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August 14, 2009
What's wrong with this Price Tag?
I'm sure that creators of ads would be amused (NOT!) to find out from media professor and consultant Jeff Jarvis that ads are not "content" !
Jarvis's stance, as reported by Stefan Deeran of BNET in the article Who Benefits from the "Link Economy", is summed up as this problem:
"In general, the consensus is that producers of original content that want to put their work behind a paywall or demand payment from linkers, just don’t get the fluidity of web."
The proof of this, they say, is that linkers prosper without paying non-ad content providers; instead, linkers get to charge the ad providers, while non-ad content providers don't get to do that.. Thus the Jarvis claim that we are shifting from a "content economy" to a "links economy".
But obviously, ads are content, and meanwhile, how many linkers actually turn a profit?
So to remain clear, the shift is about what kind of content has the most "economic" value as currency, not as net income that supports a continuation of the cash flows for non-ad content providers or linkers.
Non-ad content, now highly commoditized by the web, is most similar to currency that has suffered inflation beyond any important redemption. The "face value" has stopped being significant.
But while technology has made ad content easier to distribute, and thus magnified its face value, there is no rational proof that people suddenly prefer ads to non-ads. Instead, there is proof that ad-content providers are willing to work harder to deal with the problem of someone's "preference" than are most people willing to work on it for themselves.
As soon as non-ad content providers get people used to paid subscriptions again, the "economy" will rebalance in favor of branding, editorialism and other things that people want with non-ad content to conform to their preference.
"Non-ad Content" providers must solve the Cost-of-Preference problem. This is already being trial-and-errored with concepts like "MyContent", "Premium Content", "Actionable Content", and so on -- and most of these approaches are long past being "new".
But if paid "links" are simply today's version of booth rentals at a trade show, it's not the content that dissuades people from buying; rather, it's that the trade show is huge and unmanaged, so people are fatigued by it very quickly.
Posted by Malcolm Ryder at 5:05 PM
August 13, 2009
Why Business Processes drive Customization... and what to do about it
Customization of business processes means that there is more "precision" in the targeted effort to succeed. But in situations where support may not be up to speed and where targets may change, this precision comes at a high cost of achieving readiness and warding off eventual irrelevance, making it just as risky as it may be attractive.
The general sense of "customization" compares against three basic options for the formations of a business process.
Option 1: One-Size-Fits-All
For business processes, this is a myth, because “business” is primarily about accommodating multiple relationships and requirements, not primarily about manufacturing a standard product. The “process” must support what business “is about”. Relationships tend to be privileged, not indifferently available.
Option 2: Specialization
Sometimes incorrectly called “customization”, specialization is different: it means variations on a single theme. The theme has standard requirements; the fulfillment is where the variety occurs.
Option 3: Customization
Customization begins in the requirements, not in the fulfillment of them.
There are three reasons why requirements may be “custom”:
- Cost structures
- Competitive Innovation
- Capability Immaturity
Three reasons why requirements may be custom, not generic.
Cost Structures:
- Satisfying customers is not profitable if it is too expensive; different organizations (different suppliers, and different consumers) have different cashflows
Competitive Innovation:
- Existing customers, to decide to stick around, need to feel that the relationship is fresh and current
- Potential customers need a reason to prefer one provider over another
Capability Immaturity:
- The time available to use for improving capability may not be in synch (priority, availability) with other resources
Three reasons why requirements may be "custom", explained.
Cost Structures:
- Lack of visibility on true economic impacts puts operations on a risk-aversion basis seen in typical micro-management approches
Competitive Innovation:
- High rate of change is necessary to sustain improvisations that generate necessary nw effects or advantages
Capability Immaturity:
- Required performance level outstrips currently available supporting mechanisms, forcing risky workarounds.
How to mitigate or avoid customization.
Micro-management:
- An operational performance model allows activity to be prioritized and weighed by differential contribution to goals and thus by ROI perspective. (For example, the 80/20 rule.) Relieves pressure to dwell on the microscopic. Define objectives, CSFs and KPIs. Switch to “trust-and-verify” mode.
Improvisations:
- Linking process models to knowledge management allows standardized roles to be able to move quickly and differently on incoming information, without re-organizations.
Workarounds:
- Organizing around known best practices clarifies ways to structurally reduce risk and to more rationally divide the labor required to meet performance targets. Such greater clarity allows managers to make the compelling business case for additional help to cover properly allocated responsibilities.
When to Customize.
Considering the above notes, executives should still project the likely value of customizations. The punchline is that it cannot be taken for granted that customization is the best path to take, neither in the short run nor the long. Customization proposals that withstand comparison to the above considerations should be given even more enthusiasm than usual, as they probably then point at nearly unique opportunities to do something strategically important to the business.
Posted by Malcolm Ryder at 10:37 AM
August 2, 2009
An Inconvenient Reference. (Content, Knowledge and Information Networks)
At The Global Human Capital Journal,GHCJ pays respects to the passing of an empire of bound knowledge: the Encyclopedia Brittanica. Noting that online search is giving a better topical hit rate, the compelling value proposition of going to the paper shelf comes up mainly as a memory. Somewhat proving the point, I came to the GHCJ post online via a colleague, but at the same time there's irony in the uncertainty of relying on unfamiliar online sources to be authoritative about the passing of familiar offline sources. Online, when it comes to navigating certain topics, I'd prefer to route through a colleague than through Google. That said, as the GHCJ piece was really well put together already, I collegially posed some off-shoot thoughts in a comment left there, and shown below.
When you said "Authority", I first thought of "credibility", not of "power". My reading of your Authority description is that it is about power. I think the credibility issue is more critical to pursue. I would compare not the old hierarchy of a production "pipeline" versus the newer flatter production "collaboration", but instead the old value "chain" versus the new value "network". So far, I think the new production paradigms distinguish themselves primarily in terms of convenience, not credibility nor value: what does happen is that I can presume to meet information deadlines "cheaper", and maybe "faster', although far less certainly "prettier" (even though the acceleration of work is economically "sexy" so to speak). Tech innovation a la the web poses essentially the same risk that process automation does: it is now much easier to do something poorly more often.
And when you said "Knowledge Economy", I again experienced a related but tangential thought. Much of the widespread discussions of these affairs appears to me to terribly confuse "content", "knowledge" and "information". Each term respectively already carries a relatively new and trendy mythology about "producers", highlighting in common the newfound convenience of being one. To this I say that being a producer is "valuable", but being a producer does not "cause" value. And more to the point, the confusions I fear are the heavily marketed notions that content producers create better knowledge, that information producers create better content, that... well you get my drift. I suppose if I could make a practical point here, it would be that while the innovations in production may be revolutionary, the innovations in knowledge are instead still evolutionary. We are experiencing an expansive Content Economy that far outstrips the growth of actionable knowledge.
This brings me to the last thought to share for now: the notion of "reference". By exploiting the vehicles (let's not call them sources yet) for acquiring information, we do one or both of two different things, and it is worth knowing the difference. One of them is "referencing". The other is "researching". Part of the competency of KM is knowing that there is a difference while knowing how to relate them; to create a reference from competent research is still something that is a practice with differing degrees of acquired skill, differences that are more important than whether we are known as professionals or amateurs.
All that said, you hit a big nail right on the head. To summarize my takeaway from your posting: an inconvenient reference will lose out to a convenient one, for better or worse.
Posted by Malcolm Ryder at 11:26 AM | Comments (0) | TrackBack