Strengthening Communities in the Internet Era: Theory and Practice

Posted: March 5, 2012 | Author: | Filed under: Communications, Macroeconomics, Sociology | Tags: , , , , , , , , , , , , , , , , , , , , , , , , | Leave a comment

The problems facing American communities are as varied as the definition of community.  While in the midst of recovery from the greatest economic downturn since the Great Depression, local communities are struggling to promote a sense of community and increase civic engagement.  The need for community renewal arises from a desire to improve quality of life and to build community-based platforms to address a variety of social issues including urban growth, rural flight, economic growth, sustainability, inequality, and public health to name but a few.  In contrast, Fernback (2007) notes that some “social observers have documented the perceived decay of communal life in post-industrial nations” (p. 50). Indeed, dystopian views of the both the postindustrial revolution and globalization often cite the perceived erosion of community and loss of civic engagement as a serious concern for western society (Putnam, 2000; Saguaro Seminar on Civic Engagement, 2001).  In addition, Smith (2001) argues that impact of globalization “is a drive towards encouraging people to view themselves as consumers of services, rather than participants, and an associated move towards individualization from more collective concerns” (p. 1). However, postindustrial life also abounds with new capabilities including a global transportation network, global telecommunications infrastructure, the World Wide Web, and electronic social networks that offer new opportunities for community development.  How then, can communities take advantage of the capabilities inherent in a networked, globalized, world to increase civic engagement and address persistent social challenges?  The basis for answering that question lies in Putnam’s (2000) work on social capital, what Putnam considers the “features of social organization such as networks, norms, and social trust that facilitate coordination and cooperation for mutual benefit” (Claridge, 2004, p. 1).  The formation of social capital relies on two distinct strategies, that of bridging and bonding; where bridging uses outward looking networks that connect different kinds of people, and bonding use inward-facing networks that connect similar types of people (Knudsen, Florida, & Rousseau, 2005).  Traditional American civic engagement in organizations like the Kiwanis Club, the Knights of Columbus, or even local bowling leagues, operated largely on bonding strategies, as like-minded individuals engaged in community activities.  Whereas in a networked world, bridging strategies are far easier to implement, given low barriers to entry and that communities can be disconnected from the traditional boundary of space or place.  Indeed, the many-to-many communication paradigm inherent on the World Wide Web, offers new opportunities for communities to prosper by bridging place-based communities to the wider world to increase economic prosperity and improve quality of life.  Strengthening communities in the Internet era is a matter of using technology to harness the multitude of weak ties within a diverse community towards collective actions that benefit everyone, in essence, reimagining community by discarding old boundaries and creating new ones based on community engagement.

Background

In order to describe how communities can take advantage of the capabilities inherent in a networked and globalized world to increase civic engagement and improve community outcomes, this paper will delve further into the theoretical underpinnings of the thesis.  In addition, the opportunities and benefits of a connected community will be explored.  Next, this paper will highlight what a connected community needs in order to be viable.  Finally, the role of local government is explored in forming the required policies, practices, and infrastructure to build civic engagement online.

Theory

Communities and Cyberspace

A review of the literature on sociological theory of community might reveal that a functional definition of community does not exist given the wide variety of contentious theories of community.  Indeed, Cohen (1985) recognized the difficulty, noting that community “has proved to be highly resistant to satisfactory definition in anthropology and sociology” (p. 11).  In turn, Cohen (1985) noted that the symbolic nature of community is “essentially enshrined in the concept of boundary” (p. 14); for a boundary implies that participants have something in common and at the same time that the commonalities are also a basis for how members are understood to be different from others.  It is relatively easy to apply the notion of boundary to traditional geographical interpretations of community, as geography played a central role in the formation of societal differences in language, culture, and sense of affiliation.  In Cohen’s (1985) view, it is no surprise that community has eluded definition for so long, given that people construct the social meaning of community participation based on fluid notions of boundary and affiliation.

The advent of the Internet and the World Wide Web provides additional support for the social construction of community, given the explosive growth of online communities.  Baym’s (2010) observations of early online newsgroups suggested the development of rich community-based structures. While Fernback (2007) “advocates a symbolic interactionist perspective on cybercommunity that focuses on the process of community building as an active human endeavor” (p. 50).  Communities on the Internet are built on a variety of different technological capabilities based on computer-mediated communication, from bulletin boards, to ecommerce sites, to social network sites.  boyd[RR1]  and Ellison (2007) “define social network sites as web-based services that allow individuals to (1) construct a public or semi-public profile within a bounded system, (2) articulate a list of other users with whom they share a connection, and (3) view and traverse their list of connections and those made by others within the system” (p. 1).  Thus, the ability for users to construct a personalized online community and determine boundaries is consistent with Cohen’s (1985) ideas on the symbolic construction of community.

