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NET WORKS FOR THINKING Developing iDeas anD forming opinions in the Digital age Networks for thinking Developing ideas and forming opinions in the digital age a report from the economist intelligence Unit SOCIAL TRENDS

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NET WORKS FOR THINKING Developing ideas and forming opinions in the digital age contents About this report 3 Executive summary 5 The thinking man’s network 7 Knowledge skills: Five ways to thrive in the digital age 8 Case study: How different are the young? 12 The trust game 13 Case study: Wikipedia – The democratisation of knowledge 14 Opening up the workplace 15 Case study: Chubb uses social networking tools to generate ideas 16 Engaging with the crowd 18 Case study: Threadless – A community of creatives 20 The implications for innovation 21 Case study: Lego – Taking creativity online 22 Conclusion 23 Appendix 252 © The Economist Intelligence Unit Limited 2011

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NET WORKS FOR THINKING Developing ideas and forming opinions in the digital age about this report3 © The Economist Intelligence Unit Limited 2011

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NET WORKS FOR THINKING Developing ideas and forming opinions in the digital age Networks for thinking is an Economist Intelligence Unit report that examines the way digital tools and networks are affecting the way business people develop their ideas and thinking. The study draws on in-depth interviews with 16 leading experts and corporate leaders, as well as a global survey of almost 1,200 senior and up-and-coming executives and MBA students. Rather than considering the population as a whole, it looks specifically at those who are already digitally connected (the survey itself was conducted online). The author was Dr Paul Kielstra and the editor was Gareth Lofthouse. About the survey: A total of 1,193 executives and business school students took part in this survey, with 40% coming from Western Europe, 26% from the Asia-Pacific region, 18% from North America and the rest from the Middle East, Africa, Latin America and Eastern Europe. In terms of age, 11% were under 30, 31% in their 30s, 28% in their 40s, 18% in their 50s and 11% 60 or over. More males (78%) than females (22%) took part, but there was remarkably little difference between the genders on responses. The research was conducted between March and May 2011. Interviewees: Jagdish Belwal, CIO, Tata Motors Don Tapscott, author of studies on the impact of new technologies Irene Greif, head of IBM’s Collaborative User Experience Group Professor Manuel Castells, communications scholar Jim Jansen, a senior fellow at the Pew Internet & American Life Project Evan Rosen, consultant and speaker on collaboration strategy and author of The Culture of Collaboration John Seely Brown, former head of Xerox’s Palo Alto Research Center and now co-chair of Deloitte’s Centre for the Edge, a think tank James Knight, CIO of the Chubb Group of Insurance Companies Professor Mikolaj Jan Piskorski of Harvard Business School Jimmy Wales, founder of Wikipedia Russell Place, chief strategy officer, Universal McCann Lisbeth Pallesen, EVP of Consumer, Education and Direct, the LEGO Group Nicholas Carr, writer on technology, culture and economics Jake Nickell, co-founder and Chief Strategy Officer, Threadless Mark Holden, global strategy director, PHD Worldwide Susan Steele, chief human resources officer, Millward Brown4 © The Economist Intelligence Unit Limited 2011

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NET WORKS FOR THINKING Developing ideas and forming opinions in the digital age executive summary The Internet, together with the social and small) minority associated these technologies business communities that it has spawned, with negative feelings. Overall Internet-based continues to transform almost every conceivable networks and tools are valued more or less aspect of human life. People are not only as strongly by older executives (40+) as by spending large chunks of the day consuming those under 30, although sometimes younger digital media, but they do so using an respondents use them in different ways. increasingly sophisticated blend of channels and technologies. More importantly, the new Business people particularly value the way networks are also driving deeper changes in the technology enables them to develop their human behaviour. Social media such as Facebook thinking. Four out of five say that they have and Twitter provide an early indication of how better information to support decision-making interpersonal relationships and interactions than five years ago, and more friendships and might evolve in this environment. But, as this business relationships are now maintained study reveals, digital tools are also changing the online than offline. The Internet is seen as the way people develop ideas, form views and make “best place to go for exploring ideas and new both trivial and life-changing decisions. perspectives on the world,” according to 72% of executives in the survey. However, the research There is, of course, already a sizeable amount also suggests that people feel able to use these of research available on how consumers are tools more freely in their personal lives than using these technologies. This research differs in the workplace – not surprisingly, given that in that it focuses primarily on individuals in the many companies still discourage the use of business world, and seeks to understand how social media. they are using the new knowledge networks to advance their ideas and thinking. It shows The new networks change the way we how the people who are driving the knowledge acquire knowledge and solve problems economy are developing new skills and Technology allows individuals to rapidly gather capabilities based around these technologies. and combine huge quantities of information It also investigates the longer-term impact emanating from sources as varied as friends of these trends on corporate culture and and colleagues, traditional news outlets management strategy. and YouTube postings. But the quantity of information available is only part of the story. Key findings: The new networks have also begun to blur the line between learning and communication. Business leaders want to be digital natives too Developing knowledge increasingly involves Executives in the survey are enthusiastic users participation in a global conversation rather of digital tools and networks. The majority of than the simple absorption of data. Over six in respondents say they make them feel “smarter” 10 respondents, for example, have contributed and “connected”, whereas only a (generally to an online discussion in the last year, and one5 © The Economist Intelligence Unit Limited 2011

