Leveraging Networks And Social Media Teigland

Leveraging Networks and Social Media in a Multinational Company May 2009 Dr. Robin Teigland Stockholm School of Economics [email_address] www.knowledgenetworking.org www.slideshare.net/eteigland 1-

Introduction to networks
Why the interest?
What are some network basics?
What about power?
What about performance?
What does this mean for you?
Creating value through social media and networks
Today’s discussion – Networks & Social Media

Everyone is talking about networks National Innovation Networks Formal Networks Entrepreneurial Networks Ego Networks Regional Networks Infrastructure Networks Social Networks FAS.research Electronic Networks Informal Networks Networks of Practice Networked organization

Did You Know: Shift Happens
http://www.youtube.com/watch?v=pMcfrLYDm2U
How are these trends affecting you and your organization?

A world of rapidly growing knowledge …. > A person’s lifetime in 18th century One week 2008 Fischbowl 2007

… that becomes quickly outdated …. 50% knowledge relevant 50% knowledge outdated First year of technical-based education Third year of education

Human capacity cannot keep up… Cohen & Levinthal 1989 Growth Time Information and knowledge Human absorptive capacity

Yet, the world is “shrinking” family local colleagues friends old colleagues colleagues at other offices Just a click away… virtual communities local networks old classmates avatars business contacts social media contacts referrals

A new workforce is appearing… Mahaley 2008, Merrill Lynch 1999, Beck and Wade, Prensky “ Digital Immigrants” “ Digital Natives” Company loyalty Work ≠ Personal Learning=Behind the desk Professional loyalty Work = Personal Learning=Fun and games

… with skills in using social media tools to reach out… Rey 2008 Communication Personal Media Self-expression Collective Intelligence Content Production

… to build relationships, find information and knowledge, solve problems, and learn Mahaley 2008

6 degrees of separation Milgram 1967, DesAutels 2008

” No one knows everything,
everyone knows something,
all knowledge resides in humanity.”
networks Adapted from Lévy 1997

History tends to repeat itself…. Steam engine Internal combustion engine Microelectronics Late 18 th C Late 19 th C Late 20 th C Schön 2008 Third industrial revolution?

Shifting sources of value
Open business model
Competitive advantage through leveraging external resources (Chesborough 2003)
Permeable organizational boundaries
Redefinition of acceptable sources of value and knowledge
Potential sources of value
Users as organizational resource (von Hippel 1988, 2005)
User interactions with organizations creates value through user-generated content (Di Gangi & Wasko forthcoming)
Di Gangi 2008

Why the interest?
What about power?

What is a network? A set of actors connected by ties
Ties/Links
Knowledge, trust, team, sit by, dislike, etc.
Alliance, customer, investment, etc.
Tie
Actors/Nodes
Individuals
Teams, organizations, etc.
Actor

Swedish hip hop artists Liljeros 2006 ?? Timbuktu

Networks of firms Dahlin 2007 Nocom Ericsson Telia Nokia TietoEnator

Uncovering networks in an organization Formal organization Teigland et al. 2005 R&D organization Informal organization

Individuals within a firm Mattsson 2004 < 1 yr 1-5 yrs 5-10 yrs 10-15 yrs > 15 yrs Time at firm

Central connectors within one location Bottleneck  Teigland 1998 Surprise!! Stockholm

Boundary spanners between locations Stockholm London Brussels Helsinki Madrid Copenhagen Transferred from Stockholm Teigland 1998 San Francisco

Proximal collaboration
When people are more than 50 feet apart, the likelihood of them collaborating more than once a week is less than 10%.
Allen 1984

Communication still occurs within formal silos
US-based MNC with 30 product divisions
30,328 people for 3 months in 2006
> 114 mln emails and meetings
Where does communication occur?
Vast majority is within business unit and functional boundaries, not across them
Who are the boundary spanners?
Women
Mid- to high-level executives
Sales & Marketing executives
Kleinbaum et al 2008

Trust & reciprocity are essential for knowledge exchange in networks

… and most importantly, management cannot mandate social relationships John Eva Hans Miguel Paul Jan Lars Pia Anna Nils Bill Erik Mike Al Alex

Peripheral players between organizations San Francisco Stockholm London Brussels Helsinki Madrid Copenhagen Teigland 1998 Other firms Electronic communities

Dual loyalties Loyalty Loyalty Organization Professional network Teigland 2003

Increasing job turnover Time Number of jobs in lifetime Estimated time at one organization in Silicon Valley: ~18 months CNET 2000

Individuals make choices about how they use their knowledge…
Knowledge resides in the minds of individuals
Individuals make own choices about knowledge
Share openly for the benefit of the organization
Protect and use only in work practice
Perception that an individual’s value is diminished if share knowledge
Knowledge is power
Protect and use only in external relationships for own benefit
Knowledge leakage
Leave the firm and take knowledge with them

Individuals between business firms SEB Ray-Adams & Sandberg 2000 Interlocking directorates of Sweden’s 110 largest firms, 2000 ??