In some respects, online communities can offer potential members more choice than their geographic counterparts, given the sheer volume of interactions on the Internet.  However, dystopian observers are often concerned with the social cost of computer-mediated communication.  Baym (2010) notes that “historical changes occurring in conjunction with and facilitated by communication technologies have led many to worry that people are losing meaningful connections to their local communities (p. 73).  Rather than view online community as a threat to traditional place-based communities, a more refined view might consider how placed-based communities could prosper by integrating with the wider world using computer-mediated communication, and in particular social network sites.

Internet access and social networking sites can increase both civic and political engagement (Baym, 2010).  Hampton and Wellman’s (2003) early study of a Toronto neighborhood that was wired for high-speed Internet access is notable insofar as “Internet use was associated with larger neighborhood networks, more recognition of neighbors, greater frequency of communication (on-and offline), and participation in the public and private realms” (p. 305). Internet use enhanced the local community and increased social capital.  In addition, a Pew Internet study found that “those who use blogs and social networking sites as an outlet for civic engagement are far more active in traditional realms of political and nonpolitical participation than are other internet users [and] they are even more active than those who do not use the internet at all (A. Smith, Scholzman, Verba, & Brady, 2009).  Indeed, Putnam’s (2000) dystopian warning of the loss of social capital rings hollow in light of recent research, perhaps relating to the differences in the types of social capital afforded by the Internet and social network sites, as compared with the bowling leagues of yesteryear.

Social Network Sites and Bridging

A recent study of Facebook, the world’s most popular social network site, found “a robust connection between Facebook usage and indicators of social capital, especially of the bridging type” (Ellison, Steinfeld, & Lampe, 2007, p. 1).  Not only were Facebook users able to accumulate bridging social capital, but Ellison, et al., (2007) also found that Facebook use helped maintain bridging social capital.  Moreover, “bridging social capital—which is closely linked to the notion of “weak ties”—seems well-suited to social software applications…because it enables users to maintain such ties cheaply and easily” (Ellison, et al., 2007, p. 1).

The emphasis on bridging is important, because much of the social capital literature finds that bridging is associated with higher economic growth, while lower growth is associated with bonding (de Souza Briggs, 2003; Knudsen, et al., 2005; Putnam, 2000).  de Souza Briggs (2003) describes the value bridging has for participants, by “connecting persons and other social ‘sites’ with distinct traits, ties often constitute bridges across roles, status differences, material and symbolic interests, space, norms, and even worldviews” (p. 2).  Not only do social network sites appear to help users accumulate and maintain bridging social capital, but also, accumulated bridging social capital may translate to economic growth, and perhaps most importantly, result in the exchange of ideas between diverse groups.

The Economy of Ideas

Neoclassical economic theory holds that trade can make everyone better off despite which trading partner holds an absolute advantage (Mankiw, 2012).  Known as the principle of comparative advantage, “trade allows people to specialize in activities in which they have a comparative advantage” (Mankiw, 2012).  Ridley (2010) considers specialization and exchange to be at the heart of human prosperity, suggesting that humans are the only species that grow more prosperous as the population grows.  The uniquely human processes of communication and cooperation are the basis for trade and extend beyond the realm of objects, into the realm of ideas; where Ridley (2010) suggests that the exchange of ideas is responsible for technological progress and prosperity.  To the extent that specialization, by its very structure, defines humanity in terms of their differences, social capital from bridging may result, in part, from the exchange of ideas between heterogeneous sources.  Indeed, a recently published studied explored the role of both bridging and bonding social capital in innovation, finding that “social capital is an important predictor of innovative performance after controlling for the ‘traditional’ knowledge inputs” (Crescenzi, Gagliardi, & Percoco, 2011, p. 31).  Moreover, Crescenzi, et al., (2011) found that “bridging’ social capital – based on weak ties – can be isolated as the key driver of the process of innovation while ‘bonding’ social capital is generally negative for innovation” (pp. 31-32).  The results are perhaps unsurprising given Ridley’s (2010) view that technological process, and hence prosperity, is based on the exchange of ideas, given that bonding groups would share similar information, while bridging groups would have different knowledge and experiences, resulting in Ridley’s notion of “ideas having sex”.