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NET WORKS FOR THINKING Developing ideas and forming opinions in the digital age third have published their own information less adept at than straightforward customer on the Internet. In return, the new technology relations. Convincing people to provide ideas allows them to rapidly tap insight within their requires incentives and focus. More importantly, existing relationships, but it also enables them it requires an understanding of what makes to reach new sources of expertise rapidly. Just communities flourish. under 40% of those surveyed, for example, have directly contacted the author of The new networks favour certain types of something seen on the Internet. creativity over others Respondents believe that digital technology In the digital world, people place a premium has made companies in general much more on information they can trust innovative, but only 15% say its biggest effect Survey respondents and those interviewed on their own jobs has been the creation of identified the volume of data now available as a better, or more, ideas. The new networks seem to significant problem in itself. Even more difficult help with certain mental tasks, such as projects was determining the quality and credibility of where groups work better than individuals. information online. Only 16% disagreed with the But other forms of creativity (and indeed, other statement that “I sometimes struggle to know types of personality) may be less suited to this which information sources can be trusted when environment. About half the respondents to the online”. Given the oceans of information now survey say that they prefer to find space to do available, traditional techniques for evaluating their own thinking rather than brainstorming quality, such as time-consuming analysis, are not when developing ideas. Obviously new always practical. In this environment, reputation information tools and strategies do not overtly Being a matters even more than before. When asked forbid the lone thinker from coming up with recognised “what determines whether something catches insights, but the ubiquity of the new model and expert on a your attention online,” executives say that the the need to engage in the networks of others topic helps most important factor is the credibility of the could bring its own negative social pressures. you get your information source. opinion or idea aired, but in They are also more questioning of authority These trends hold far-reaching implications a sceptical environment While people still value the views of experts for both individuals and for organisations. you have to and credible information sources, this does not At the individual level, business people are re-earn your mean that their word is automatically accepted increasingly using a blend of digital tools and reputation – on the contrary, networks encourage people strategies to inform their decisions and improve almost on a to challenge traditional authority figures. In their knowledge. The new technology creates daily basis. practice, this means people will start with a challenges too, of course. The sheer quantity of trusted information provider, but then check information available is often overwhelming, what they find against a wide range of sources, and it is becoming difficult to know what sources which might include alternative information you can really trust. Privacy issues also remain channels but also friends and colleagues. Thus a serious concern. But despite these issues, being a recognised expert on a topic helps you executives of all ages generally emphasise the get your opinion or idea aired, but in a sceptical benefits of the new networks. environment you have to re-earn your reputation almost on a daily basis. The networks also hold huge potential for companies, but it seems harder to unlock their Crowdsourcing can fuel ideas, but will remain full value at an organisational level. Certainly a niche activity for some time there are a growing number of companies – Although three quarters of respondents say that some profiled in this report – that have found their influence as consumers over companies ways to harness them. But many others still view has increased, crowdsourcing remains a niche the latest technologies primarily as a threat to activity, with only 3% of companies using it as a their ability to control information and employee leading source of new ideas. There are, of course, performance. This often leads them to place innovative companies that are successfully restrictions on these tools. Whether such a harnessing the “wisdom of the crowd”, but doing policy of prohibition can be sustained is another so entails overcoming some sizeable hurdles. matter. Increasingly, employees and customers To be effective, crowdsourcing often needs will expect organisations to embrace the free to go beyond the customer base to engage a exchange of ideas and information that these wider public, something which businesses are networks were designed to deliver.6 © The Economist Intelligence Unit Limited 2011

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NET WORKS FOR THINKING Developing ideas and forming opinions in the digital age the thinking man’s network Digital networks are assuming an ever greater The digital shift prominence in the lives of billions of people One of the most striking aspects of the research around the world. The average American is just how positive business people of every age already spends two hours a day online, versus feel about these networks. Over half of survey three hours watching TV. Some of the newer participants (58%) say that, as a result of digital technology channels are growing particularly technologies, they feel smarter. Whatever the fast. For example, the time spent by global impact of these tools on brain power itself, the consumers on social media networks had grown availability of data online is leaving them far year-on-year by 82% by 2009, while the number better informed: 88% use many more information of Americans watching mobile video grew by sources and 83% have better data on which to 40% year-on-year by 20101. base decisions than they did even five years ago – the web dates back nearly 20 and the Internet Undoubtedly this migration to digital networks is itself far longer. having a profound effect on the way people find and exchange information, as well as collaborate with Respondents are finding this rich trove of others. What is less understood is the extent to which information online: 72% call the Internet “the these tools are changing the way people develop best place to go for exploring ideas and new their ideas and thinking. perspectives on the world.” Three quarters are This has broad implications across society, not least spending more time online than five years ago in business. keeping up with global events and 74% are doing so in search of news within their own This study examines how the new networks are industry. Jagdish Belwal, CIO of Tata Motors, affecting senior business people in particular. It speaks for many when he says: “People are much relies on 16 interviews with prominent experts more informed now. There used to be a lot of and corporate leaders, as well as a survey of information asymmetry, but today if I am talking nearly 1,200 executives worldwide which looks to an expert, I can quickly Google and get a lot of at the impact of technology on respondents information on what we are talking about.” as individuals and on their organisations. Although most of those surveyed are already The search for information is part of a greater well advanced in their careers, to obtain a shift of life online for these business people. wide range of ages the survey also includes Over half of respondents, for example, have also a cohort of younger executives and MBA filed tax returns and supported charities over the students. To understand how this group uses Internet, and 41% have volunteered to engage these digital technologies to help shape their in some activity. It thus comes as little surprise that worldview requires a detailed look at how they people are using the web to find data or that nearly are informing themselves, communicating and every respondent has heard of Wikipedia, the free making decisions. online encyclopaedia, and 83% find the site useful. Nielsen, 2010 17 © The Economist Intelligence Unit Limited 2011

