John Hagel on the user revolution

(Third installment in a series of Notes from FastForward 2008

John Hagel: The User Revolution

(John spoke without slides – what a relief)

The user revolution is about power. Good news, bad news: Most of us are users, so that is good. But most of us are employees of companies, and they are being squeezed. Average lifetime as humans going up, average lifetime of firms is going down (average time in Fortune 500 is now 15 years.) Companies have not yet figured out how to thrive in this environment.

A key limiter has always been shelf space – either in a store or as share of attention of a sales person. This is no longer a scarce resource. The scarce resource now is is customer attention. Second part of the story is the increasing power of talent. Talent is in short supply and increasingly important to company performance – and there are more options for talent to leave. Companies will increasingly differentiate themselves on their ability to develop talent.

Movement from push programs to pull platforms – from tightly scripted activities to flexible frameworks for orchestrating resources. How do we create decentralized resource networks that are highly scalable? The “pull platforms” are about connecting people to resources and to each other. Bill Joy: There are always a lot more smart people outside your organization than inside. Example: Lee & Fong, tailored supply chains for apparel designers.  Cisco Connection Online with 40K “partners” around support of products. Facebooks mobilizing application developers.

Push models allowed companies to start and to create effective processes. Manufacturing, education etc. has primarily been in push mode. Push programs treat people as passive consumers, pull platforms treat people as network creators. Search is a critical tool here.

One problem: For any revolution, we need a pragmatic transition path. This requires a new set of performance measures (in addition to traditional measures, not as substitutes):

  • ROA: Return on attention. From participant and organizer perspectives. Key question for participants: What is the productivity of the attention I give to one resource? For organizers: How much resources necessary to gain attention, and what is it worth.
  • ROI: Return on Intention: For participant: How much information about myself and my needs have I provided relative to what I have receive. From organizer: How much effort invested, how much value in return. Need to watch what people are doing and generate insight from that, as opposed to having people fill out lengthy registration forms. How can we shorten the time from information collection to delivery of value? Are we fully utilizing the data that we have – many companies brag about all the data they have about customers, but the tangible value is often negligible.
  • ROS: Return on skills. Given the amount of effort I spend, to what extent can I develop my skills. Can I use my skill on other platforms. For organizers: What kind of contributors can I attract to my pull platform?

As customers become more powerful, they want influence over the design of the platform. Allow that to gain loyalty. Customers are looking for partners that can help them become better faster, collaborate more effectively with others.