” Birds of a feather flock together”
“ Lika barn leka bäst”
People find similar people attractive and develop relations with people like themselves
Our networks tend to be homogeneous
and not heterogeneous
Marsden 1987, Burt 1990

Why the interest?
What about power?

What is the relationship between networks and power?
Power: Access to and control over resources

How does informal power arise? Krebs 2004 Jack gains informal power, weakening the boss Lisa’s formal power… Jill Jack Bob Lars Anna Sue Lisa Mira Sam Fred

How does informal power arise? … and now Jack’s informal power is greater than the boss Lisa’s formal power Krebs 2004 Jill Jack Bob Lars Anna Sue Lisa Mira Sam Fred

Your network position is related to power
Betweenness
Control over what flows in the network
How often are you on the shortest path between 2 individuals?
Closeness
Access to what flows in the network
How quickly can you reach all others in the network?
Krebs 2004 Jill Jack Bob Lars Anna Sue Lisa Mira Sam Fred

Why the interest?
What about power?

What is the relationship between networks and performance?

Two individuals with the same number of contacts… B A

… but with very different access to resources B A

Bridging unconnected groups brings advantages
More rapid promotions
Greater career mobility
More adaptable to changing environments
Brass, Burt, Podolny & Baron, Sparrowe et al, Gargiulo & Benassi

Performance differs based on one’s network Firm A Low on-time High Creative High on-time Low creative Teigland 2003 High creative Virtual community Firm B

When you hire someone,… … ..you “hire” his or her network.

The strength of weak ties Network A’s knowledge Network D’s knowledge Network B’s knowledge Network C’s knowledge Granovetter 1973

Two divisions within Sundlink (Öresund Bridge) Section 1 Section 2 Improved efficiency over time Stagnant performance over time Schenkel & Teigland 2008

More social get-togethers and coffee breaks are not the solution

“ Managing” networks in your organization Before After Anklam & Welch 2005 1. Uncover networks 2. Analyze networks 3. Improve connectedness

Changing the physical layout Cross, Parise, Weiss 2006
Open-space environment led to impromptu meetings and connections necessary for new ideas and innovations
Easy access to key individuals since no closed offices
Increased knowledge flow of customer and supplier needs since awareness of their visits

Comparing performance across firms Teigland et al 2000

Hewlett-Packard (1990s)
Networking activities recognized and rewarded at individual and unit levels
Management support for informal and formal networking activities across internal and external boundaries
Best practice task group
Personal initiatives
Extensive socialization : personnel rotation, cross-office teams
A visionary organization
Clearly defined mission: ”To make technical contributions for the advancement and welfare of humanity”
Supporting core values, e.g., teamwork, helpfulness
Company-wide goal of World’s Best Laboratory
Teigland et al 2000

Avoid creating insular networks http://www.enronexplorer.com/focus/19185#

eZ Systems and the eZ ecosystem: #1 open source content management software eZ Partners Community Customers
Enterprise open source – “Grow the cake”
60 Employees in 8 countries (Europe & Asia)
230+ Partners
5000+ Customers
30,000+ Community members
www.ez.no Skien, Norway

The Enterprise Open Source Business Model Subscription-based business model

Some leadership challenges!
When employees are more than 50 feet apart, the likelihood of them collaborating more than once a week is less than 10%.
Knowledge is sticky within the firm, but flows easily across organizational boundaries within networks of practice.
Our networks tend to be homogeneous – we tend to develop relations with people like ourselves.
The higher the diversity of team members, the higher the potential for conflict and poor results.
Creating a knowledge sharing culture requires a holistic perspective
Allen 1984, Burt 1992, Brown & Duguid 2002, Marsden 1987, Ruuska & Teigland 2009, Teigland 2003

Why the interest?
What about power?