Shirky (2009) contributes to the proposition that social media may be transformational because of the many-to-many communication paradigm; when coupled with the notion of billions of connected human beings, one wonders at the possibilities.  Shirky (2010) further observes that there are existing trends that hint at future possibilities, describing how humanity’s ‘cognitive surplus’ or excess brain cycles are generously being put to use in online communities, citing notable examples like development of open-source software or Wikipedia, unexpected open market innovations that turn the traditional profit notions upside-down.  What future developments and ideas are possible when another billion people come online?  More importantly, what impact will the world’s ‘cognitive surplus’ have on economic growth and prosperity when their ideas have sex?

In the field of economics, Romer (2008) departed from neoclassical economic models with the development of endogenous growth theory, arguing that the level of technological change can be impacted by policy decisions, such as policies that promote openness, competition, encourage education, and protect intellectual property.  Notably, Romer’s model reflects the notion that ideas do not reach a point of diminishing returns like other resources, rather ideas build upon one another (Cortright, 2001; Romer, 1994).  Therefore, it appears clear that modern economic theory supports the notion that rate of growth for ideas is driven from a policy perspective.

Conceptual Model for a Connected Community

It certainly appears that Cohen’s (1985) view of community in the context of boundaries had deep implications for strengthening communities, for boundaries both bind and differentiate community members.  Where Putnam (2000) described the value and positive externalities associated with both types of social capital, numerous scholars have extolled the economic and other benefits of bridging social capital, the social capital that arises from differences (Crescenzi, et al., 2011; de Souza Briggs, 2003; Ellison, et al., 2007; Knudsen, et al., 2005; Putnam, 2000), confirming Granovetter’s (1973) perspective on the strength of weak ties.  Ridley (2010) goes a step further, envisioning all of humanity as a collective brain, connected through the Internet and social networks, observing continued innovation and technological process based on the exchange of ideas.  Whereas Crescenzi, et al., (2011) confirmed that bridging social capital is an important driver of the innovation process, again owing to differences.  In addition, the notion that innovation and technological progress are outcomes of policy decisions gives rise to the idea of what Romer (2008) calls a meta-idea, or an idea “about how to support the production and transmission of other ideas” (p. 1); in this case, driven from a local community context.

The meta-idea, is the notion that local community developers can improve community outcomes through a connected community, focused on the issues of economic growth, sustainability, public health, inequality, and urban growth/rural flight.  A connected community enables the flow of bridging social capital via exponential growth of weak ties, enabled by cooperation and communication between diverse community constituents and trading partners in the globalized world.  The exponential growth of weak ties and resulting flow of bridging social capital requires the low barriers to entry inherent in social network capabilities.  In addition, a connected community requires forward-thinking policies that promote openness, transparency, diversity, and investment in infrastructure, higher education, and R&D.  The conceptual model for the connected community is constructed visually in Figure 1:

Figure 1.  The figure presents a conceptual model for a connected that highlights how technology, public policy, and both local and global community constituents can improve community outcomes.  The model encourages diversity, investment, the growth of weak ties, and flow of social bridging capital to improve community outcomes related to economic growth, sustainability, public health, inequality, and urban growth/rural flight.

The conceptual model for the connected community is not necessarily a new meta-idea, insofar as there are several communities in the United States and elsewhere that already have some form of the model in place.  Rather, this may be one of the few times the idea is expressed with a sociological and economic theoretical foundation.  In the next section, the paper will explore the practical application of the meta-idea using existing communities as the basis for exploring the benefits and requirements of implementation, as well as risks. 

Practice

Benefits of a Connected Community

In 2004, the City of Riverside, California collaborated with Riverside Community College, to pull together a high tech task force to in order to gain a larger share of the economic prosperity afforded by California’s high technology industry.  Eight years later, Riverside was named one of the top seven intelligent communities by the Intelligent Community Forum, an acknowledgment of Riverside’s ability to build a sustainable, competitive economy and a vibrant society (Intelligent Community Forum, 2012).  The outcome of the high tech task force was a roadmap that “focused on promoting technology businesses and creating the information infrastructure they needed, fostering entrepreneurship in higher education, improving the skills of the population and demanding that city government set an example of tech-based innovation” (Intelligent Community Forum, 2012, p. 1).  Indeed, the initial roadmap included ideas similar to those found in the conceptual model for a connected community, insofar as the roadmap identified government, business, higher education, and community organizations as key constituents (Tillquist, 2004).  In addition, the roadmap targeted policy and investment goals towards strategic use of technology, assurance of advanced Internet access, policy, code and ordinance orientation around high technology, and university system R&D investment transfer into the local community (Tillquist, 2004).

