Five things I didn’t know about Darwin

28 02 2009

You should probably know by now that in 2009 we celebrate 200 years of Charles Darwin’s birth and 150 years since “The Origin of Species” was first published. I’ve been feasting on all the information flooding in the media about him, and I learned quite a bit about the man and the book in the last few months. Here’s my top 5 list, in no particular order.

1. A dinasty of sorts
The last publication by Darwin, written just 2 weeks before he died, was about a tiny clam found on a beetle leg. Nothing particularly interesting there. The person sending Charles the specimen was Walter Drawbridge Crick, a shoemaker and amateur naturalist. Even less remarkable, one could say, until you learn that Walter would eventually have a grandson named Francis, of Watson & Crick’s double helix fame, arguably the second most important insight in Biology, and perhaps in all sciences (Source: National Geographic Magazine).

2. Evolution
The word “Evolution”, so associated with Darwin in our collective mind, never appears in “The Origin of Species”. The closest you get is the last word in the last sentence of the book, a poetic gem of scientific literature: “There is grandeur in this view of life, with its several powers, having been originally breathed into a few forms or into one; and that, whilst this planet has gone cycling on according to the fixed law of gravity, from so simple a beginning endless forms most beautiful and most wonderful have been, and are being, evolved.” You can check that yourself by downloading a PDF version of the book here (Source: Quirks and Quarks podcast, CBC).

3. Survival of the fittest
Even more puzzling is the fact that the term “survival of the fittest” was first coined by Herbert Spencer in the book “The principles of biology” (1864), and only shows up in late editions of Origin, duly acknowledging Spencer’s authorship: “I have called this principle, by which each slight variation, if useful, is preserved, by the term natural selection, in order to mark its relation to man’s power of selection.  But the expression often used by Mr. Herbert Spencer, of the Survival of the Fittest, is more accurate, and is sometimes equally convenient.”. (Sources: The Phrase Finder and Gutemberg project).

4. The destiny of species
Long before coming up with his theory about where the species came from, many of Charles’ objects of study ended up in his stomach. Darwin used to eat several of the animals he helped describing, including, but not limited to, water-hogs (capivaras for Brazilians, a REALLY big rat, in fact the largest rodent in the world), birds of prey like the caracara, and armadillos. I guess that to provide a comprehensive description of a species, behaviour and looks were not enough: the more information the better 🙂 . I learned about this bizarre piece of trivia while watching the excellent “Darwin’s Legacy” course by Stanford University, available in iTunes U., but you can find a very good description of Darwin’s culinary adventures here.

5. Brazil according to Darwin
Charles, to put it mildly, didn’t enjoy much his time in Brazil, affirming at the end of his “Voyage of the Beagle” travelog: “On the 19th of August we finally left the shores of Brazil. I thank God, I shall never again visit a slave-country.” I’m not sure if slavery in Brazil was worse than in other parts of the world, but being the last country in the Western hemisphere to abolish slavery suggests that the Brazilian society of the 18th century relied heavily on it, to the point that even today Brazil still has the second largest population of black origin in the world (after Nigeria). On the other side, Darwin was awed by the forests in Brazil: “Among the scenes which are deeply impressed on my mind, none exceed in sublimity the primeval forests undefaced by the hand of man; whether those of Brazil, where the powers of Life are predominant, or those of Tierra del Fuego, where Death and decay prevail.  Both are temples filled with the varied productions of the God of Nature: — no one can stand in these solitudes unmoved, and not feel that there is more in man than the mere breath of his body.” Both quotes are a bit surprising given their quasi-spiritual tone. Finally, to conclude on a lighter note, this is Darwin’s account of Carnival folies in Salvador, Bahia, written on March 4th, 1832:

This day is the first of the Carnival, but Wickham, Sullivan & myself nothing undaunted were determined to face its dangers. — These dangers consist in being unmercifully pelted by wax balls full of water & being wet through by large tin squirts. — We found it very difficult to maintain our dignity whilst walking through the streets. — Charles the V has said that he was a brave man who could snuff a candle with his fingers without flinching; I say it is he who can walk at a steady pace, when buckets of water on each side are ready to be dashed over him. After an hours walking the gauntlet, we at length reached the country & there we were well determined to remain till it was dark. — We did so, & had some difficulty in finding the road back again, as we took care to coast along the outside of the town. — To complete our ludicrous miseries a heavy shower wet us to the skins, & at last gladly we reached the Beagle. — It was the first time Wickham had been on shore, & he vowed if he was here for six months it should be only one.

Watching Darwin braving the festive Carnival crowds in Salvador would have been priceless. If only we had Flickr and YouTube back then!

ROI 2.0, Part 3: We don’t need a Social Media ROI model

19 02 2009

Malcolm Gladwell, in his hilarious TED talk on spaghetti sauce, tells the story of Howard Moskowitz’s epiphany while looking for the perfect concentration of aspartame to use in the Diet Pepsi formulation:

Howard does the experiment, and he gets the data back, and he plots it on a curve, and all of a sudden he realizes it’s not a nice bell curve. In fact, the data doesn’t make any sense. It’s a mess. It’s all over the place. (…) Why could we not make sense of this experiment with Diet Pepsi? And one day, he was sitting in a diner in White Plains (…). And suddenly, like a bolt of lightning, the answer came to him. And that is, that when they analyzed the Diet Pepsi data, they were asking the wrong question. They were looking for the perfect Pepsi, and they should have been looking for the perfect Pepsis.”

Tangent note: Most TED talks are a treat, but this one is particularly funny and thought-provoking. If you haven’t seen it yet, consider paying it a visit. If you have an iPhone or iPod Touch, you may like the TED app too!

Over the last few years, many in the Social Media space have been on a quest to find the perfect ROI model for blogs, micro-blogs, wikis, social networking, social bookmarking and other animals in the ever growing Web 2.0 zoo. You’ll see opinions ranging from “we don’t need ROI for Social Media” to “Web 2.0 has to rely on a lagging ROI” to “ROI 2.0 comes from time savings”. In a way, they are all right and all wrong at the same time. Paraphrasing Doctor Moskowitz, there is no perfect Social Media ROI model, there are only perfect Social Media ROI models.

Since 2006, I’ve been talking to several senior executives in multiple industries and across geographies about the business value of Web 2.0, and have noticed a wide range of approaches when deciding whether or not (and how much) to invest in social computing. For companies in the forefront of the social media battleground, such as newspapers, book publishers and TV channels, investing heavily in new web technologies has often been a question of survival, and decision makers had significant leeway in trying new ways of delivering their products and services, with the full blessing of their stakeholders. On the other side of the spectrum, in sectors such as financial services, social media is not yet unanimously regarded as the way to go. I’ve heard from a number of banking and insurance clients that, if Social Media advocates don’t articulate clearly the returns they are expecting to achieve, they won’t get the funds to realize their vision.

Most players in Government were also very skeptical until the Obama effect took the world by storm, creating a sense of urgency that was not as prevalent before. Since then, government agencies around the globe seem to be a bit more forgiving with high level business cases for social computing initiatives inside and outside the firewall. However, to balance things out, in most of the other industries, investments in innovation are being subject to even more scrutiny than normal due to the tough current economic environment. So, having a few ROI models in your pocket does not hurt.

The following ROI models are emerging, and we can expect a few more to appear in the near future.

1. Lagging ROI

Last year, I spoke to the CIO of a global retail chain and he had an interesting approach towards strategic investments in emerging technologies. Instead of trying to develop a standard business case based on pie-in-the-sky ROI calculations, he managed to convince the board of directors to give him more flexibility to invest in a few projects his team deemed to be essential for the long-term survival of the company. For those, he would provide after-the-fact ROI metrics, so that decision makers could assess whether to keep investing or pull the plug. He also managed expectations by saying upfront that some of those projects would fail, but doing nothing was not an option. By setting aside an innovation bucket and establishing a portfolio of parallel innovation initiatives, you can hedge your bets and improve your overall success rate.