So, what does this mean for you?
An actor’s position in a social network, i.e., social capital, determines in part the actor’s opportunities and constraints
Casper & Murray 2002 German biotech scientists

Myths and reality checks about networks
I already know what is going on in my network
We can’t do much to help informal networks
To build networks, you have to communicate more
Adapted from Cross et al. 2002

High performers leverage networks (in top 20% of organization’s HR ratings)
Structural – Position themselves at key points in the network and leverage networks to get things done
Relational – Invest in relationships that extend expertise and that help to avoid learning biases and career traps
Behavioral – Understand and cultivate the value of networks and focus on building high quality relationships, not just big networks
Cross, Parise, & Weiss 2006

What is network leadership?
Changing the order of things…
By inspiring others to see the possibilities and enabling them to act on them…
While having only a “blank business card”

Leading through networks
Overcome forces for stability through developing a shared interest in your vision
Gain access to resources through strategically building your networks
Leverage diversity to develop the best solutions
Foster relationships through building trust and open communication
Continuously scan the environment for drivers of change
I f you love knowledge, set it free …

Higher performers create energy in their interactions with others
Those who energize others are higher performers while those who drain energy are lower performers
Get higher commitment from others
Motivate others so get resources they need
Help others learn
How do they do this?
Create a compelling vision – see the possibilities and not the roadblocks
Enable others to contribute meaningfully to achieving the vision – allowing them to shape the road
Are trustworthy – honest and not driven by a hidden agenda
Cross, Baker, & Parker 2003

Structural holes Advantages of position in information networks Bill Burt 1992, Baker 2003 Dept 3 Dept 4 Dept 1 Dept 2 Barb

Build relationships with people at all hierarchical levels Look for complementary skills while maintaining a balance! Cross, Parise, & Weiss 2006 Higher: Help with making decisions, acquiring resources, developing political awareness, explaining organizational activities beyond local setting Equal: Help brainstorm and provide specific help, support, and needed information Lower: Provide best sources of technical information and expertise

External networks are growing in importance! Other people around the world Other employes around the world Other employees in your country Co-Workers Friends Large portion of new ideas and formal collaboration relationships come from external contacts You Alex Eyal Your manager Rami’s manager Hila Yaron Yuval Eduardo Ed Muriel Peter Frequent e-mails Infrequent e-mails Web 2.0 Collaboration

Go meet someone different or far away Robin and Steve Mahaley from Duke CE in Second Life

Develop participation in a variety of networks Strong ties Weak ties Outside organization Inside organization SOCNET

Develop three forms of networking Ibarra & Hunter, HBR Jan 2007 Operational Personal Strategic Purpose Getting work done efficiently Enhancing personal and professional development Developing and achieving future priorities Members Mostly internal contacts and focused on current demands Mostly external contacts and focused on current and future interests Both internal and external contacts and focused on future Network attributes Depth through building strong working relationships Breadth through reaching out to contacts who can refer you to others Leverage through creating inside-outside links

What do your networks look like?
Reflect on your networks
What is the balance between your operational, personal, or strategic networks?
Which networks would you like to strengthen?
What actions can you take to strengthen them?

Build relationships before you need them,…. … … while making sure you create value and foster trust.

Foster trust to build relationships Coleman 2006 Practices and discipline build trust, not who you are in the formal organization

People understand the game We do have certain individuals who …blast out FYI emails…… I think a lot of it is positioning within the organization….. I would say that 99% of those emails/articles are irrelevant…. are deleted. If I find something interesting …… I would send it to relevant people, but I certainly wouldn’t send it to everyone. Whelan, Teigland, & Donnellan 2008 R&D Scientist

The positive spiral of social networks tschaut’s photos Contribution Reciprocity Accumulation Value

Myths and reality checks about networks
I already know what is going on in my network
Those who think they know their network the best are usually the ones who know the least
We can’t do much to help informal networks
Informal networks can be “managed” through changing the organizational context
To build networks, you have to communicate more
Networks can be strategically developed
Adapted from Cross et al. 2002

Creating value through social media
Background
What do they mean for multinational corporations?
What are some benefits?
What are some challenges?
Stepping into the internet – A look at VWs
Today’s discussion – Social Media & VWs

Tomorrow’s workers building skills today
World of Warcraft
Collaborating and leading across geographies, demographics, and cultures
Creating and executing strategies in self-organizing teams
Collaborative decision making under pressure
All virtually with no face-to-face interaction

Traditional media vs social media http://adultaddstrengths.com/2008/11/05/obama-vs-mccain-social-media/

The speed of information: The power of social media http://www.youtube.com/watch?v=t8XxcOj3Seo Fortune, Rey 2008

Microfinancing: Taking on Wall Street
>$30 mln raised to date
5 year projections: $130M – 280M USD
On track to be one of largest microfinance funds (Citibank = $100M)

Background

Organizing in MNCs Network picture from http://n-e-r-v-o-u-s.com/blog/?m=200712 Hierarchy Linear, static, process-based organization Heterarchy Dynamic, integrated collaboration networks

Why does the multinational exist?
Specializes in creation and transfer of knowledge
Superior to market as organizational vehicle to transfer knowledge across geographical borders
The more tacit the knowledge, the more likely to be transferred within the firm
Kogut & Zander 1993 A social community?

