Measures of relationship capital
for the Value Scorecard
J. Stephen Town
10th Northumbria International
Conference
Tuesday...
Summary
• Concepts of relational capital
• Some foundation theories
– Transaction costs
– Trust (as a component of social ...
The Value Scorecard
Value & Balanced Scorecards
Rationale for relationship measurement
• The Library is still “a growing organism”
(Ranganathan Law 5)
• Engagement and un...
RELATIONSHIP CAPITAL VALUE
Foundation concepts from economics and management
Relationship capital (RC)
Definitions
“the sum of all of the relationships of all the people within an
organisation”
(rela...
RC attributes and consequences
– Individual and personal
– internal as well as external
– markets, power, and cooperation
...
Calculating RC
• In accounting terms, RC is about the effect of
goodwill as an intangible asset which increases
market val...
Fukuyama, Trust (1995)
“if people who have to work together in an
enterprise trust one another because they are
all operat...
Transaction cost theory
• Coase The nature of the firm (1937)
• “Trust lubricates co-operation” Putnam (2004)
• “focuses o...
Social capital and relationships
• Social capital and trust
are in inverse relation to
Transaction costs
• Social capital ...
McHale (2006)
The “strength of relationship index”
• 15 relationship dimensions
– Includes
satisfaction, trust, commitment...
Relationship marketing
The commitment-trust theory of relationship
marketing (Morgan & Hunt, 1994)
“the turn is towards re...
Total relationship marketing
Gummeson’s list of 30Rs (2002)
• Classic market relationships (1-3)
• Special market relation...
Other possibilities
Sussan, F. Consumer interaction as intellectual
capital (2012)
– C2C interaction as subcomponent of re...
Peck & Payne Six market model (1998)
DANGEROUS LIAISONS
Application cases in libraries: people, markets, relationships
The embedded librarian
Gertrude Lamb Clinical Librarianship (1971-)
• “the clinical librarian as a member of the patient c...
The measure of academic liaison
The effective academic library (1995)
Integration
Indicator P1.4 Liaison
“evidence of form...
The measure of academic liaison
Johnson, 1st Northumbria Conference (1995)
• Two broad headings: activities and
relationsh...
The nadir of academic liaison
• Bangor University (2005)
– reduce 6 subject librarians to 1 user support officer
– “the su...
Library CR initiatives
• Broady-Preston et al (2006)
– CR case studies from Malta and the UK
• Wang (2006)
– CRM into Hsua...
The transformed role (2013)
• The concept of “brokering”
• The concept of “engagement”
• The concept of “selling” against ...
A FRAMEWORK FOR RC VALUE
MEASUREMENT FOR LIBRARIES
Conclusions
Niels Ole Pors, 7th Northumbria Conference (2007)
‘Social capital, trust and organisational effectiveness’
– Trust is prob...
Other ideas
Huotari & Iivonen Knowledge processes: a
strategic foundation for partnership between
the university and its l...
Kostagiolis & Asonitis, Intangible assets (2009)
Relational capital intangible assets
– Users training
– Collaboration bet...
Kostagiolis Managing IC in Libraries (2012)
Kostagiolis Managing IC in Libraries (2012)
Seven market model for academic libraries
Components of relationship measurement
• Consciousness & Congruence
• Communities & Communication
• Causality & Comeback
p...
Awareness & Fit measures
Consciousness
Measures based on a
general audit of the
relational space
(using the 7 markets mode...
Strength & process measures
Communities
Data, potentially from a
CRM system, used to
assess a level of strength
of relatio...
Return on relationships
Causality
The specific outcomes and
impact of positive
relationships on academic
process, innovati...
Acknowledgments
• Ruth MacMullen, Research Assistant
• Rachel Daniels & Selena Lock, Cranfield
Michelle Blake, Relationshi...