While the roadmap did not call out specific uses of social network technology or include foreign trading partners as key constituents, those elements are found in practice.  For instance, there is evidence of foreign trading partner involvement in key initiatives highlighted by the Intelligent Community Forum (2012), including a testing and implementation partnership “with new technologies like thin-film solar cells with researchers at Tohoku University and rare-earth yttrium batteries with Winston Global Energy in Shenzhen, China” (p. 1).  In addition, Winston Global Energy company, and local Riverside business SolarMax, are collaborating on the development and construction of a 2MW solar generation project at University of California, Riverside, and a comprehensive 20MW solar energy strategy for Riverside Public Utilities (Intelligent Community Forum, 2012).

On the social networking front, there does not appear to be a specific focus on the use of social networking sites to encourage communication and cooperation, but one can easily image how such capabilities are being used by individuals involved in the program, absent a specific mandate.  In addition, there is evidence that the City of Riverside is attempting to engage community members with systems like the “Riverside Resident Connect system for reporting problems by phone, email, or submission of a photo taken with a smartphone” (Intelligent Community Forum, 2012, p. 1).  E-government services are also prevalent with an extensive menu of online government services (Riverside City Government, 2012b).  There remains considerable opportunity for the City of Riverside to encourage the growth of bridging social capital through more far-sight use of social networking capabilities.

The City of Riverside has proven adept at encouraging the notion of a connected community to improve community outcomes, focusing their efforts on economic growth, sustainability, and urban growth.  Their investment and collaboration has resulted in the growth of a high technology community of businesses, higher education institutions, and foreign trading partners, that have spurred economic growth and more than 6,000 new jobs in the last three years (Intelligent Community Forum, 2012; Riverside City Government, 2012a).  Of course, their journey continues with upcoming projects focused on both infrastructure improvements and digital inclusion (Intelligent Community Forum, 2012).

Needs of a Connected Community

There are significant resources available to local governments seeking to build connected communities.  Commercial technology companies like Cisco and IBM both have established business units with expertise in building digital communities and cities.  Cisco’s Smart+ Connected Communities solutions in particular, was central to the City of Riverside’s citywide deployment of Wi-Fi technology.  In addition, there are several forums with ideas to guide investments in connected communities, including the Intelligent Community Forum and the Smart Cities collaboration project.  Ovum, an international consultancy also recently released a strategy paper that provides high level guidelines for developing a smart city based on two primary strategies, a digital cities strategy for the top down development and investment by government, business, utilities, and a digital society strategy for bottoms up engagement from individuals, community groups, universities, start-up firms, and NGOs (Hodgkinson, 2011). Hodgkinson (2011) defines the critical ingredients for successful digital city initiatives:

  • leaders who inspire the pursuits of economic, social, and environmental sustainability,
  • governments, industry, cities, and citizens who collaborate,
  • cities that leverage proven ideas and solutions to build more city for less,
  • cities that consciously nurture a vibrant digital society to strengthen social capital and engender digital inclusion. (p. 3)

The focus on collaboration and the recognition of the need to strengthen social capital and create digital inclusion strategies suggests that industry strategy for connected communities rests solidly on the theoretical backbone of the sociology.

The Role of Government in Developing a Connected Community

Concerned over Putnam’s (2000) observation at the decline of civic and political engagement, leaders in local government might be tempted to direct limited information technology budgets towards increasing the affective commitment of local citizens to their communities, hoping to increase bonding social capital, a strategy at odds with innovation and growth.  Rather, local governments should seek to exponentially increase the number of weak ties to the community and oriented their services to harness weak ties of the crowd, improving the exchange of ideas, and thereby using community engagement to lower government costs.  In addition, local governments should seek to reduce information technology budgets for maintenance, support, and operations and redirect those funds toward the investments congruent with a connected community, including R&D, education, and infrastructure for advanced Internet access.

In order to lower local government IT spend for maintenance, support, and operations, government IT shops need to transform the way IT departments operate, where possible, moving away from commercial applications and technology, in favor of open source software and cloud computing.  Open source software adoption is increasingly a viable option for government entities owing to the free license distribution model and is sometimes supported by major vendors.  For example, the State of California recently authorized the use of open source software (Office of the State CIO, 2010).  In a related effort to reduce government IT costs, the federal government has adopted a “cloud first” strategy, highlighting a preference for applications and technology deployments in the cloud, thereby reducing the need to maintain IT plumbing and allowing IT departments to manage services, rather that infrastructure (Kundra, 2011).  Both the adoption of open source software and cloud computing in local government can free up much needed government IT capital and operating expenditures to fund the development and transmission of government services to community constituents.