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NET WORKS FOR THINKING Developing ideas and forming opinions in the digital age More interesting is that the same digital tools have shifted the process of becoming informed knowledge skills from one of absorbing knowledge to one of participating in a global conversation. This Five ways to thrive in the digital age takes several forms: 39% of those surveyed, for What does the research tell us about how people can use these technologies to solve example, have directly contacted the author of problems and enhance their careers? something seen on the Internet. More common is commenting online about information found 1. Learn to generate the right network for the right job there. Sixty-five percent of respondents have The ability to generate new, complex networks to help solve information needs or contributed to a discussion of a political, social or coordinate collaboration is a learned skill in itself. Keeping abreast of networking and communication technologies is essential, as is being willing to look for a broad range of business issue on the web in the last 12 months. network participants. About half that number (33%) have gone further, self-publishing their own information, often 2. Tend your network assets – it’s fun through a blog. These networks work only because of their social context. The ability to call on a wide range of network contacts requires engagement and commitment – after all, human relationships need to be nurtured and maintained. Fortunately, most people find such This interactivity is not a by-product of the activity enjoyable. The line is blurring between researching and learning, sharing of search for information: it is central to the information and building relationships. Hence, maintaining a growing social network Internet experience. Don Tapscott, co-author can be central to business productivity. Ideally, the question “Am I working, chatting, of Wikinomics and also author of a number of learning or having fun?” should become meaningless as these activities meld into one. studies on the impact of new technologies on 3. Use the network to help you discriminate and evaluate the generation currently entering the workforce, There is now often too much information to assess it all confidently. Unfortunately explains that individuals brought up with people often need to evaluate the validity and trustworthiness of a multitude of sources digital technology typically think, “What good is at great speed. Again, bespoke, temporary networks including credible, trusted sources, knowledge if you don’t share it?” This sentiment friends, colleagues or even the wisdom of the wider “crowd” can greatly help in this has spread broadly among business executives, process of selection and scoring. at least as individuals: 56% of respondents like 4. Don’t forget privacy that they can easily have their own say online, Although the new networks encourage people to share information, doing too much has against just 10% who do not, and 65% like the fact its own dangers. The need for some level of personal privacy and corporate secrecy has not that it allows mavericks or contrarians a voice. disappeared. Balancing privacy and openness will become an increasingly important skill. If information gathering now resembles 5. Know when to go it alone The new knowledge networks can help today’s executives tackle many business communication, it is partly because executives challenges more effectively. But they are more suited to some business tasks than are doing much more of the latter online as others. Creative tasks that require brainstorming or user input, or which involve well. Sixty-three percent feel more connected building on other’s ideas, are ideally suited to the new networks. There are many because of digital technology and over half other tasks or stages in the creative process that may be better addressed report spending significantly more time on through introspection. Have you done any of the 13% following in the past 12 months? Won business through contacts made via social media site Select All thAT apply. (% respondents) 65% 60% 48% 39% 37% 35% 33% Added a Researched Worked in a Directly Written a Made a Self comment a medical ‘virtual’ team contacted review on a friend or published to an online condition (ie, the team the writer of website relationship your own discussion collaborates something (eg, customer online who information on a political, mainly online) you have comments you go to on a topic business or read online on Amazon) meet in (eg, a blog) social issue person8 © The Economist Intelligence Unit Limited 2011

