The Long Tail market concept, (Chris Anderson), is now familiarto many observers of the Web’s impact on markets and commerce. From the point of view ofexternal markets, it often represented like this.

The mass market culture has been fundamentally changed bythe Web and the economies of the Long Tail. Companies often focus on bringing products andservices to market with mass penetration being required to meet the demands ofmaking a profit over the cost of sales and distribution. The Web has provided a channel that greatlyexpands exposure and lowers the cost of distribution and delivery. Many small niche markets are now more andmore attractive to reach, and in aggregate are attractively profitable.

 The Web has also provided for broader social networks, andcapacities for individuals to self-identify their interests and preferences andcreate new, marketable content themselves in what is called an “architecture ofparticipation.”

However,

  Companies focus on strategic plans and annual businessplans – identifying the resources and organizational piorities that need to bedevoted and aligned to achieve business results. Those piorities are likelyfocused on the front, large end of the tail and as such are high costtransactions. While focus and alignmentare important, it can also diminish the opportunity for innovation and ideasthat might be slightly off-topic to high level priorities, but nonetheless canalone or in aggregate yield productive ideas, streamlined or new economies in business process enhancements,  or better customer engagement.

I recently re-read an article from the July-August 2005 Harvard Business Review, an issue dedicated to and titled The High Performance Organization. In the article entitled Collaboration Rules, PhilipEvans and Bob Wolf postulate thatextraordinary results from collaborative teams can be more the norm than out-of-the-ordinary, or in the realm of hyper-achievers only.

When collaboration is fostered by both access to simple, adaptable tools and technologies, and a cultural and management approach that supports collaborative work styles, productive ideas and work habits can flourish.

A collaborative environment is one that fosters lots of “cheap, plentiful transactions,” of ideas, innovative ad hoc projects, or simply accelerate every-day project work.

Evans and Wolf explore this notion in two case study examples as disparate as the Linux open source community, and Toyota.   They recommend the following collaboration guidelines to advance productive collaboration, rules that I've posted in a mind map format.  Like many powerful notions, these helpful "rules" are simple and direct, but perhaps not common enough.

Where collaborative Enterprise 2.0 tools and practices are used, both team members and managers can and must evolve to functioning in an increasingly networked and participative model, where some key people become hubs in a team, while others, especially managers, become links to wider networks of people and expertise.

In his 7 November blog post, Andrew McAfee noted thatcurrently the uptake in Enterprise 2.0 collaboration and participationtechnologies seems to be confined to two primary user communities he calls “thenewbies” and “the techies.” Thenewbies refer to the pool of younger entrants to the job market who have usedWeb 2.0 technologies in high school and college years. The techies are typically tech savvy ITstaffers and a diaspora of tech advanced people in outposts across a company ororganization.

But as McAfee’s chart points out there’s a Montana-sizedquadrant of non-adopter knowledge workers out there that have yet to participate inor uptake Enterprise 2.0. The YoungTurks might say “so what, we’re taking over now.” Managers might say, “so what, we have email.” But business leaders and highly skilledknowledge workers should care because, as McAfee points out, “ahigh amount of the company’s accumulated knowledge and expertise residesnowhere else except in the heads of the empty quarter’s inhabitants.” In other words, the Empty Quarter is an untapped gold mine of potential innovation, competitiveness and marketvalue.

The problem is this too much of the gold in the mine (and minds) is trappedunder the rubble of corporate email. Email is, asa technology and application, designed as a communication tool.  Unfortunately, it’s also now a documentmanagement system, light-weight workflow system, and knowledge workers spend aninordinate amount of time (read money) managing the miasma of content andproject flows through various email chains.

In email channels important business thoughts get lost andtherefore lack persistence or re-use potential.   Enterprise 2.0 technologiesand applications get at the Empty Quarter gold mine by:

• Making the information exchange among knowledge workers more widely visible.
• Allowing for better persistence and therefore re-use of information
• Catalyzing  broader ideation and knowledge transfer
• Acceleratingproject and collaboration processes
• Characterizing and capturing unstructured information in early stages of project conception before formal project management and content management applications are needed.

The dynamics of Enterprise 2.0 tools and use practices mine the gold (n of the skills and (often tacit) knowledge trapped in the McAfee's EmptyQuarter.   Smartcompanies and knowledge workers will see the use of Enterprise  2.0  as this era’s mining technology of the 21^st century gold rushfor innovation and market competitiveness.

Last week SD Forum hosted a second of their innovation series, Foundations of Innovation II.  Judy Estrin, CEO of PacketDesign and former CTO of Cisco gave the keynote.  There's been a lot of press and hype about innovation lately, but Judy gave a thoughtful analysis and commentary on the topic.  Estrin is beginning to write a book on entreprenuerialism and innovation.

Silicon Valley is considered a hotbed of innovation, but Estrin is concerned that the climate of high tech innovation has cooled from a peak era of the 1960s to the 1990s when there were major breakthroughs in computing (CPUs), PCs, networking and the basic Web.   According to Estrin that era of innovation was supported by a greater alignment of capital investment via research funding, venture and capital markets, and a greater acceptability of risk by entrepreneurs, VCs and larger companies.

The futurist, Paul Saffo, sees this transition from basic innovation in high technology as more fundamental, that the age of electronics is past,  and that we are now in an emerging 30 year cycle of innovation in biology.  Certain breakthroughs in basic research and science, such as chemisty, physics and electronics, were followed, according to Saffo by a 30-year dominance in industry.