Most local governments offer a variety of citizen services available on Internet computing technology, particularly those in large urban centers.  Many government services are built in a traditional top-down way intending to cut government labor costs, increase administrative productivity, and make government data available to the public (City and County of Denver, 2012; Riverside City Government, 2012b).  While the menu of government services continues to increase and provide incremental improvements in government services, in this author’s opinion, they fail to capture the imagination of their communities, nor leverage the cognitive surplus of their constituencies.  The City of San Francisco is notable in leveraging the cognitive surplus of the crowd, perhaps owing to the influence of nearby Silicon Valley.  The city is “leading the nation in adapting consumer technologies to improve the way citizens interact with their metro areas” (Feldman, 2010, p. 1).  The city has opened up their data sets, and made them available to the public, spurring the development of innovative new applications, deployed on mobile platforms that connect citizens and government.  The result is “more than 50 privately produced mobile apps, which work on gadgets such as iPhones and Android cell phones, that track everything in San Francisco from restaurant health codes to the most popular biking routes” (Feldman, 2010, p. 1).  San Francisco’s strategy is a live example of Hodgkinson’s (2011) digital society strategy.  The open data sets enable third parties to develop valuable IT services at little cost to the local government, while the developed apps increase the number of weak ties to the community.  Rather than determining what services community constituents want, where possible, local governments can let them build the apps that will improve their quality of life.

Of course, even given open data and crowdsourcing initiatives, local governments still need to consider how they deploy government services in a way that creates more meaningful community engagement.  Hodgkinson (2011) suggests the development of a comprehensive digital strategy that encompasses a variety of digital city services that include digitally enabled transportation, education, healthcare, grids and utilities, and urban planning.  However, local government’s role is not simply to use traditional IT planning processes, but rather to open the door to constituent collaboration to inform the planning process, and understand where the opportunities exist to build social capital and spur economic growth.  The opportunities for collaboration are numerous with a variety of innovative organizations leading efforts to increase social impact in communities, including TED’s City 2.0, OpenIdeo, the Intelligent Community Forum, Smart Cities and Metropolis.org.  In addition, the IT planning process can leverage emerging digital society initiatives including volunteering networks, urban action networks, hyper-local websites, carpooling networks, collective action forums, support networks, and mainstream social networks to “stimulate self-help and co-production behaviors in the community, strengthen social capital, and engender digital inclusion” (Hodgkinson, 2011, p. 2).  Rather than suggest there is a proscriptive approach to determining which government services should be prioritized in a planning process, it is more appropriate to assure that the right stakeholders are engaged in the planning process.  In addition, the final priorities should reflect an awareness of the need to engage constituents to grow the volume of weak ties needed to create the flow of social capital.

Risks

While there is a clear opportunity to reimagine community in the Internet era to promote economic growth, sustainability, and public health, while addressing inequality and improving quality of life, there remain considerable risks.  First, government regulations, ordinances, and legal commitments can inhibit the flexibility of local governments to fully embrace the free flow of ideas across constituents.  Second, given the importance of diversity to bridging social capital and innovation, policies that promote digital inclusion are considered table-stakes.  Yet, even forward-thinking cities like Riverside focus first on efforts that have a more direct connection to economic growth (Intelligent Community Forum, 2012).  In addition, the rise of nativist sentiment across the country has created an environment hostile to immigrants and people of color that negatively impact growth (Immigration Policy Center, 2012).  Local governments need to create an inclusive environment that encourages diversity, a necessary requirement for bridging social capital.  Third, the recent economic challenges, pervasive trade deficits, and outsourcing trends have created anti-trade sentiment in many Americans, in particular towards China.  The possibility exists that anti-trade sentiment could result in protectionist policies that could derail efforts by local governments to strengthen local communities through participation in a globalized world.  Local politicians need to assure that opportunities to communicate and collaborate with foreign trading partners are realized, a requirement of a connected community.