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NET WORKS FOR THINKING Developing ideas and forming opinions in the digital age the Internet communicating with friends and sometimes even the piece of software or website. family, collaborating with colleagues and even exchanging ideas with people they do not know. The survey sheds light on how respondents As with information gathering, this represents an combine different elements depending on the increase in overall activity rather than a shift to a situation. When developing general ideas and different medium. knowledge, respondents say that their most valuable sources of information are newspapers In consequence, many more relationships are or magazines, whether online or offline (61%), now maintained inside cyberspace than outside: and Internet search engines (59%). The search respondents sustained, on average, 77 business for information on political, ethical or social relationships largely online compared to 53 in the issues focuses much more tightly: magazines and traditional way, and even for personal friendships newspapers are a leading source for 77%, but the equivalent figures are 65 to 53. Although the diffuse Internet searches only for 25%. Instead, difference decreases with age, those in their 60s direct conversations with family and friends still have more friends online than offline. On the (39%) and TV and radio stations (36%) grow business side, it is those in their 40s who have the greatly in importance. largest percentage maintained online. Business decisions bring together yet another The two types of contacts are not mutually constellation: there, most point to the Internet exclusive. Although early studies suggested that search (64%) as a valuable source, followed online activity decreased friendships away from by conversations with colleagues (58%) and the computer, more comprehensive research only then newspapers (51%). Jim Jansen, a has found that Internet sociability increases Senior Fellow at the Pew Internet & American social activity offline2. In our own survey, 35% of Life Project, explains that the wide variety of respondents said that, in the past year, they had information sources available allows individuals met someone in person to develop a relationship to access and, importantly, aggregate data with a they started online. This does not mean that variety of uses and viewpoints depending on the all friendships are alike either. Irene Greif, head information problem. of IBM’s Collaborative User Experience Group, notes: “Social software systems let you do better Sociability is the new productivity at the weak ties [the equivalent of a nodding Two other aspects of these networks are acquaintance]. It doesn’t turn them into strong particularly noteworthy. The first is that they ties, but it lets you keep them lively enough that are ad hoc creations of individuals based on it is not awkward to renew them, when you need their own needs. As Professor Castells explains: insight from people outside your inner circle.” “Networks fundamentally are self-centred. Most people in the newest generation already start The technology, however, has done more than with networks, but they do not conform to what provide enhanced information gathering and these networks give. They carve out a niche. communication capacities. Where it has truly They can decide to think with others on selective changed how people learn and collaborate projects. They do not belong to networks, is in the ability it provides to combine these networks belong to them.” two elements easily and seamlessly. Professor Manuel Castells, one of the world’s most-cited This does not translate into selfishness but communications scholars of the last decade, quite the opposite. For their own networks to explains: “Everybody in the digital world has function, individuals must be willing to share the ability to select, generate and diversify information with and take part in those of networks with great ease and at very low cost. others. Evan Rosen, a consultant and speaker Depending on the topic, what information they on collaboration strategy and author of The are looking for and what they need, they will Culture of Collaboration, explains the sort of generate different types of networks.” These behaviour necessary for this type of activity to networks are not just lists of friends but complex work in the business world: “Team members of amalgamations of individuals they know all ages must be ready to engage one another personally, experts or non-experts whom they spontaneously regardless of level, role or region, may not know, institutional information sources via IM, voice, web conference or video on the fly. such as newspapers and other diverse types No appointment is necessary.” The supposedly of data found online in numerous forms. The debased online term “friend” could be defined as machine used to access all these is the same, as is someone open to communication in this way.9 © The Economist Intelligence Unit Limited 2011

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NET WORKS FOR THINKING Developing ideas and forming opinions in the digital age Which information source do you use most for researching business decisions? Please select most valuable sources. Select UP TO Three (% respondents) 64% Internet search engines (Google etc) 58% Direct conversation with colleagues 51% Newspapers and magazines (print or online) 27% Online reference source 24% (eg Wikipedia) Books 18% Online discussion 10% forums focused on relevant Direct topic conversation 7% with friends and family TV and radio 6% Blogs 5% Social networks (Facebook, 1% LinkedIn etc) Twitter 1% I don’t spend much time on this at all10 © The Economist Intelligence Unit Limited 2011

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NET WORKS FOR THINKING Developing ideas and forming opinions in the digital age Professor Castells summarises this networked the British Household Panel Survey. It found that individualism, which he calls a transformation of use of information technology increased people’s sociability: “People are strongly individualised, sense of well-being and life satisfaction. This but not individualistic. To accomplish their goals, improvement was related to the greater sense they know they can be more effective by sharing of autonomy and control that digital technology information. People always start with themselves, brings. Similarly, 61% of our respondents say that with what they want to do and what they want to technology, along with the increased choice and be, and at the same time very quickly they try to information it provides, excites them. Nor is this build networks to share, to be more effective and just the exuberance of youth: 55% of those aged to be more empowered.” 60 to 69 feel this way. It is a mistake to see these networks as mere For Mr Brown, the element of fun is vital. In order to tools. John Seely Brown, former head of Xerox’s address the rapidly changing information and skill Palo Alto Research Center and now co-chair of environment, “you have to be willing to play with Deloitte’s Centre for the Edge, a think tank, points information. That is why the sociability of the new out they can influence the modern sense of age is so important: you share new ideas, you receive identity in important ways. “More and more,” he critiques; it is a whole world of curiosity coupled says, describing the process, “my sense of identity with ideas.” Mr Tapscott adds that, for younger users, is what I have created and shared with other the integration of fun is part of “a whole new culture people, and what they have done with it. I am of collaboration, innovation and speed. We asked 2 One of the biggest studies is Barry Wellman what I create, share and others build on.” ‘Online are you working, learning, collaborating and Keith Hampton’s or having fun?’They said they can’t really answer “Neighboring in Netville: The great driver of this change, however, is less because they are doing all of them at once. The kids How the Internet the technology, which enables it, than how it have got it right. That is the new culture of work.” Supports Community makes people feel. A recent study for the BCS, and Social Capital in a Wired Suburb”, City & the United Kingdom’s Chartered Institute for IT, However, the new opportunities for gathering and Community, December examined 35,000 records from 39 countries in the sharing information are not all fun and games: 2003, pp. 277-311. World Values Survey and a further 10,000 from they bring heightened problems as well.11 © The Economist Intelligence Unit Limited 2011