Saffo's notion may dovetail with Estrin's classification of innovation.  Breakthrough innovation is creating  something completely new, as the transitor, or credit card.   Incremental innovation is a product manager's stock in trade - enhancements to current products or process, as in debit cards. The last type of Estrin's innovation types seems to be the one permeating the "new media" these days: orthoganol innovation; using a combination of existing innovations in a completely new way, as in the IPod and ITunes market.    It's the breakthrough and orthogonal innovations that create new markets.  Incremental innovation advances or extends markets.

Innovation, according to Estrin, is a process, and an interative one, not one "a-ha" moment.   It's about thinking differently, questioning, experimenting, learning and adapting.  The only quality I would add is that it is a collaborative process.

On the stage at Office 2.0 you could find, as Peter Rip of Leapfrog Ventures said on the last panel, "plenty of how, but not a lot of what."   One of the early panels remarked, "it's all about collaboration," and the presenters had a lot to say about the tools of collaboration, but not the impact and process. 

In one of the side conversations with Andrew McAfee, I happened to overhear Toby Moore's comments on the use of wiki tools in an innovation project he's facilitating, and I grabbed him by the elbow; I had to hear more.

Toby is a visiting professor with the newly launched Institute of Creative Technologies, at De Montfort University, Leicester.  DMU, it turns out, is a leading university in the creative industries, (digital arts, computer science, drama, literature), and the commercial output of those creative talents are also a major market sector in the UK economy.   Toby is also head of an ideas company, Sleepy Dog, and has developed game technology for Sony.

The IOCT was created to facilitate and accelerate innovation potential across the individual disciplines at DMU, and Toby, along with Howard Rheingold, and Steve Grand OBE, are visiting faculty this year.

As Toby tell it, the use of wiki tools is one way to facilitate both collaboration among members of the unique academic disciplines, and to encourage a broader consideration of new ideas.

First, as a general rule, the IOCT wiki is to be a place of praise culture.  Most people steeped in a discipline naturally often rely on behavior of analysis and critique, but here, the practice is to support the range of contributions.

Other ways to encourage the flow of ideas and conversation, is what Toby refers to as the 20/20 rule.   Wiki members are encouraged to look at 20 ideas posted on the site and then write twenty words (not an exhaustive analysis).   In this way, a broader swatch of participants are adding a little bit to a lot of ideas, and as they "spread their footprint, they find commonality with more people."  This also builds an increasing sense of sociability and trust, and allows participants to take more risks with new ideas.

The other practice is the "3,4,5" notion.   Most people focus on their top two ideas as try to refine them as their best ideas.   At the IOCT, people  are encouraged to disseminate their third, fourth and fifth ideas, things that they, themselves, might deem "lower tier,"   or "half formed," but by putting it out to the larger IOCT community, someone might be able to help advance the idea, to see where the idea might flourish in a broader context.

In this way, as Toby says, it's "open source ideas," and while the technical open source community's mantra is "with enough eyeballs, all bugs are shallow,".   In the realm of innovation and ideas, I pointed out that it's more like, "with enough eyeballs, more ideas have legs," and are possibly richer in their potential.

As Peter Rip said on the VC panel at the final hour of the conference, "context is the missing piece of enterprise software."  And at next year's Office 2.0 conference, more emphasis on the context of collaboration would offer a good balance to the discussion of the tools and technologies.  Or as I said to Rod Boothby at the close of the proceedings..."where are the human beings?"

It's a big deal when the balance of economic value of American public companies shift from tangible to intangible assets.

A recent Economist profile, entitled "The Battle for Brainpower," quotes that intangible assets are now more than half the market capitalization of U.S. public companies, and, according to their citing of an Accenture study, the shift is up to 70% in 2006, from 20% in 1980.  Those intangible assets reside predominantly in the domain of what is described as "tacit" interactions. 

Dan Pink, in his book, "A Whole New Mind: Why Right-Brainers Will Rule the Future," refers to this as the transition to the conceptual age, where the ability to form relationships, sythensize concepts, and engage in complex, problem solving, is more to the fore as a key set of skills for the modern company or organization.

The Economist article focuses on the issues of the dearth of talent as an emerging business issue, and as a primary resource issue of nations.   Yet they note that high talent individuals often decline in productivty for up to a year when they move from one company to the next and don't bring elements of their work teams with them (their productivty context).

Companies often continue to organize and relate to their workforce as if it was still predominantly "tranformational" * or "transactional.**"   The Economist defines talent simply and powerfully as "the ability to solve complex problems or invent new solutions."    Lawrence M. Miller calls this talent broad-slicing in his book, "The New Capitalism" (in contrast to Malcolm Gladwell's thin-slicing concept), and articulates how broad-slicing functions at a leadership, capability and operational levels in organizations.

Talented individuals don't exercise their talent in a vacuum, but often in the context of conducting their work in a team or collaborative process, whose members often represent diverse disciplines and cultures, and are often part of a global team or supply chain.

Collaboration practice enables talented knowledge workers to effectively connect with their team, creates a context for and fosters an ability to synthesize to analyze complex problems to allow individuals able to "see" all the elements of a problem.  A high functioning team of talented individuals can then build on their collective experience and wisdom to be even more productive on the next set of problems or innovations.    Collaboration tools support those business and organizational needs.

*Transformational:  extracting raw materials or converting them into finished goods.
*Transactional:  transactions that can be easily scripted or automated.