Conclusion

The sociological imagination is alive and well in an era of remarkable transformation, characterized by simultaneous trends of globalization and localization as community leaders seek to strengthen their communities.  Global capabilities like a worldwide transportation network, a global telecommunications network, the Internet, and the World Wide Web offer community leaders an unprecedented opportunity to improve economic growth and quality of life when directed properly.  Contributions from the fields of sociology and macroeconomics guide community leaders beyond the notion of the postindustrial revolution and towards an economy of ideas where social capital is as important as more traditional forms of capital.  In addition, societies use of technology has transformed the World Wide Web, shaping technology into a decidedly social view as a variety of new social network capabilities are brought to market.  Many social networking technologies encourage the accumulation and maintenance of bridging social capital, the type of social capital correlated with both innovation and economic growth.  Accordingly, community leaders can steer their efforts to grow bridging social capital by creating powerful, connected and diverse communities designed with the exponential growth of weak ties in mind, perhaps igniting social and economic processes described by both Ridley and Shirky.

There is no reason to hesitate, given the numerous opportunities to collaborate with forward-looking community organizations, industry, academics, and trading partners.  The roadmap to build a connected community is clear, based on a strong theoretical foundation, and the groundwork of centuries of human progress.  Leaders of vision will embrace the opportunity to drive economic growth and improve quality of life by harnessing the collective efforts of an increasingly connected and diverse constituency.  The creation of a vibrant and connected community will help community leaders redraw the boundaries of traditional place-based communities, to engage a broader, and more inclusive constituency to improve both quality of life and create economic growth.  The community of the future is here.

References

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Claridge, T. (2004). Social Capital and Natural Resource Management. University of Queensland. Brisbane, Australia. Retrieved from http://www.socialcapitalresearch.com/definition.html

Cohen, A. P. (1985). The symbolic construction of community. Chichester, London ; New York: E. Horwood ; Tavistock Publications.

Cortright, J. (2001). New growth theory, technology, and learning: A practitioner’s guide Review of Economic Development Literature and Practice (Vol. 4, pp. 1-36). Portland, OR: U.S. Department of Commerce, Economic Development Administration.

Crescenzi, R., Gagliardi, L., & Percoco, M. (2011). The bright side of social capital: How ‘bridging’ makes Italian provinces more innovative (pp. 1-42). London, UK: UK Spatial Economics Research Centre.

de Souza Briggs, X. (2003). Bridging networks, social capital, and racial segregation in America (pp. 1-38). Cambridge, MA: John F. Kennedy School of Government, Harvard University.

Ellison, N. B., Steinfeld, C., & Lampe, C. (2007). The benefits of Facebook “friends”: Social capital and college students’ use of online social network sites. Journal of Computer-Mediated Communication, 12(4), article 1.

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Fernback, J. (2007). Beyond the diluted community concept: a symbolic interactionist perspective on online social relations. New Media & society, 9(1), 49-69. doi: DOI: 10.1177/1461444807072417

Granovetter, M. S. (1973). The strength of weak ties. American Journal of Sociology, 78, 1360-1380.

Hampton, K., & Wellman, B. (2003). Neighboring in Netville: How the Internet supports community and social capital in a wired suburb. City & Community, 2(4), 277-311.

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Knudsen, B., Florida, R., & Rousseau, D. (2005). Bridging and bonding: A multi-dimensional approach to regional social capital (pp. 1-54). Toronto, Canada: Martin Prosperity Institute, Joseph L. Rotman School of Management, University of Toronto.

Kundra, V. (2011). Federal Cloud Computing Strategy.  Washington DC: U.S. Government Retrieved from http://www.cio.gov/documents/federal-cloud-computing-strategy.pdf.

Mankiw, N. G. (2012). Principles of macroeconomics (6th ed.). Mason, OH: South-Western Cengage Learning.

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Putnam, R. D. (2000). Bowling alone : the collapse and revival of American community. New York: Simon & Schuster.

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 [RR1]This is intentional, based on the author’s choice of capitalization.

Communications 305: A Digital Media Journey

Posted: September 12, 2011 | Author: | Filed under: Communications | Tags: , , , , , , , | Leave a comment

Life often dishes out irony as if humans required it for sustenance.  I began this class thinking myself a digital native, although I had yet to hear the term.  Working for major software corporation for many years, I ran successful Content Management and Collaboration technology consulting practices that helped our customers take advantage of web technologies and thought myself well-versed in the implications of digital communication on things like security, identity, brand, presence, and other dimensions of the implementation discussion.  I expected to come into this class and excel simply based on the fact that this was a realm I understood and I couldn’t have been farther from the truth.  For while my understanding was perhaps sufficient to help a customer address a need, I missed the big picture that a solid theoretical foundation provides.  In addition, I could have likely added far more value to my customers by helping them think through the implications of digital media on their business, relationships with customers, relationships with partners, and opportunities and risk to their brand reputation.  Life is full of ironies.