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NET WORKS FOR THINKING Developing ideas and forming opinions in the digital age case study How different are the young? Which of the following online networks The generation coming into the workplace – labelled variously Millenials, Gen-Y would You describe As VERY USEFUL in terms or Generation Next – has grown up accustomed to digital technology, but what of their long-term value? impact has this had? (% respondents) Aged 18 to 29 Don Tapscott has written several studies of this group, which he dubbed the Aged 30 to 49 Net Generation in his 1997 book, Growing Up Digital. “These kids are different,” Aged 50+ he says, “because their brains are different. How you spend your time during extended adolescence is the number one variable determining the wiring of one-third of your brain. If you spend a third of your time being a passive recipient Facebook of information like baby boomers you get a certain kind of brain; if you spend time interacting, you get a different brain.” In particular they have a high level of comfort with new technology, they work collaboratively and are used to minimal hierarchy. Mr Brown believes that they have completely different skills. “If I say give me a visual argument to most people of my generation, they freak out. I ask the same 38% 17% 11% of a 25 year-old, they at least know what I am getting at. They can usually create a YouTube video through a remix.” Both warn that those who see younger workers as slackers or incapable of fitting into an organisation have failed to understand the rich information and communication culture which younger individuals share. The survey shows some interesting differences between those respondents aged Twitter less than 30 and older executives. In particular, the former are more active users of social technology in their personal lives. While 35% of all respondents have, in the last year, made a friend online which they went on to meet in person, the figure is 46% for those aged 18 to 29 and the number declines with age. Similarly, only 19% 8% 7% 9% overall had ended a relationship via a social media site in the last 12 months, but 20% of those aged 18 to 29 had done so, although whether this is the eternal callowness of youth or an emerging social norm is difficult to say. It is, however, possible to overemphasise the differences between young and LinkedIn old. Those under 30 in the survey are certainly more likely to call Facebook and Twitter useful or very useful, but these are not the only social tools. Although respondents increasingly dismissed these two as overhyped as they aged, they were more interested in LinkedIn. More broadly, a study looking at 19 social 21% 26% 15% networking sites for Pingdom, a company that tracks website performance, found that the average user was 37 years old. Generally, the survey does not readily support the stereotypes of technophile, adept youth contrasted with technophobe elders. Although younger Wikipedia respondents are more likely to say that they are excited about digital technologies, they are also more likely to say that these make them anxious and confused. Meanwhile, the number feeling connected or smarter does not drop dramatically with age until respondents hit their 60s or 70s. Although those aged 18 to 29 are more likely than older respondents to turn to social networks and blogs for information, they also say that they are more likely to use books. 56% 49% 40% Internet search engines, on the other hand, appeal slightly more to the middle- aged. The bigger story, however, is that these are relatively slight variations, with the rank of popularity of each information source staying mostly consistent across age groups. Groupon Susan Steele, chief human resources officer at Millward Brown, a global market 4% 1% research consultancy, notes that “There are some older employees who are very proficient digitally. We talk about being digital native, but that could be somebody 12% in their 40s or 25.” Nicholas Carr, writer on technology, culture and economics goes further: “I don’t see a fundamental difference between digital natives and immigrants. We have the same genetically determined brain that acts in the same way when confronted with a new technology.” Although more adaptable in the Digg first 20 years, he adds, brains continue to adapt to tools. 3% 1% 0% Youth culture may well be different – although that has been true for decades – and therefore the young may prefer to use technology in distinct ways, but it is important not to think of old and young as binary opposites.12 © The Economist Intelligence Unit Limited 2011

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NET WORKS FOR THINKING Developing ideas and forming opinions in the digital age the trust game One cause of the modern world’s obesity Moreover, the very abundance of information Which epidemic is that human feeding instincts are available has made roughly half (49%) sceptical attribute adapted to periods of feast and famine: a about traditional experts or authority figures. do you steady food supply therefore presents dangers Mr Brown says: “I can pull information to me on feel is most as well as benefits. Much of our intellectual demand with brilliant ease, but now I have to important in enabling you apparatus developed amid relative information think more about why I believe it. The need for to get the most scarcity. Information abundance is therefore a critical judgement is going up even faster than benefit from problematic blessing. access to information and is a critical part of the Internet literacy today.” The technology itself, however, and online The most obvious difficulty is the sheer volume of works against the traditional techniques used networks? information. Thirty-one percent of respondents to assess the reliability of information. When say that purchasing decisions have become more asked to compare which of the following was (% respondents) stressful because of the Internet, 40% that digital more important in obtaining the greatest benefit technology makes them feel overloaded and from online networks, 64% ranked the power to nearly half (46%) that a wealth of information and absorb information at great speed above the options has significantly complicated workplace ability to analyse it rigorously. decisions. This is not the moaning of grumpy old 64% luddites: the responses of those aged 18 to 29 were roughly similar to those of the entire survey. To overcome issues of volume, and particularly trust, people are mixing filtering and assessment Even with the technology at a CIO’s command, techniques that predate the Internet with ones Mr Belwal is not exempt from the problem: which technology enables. This involves using Ability to process and “There is an overload of information, both on a the same networks of sources and people absorb information at personal and professional front,” and improved which allow the gathering of so much data great speed filtering technology is growing ever more in the first place. essential. Similarly, James Knight, CIO of the Chubb Group of Insurance Companies, describes To begin with, the value of expertise and a one of the essential skills of the modern reputation for reliability are far from dead. The workforce as the ability to “bring the wealth of attribute of information which far and away information all together, to get the true meaning attracts the most attention among survey and not get overwhelmed”. respondents is its source’s credibility (75%). Similarly, various Pew surveys in the US show that 36% An even bigger problem online is knowing what, in the great mass of data available, is credible. people still look to newspapers for the news – if online more than offline – and ultimately trust While 79% of respondents believe that the their doctors on health issues. What has changed Ability to analyse Internet makes it more important to understand is that these experts are now only the starting information rigorously the agenda of information providers, 63% admit point rather than the final authority. As medical that they sometimes struggle to know whom professionals have famously found out over the to trust. Only 16% never have this problem. last decade, people will challenge that expertise13 © The Economist Intelligence Unit Limited 2011