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Measures of relationship capital for the Value Scorecard

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Delivered at the 10th Northumbria International Conference on Performance Measurement in Libraries and Information Services, Tuesday 23rd July 2013

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Measures of relationship capital for the Value Scorecard

  1. 1. Measures of relationship capital for the Value Scorecard J. Stephen Town 10th Northumbria International Conference Tuesday 23rd July 2013
  2. 2. Summary • Concepts of relational capital • Some foundation theories – Transaction costs – Trust (as a component of social capital) • Cases: Academic & Special Library history – Embedded librarians – The fall and rise of academic liaison – CRM in libraries • Conclusions – A framework for relationship value measurement
  3. 3. The Value Scorecard
  4. 4. Value & Balanced Scorecards
  5. 5. Rationale for relationship measurement • The Library is still “a growing organism” (Ranganathan Law 5) • Engagement and understanding of stakeholder requirements and context is essential for service design in changing times – The role of relationships in innovation and new service creation is therefore critical – “Success is a function of healthy relationships” • Value measurement of all activity is crucial in constrained or customer-oriented contexts
  6. 6. RELATIONSHIP CAPITAL VALUE Foundation concepts from economics and management
  7. 7. Relationship capital (RC) Definitions “the sum of all of the relationships of all the people within an organisation” (relatedvision.com, 2013) “the value of relationships that an organisation maintains with different agencies of its environment” (Euroforum, 1998) “the intentional building of a system-wide understanding and capacity to act, which becomes the asset or ‘glue’ for creating the context for achieving goals ” (Darling & Russ, 2000)
  8. 8. RC attributes and consequences – Individual and personal – internal as well as external – markets, power, and cooperation – knowledge sharing and problem solving – creation of brand & reputation through connections – creates or destroys value – dependent on behaviour and character
  9. 9. Calculating RC • In accounting terms, RC is about the effect of goodwill as an intangible asset which increases market value • Factors for calculating RC – position power and personal influence – types of relationship – strength of relationship – number of touch points – as a source of innovation – measured outside the institution
  10. 10. Fukuyama, Trust (1995) “if people who have to work together in an enterprise trust one another because they are all operating according to a common set of ethical norms, doing business costs less” “by contrast … legal apparatus serving as a substitute for trust, entails what economists call ‘transaction costs’”
  11. 11. Transaction cost theory • Coase The nature of the firm (1937) • “Trust lubricates co-operation” Putnam (2004) • “focuses on those costs associated with human interaction” Fussell et al (2006) – if social capital exists, then transaction costs can be managed [down], providing a tangible benefit to outcomes
  12. 12. Social capital and relationships • Social capital and trust are in inverse relation to Transaction costs • Social capital cannot be built on your own! • Effective relationships add value and save cost where they build trust; so human interaction measures are a key indicator of value “There are intelligent [libraries] and stupid *libraries+ … intelligent groups gather information better and adapt better to reality… thus we find ‘social intelligence’ Anglada (2007) quoting Marina (2004)
  13. 13. McHale (2006) The “strength of relationship index” • 15 relationship dimensions – Includes satisfaction, trust, commitment, advocacy, goodwi ll, repeat business • StoRI • Provides a numerical relationship capital “dashboard”
  14. 14. Relationship marketing The commitment-trust theory of relationship marketing (Morgan & Hunt, 1994) “the turn is towards relationship marketing, a concept that encompasses … relational marketing …working partnerships … strategic alliances and internal marketing [this last idea from Berry & Parasuraman+”
  15. 15. Total relationship marketing Gummeson’s list of 30Rs (2002) • Classic market relationships (1-3) • Special market relationships (4-17) • Mega relationships (18-23) • Nano relationships (24-30) Many relevant to libraries within parent organisations and complex relationships with various stakeholder groups
  16. 16. Other possibilities Sussan, F. Consumer interaction as intellectual capital (2012) – C2C interaction as subcomponent of relational capital; could be considered in relation to social media activity in libraries
  17. 17. Peck & Payne Six market model (1998)
  18. 18. DANGEROUS LIAISONS Application cases in libraries: people, markets, relationships
  19. 19. The embedded librarian Gertrude Lamb Clinical Librarianship (1971-) • “the clinical librarian as a member of the patient care team” • “a valuable interface … the key to better patient care” • “ … must observe the ways in which health professionals are currently seeking information” • “a working member – not just an observer – of the team” • “I can measure my acceptance” • In 1984, described the application of the Rothenberg Model for effectiveness and efficiency
  20. 20. The measure of academic liaison The effective academic library (1995) Integration Indicator P1.4 Liaison “evidence of formal and informal communications between the library service, the senior management of the institution, academics and students … to assess the degree of effective and dynamic communication to inform service provision”
  21. 21. The measure of academic liaison Johnson, 1st Northumbria Conference (1995) • Two broad headings: activities and relationships – Academic liaison primarily about the latter • Seven relationships [markets] • Effectiveness measure: relationship quality – ‘Warmth’ variation? – ‘Trouble free’ but is smooth good?