             During the course, I started a blog to chronicle my personal journey to graduate with honors, but more importantly as a personal exploration of digital media, and found myself grappling with issues I had previously only encountered as a thought experiment during the class; a powerful way to learn, indeed (Rock, 2011a).

There are a number of perspectives that have influenced my thinking during the course.  I was struck by the simplicity and elegance of Symbolic Interactionism as a theoretical framework, and because it leads to an important philosophical question about the growth of meaning; how will humanity transform as the volume of interactions grow exponentially as the rest of the world joins the network?  In the past, interactions tended largely to be bound in both time and space and now neither is true, there are very few boundaries in the virtual world.

Social shaping of technology is another theoretical perspective that influenced me during the course.  I believe there are deterministic elements of technology that ties to the capabilities that technology affords, and yet observe that often people use technology in ways that designers never envisioned.  Who would have thought during design that Twitter could help overturn an authoritarian regime?  From a purely business point of view, social shaping theory means that we in the software engineering business need to pay close attention to how our products are used.

Of course, the question that most dominated my thoughts during the course was the democratic nature of the medium.  The Arab Spring opened my eyes to the fact that something very different was happening in the world and digital media was at the center of it.  I realized very quickly, that digital media was having profound implications on humanity and wondered at the implications for family, my business, nations, and myself.  It appears to me that Internet and the World Wide Web are significantly shifting the balance of power between individuals, minorities, and dominant hierarchies and believe that humanity may be on the cusp of a new understanding of what it means to be human.  Long have our differences been used as a means of controlling access to resources and our entire system of economics is based on that idea.  I think that the Web is going to give us an opportunity to rethink what it means to be human and how to share.  I know that others see the Web as simply a reflection of humanity, but I do not ascribe to that view because the balance of power is changing, myths are being exposed for what they are, and once dominant entities have given way, while others continue to fight.  It may sound like I am subscribing to some utopian view, and in the end, perhaps I am.  However, throughout history, most power struggles have been violent, and if we look to the example of Libya, this power struggle between Netizens and the dominant hierarchies that control them has the same potential.  I am a firm believer that the natural state of humanity is freedom and so the idea of such a powerful equalizing force appeals strongly to my ideals.

Business, the Web, and the Balance of Power

Posted: September 12, 2011 | Author: | Filed under: Communications | Tags: , , , , , , , , | Leave a comment

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Business has changed significantly over the last twenty years, particularly with the advent of the Internet and the World Wide Web, resulting in fundamental changes to the way business is conducted, as disruptive new business models replace industry norms.  The Internet and the Web have connected people and businesses in ways never before imaginable, creating significant new opportunities to create value and disrupt existing markets, as Google did to advertising, Amazon did to retail, and Netflix did to Blockbuster and the home DVD market.  It appears that many U.S. corporations exist in the space between the traditional business models of the 20th century and emergent business models characterized by fundamentally different consumer behaviors, and are likely to experience significant business disruption by both competitors and consumers alike that take advantage of a new balance of power inherent on the Web.

The Relationship between the Web and Power

         The Web has made revolutionary changes to people’s relationship with each other and with information, as the Web has become the de facto standard for communication and information access in our time (Smith, 2010).   Allowing people to communicate in ways never before imagined, the Web has also changed people’s relationship with media from largely a consumption culture to more of a participatory culture, where individuals are both consumers and producers of media (Shirky, 2009).  The change to a participatory culture has had profound implications on the way consumers interact with each other and with government and corporate institutions, as mainstream media institutions are no longer the sole gatekeepers of information, rather individuals and institutions are free to organize, collaborate, share, and develop media according to their own wants and needs (Shirky, 2009).  The result is that millions upon millions of people, or the crowd, are using the combined power of access to information and the ability to organize to gain power over government and corporate institutions.  Hanley (2010), describes the transformational nature of the web as a constant power struggle “in a constant ebb and flow of winners and losers” between individuals and governments, between consumers and corporations, and even between corporations, or between governments.

Naha Tug of War - Pentax 645D Full Size JPEG

However, it is not enough to note the power struggles without understanding the unique, power-sharing, nature of the web.

