if you can’t!)

(thanks to Alyssa Contreras for the editing)

Thanks so much to my friend, Jay Fichialos, now on Ma.gnolia and sending me awesome links like this one that say things like:

…the one thing I have been able to extract as the core and essential principle is the fact that people are the singlemost important elements in a company. When you think about it, “company” implies that one person is in the company of another. Or an “organization” is a system of people, and certainly not a bunch of computers or other inanimate objects. Human resources are the critical factor to winning a game of basketball (not the basketball itself), to taking a company public (lawyers are people too), to fixing a great bowl of chicken soup (the ingredients do help, but it takes a person to collect those ingredients), and so forth.

This reminded me of frustrations I had a couple of years back and an equivalent frustration I experienced lately when a dear friend told me she couldn’t attend this amazing conference on Customer Service/Satisfaction (by the good folks at Satisfaction), which would not only be an excellent boon for her knowledge on the subject, it would also benefit her employer greatly because they would have an incredibly plugged-in, cutting edge thinker on the team. This is not to mention that the customer service executives from every cool company in North America will be hungrily networking there to meet those plugged-in, cutting edge thinkers like my friend.

My frustrations occurred in a couple of different marketing positions I held at various companies, where, even though I was in charge of building community in one particular case, I was expected to hold regular office hours with the rest of the staff. Ducking out for an afternoon meetup or other community-type event was seen as ‘frivolous’ and something I should do on ‘my time’. This was an absurd idea to me and I continued to defy the notion that I should be sitting at a desk creating marketing plans rather than actually going out and meeting people face to face who are part of the community I wished to reach.

Compound this with a very astute tweet by my friend Chris Heuer (another budding author) a couple of weeks back:

Companies don’t really have conversations with customers, their employees do. People talking to people is real, beyond marketing and spin... 10:56 AM November 01, 2007

…and something really profound occurred to me: A Company is the Sum of the Social Capital of its People.

When I think about the really ‘cool’ brands out there there is always at least one person who we know and admire…who has influence and who has reams of Social Capital. You dig deeper into the company employees and you see that really dynamic and growing companies have loads of employees with smaller, but strong networks they influence. Apple, of course is a really great example of this. Who doesn’t want to be Steve Jobs, really? I mean, he even has someone who IS his fake self. But there are Apple employees who are influencers everywhere, even if they don’t appear in an official capacity all of the time. And how about the influence of the Geniuses and other Apple Store employees on people’s interaction with the brand? HUGE. [hat tip to Lloyd for that great link] I would take a leap and attribute a good portion of Apple’s fantastic growth in the past couple of years to that one-on-one interaction between employees and customers.

Of course, none of this is news or anything. It’s been pretty obvious to many people for a long time that sending your employees out into the world to build relationships with customers and potential customers is really good for your brand. D’uh.

So, why is it that my friend and many others are still expected to clock in at 8:00 a.m. and clock out at 5:00 p.m.? Why aren’t social gatherings, community involvement, courses, conferences and events and general networking encouraged more? Why isn’t everyone encouraged to blog, be on IM, have Facebook profiles and post their running commentary on Twitter? Why aren’t we encouraging every one of our employees to go out there and build the hell out of their Social Capital?

I have a theory. Tell me if I’m wrong.

We don’t value non-crappy, paper-heavy, numbers-driven work. As soon as we see someone enjoying their work, we accuse it of not being work at all. If someone takes an extra long lunch to go to a social event where they are meeting industry peers, we say things like, “Must be nice to be able to take such a long lunch break” as if that person’s extra 1/2 hour should have been spent sitting in front of their computers, working on some spreadsheet or something that would have been actual work.

Now, OF COURSE there should be some sort of definition of activities and measurements in place to ensure that everyone is accountable. I like to trust my coworkers as much as the next person, but I’ve worked with enough people to realize that loose, under-defined goals like, “Build Social Capital” are bound to lead to equally under-defined actions. If I used this new structure to hang with my same friends each and every day, it ceases being useful Capital.

According to theorists, Social Capital comes in two forms: Bonding and Bridging Capital. Bonding Capital is what we do with good friends and family: we build deep relationships of trust and care. We can count on those we have Bonding Capital with for our survival. Bonding Capital is essential to our individual survival (so these days when my 14 year old is rude to me, I tell him that he is threatening his survival by testing our Bonding Capital – works like a charm) and is what emotionally fulfills us.

Bridging Capital, on the hand, is the type of Social Capital that helps us grow and builds our careers and businesses. Bridging Capital is what you are building when you go outside of your normal group of friends and meet new people. It’s what you do when you go to conferences that have people you don’t always hang out with there. It’s what you do when you leave your office and meet others in your industry. According to Robert Putnum (Bowling Alone):

(Bridging connections) are better for linkage to external assets and for information diffusion…(and provide a)…sociological WD-40…(that can)…generate broader identities and reciprocity. (Putnum 2000: 22-23)

But even though these definitions and measurements are not currently in place, businesses can start by recognizing that a certain amount of bridging activity is necessary to encourage for all of their employees – not just those in sales and marketing. Benefits?