Hinton 2007 Knowledge flows through communities of practice

Web 2.0/3.0 and social media help overcome knowledge challenges
Finding and connecting with people internally and externally
Building communities
Sharing information & knowledge
Solving problems & finding solutions
Learning informally
Overcoming diversity challenges
through creating collective
competence
Shared understanding
Shared language and norms
Communication Personal Media Self-expression Collective Intelligence Content Production

How can social networking sites be leveraged? ringsidenetworks.com

Serena Software: Strengthening internal and external relationships through Facebook
#1 Applications Lifecycle Management (ALM) & business mashup
96 of Fortune 100 as customers
800 employees in 18 countries across globe
Facebook Fridays: One hour every Friday on Facebook to find fun and connect with co-workers, customers, family, and friends
Average employee age: 46
27 year old Silicon Valley company
>90% of employees on FB

eZ Systems and the eZ ecosystem: Creating value through its open source business model eZ Partners Community Customers
#1 open source content management software
Enterprise open source – “Grow the cake”
60 Employees in 8 countries (Europe & Asia)
230+ Partners
5000+ Customers
30,000+ Community members
www.ez.no Skien, Norway

eZ Wire enables global conversations

IBM – “A marketplace for projects” for its 390,000 employees worldwide http://www.slideshare.net/SOMESSO/speaker-1-bettina-kahlau-presentation

IBM – A company reinventing itself
$98 bln in sales 2007
Ca. 355,000 employees
New values developed by employees in jam sessions
Dedication to every client's success
Innovation that matters, for our company and for the world
Trust and personal responsibility in all relationships

At IBM, “BlueIQ” facilitates several functions Communities Create, find, join, and work with communities of people who share a common interest, responsibility, or area of expertise Blogs Use a weblog to present your idea and get feedback from others; learn from the expertise and experience of others who blog Dogear Save, organize and share bookmarks; discover bookmarks that have been qualified by others with similar interests & expertise Activities Organize your work, plan next steps, and easily tap your expanding professional network to help execute your everyday deliverables, faster Profiles Quickly find the people you need by searching across your organization using keywords that help identify expertise, current projects and responsibilities Poole 2008

Management cannot mandate social relationships Stockholm London Brussels Helsinki Madrid Copenhagen Transferred from Stockholm Teigland 1998 San Francisco

IBM’s Atlas shows the social network of a topic and how to get to someone Poole 2008

Ericsson blogs for internal communication
Community blogs
Knowledge development within one area, eg technical
Individuals who want to drive their ideas and gather support
Management blogs
Managers blog for their own organization
Individuals or management groups
More of an informal nature, visit to China
Individual blogs
Personal nature
Engage people in one’s interests

The future manager portal at Cisco

Tomorrow’s meeting
Telepresence by Cisco
http://www.youtube.com/watch?v=rcfNC_x0VvE

Companies are turning to virtual worlds to facilitate the virtual workforce – “Immernets”
Public and completely private virtual business worlds (immernets) to recruit, train, collaborate, and innovate
Accenture, Cisco, IBM, Intel, Johnson & Johnson, Motorola, Novartis, Philips, Sun, Unilever, …..

Improving virtual teaming and cross-cultural skills Task: To build a bridge in your virtual team Designed by Duke CE and Stockholm School of Economics

Improving global collaboration
Creating immersive workspaces in virtual worlds
http://www.youtube.com/watch?v=PnPBQAxUuDE
By 2012, Gartner estimates that 70% of organizations will have their own private virtual worlds. (May 2008)

IBM - Convergence in virtual spaces mentoring Green Data Center SOA Training Play is how we principally learn and principally create " Ray Kurzweil many to choose from IBM Lotus Tools BMW Training Media Brain Thinking Hamilton, 2009

IBM’s jam sessions in Second Life

External networks are growing in importance! Other people around the world Other employes around the world Other employees in your country Co-Workers Friends Large portion of new ideas and formal collaboration relationships come from external contacts You Alex Eyal Your manager Rami’s manager Hila Yaron Yuval Eduardo Ed Muriel Peter Frequent e-mails Infrequent e-mails Web 2.0 Collaboration