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NET WORKS FOR THINKING Developing ideas and forming opinions in the digital age case study Wikipedia – The democratisation of knowledge historically”. He believes that such complexity grows over time but is natural given the difficulties inherent in any collaborative project. “You Just a decade ago, Wikipedia was little more than a revolutionary idea. Its don’t want to live in a police state, but you don’t want to live in a crazy model, relying on volunteer contributors to create and edit content, was anarchy either. In online communities, you have to find that balance.” completely contrary to that followed by previous encyclopaedias on and offline. Despite occasional controversy, however, the results have justified The importance of focusing on the human does not end once a set of the approach. Wikipedia’s ability to be accessed freely and easily, general norms are in place. “A big part of what needs to be understood, particularly level of quality and reputation for speedy updates has made it one of the by companies, is that such an enterprise is very social. You need to think in most popular reference works in the world. Founder Jimmy Wales believes terms of community management: how do you thank people, how do you that the project “has shown us that it is possible for the general public to discourage disruptive contributions? Those issues are non-trivial.” get engaged and to participate in creating good, high quality content with values such as neutrality.” In particular, Mr Wales finds it a surprisingly common mistake that people imagine “we interact differently in cyberspace and a new psychology is Anyone who wants to build a thriving community online can learn much needed. Actually, we are still just people. We like getting a kind word. All from Wikipedia. Although the model would be impossible without modern the classic things apply.” communication technology, one of the interesting aspects of the project is that it must deal with very basic problems of human nature in order to succeed. This Wikipedia shows, then, that new models of collaboration in information is reflected in the governance model which Mr Wales characterises as, to a large gathering and content creation will be shaped as much by age-old human extent, made up of “many unstated rules and conventions that have emerged behaviours as by the possibilities provided by the latest technology. with their own information. One’s reputation one source of information to another because it Which needs to be re-earned daily. Mr Jansen explains: is free, the technology is there. You spend a few sources “People still want credible, professional minutes and you can multiply the number of of information, but they view it with a degree of networks you are using.” advice do you scepticism. The naïve acceptance of authority, trust most when making if it ever existed, is not as prevalent.” Instead, he These techniques are also far from perfect, A Business notes, they check what they find against a wide however. They can lead to the delegation of decisions? range of sources. Professor Castells agrees: “Most judgement rather than the development of people look for proper sources of data, be it a that capacity and may even, ironically, reduce (% respondents) particular expert or newspapers, databanks or the likelihood that new information will change 65% specialised organisations. Then they check other perceptions. Although 71% of respondents sources of information, maybe colleagues, friends seek a wide range of views online, Mr Jansen Colleagues or acquaintances.” cites research indicating that “on controversial issues we gravitate toward sources that support Professor Mikolaj Jan Piskorski of Harvard our opinion. That has been true for decades.” Business School, an expert on online networks, Professor Castells agrees: “Ultimately, when explains that the use of multiple sources, people have checked different versions of the including social networks, microblogs and other truth, what they were thinking about the matter sites, goes beyond simple fact checking: “People already is more important than how accurate the 61% are not doing this blindly. They have learned how information is. They ultimately go with what their to select information carefully and pay attention gut feelings tell them.” Experts to the source.” Survey respondents, for example, noticeably vary whom they rely on by topic. For experts and information sources, the For questions of personal finances and health, challenges thrown up by the technologically experts are the most frequently trusted but in enabled networked approach to information other areas, such as major business decisions, gathering may be new, but the best strategies people rely equally on work colleagues. For to deal with them are ancient. The first element major personal purchases, meanwhile, family is getting the facts straight. Jimmy Wales, 28% and friends as well as the wisdom of the crowd founder of Wikipedia, explains: “To the extent – expressed through online reviews and ratings – that Wikipedia is high quality, people will trust Traditional media are of greater importance. us. The techniques are quite old-fashioned, such as guidelines about what counts as a reliable 13% Although people may have always turned to source.” The second part is honesty. Mark Holden, Family and friends some of these sources, the extent to which they Global Strategy Director for PHD Worldwide, 13% can now be tapped is a result of technology. knows of no particular techniques of building Wisdom of the crowd Professor Castells says: “You can only jump from credibility online other than “you can’t fake it.”14 © The Economist Intelligence Unit Limited 2011

