Dividing Factors: People vs. Business

IBM, Toyota, even Wells-Fargo Bank, have invested serious money in social technologies and are using blogs to engage customers, people; and many corporations are building their own social networks to serve employees and to create commerce amongst customers.

One of the key challenges for businesses is how they integrate these new technologies within their enterprises and figure out which best suit their needs and the needs of their customers. Another challenge is how to facilitate ecommerce into these social exchanges thus enabling participants to exchange products and services for economic gains.

Economic activity takes place within social relationships. For businesses to reach buyers they need to reach people. More importantly, businesses need to understand “how” to reach people.

The Dividing Factors between People and Businesses

Today people use the social web for a variety of reasons, but the primary aim is relational.

Charles (Kalev) Ehin, Ph.D and author of Hidden Assets writes “As Doc Searls, Senior Editor of Linux Journal, has said, “Think of markets as three overlapping circles: Transaction, Conversation and Relationship. Our financial system is Transaction run amok. Metastasized. Optimized at all costs. Impoverished in the Conversation department, and dismissive of Relationship entirely. We’ve been systematically eliminating Relationship for decades, excluding, devaluing and controlling human interaction wherever possible, to maximize efficiency and mechanization.”

From my perspective, transactions include monetary attributes such as stocks, tangibles such as machinery, intangibles such as patents or all three of the general factors. Nevertheless, no matter what a transaction includes it’s always explicit whether there’s a signed agreement or not. The same is true for conversations. They are explicit even in informal circumstances.

The major difference that needs to be highlighted between relationships and the other two marketing features is that relationships are “implicit.” Relationships are self-motivated and constantly evolving for better or for worse. It’s a self-organizing process whose outcomes are quite unpredictable. Relationships also have intrinsic value. They can be economic, intellectual, emotional, spiritual or a combination of all four. The key point to remember is that relationships are emergent. They can be influenced but not controlled by third parties or varying environmental contexts. As a result, relationships are the informal social fabric of every organization and network whether we are dealing with a book club or the United Nations.

Business leaders are just now beginning to engage in the social web; however, much of what we see today demonstrates a misunderstanding in purpose and methodology. Businesses should approach the social web with a common objective of gaining relationships and converting those relationships into economic gains.

Which comes first, the business or the people? What drives business success, the people or management methods? Just look at the differences in framework between why and how people approach the social web and why and how businesses approach the social web.

Do you see the differences? It is in the mindset of Socialutions.

Tagged as: Doc Searls, hidden assets, people and business, Relationship Economy, Socialutions