  22. 22. The nadir of academic liaison • Bangor University (2005) – reduce 6 subject librarians to 1 user support officer – “the support … from the qualified subject librarians is hard to justify in value-for-money terms at a time when the process of literature searches is substantially de-skilled by online bibliographical resources” – East (2007) a literature review on “The future role” mentions neither ‘marketing’ nor ‘relationships’ but does allude to ‘traveling’ staff models • SOAS (2005) – Redundancy notices to 4 subject librarians – Posts saved because of relationships with academic staff
  23. 23. Library CR initiatives • Broady-Preston et al (2006) – CR case studies from Malta and the UK • Wang (2006) – CRM into Hsuan Chuang U Library • Anglada (2007) – Typology of alliances and social intelligence; six types • British Library (2009) – CRM initiative to reduce 37 CR databases • Sharma et al (2009) – Singapore National Library System and RC • Daniels & Killick (2013) Cranfield – Creating and using the Barrington Liaison Tool for recording and analysing customer communications
  24. 24. The transformed role (2013) • The concept of “brokering” • The concept of “engagement” • The concept of “selling” against a “service catalogue” • Two-way voice; department-library; “insight” • Functional elements becoming stronger, but a necessary relationship retention • Research support through “internal partnership”
  25. 25. A FRAMEWORK FOR RC VALUE MEASUREMENT FOR LIBRARIES Conclusions
  26. 26. Niels Ole Pors, 7th Northumbria Conference (2007) ‘Social capital, trust and organisational effectiveness’ – Trust is probably a relevant concept in relation to information behaviour – Trust is probably related to fulfilment of information needs – Trust is probably related to institution’s degree of effectiveness, efficiency, perception of competencies and positive personal interaction – And finally, trust and social capital are concepts that will be more fashionable in the coming years
  27. 27. Other ideas Huotari & Iivonen Knowledge processes: a strategic foundation for partnership between the university and its library (2004) • The library’s role in productive knowledge processes • Relationship of the intellectual capital of the library to the University’s intellectual capital
  28. 28. Kostagiolis & Asonitis, Intangible assets (2009) Relational capital intangible assets – Users training – Collaboration between academics and subject specialists – Participation in information networks – Trust and cooperation within staffs – Lists of users – Agreements with authorities – Reputation – Brand name
  29. 29. Kostagiolis Managing IC in Libraries (2012)
  30. 30. Kostagiolis Managing IC in Libraries (2012)
  31. 31. Seven market model for academic libraries
  32. 32. Components of relationship measurement • Consciousness & Congruence • Communities & Communication • Causality & Comeback partly inspired by Darling & Russ 5 ‘Cs’ (2000)
  33. 33. Awareness & Fit measures Consciousness Measures based on a general audit of the relational space (using the 7 markets model) Congruence The degree of fit of relationship activity to the parent institution Gaps may then be deduced when this is set against the audit
  34. 34. Strength & process measures Communities Data, potentially from a CRM system, used to assess a level of strength of relationship across all relations Communication The measures of the process of communication which develop relationships within each sphere Could be down to the level of individuals
  35. 35. Return on relationships Causality The specific outcomes and impact of positive relationships on academic process, innovation, finan ce, quality and staff development Comeback The specific ensuing returns to the library of repeat benefits of relationships
  36. 36. Acknowledgments • Ruth MacMullen, Research Assistant • Rachel Daniels & Selena Lock, Cranfield Michelle Blake, Relationship Manager, York • UK academic library colleagues engaged in the White Rose and “Relationship management for the 21st Century Library” activity

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