Improving recruiting efforts Job Fairs Accenture recruits in Second Life since 2006 – this recruiting has since paid for itself A manager at a high-tech multinational recruits senior level employees through Orkut, resulting in reduced turnover and headhunter fees Virtualworldnews.com 2008, Hustad & Teigland 2008

Using wikis at Target (Retail chain in USA)
Purchasers work with vendors all over the world
Have seasonal deadlines to purchase items
Email did not facilitate interaction
A purchasing agent set up wiki-based GroveSite (took only 20 minutes to set up)
Invited her vendors to be part of the team
Posted drawings and requirements for next season’s fashions
Got much better response from vendors
Vendors felt much more part of process and more of a partner of Target
Coleman 2006

Creating new knowledge sources… Closed Expensive Complex Accurate Open Inexpensive Simple Close enough Hinton 2007

Crowdsourcing: Capturing the wisdom of crowds
What is it?
Customer participation in business and business development
Why the interest?
Experience
Ownership
Engagement
Loyalty
Brayrie 2007

What can organizations do? Innovation Product development Content generation Decision making Funding Sales & marketing Distribution Brayrie 2007

Innovations - www.innocentive.com

Problem solutions - The Goldcorp Challenge

From organization-generated content (OGC) to user-generated content (UGC) Content created by a user to be used by a user Content created by an organization to sell to a user Di Gangi 2008

Rapid growth of UGC Web Sites Organizations increasingly introducing UGC websites (e.g., social networking, electronic communities) as organizational resources Deloitte 2008, DiGangi 2008

Why are organizations using UGC websites? Deloitte 2008

GE Healthcare on Twitter

GE Healthcare on LinkedIn

Examples at Dell DiGangi 2008, Brayrie 2007 Self-support Product development

Building the Dell community Brayrie 2007

Motorola Q – Creating content

Scania Social Media Newsroom “ One of the best B2B newsrooms I have seen.” -Bodnar, May 10, 2009

Scania Social Media Newsroom – Blog comments
Content is clearly something that Scania has made a priority….aggregate, categorized, and tagged.
But only written content is traditional product releases. …no white papers, case studies, or other written documents that could add additional value for a site visitor
http://socialmediab2b.com/2009/05/b2b-social-media-newsroom/comment-page-1/#comment-80

Engaging readers in content creation http://socialmediab2b.com/2009/05/b2b-social-media-newsroom/comment-page-1/#comment-80

Suggestions for Scania’s Internet Communications Manager
Include sales materials for sales team to download and allow comments to help generate feedback from customers.
Showcase more customer experiences: written case studies, testimonials, videos with customers, etc.
Focus on search add content that is focused on your key search terms as a way to build awareness with a new audience.
Add a live chat function to answer customer questions or media questions in real-time.
http://socialmediab2b.com/2009/05/b2b-social-media-newsroom/comment-page-1/#comment-80

Social media at your company?
How are social media used internally and externally at your company?
Are there any benefits?
What could you do to better leverage social media?
Some search words for search engines
Social media, Social networking, Web 2.0, Enterprise 2.0
Some sites
Company homepage blogs
www.wikipedia.org www.slideshare.net
www.youtube.com www.flickr.com
www.linkedin.com www.facebook.com
www.twitter.com

Match the tool to the purpose Tool Purpose Example Blogs/Microblogs Conversation Relationship building Information sharing Getting customer and employee feedback Sun Microsystems Ericsson GE Healthcare Discussion forums Self-support Solution finding Customer engagement Dell Wikis Collaboration Mutual problem solving Engagement Motorola Swedbank Social networking sites Community development Relationship building Building loyalty Solution finding Serena Software Victoria’s Secret Jeep Virtual worlds Collaboration Innovation Engagement Knowledge accidents Nokia Philips IBM

Background

Why use these new social media tools? Melcrum 10/07

What about business results?
Driving innovation into products faster
Enabling employees to be more productive, more knowledgeable, faster
Harnessing the knowledge of the wise , before they retire
Being more responsive to customers, with knowledge from subject experts you may or may not know
Poole 2008

Profitable growth through higher efficiency and innovation
Preventing the waste of valuable resources - avoid reinventing the wheel
Ensuring the use of leading-edge technology and thinking across the firm
Increasing customer satisfaction through shorter lead-times and consistent behavior
Creating a competitive cost structure
Facilitating breakthrough and incremental innovations through combination of technologies and ideas from across and outside the firm
An attractive workplace that encourages cross-functional co-operation across the globe
Attracting and retaining key individuals
What about business results?

