Thought leading clips from the morning sessions

Mary Trigiani | December 2nd, 2009 | Networks for Change, The Changing World

Translating traditional strategic practices in a digitally networked world.  Beyond personal, product or economic innovation, institutions must innovate everything from their operations, to their attitudes, to their roles in industry and society.  Our institutions are built upon infrastructures that cannot absorb digital networks much less re-tool around them.  Large organizations will exist but they will be fundamentally different in structure and priority from how they operate today.  Knowledge flow, not information flow.  Relationships, not just transactions.  The rationale of connecting people, not just the ability to do so.  Context as well as content.  Corporate infrastructures will not be the competitive differentiators they once might have been unless they invent new ways to create trust in relationships.

It’s not a financial crisis but the pivot of a shift in institutional performance.  A long-term deterioration is back of the undoing of the financial markets:  measuring the wrong indicators, inflating the value of outdated indicators, quarterly obsession.  Research is showing that there is no correlation between productivity, product and process innovation, or customer value and return on assets.  In fact, in the case of customers, they are realizing value at the expense of institutions, in multiples.  And creative talent, who crave passion for their work, continue to leave institutions, taking knowledge with them — thus depleting a key 21st centure asset. Collaboration has not been rewarded, only touted.  The global economy, whose infrastructure was shaped by Wall Street priorities, has been about the income of institutions, not their outcomes.  Organizations must devise business models that are pull driven — pulling people, connections, relationships into their domains — not push oriented — pushing sales, products, services on the customer.

The right kind of startup can find the right kind of money.  This market is a good filter over mediocre ideas; quirky concepts with potential value just do not cut it for the good funding sources.  [When there's stupid money, dumb stuff gets funded.]  You don’t need capital to try an idea — and sometimes, your side ideas are the ones that gain traction, so other people’s money isn’t desirable.  Sustaining the bootstrap mentality after investment capital is attained is critical to success in this environment.

The best business model for startups is subscription based.  It’s less risky for everyone, especially investors, if startups use free services as the bait for hooking subscriptions.  The gambling VCs are currently few and far between, tending to fund things like outmoded inventory plays.  If the traffic is there, it’s hard to ignore — but make sure you can monetize that traffic in ways other than advertising.  When it comes to platforms, make sure you own the email addresses, because then you can stake a claim to user relationships.