Social Networking as Information Arbitrage
There has been a lot of angst in the business journals over the last decade on how to make organizations nimble, flexible, and fast. Charlie Fine, at MIT, was talking about opportunistically created supply chains a decade ago. For two decades operations experts and enterprise software companies have been ringing out all the inefficiency they can in data-based processes.
What's left to optimize? People. Unstructured information. Decision Making.
It's all messy because people get involved and they all understand and communicate information differently.
Which gets to why social networking is really so interesting. It allows me to filter information through the people I trust - whether that is entertainment filtered through friends or business information filtered through colleagues. The value of information is higher if its source is known and trusted - that goes for published media and informal gossip. This informal trusted network of colleagues has always been critical to get business initiatives moved forward but establishing trust and communicating have been mostly one-to-one which is time consuming.
Enter social networking tools and now:
- Conversational information is captured (which includes emotions and tonality that would not be included in formal documentation)
- Conversations are persistent
- Conversations are transparent to wider audiences
- Barriers to participate are lower
- Conversations are more inclusive
These traits allow online communities to vet and prioritize ideas at a much faster rate and come to a better solution because of the wider audience involved (typically). Good, vetted ideas are what allow organizations to execute and it is a competitive differentiator to be able to vet and start execution on an idea before anyone else. I call this Information Arbitrage.