Are there any numbers to back this?
Among the clients surveyed by Select Minds, corporate social networking resulted in:
Productivity Contributions: Increase in productivity by an average of 10%
Retention Contributions: Increase in retention by an average of 9%
Increases in New Business: Increase new business by an average of 12%
Rehiring Former Employees: On average, rehires made through their Corporate Social Networking program….
become fully productive 49% faster than all experienced hires
became Star Performers (66%), versus 26% of experienced hires
Select Minds 2008: "Corporate Social Networking: Increasing the Density of Workplace Connections to Power Business Performance"

Are there any b enefits from social media, or is it all hype? Poole 2008: IBM Global Technical Services Knowledge Community of Practice Business Impact Survey 2007, completed by approximately 2,300 respondents

Background

However, there are challenges….
Resistance from top management
Difficulty to measure and validate value of web 2.0
Knowledge trading and leakage outside of firm
Social overload and role conflict
Poor organizational stewardship
Web 2.0 and social networking are typically of a more grassroots nature – their implementation in more traditional hierarchical organizations may result in tension between employees and management Hustad & Teigland 2008

Fear of loss of power at the top Cross, Parise, & Weiss 2006

Is knowledge trading good or bad for a firm? We pass over the nondisclosure agreements of different companies and trade company secrets all the time.

Who owns the knowledge? Organizational information vs. Personal expertise

Social overload and role conflict Loyalty Loyalty Organization Professional network Teigland 2003

Do employees know how to represent the company when using external social media? Statoil-Hydro Love at 150 m below sea level!

IBM’s blogging policy & guidance, created by the employees Policies based on IBM’s Business Conduct Guidelines Apply internally and externally Available on ibm.com “ blogging guidelines” Adapted from Poole 2008

Company guidelines for using social media internally and externally
Trust your employees, and don’t ban social media
Use wikis to enable employees to create the company guidelines, eg IBM
Yahoo’s best practice guidelines for blogging (http://jeremy.zawodny.com/yahoo/yahoo-blog-guidelines.pdf)
Be respectful of your colleagues
Get your facts straight
Provide context to your argument
Engage in private feedback
When trusted, employees feel empowered to do the right thing!

Promoting an open innovation attitude Not all the smart people work for us. We need to work with smart people inside and outside the company. The smart people in our field work for us. If you create the most and the best ideas in the industry, you will win. If you make the best use of internal and external ideas, you will win. Closed attitude Open attitude Chesborough 2003

Users create their own meanings Wesch 2008

There is nowhere to hide http://www.youtube.com/watch?v=t8XxcOj3Seo Fortune, Rey 2008 Monitor social media sites and react in a timely fashion

Treat like any change project Kotter 1996 2. Form a powerful guiding coalition 1. Establish a sense of urgency 3. Create a vision 8. Anchor new approaches 4. Communicate the vision 5. Empower others to act on the vision 6. Plan for and create short-term wins 7. Consolidate improvements and produce more change

Background

Watch out! Forces converging….
People
Net generation
Neuroplasticity
New demands
Technology
Social software (Web 2.0)
Broadband access
Mobile hardware
Business Environment
Globalization
Pace and change
Information load
Mahaley 2008

What one listener emailed me after…. When I got home last night, my 17 year old son was doing what he usually does – sitting at the computer online with his friends…But after hearing this presentation, I couldn’t help but be interested in what he really was doing. So, when I looked more closely, I saw that he was involved in three separate conversations - all at the same time, and not only that, he was also following the discussions on one of the school’s forums. Then he said, “Mom, you grown-ups are sooooo behind…..think how much you could get done if you worked like this!”

Discussion – Some questions to ponder
What defines the boundaries of the MNC?
From nonporous to porous
Ecosystems and “open source”
What defines an employee of the MNC?
From binary membership to fuzzy membership
Microemployees and community members
Where is the MNC located?
From the physical to the blended (physical & virtual)
Labor “mobility”
Are we stuck in a traditional mindset?
Knowledge creation and transfer in MNCs superior to the market…..but is it superior to networks?