2. Efficiency gains or cost avoidance

Many of the early Social Media ROI models are based on how much time you save by relying on social media, converting that to monetary terms based on the cost of labour. While this is certainly a valid approach, it needs to be supplemented by other sources of business value. Unless you are capable of mapping the saved minutes with other measurable outcomes derived from having more time available, the most obvious way to realize the value of being more efficient is to reduce head count, as in theory the group can do the same work as before with less people. If that’s the core of your business case justification, it may fire back in the long term, as some people may feel that the more they use social computing, the more likely it is that their department will be downsized.

3. Proxy Metrics

Some of the ROI examples in the Groundswell book and blog rely on proxy marketing metrics, i.e., what would be the corresponding cost of a conventional marketing campaign to achieve the same level of reach or awareness. For example, when calculating the ROI of an executive blog, the authors measure value by calculating the cost of advertising, PR, SEO and word-of-mouth equivalents.

4. Product/Service/Process Innovation

The value of customer or employee insights that end up generating brand new products, services and processes or improvements to existing one needs to be taken into account. Measuring the number of new features is relatively straightforward. Over time, you may want to figure out the equivalent R&D cost to get the same results.

5. Improved Conversions

Back to the Groundswell book, one of the ROI examples there shows how ratings and reviews can improve conversion rates (i.e., from all people visiting your site, how many more buy products because they trust the input from other consumers, compared to typical conversion rates).

6. Digitalization of knowledge

By having employees blogging, contributing to wikis, commenting or rating content, creating videos and podcasts, companies are essentially enabling the digitalization of knowledge. Things that used to exist only in people’s heads are now being converted to text, audio and images that are searchable and discoverable. It’s the realization of the asset that Clay Shirky calls the cognitive surplus. That was an elusive resource that didn’t have much monetary value before the surge in user-generated content. Naturally, a fair portion of that digitalized knowledge has very little business value, so you need to find metrics to determine how much of that truckload of content is actually useful. You can infer that by using cross-links, comments, ratings or even number of visits.

7. Social capital and empowerment of the workforce

There is certainly business value in having a workforce composed of well connected, well informed and motivated employees. What metrics can be used to assess the degree of connectivity/knowledge/motivation of your human resources? Several social computing tools give you indirect metrics that provide a glimpse of the metrics you can exploit. Atlas for IBM Lotus Connections, for example, gives you the ability to see how your social network evolves quarterly, and can help determining how many people are associated with some hot skill (full disclosure: I work for IBM).

As you can see in several of the emerging models listed above, there are often three types of inputs to develop ROI calculations:

  • Quantitative metrics that can be obtained directly from the system data and log files
  • Qualitative metrics that are determined using surveys, questionnaires and polls
  • Dollar multipliers that attribute arbitrary monetary value to hard to assess items such as a blog comment or an extra contact in your social network

For the monetary value, I would suggest to adopt a sensitivity analysis approach, working with conservative, average and aggressive scenarios, and adjusting them over time. Just don’t go overboard. As I stated in a previous post, there’s an ROI for calculating ROI. ROI models should be easy to understand, as decision makers will often frown upon obscure calculations that require a PhD degree in financial modeling.

In summary: we don’t need one Social Media ROI model, we need many of them. None of the ones emerging now is perfect, none will ever be. You may need to have a few in your toolkit and develop a sense of which one to use in each case.