• The creation of Bridging Capital that will positively effect the influence of your company
• This puts your employees in the perfectly right position for coming up with awesome ideas to please your customers
• The flipside of that, which is the ability of your employees to recognize potential problems and be proactive in averting them
• The creation of plugged-in, cutting edge employees in general
• A happier, more fulfilled group of employees who feel part of their company’s growth (which they are)

I really hope that my unnamed friend shows this article to her employer and is able to attend said conference and that it resonates as well with many others. I look forward to your feedback and stories.

q: What do you call someone who joins communities, adds friends and generally uses social networking tools to promote their own interests solely?

a: a community freeloader

Now, promoting your interests within a community isn’t a bad thing, per se. Having strong networks of people is a great advantage to furthering your causes, getting advice, meeting the right contacts to further your career and getting folks out to your events. However, where it becomes problematic is when you lose the balance of DEPOSIT and WITHDRAWAL in that Social Capital bank account of yours.

Balancing Your Social Capital Accounts

Now, I don’t want to reduce every interaction we human beings have with another person to being a transaction, but, in effect, it is. If I ask a friend for a favor, she is bound oblige. However, if I ask that same friend for ten favors, she may start to feel like I’ve depleted my ‘allowance’ on my account with her. Of course, with different people, we have more leeway. With our close friends and family we have loads of Social Capital to withdraw from and as our relationships get more casual, the less influence and favor we carry with others.

For instance, have you ever heard yourself saying, “I don’t want to use up my favors with him” or “It’s time to cash in those favors”? Well, whether we are aware of it or not, there is a transaction – even if it isn’t always direct or equally reciprocated – that happens between people. In the book that I’m currently reading, The Origins of Virtue: Human Instincts and the Evolution of Cooperation, Matt Ridley points out that this isn’t unique to our culture or even to us as human beings. Tit-for-tat is a common tool for community balance amongst many cultures as well as animal groups. It ensures that people both contribute as well as benefit to the commons.

It is actually a very positive part of our relationships – especially when we do a favor for someone without expecting it in immediate return. Those favors add up to a great deal of future Social Capital. And that Social Capital goes a long way in the future.

What I’ve observed in the various communities I’ve been part of is the entrance of community freeloaders, or, really, the types of people who just withdrawal their Social Capital until their totally whuffie poor, then wonder why they aren’t getting ahead. These people are what economists call ‘rational fools’:

…far from being altruistic, the cooperative person is merely looking out to his long-term self-interest, rather than the short term….Amartya Sen has called the caricature of the short-sighted self-interested person a ‘rational fool’. If the rational fool turns out to be taking short-sighted decisions then he is not being rational, just short sighted. He is indeed a fool who fails to consider the (long term) effect of his actions… – p.137

It is rational (economically) to take advantages of people in the short-term to make gains, but as Ridley points out, it is the generous villagers who are almost always the dominant ones. (p. 98)

Deposits and Withdrawals

So what kinds of actions are DEPOSITS and what kind of actions are WITHDRAWALS? Well, it really does depend on the community and the individuals you interact with. For instance, most people would probably feel good about helping out an even casual acquaintance with an introduction to another acquaintance. Some may put a caveat on the introduction (“I don’t know him too well, but he comes highly recommended”, etc.). Of course, the size of that favor also matters to whether the withdrawal is too large for the relationship. If someone I just met asked me to introduce them to Jimmy Wales, I would probably feel that was a little presumptive and would need them to spend more time establishing their trustworthiness with me before I passed that introduction along as a misfired introduction may hurt my own reputation with Jimmy. But most first favors may actually be a deposit (leaving me with the feeling of having done something nice for someone else, I warm up to the person), then start to become withdrawals after that point.

But if we were to speak in general terms about what is a DEPOSIT and what is a WITHDRAWAL, I would present the following table:

Of course, this list isn’t conclusive, the withdrawals aren’t all for the same amount and there are alot of grey areas for people, but you get the gist. What the things in the DEPOSIT column have in common is that they are reciprocal, relationship-building actions, whereas, the WITHDRAWAL column is about personal gain. Now, of course, there is personal gain in the relationships, but it is a long-term gain, rather than the short-term gains of the WITHDRAWAL column.

And don’t get me wrong, promoting your events, asking for connections and telling people about your company are totally viable, real and legitimate actions that are and should be performed within networks and communities every day. The trick is, just like a bank account, make sure you have a healthy account balance (ie. more deposited than withdrawn). As well, much like a personal bank account, it is beneficial to carry a higher balance. You never know when you’ll have a rainy day.