“ Leading by values is very different …..It is empowering .. Rather than burden our people with excessive controls, we are trusting them to make decisions and to act based on values...
In today's world, where everyone is so interconnected and interdependent …. If we're going to solve the biggest, thorniest and most widespread problems in business and society, we have to innovate in ways that truly matter. And we have to do all this by taking personal responsibility for all of our relationships - with clients, colleagues, partners, investors and the public at large.
This is IBM's mission as an enterprise, and a goal toward which we hope to work with many others, in our industry and beyond.
Samuel Palmisano, IBM Chairman, President, and CEO

So, what does all this mean?
Organizations have to develop their networks globally - both inside and out
Organizations have to leverage social media such as virtual worlds
To win the war for talent
To innovate for competitive advantage
Organizations have to cultivate an open, knowledge sharing culture
I f you love knowledge, set it free …

Background
What are the benefits?

Interested in a tour? Stepping into the Internet: A tour of Second Life

Within five years, the 3-D Internet will be as important for work as the Web is today. January 2008 By the end of 2011, 80 percent of active Internet users (and Fortune 500 enterprises) will have a “second life”, but not necessarily in Second Life. Steve Prentice Gartner

Towards 3-D Internet Level of Interaction Time Hamilton 2008 Individual - Web 1.0 Thinking Mosaic, Prodigy, Compuserve, AOL, Netscape Connected Web 2.0 Thinking Facebook, Friendster, Yahoo, Blogger, Wikipedia, eBay, Typepad, LinkedIn. Amazon, MySpace, Textamerica, Delicious, HubPages SENSORY 3D Internet Thinking SecondLife, Active Worlds, There, SimsOnline, Club Penguin, World of Warcraft, 3D planets, ToonTown, Habbo, VSlide, Protosphere

No financial crisis in VWs?
Increasing members
Increasing companies
Increasing turnover
Wonderland

780,000 users USD 420 mln turnover 2008

Entropia Universe by MindArk
Ability to develop skills and sell virtual goods
Island sold for USD 26,500 in 2004
Asteroid space resort sold for USD 100,000 in 2005
Clothes Against Violence – limited edition virtual jackets sold for more than same model of real world jackets
Virtual universe with real cash economy
Fixed exchange rate to US Dollar, 1 USD = 10 PED
Five banks auctioned for USD 404,000 in 2007
Real life bank license granted by Swedish Government to MindArk Bank in March 2009
A business model like the real world
Raw materials and skills needed to build
Goods deteriorate and need to be replenished

Second Life – one example of a virtual world
Machinama film by Duke CE on SSE MBA
http://www.youtube.com/watch?v=Bi5i3UwVvbg

“ Clearly if social activity migrates to synthetic worlds, economic activity will go there as well.” Castranova Joe Miller, Linden Lab
16 Million members
1.1 Million active residents
350,000 Hours of use per day
87,500 Hours development time/day
$1.6 Billion worth of free work per year
163 Virtual square miles (5X Boston)
520,000 Unique items traded/month

“ We think it has potential as a way of doing business. We’re just experimenting with it ourselves but we see massive potential in the human interaction you can bring. It’s a big browsing environment in many ways.” - IBM Director

Recruiting Job Fairs

Improving internal effectiveness Unilever is running an extensive pilot in SL

In-house training and education IFL at SSE and Duke Corporate Education Co-developing and running virtual team building exercise

Co-creating solutions for today… Philips Design Group Lead-user innovation workshops

… as well as for tomorrow HSB: Building the house of the future in a competition with KTH and Chalmers architecture students

Increasing effectiveness in traditional industries “ Soon all fashion designers will be originating their designs and managing the production in virtual worlds ….Why such a dramatic change? Economics, pure and simple .” Shenlei Winkler, Director Fashion Research Institute

3D internet Before the first plate of aluminum is even bent for production, the passengers will have flown, the crew will have serviced, and the pilots will have flown the plane. CEO of Boeing supplier

China is making big efforts in virtual worlds!
“ Virtual economy district – a world where millions will work, communicate, and be in love”
Reaching out to the 150 mln overseas Chinese
7 million inworld at same time
Ability to borrow money to finance operations through Mind Bank
www.crd.gov.cn, www.foreignpolicy.com “ The real China is only a piece of land. We believe that there must be a China in the virtual world and the real world.” Robert Lai, Chief Scientist, CRD

MMOGs still dominate
World of Warcraft
374,000 hours played each day or 50,000 man days each day
8.5 mln players worldwide
Xfire.com, MMPORG.com
Korean Free to Play (F2P)
4 of top 10 MMOGs in Western world
Silkroad Online #1 in West
MapleStory with >50 mln players

The opportunities are endless……. http://static.flickr.com/47/110109290_2189217cee.jpg