Previous ROI entries:

ROI 2.0, Part 1: Bean counters vs Innovators – The need for a real exchange of ideas
ROI 2.0, Part 2: Storytelling and Business Cases

ROI 2.0, Part 2: Storytelling and Business Cases

15 12 2008

Storytelling, in the various realms of life, is a powerful tool in spreading the word, creating rapport and inspiring others. It’s not uncommon to hear advocates of social media tell nice stories
about how they blogged or twittered about something and because of
that, somebody else was able to solve a problem that otherwise would
take much longer to address. I use it all the time, and enjoy when others do the same.

However, storytelling is not a substitute for a solid business case. While story telling is a legitimate way to communicate, anecdotal evidence showing a feel-good story on the power of social computing does not constitute proof that net returns are being achieved. Of course, that cuts both ways: the fact that a given person or team never got anything out of blogging or using a wiki cannot be used as a conclusive argument against it either.

The tale that goes untold is: how many of the blog posts, tweets or wiki articles went unnoticed, and how much time was spent covering numerous subjects that did not help the resolution of any problem?

User-generated content (UGC), be it in the form of blog posts, tweets, contributions to a wiki, photos posted to Flickr or Facebook, Amazon book reviews, TripAdvisor feedback or comments to newspaper articles, tend to follow a power law distribution, where usefulness or relevance tend to concentrate on a very small fraction of the whole. That pattern is expected, and it can be even considered an intrinsic part of the overall value embedded in UGC. The gems made possible by UGC exist in part because so much content of various degrees of quality was created, not despite of that.

The point that sometimes is missed in the ROI discussion is that one cannot ignore the total cost and investment to generate those gems when assessing the business value of enabling users to create content. There’s no doubt that the enterprise adoption of social media generates value, as can be attested by the multiple stories collected by Web 2.0 advocates in the last few years. But once discounted the costs, does it generate net business value? Any ROI analysis needs to take into consideration the returns, the investment and the time horizon. Therefore, the questions that need to be answered are: how much, how often (or how soon) and at what cost. Add storytelling to that, and you may have a winner in your hands.

Click here for Part 1 of this ROI 2.0 Series: Bean Counters vs Innovators – The need for a real exchange of ideas

ROI 2.0, Part 1: Bean counters vs Innovators – The need for a real exchange of ideas

11 12 2008

This year I’ve been talking to a very large number of clients around the globe and across multiple industries about the business value of Web 2.0 and Social Computing, and inevitably the topic of ROI surfaces. It seems to be more the subject of a book than a blog post due to its complexity and scope, and it’s also a dry subject, not as flashy as talking about Twitter or cool beer ads. Nonetheless, blogging is my way of thinking out loud, so I’ll give it a try here, but breaking it down into manageable chunks.

Discussions on the ROI for Web 2.0 and Social Computing tend to be very polarized. Many early adopters, enterprise 2.0 thinkers and so-called evangelists tend to dismiss the need to articulate ROI for innovation, with arguments ranging from quick – and shallow – “nobody asks for the ROI of email or phones” to some elaborated points of view. Andrew McAfee, Associate Professor with the Harvard Business School and a recognized thought leader in Enterprise 2.0 wrote a blog post back in 2006 about the challenges of building business cases to justify IT investments using ROI or NPV figures. He quotes the book Strategy Maps, by Bob Kaplan and David Norton, who say:

“None of these intangible assets has value that can be measured separately or independently. The value of these intangible assets derives from their ability to help the organization implement its strategy… Intangible assets such as knowledge and technology seldom have a direct impact on financial outcomes such as increased revenues, lowered costs, and higher profits.  Improvements in intangible assets affect financial outcomes through chains of cause-and-effect relationships.”

On the other side, there seems to be a strong demand by the ones holding the money – often the decision makers – to better articulate the financial returns on social computing initiatives. Pat LaPointe, from MarketingNPV, stated in a blog post he wrote in September 2008:

“(…) we marketers don’t do ourselves any favors by trying to disconnect [Social Media] from financial value just because it’s hard to make the links. Maybe we should take a page from how our companies decide to invest in R&D – with clarity of purpose, explicit assumptions, and rigorous experimentation in escalating risk scenarios. In the end, that will accelerate corporate adoption of social media much faster. So rather than trying to spin the tangential metrics, help those grounded in the P&L to “get it”. Remember, if they don’t “get it”, neither will you. Budget that is.”

