RonAmok!

The history of business has been driven by three forms of mathematics: subtraction, division, and differentiation.

Consider for a moment the terms that we use to describe our businesses with. We organize our companies into “divisions,” “departments,” and “branches.” We “segment” the marketplace and “allocate” our budgets.

The majority of our manufacturing process has been based on the process of subtraction. For example, we start with raw stock and subtract from it until the component that we want is revealed. We carve with chisels, cut with saws, make holes with drills and punches, and shape with grinders. In all of these manufacturing techniques, we start with raw material and end with a product plus significant waste.

Why do we break things into smaller pieces?  Because up until now, it has been the most cost-efficient way for businesses to manage their resources.

However, recent advances in technology (digitization, networking and the Internet of Things) have opened up new ways to build businesses upon a new math: addition, multiplication, and integration.

Consider the process of building a component with a 3D printer. Rather than subtracting material until a product emerges from the waste, we build the product sequentially, layer by layer. Since we only use the material required to create the product, we eliminate not only the waste, but all of the negative things related with it, such as landfills, stock costs, freight charges, etc…

We are at the dawn of a new economy that is being built through adding resources, multiplying their abilities, and integrating these changes into our professional and private lives. The days of divide and conquer businesses are limited. New technologies allow us to draw upon rich resources that were once too expensive to acquire, such as ubiquitous networks and the instant access to vast resources of the human, capital, and manufacturing variety.

The ramifications of this additive economy will be profound. Managers who are used to creating budgets, schedules, and staffing profiles based on inherent inefficiencies will struggle. Companies who seek to corner markets by hoarding resources will also find themselves at a serious disadvantage.

If Joey has the ability to manufacture your product in his spare bedroom using a 3D printer, what does that mean to your business? If Suzie has the ability to cost-effectively tap into vast labor resources through Mechanical Turk, how can your company’s R&D department keep up with her? If a start-up venture has access to a plethora of shallow-pocket investors, will it be able to enter the great game of business by simply bypassing the venture capitalist gatekeepers?

As we wrap-up 2012, its time for your company to consider the consequences of the fast-approaching Additive Economy. What if the fundamental assumptions that your company was built were turned totally upside down? Specifically, what ramifications might your company be forced to deal with if it were suddenly more efficient to add instead of subtract, multiply instead of divide, or integrate instead of differentiate?

Are you ready for the changes that the Additive Economy may bring?

Photo available under Creative Commons from urbanmkr

In May 2008, I founded OC New Media, LLC with the goal of teaching executives about social media. During the past 53 months, I’ve had the good fortune of working with amazing customers, whose expertise ranged from: manufacturing spirits to frozen yogurt, practicing public relations to practicing law, and writing software to writing history. It’s been a wild ride.

A lot has changed since then. Although today the term, social media, is much more familiar, it still draws quizzical looks as organizations wonder how to integrate it within their particular businesses. Back then, few companies would consider investing in it. Today, more are hiring those who specialize in this non-traditional combination of technology, content and media.

Over the past few months, I’ve been delighted to see more companies creating managerial positions dedicated to addressing the challenges of social media. One of them caught my eye.

It is therefore with great excitement that I announce that I have accepted a new position as the manager of social media for Epson America. I am very excited to be working with such a well-known and highly respected brand.

Accepting a full-time position means that I will be shutting down OC New Media’s consulting business. But don’t worry, I still plan on sharing my insights through this blog. As a matter of fact, I’m working on a case study about a local company who used social media to not only increase its brand awareness, but it also created the single highest sales day in the company’s six year history.

I’d like to thank all of my customers who’ve allowed me to be a part of their social communications plans. Confidentiality agreements don’t allow me to identify them by name, but you know who you are. Without you, I wouldn’t have had a company. Nor would I have been able to eat:-)

Finally, I’d like to thank the readers of this blog. Since 2007, we’ve documented a revolution. And although the revolution is far from over, we are much closer to the end than when we started. I look forward to continuing our relationship, with me “Ronning Amok” and you commenting on my ramblings.

I wonder what we’ll be talking about 53 months from now, in March 2017?

For the past year, I’ve been focusing my research on the power of networked resources. I’ve written blog posts that have demonstrated how both companies and individuals have used digital network technologies to innovate, solve problems, or even spread marketing messages. In each case, I’ve tried to quantify the monetary value created through such access.

Last week, I experienced an “Ah-hah!” moment after reading a MarketingProfs article that demonstrated the monetary value a story can add  to cheap knickknacks. The goal of the Significant Objects experiment wasn’t to mislead. According to its rules, misleading would have voided the test. Instead, the experiment involved writing knickknack-inspired stories that future owners could appreciate and therefore pay a premium.

According to the website, the experiment “…sold $128.74 worth of thrift-store junk for $3,612.51,” simply by attaching a story to each item. Doing the math, storytelling increased the average monetary value of each object by 2,806%.

The X 28 Factor

Twenty years ago, my uncle gave me a three-inch stack of early 1900s post cards. Here’s an example, circa 1915, called “The Great White Way,” Broadway, New York City:

I’ve always known that these cards carried some monetary value. A quick glance at eBay reveals that their average price tag is about $5 per card, bringing the stack’s estimated value to about $500. However, after reading the results of the Significant Objects experiment, I considered the upside of adding a story to the collection. Would it be possible to increase the stack’s value twenty-eight fold too? Could adding a story to these old postcards increase their total value to $14,000?

Meet Elizabeth

What if I told you that the majority of these postcards were addressed to a woman named Elizabeth who lived in the greater Boston area over one hundred years ago? What if I told you that the cards contained clues to her life? For example, we know that she was married but we don’t know much about her husband. We know that she had a son named Eddie, she worked at a Boston-based Cigar Factory, and she vacationed on Peaks Island in Maine? Do any these tidbits make the postcards sound a little more interesting?

For twenty years, I’d always viewed this stack of postcards as antiques to be sold-off piece-wise. However, after transcribing ninety-nine postcard messages and entering them into a spreadsheet last weekend, I saw them as something very different: a century-old mystery.

I wondered. Who was Elizabeth? What was her life like? Did she have to work in a Cigar Factory, or was it her choice? Who were Nellie, Sadie, Annie, Frank, Ella, Tom, Joe, Ruthie, Margaret, Debby, Mamie, and Kathryn? Why did so many of the messages end with “give my love to the girls?” Who were they? Her daughters? Her sisters? Something more…hmm…interesting?

Could a mystery centered around a woman who lived a century ago multiply the monetary value of these cards? Could the story become a book? A movie? Or, what if the story was less about Elizabeth and more about a quest to eventually return these cards to Elizabeth’s family? Would you watch a documentary of such a quest unfolding?

An Open Source Mystery

If we published all of these postcards online, could we harness the power of the network to help solve this mystery? Would participants from around the globe be willing to use the resources available to them to collectively piece together Elizabeth’s story, with the ultimate goal of delivering it with her postcards to her great-great (great?) grandchildren?

I’d love to hear your thoughts.