Where are we today with virtual worlds?
Business opportunities limited?
Many real world firms have virtual world presence, but difficulty turning it into an effective, profitable sales channel
Few RoI success stories for real world firms - disconnect between real world companies/products and SL fantasy avatars?
Multinationals now turning to internal focus, i.e., how can VWs be used to improve effectiveness (intraverses)?
IBM signs agreement with Linden Lab
Limited number of individual success stories
~150 other individuals making >$5000 per month
“ Trapped” in real world activities?
But educational and training uses are taking off!
Schools and universities across the globe are experimenting across all disciplines

What should you do in virtual worlds? Experiment, “play”, and learn Stay on the look-out Consider creating independent operations Don’t forget other emerging media

We digitized audio and video, why can’t we just digitize, you know, Earth” Philip Rosedale, Chairman Linden Lab

“ I think there’s a world market for maybe five computers.” Thomas Watson, Chairman of IBM, 1943 “ There is no reason anyone would want a computer in their home.” Ken Olson, President, Chairman and Founder of Digital Equipment Corporation, 1977 “ Heavier-than-air flying machines are impossible.” Lord Kelvin, President, Royal Society, 1895

Thanks and see you in world! Karinda Rhode aka Robin Teigland [email_address] www.knowledgenetworking.org www.slideshare.net/eteigland

Sources and acknowledgements
Books
Barabási, Linked: The New Science of Networks . Perseus, 2002
Burt, Structural Holes, 1992
Castells, The Rise of the Network Society . Blackwell, 2000
Cross & Parker, The Hidden Power of Social Networks . Harvard Business School, 2004
Gladwell, The Tipping Point . Abacus, 2001
Scott, Social Network Analysis . Sage, 2000
Teigland, Knowledge Networking , SSE, 2003
Teten & Allen, The Virtual Handshake . American Management Assoc., 2007
Homepages
Wayne Baker, webuser.bus.umich.edu/wayneb/
Stephen Bird, people.bu.edu/sbird
Steve Borgatti, www.socialnetworkanalysis.com
Rob Cross, www.robcross.org
International Network for Social Network Analysis http://www.insna.org/
David Krackhardt, www.andrew.cmu.edu/user/krack/index.shtml
Valdis Krebs, www.orgnet.com
Fredrik Liljeros, www.sociology.su.se/home/Liljeros/index.html
Steve Mahaley, www.dukece.com
James Moody, www.soc.duke.edu/~jmoody77/presentations/index.htm
Giancarlo Oriani, www.informalorg.eu (In Italian)
Barry Wellman, www.chass.utoronto.ca/~wellman/

Sources and acknowledgements (cont’d)
Articles and Research Papers
Cross, Baker, & Parker, “What creates energy in organizations?”, Sloan Management Review , Summer 2003.
Cross, Parise, & Weiss, “Driving Strategic Change with a Network Perspective”, Network Roundtable working paper, 2006.
Kleinbaum, Stuart, Tushman, Communication (and Coordination?) in a Modern, Complex Organization, HBS working paper, http://www.hbs.edu/research/pdf/09-004.pdf
Ibarra & Hunter, “How Leaders Create and Use Networks”, HBR, 2007.
Coleman, D. Virtual Team Spaces, 2006.
Connaughton, SL & Daly, JA, “Leading from Afar: Strategies for Effectively Leading Virtual Teams” in Virtual Collaborative Teams: Process, Technologies, & Practice (S. H. Godar & S. P. Ferris, Eds.).
Lipnack, J. & Stamps, Virtual Teams: Reaching Across Space, Time, and Organizations with Technology . John Wiley & Sons, Inc.: New York, 1997.
Maznevski, M. High performance from global virtual teams, 2001.
Ruuska, I. & Teigland, R. 2009 (Forthcoming). “Ensuring Project Success through Collective Competence and Conflict Management in Public-private Partnerships: A Case Study of a Swedish Triple Helix e-government Initiative”. International Journal of Project Management .
Schermerhorn, Jr., J., Management , 2004.

Sources and acknowledgements (cont’d)
Online sources
Bodnar, http://socialmediab2b.com/2009/05/b2b-social-media-newsroom/comment-page-1/#comment-80
Gurteen, Online Information 2007: KM goes Social, http://www.slideshare.net/dgurteen/km-goes-social-194717
Poole, IBM: Web 2.0 goes to work, http://www.slideshare.net/jward5519/ibm-web-2-0-goes-to-work-presentation

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Leveraging Networks And Social Media Teigland

by Robin Teigland

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