John T. Gourville, associate professor at Harvard Business School, writing about the psychology of new-product adoption for the Harvard Business Review (Eager Sellers and Stony Buyers), described a similar conflict between product developers and consumers. The former, like innovators, are likely to see a need for their product and see them as essential, while the latter are reluctant to part with the incumbent product, and are unable to see the need for a change.

As in any polarized discussion, the arguments quickly escalate to become very dogmatic, and no real dialogue takes place. Which side is right, the innovators or the bean counters? Both, to some extent, as it’s often the case. ROI models are far from perfect and benefits derived from social computing are hard to measure. But in a corporate world of limited resources and high scrutiny, investments on Web 2.0 compete with more ordinary needs such as employee compensation and basic infrastructure improvements, so if you don’t have a business case, chances are that you won’t get much funding either. Hype will only take you so far. Past the smoke and mirrors, if there is real net value in Enterprise 2.0, it must be clearly articulated.

To get this conversation started, both sides need to focus on their common objectives: a solution that will benefit both the individuals and the companies they work for. That’s why, at this point of the Social Media evolution, we need more bridges than evangelists.

Blog or Twitter?

8 12 2008

I haven’t blogged for quite some time now, and even my feed reader is covered by virtual cobwebs these days. Being busy is the first excuse that comes to mind – and I’ve been insanely busy in the last few weeks – but of course you always find time to do what you love. And I do love writing and reading blog posts and comments. On the other side, I’ve been twittering quite a bit lately, resembling the character in this gaping void cartoon that Andy Piper mentioned in a recent Web 2.0 presentation of his:

by Hugh MacLeod, gapingvoid

I was actually late to the Twitter party. My first tweet was dated April 16th, 2007 but I only started using it often a few months ago.

Switching completely from blogs to Twitter is very tempting. You may struggle to write a blog post from time to time, but you always have an answer to the question “What are you doing right now?”. That may result in tweets that go from mundane (“back to my dorm”), to cryptic (“VARIA: Files Antwerpen”), to bizarre (abracadabra and decaf???) to history-in-the-making, like in the Mumbai attacks. The atomic nature of Twitter holds an enormous potential that’s not fully realized yet. But does that mean that blogs are really dying?

Paul Boutin, from Valleywag, created some buzz when he wrote in the November issue of the WIRED magazine:

Thinking about launching your own blog? Here’s some friendly advice: Don’t. And if you’ve already got one, pull the plug. (…) The time it takes to craft sharp, witty blog prose is better spent expressing yourself on Flickr, Facebook, or Twitter.

The trend towards minimalism in communications was nicely covered by Jeremy Kaplan (Time magazine) in his befitting short article Haiku Nation. If you find 140 characters too limiting, visit smithmag’s Six-Word Memoirs and you may find that the 1120-bit ceiling for SMS is plenty. Supporting his micro-writing argument, Jeremy lists the NaNoWriMo 12-word novel challenge, the 5-word reviews blog for London musicals and plays, and the always popular 4-word film review site (the reviews on Titanic are just hilarious).

And, of course, there’s a whole series you can find in YouTube shrinking popular movies to their bare essence, such as “Rocky in 5 Seconds”:

Nobody knows for sure if blogs will follow the way of the dodo and GeoCities, or if we are just witnessing the ultra fragmentation of media channels. I expect blogs to be around for a long time, evolving with the other social media, as opposed to being replaced by them. Blogging is still my preferred way of communicating as it allows one to more effectively construct an argument and have meaningful conversations. And of course, you can tell by the length of this post that being succinct has never been my forté 😉