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NET WORKS FOR THINKING Developing ideas and forming opinions in the digital age opening up the workplace If the way that senior executives gather information security firm McAfee of 1,000 companies in 17 and communicate has changed, what is the effect countries found that about half banned such sites. on the workplace? The survey suggests significant One firm that does is Goldman Sachs, even though it differences between the use of these networks at has invested $450 million in Facebook. work and in personal life. According to respondents, the biggest impact of digital technology at work is A blanket prohibition is a self-inflicted wound. improving their knowledge (65%). Only 10% listed In practice it just displaces behaviour, increasing keeping in touch with contacts. In their personal inefficiency: those who find social networking lives, however, these same executives say the tools an essential part of how they work may greatest benefit is the ability to keep in touch with simply buy their own mobile devices for use There is a need friends (60%), with 36% citing better knowledge. while at the office or use less efficient networking for personal technologies such as email. It also sends a communication Some difference between work and home life is negative message. As Mr Tapscott notes, banning technology. predictable. The above figures suggest, however, social tools says “we don’t understand your way of People do that the tools and techniques which executives have working,” and do not value it. This has a particular want to use developed as Internet users to improve collaboration effect on younger employees, many of whom it in their and decision-making are not being fully deployed in know no other style, but increasingly it will have official work, the corporate environment. an effect across all age ranges [see previous box]. even though organisations Companies do not always make it easy to do so. As Such a ban is also ultimately unsustainable. are probably Mr Tapscott puts it, the way that people, especially Mr Belwal notes: “There is a need for personal not so ready younger ones, work and interact online in their home communication technology. People do want to use it and don’t want lives “runs up against the 20th century workplace. in their official work, even though organisations are to give up that We stick them in a cubicle and we supervise them, probably not so ready and don’t want to give up that much control. and then we take away their tools.” Dr Greif, head much control.” of IBM’s Collaborative User Experience Group, adds that a lot of businesses “do not understand how Such technology does, however, present risks for any Jagdish Belwal, important it is to bring these tools in.” Mr Brown organisation, notably the security of its own systems CIO of Tata Motors goes further: “Today’s corporations are behind the and data protection. Increasingly, firms are turning to times in terms of these new practices. They still in-house social tools as a solution, again with uneven harbour outmoded command and control practices results. But while safeguards are clearly needed, the with no understanding of how to establish an open key to extracting benefit from these technologies lies context for the knowledge worker.” in the underlying culture of the firm. The most prevalent example of this is the hostility To begin with, companies need to adjust to the which the corporate world can show toward social practicalities of the different work styles the networking tools. A 2010 survey for the computer technology brings. Susan Steele, chief human15 © The Economist Intelligence Unit Limited 2011

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NET WORKS FOR THINKING Developing ideas and forming opinions in the digital age resources officer at Millward Brown, a global notes research showing that the introduction market research consultancy, recalls a law firm of networking technologies in hierarchical where the partners complained that “their new companies decreases productivity, but in flexible intake of lawyers were reducing billable hours, ones it improves it. not because they were slackers but because they got information more quickly, and finished the Employees, on the other hand, need to recognise work faster, using IM, texting and other tools.” that the way they use their networks at home may The partners could either forbid more efficient not translate exactly into best practice at work. practices or find a better pricing model. One obvious issue is the retention of corporate information in an environment based on sharing. More generally, companies need to accept the Another, Mr Knight says, is the informality value of giving individuals the scope to create or tap typical of social software and that “they have to into their personal, ad hoc information networks. understand that what you say on any network, According to Professor Piskorski, the reason why whether the Internet or even the company’s the internal use of corporate social tools often fails intranet, can become public, and that it can last “is straightforward and really difficult for companies for eternity and be taken out of context.” Mr to accept. You have to stop thinking about yourself Rosen adds: “Sharing videos on YouTube and as a company first.” He believes that companies tweeting isn’t necessarily the kind of collaborative need to focus on creating something that will help behaviour that creates value for organisations. It the employee directly even if not necessarily, or comes down to what are we sharing and why.” quantifiably, the company. That, he adds, is “a very big difference from what companies often want. The bigger issue is that although people are Why would they do something where the benefit increasingly using technology-enabled collaboration, is not clear?” More broadly, Professor Castells it is a relatively new ability. Ms Steele believes that in case study Chubb uses social networking areas where they might share expertise or interest. Mr Knight recalls that tools to generate ideas at one point he saw an idea similar to one that he had also suggested so “I phoned the guy. These tools promote collaboration not only from Trying to find the best ideas within a company of 10,000 people spread people you know. The social platform lets us search out experts and across 27 countries is a daunting task. In 2008 Chubb Insurance decided opens doors for further collaboration.” In the end, more people discussed to see what social networking technology could do, using it to conduct a the ideas of others than submitted their own. company-wide, month-long event that encouraged the submission and discussion of ideas by all employees. The only real problem arising from the event, says Mr Knight, was the extent of its success. The exercise produced 608 ideas, a number The technology was relatively straightforward. The organisers were that he calls “a little overwhelming.” Although IT provided the most able to move from board approval of the idea to the beginning of the contributions of any function, participation from around the company event itself within just three months in part because the cloud could was high, with the 1,409 participants – about one in seven of all provide highly scalable tools for such communication. As Jim Knight, the employees – coming from every department and zone. company’s CIO explains: “There were not many barriers except hard work.” The market was not ready for some ideas – such as policies for death Equally important to success, though, was creating an environment or dismemberment on a space flight – but many deserved close in which people would want to participate. Efforts began with a consideration. Chubb had committed to pursue the top five submissions, communications campaign publicising the event internally and which it funded with at least a million dollars per idea. All of these, notes demonstrating that senior leadership backed it fully – the board of Mr Knight, have been “complete successes”. One in particular, a scheme directors even appeared in a promotional video. Further, the company to reduce delays in clinical trials by simplifying how those involved made clear, says Mr Knight, that this “was for real, not something that obtain liability insurance, won an innovation award from Business would vaporise” by earmarking significant funds to pursue the top ideas. Insurance magazine. Personal incentives were also created, including prizes such as one for the best “giraffe idea” that went to a person who stuck his or her neck out with The company has since used the same platform successfully on several an unusual suggestion. Even more important, anyone whose suggestion occasions, including once for the IT function to discuss its own efficiency was adopted would be eligible for a bonus depending on how much it and another for interns to consider how to use social networking to saved money or increased income. improve business. All told, the company says, the events have yielded over 4,000 ideas, 12 of which are yielding revenue and dozens more The social networking aspect of the event allowed it to be more than an which have improved existing processes. electronic suggestion box on a grand scale. During the event people could not only propose ideas, all who were interested could read, comment Chubb’s experience shows how effective relatively simple social and develop any submitted suggestion further. This allowed rapid technology can be in harvesting and developing the ideas latent collaboration between sometimes previously unconnected individuals in in an organisation.16 © The Economist Intelligence Unit Limited 2011

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NET WORKS FOR THINKING Developing ideas and forming opinions in the digital age the next few years “probably the single biggest error to decide the appropriate limits on information skill across the board is going to be collaboration. sharing and the appropriate levels of privacy when Most individuals in most organisations have only engaged in business activity using social tools. The started to scratch the surface of how to foster ongoing evolution of the tools themselves, he adds, and grow these skills. The whole nature of social will make the problem even harder. learning is social. It is with others, which speaks to a level of collaboration that has not been as This might lead some companies to ban as much critical as in the past.” as possible. Not only will that limit the effectiveness of employees increasingly unused to learning Companies will be learning at the same time as in any other way, it will also fail. As Dr Greif says: individuals. Mr Brown explains that, as with any “Those who can network outside and don’t have technology: “It takes time to build the practices on technology to network inside the company are how to use these new tools.” It will require trial and going to go outside to ask for help.” Where work life personal life has the internet had the biggest Improving your impact on knowledge and 65% 35% your life? understanding (% respondents) Keeping up-to-date with news and events 35% 39% Getting ideas, advice and viewpoints 32% 19% Making better decisons 22% 10% Being more efficient with your time 20% 10% Keeping in touch with friends or contacts 10% 60% Making new friends or contacts 5% 14%17 © The Economist Intelligence Unit Limited 2011

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NET WORKS FOR THINKING Developing ideas and forming opinions in the digital age engaging with the crowd The new information environment has brought Holden recalls how PHD had to deal with negative A lot of clients about a dramatic shift in power between comments about one of its own videos that went have been companies and their customers. Two-thirds of viral. He calls such reactions by stakeholders reticent about survey respondents say that digital technology online “probably the greatest and most defining the social media and social media have increased their influence representation of the new physics of marketing. space because of as consumers, well ahead of the number who see People are empowered to be as vocal as they wish, examples where greater influence in other areas of life, such as over or to be micro media owners themselves and companies have the decisions of friends (44%) or as citizens (34%). shape opinion dramatically.” got the angle of As Mr Belwal puts it, with new communication marketing wrong. tools, “the power a customer holds over a For the online world to represent more than company is enormous.” an untameable source of reputational danger, organisations need to communicate on the Russell Place One example of this new consumer power is the Internet in the way to which consumers have Chief Strategy Officer, reputational damage sustained by United Airlines become accustomed. This means learning how to Universal McCann when the song “United broke my guitar” went manage two-way exchanges. Both Mr Holden and viral. Dave Carroll, a musician, after nine months Mr Place have observed a shift in their agencies’ of fruitlessly seeking compensation for a guitar roles away from advertising a company’s message damaged by baggage handlers, encapsulated his toward one of helping companies interact with frustrations in a humorous music video posted their customers. on YouTube in July 2009. Carroll expected a few hits, but instead his work had 150,000 views the The crowd has limits first day and five million within five weeks. The In many eyes, a far more revolutionary possibility incident, widely reported in the media, became provided by the technology has to do with the topic of a Harvard Business School case study. production rather than marketing. Crowdsourcing, or according to the Mirriam Webster Dictionary Customer service is not the only department “the practice of obtaining needed services, ideas that can expect to face new challenges as online or content by soliciting contributions from a large channels become more dominant. Marketers group of people...” could conceivably be about continue to experiment with new ways to engage any sort of service but in practice tends to involve with consumers via these channels, but it is easy the creation of intellectual content. It also need to trip up in the new environment. Russell Place, not be online – the first Oxford English Dictionary Chief Strategy Officer at Universal McCann, a in the nineteenth century benefited from 6 communications agency, notes that “a lot of million postal submissions by volunteers – but clients have been reticent about the social media digital technology has greatly expanded ease of space because of examples where companies collaboration. Wikipedia is an oft-cited example of have got the angle of marketing wrong.” Mr what crowdsourcing can achieve, but companies,18 © The Economist Intelligence Unit Limited 2011