Power to Change Dominant Hierarchies

              The Web has demonstrated a significant range of capability to shift power balances or completely upend existing dominant hierarchies, and Social Dominance Theory is a useful lens to evaluate the power of the Web to create change.  Social Dominance Theory (SDT) is a general theory that explains the stability of social inequality in societies with an economic surplus, arguing that three systems, age, gender, and an arbitrary set, oriented on religion, race, nationality, class, ethnicity, or otherwise, combine to maintain dominant hierarchies (Sidanius & Pratto, 1999).  SDT argues the maintenance of inequality occurs not only with the application of force, intimidation, or discrimination practiced by dominants against subordinates, but rather, “the decisions and behaviours of individuals, the formation of new social practices, and the operations of institutions are shaped by legitimising myths…consensually held values, attitudes, beliefs, stereotypes, and cultural ideologies” (Pratto, Sidanius, & Levin, 2006, p. 275).   Legitimizing myths provide a means of justifying, either morally or intellectually, dominating behavior (Pratto, et al., 2006).  For example, a legitimizing myth about Mexican illegal aliens is that they are do not pay taxes, use an unequal share of social services, have higher rates of criminal activity, and take American jobs; a myth that was used to gain passage of the controversial Arizona law, SB1070 (Rock, 2011d).  How then, given the complex interplay between individual behaviors, institutional and societal practices, and cohesive power of legitimizing myths, are the power of dominant hierarchies changed by people using the Internet and the Web?

What is Different about the Web

            Dominant hierarchies are maintained with myths that focus on the trimorphic systems of differences, age, gender, and arbitrary differences like race, class, or ethnicity (Pratto, et al., 2006).  However, on the Web, identities are amorphous, sometimes anonymous, and crafted by individuals (Baym, 2010), eroding the power of the arbitrary-set system to dominate, by allowing individuals to choose which acculturation to accept or shed on a moment’s notice.  Simply put, individuals can shape their personas and this is a key difference from the physical world, that expects behaviors aligned with age, gender, and arbitrary-set systems.

The Web also serves to erode the power of legitimizing myths because the more than a quarter of the world’s population (Hanly, 2010) has access to the what amounts to the sum of human knowledge (Wesch, 2010).   Wesch describes the new media landscape as “ubiquitous computing, ubiquitous communication, ubiquitous information, about unlimited speed about everything, everywhere, from anywhere on all kinds of devices and this makes it ridiculously easy to connect, organize, share, collect, collaborate and publish” (Wesch, 2010).  Ubiquitous access to information makes it very difficult for myth to exist as anything but a myth, because facts and reality and the impact of legitimizing myths are spread across the web at blazing speeds in the form of images and videos that cannot hide fundamental truth, while the diffusion of the net resists attempts to suppress information.  Gilmore (2011) described the nature of the networks treatment of information as “the net interprets censorship as damage and routes around it”.   In the virtual environment, information flows freely and individuals and groups are able to challenge the assumptions of legitimizing myths will information, while circumventing the information control efforts of dominant hierarchy institutions, acting as gatekeepers, that may attempt to control information flow.   Examples of people using the Web to challenge dominant hierarchies are everywhere, including the Chinese people’s challenge to the government during the Sichaun earthquake (Shirky, 2009), the Iranian people’s challenge to the government following the 2009 Iranian Presidential Election (Hanly, 2010), and the recent Arab Spring in the Middle East that has overturned many existing regimes (Rock, 2011b).  The Web is a great equalizer that erodes the power of dominant hierarchies and changes the power dynamics between individuals and institutions, moderating the impact of dominant institutions, or in extreme examples, seizing control of dominant institutions.  While recent events have highlighted the effects of the Web on the balance of power between citizens and governments, what is the impact on business world?

The Web and Corporate Power

             It will come as no surprise to anyone that the business world is about profit.  To the extent that a corporation can dominate a market or industry, a corporation can expect to grow and pass along profits to its shareholders and the greater the profit, the greater the earnings of shareholders and corporate officers.   As noted in the introduction, the Web is having a disruptive affect on the corporate world, where some corporations are seeing their business models and practices challenged, and others are attempting to harness the Web to reach new customers and commoditize existing marketplace leaders.  What differentiates the businesses that take advantage of the new medium versus those that diminish?  What business characteristics allowed Amazon to disrupt first Borders and now Best Buy?  How did Netflix destroy Blockbuster so quickly?  What prevented Blockbuster and Borders, both companies with dominant market positions, significant capital, and great brand recognition, from capitalizing on the opportunity the Web provides?  Perhaps most importantly, what can companies with dominant market positions learn about the changing balance of power?

Corporations that dominate their respective markets are targets for disruption, because marketplace leaders have the highest expectations on their performance.  Well-run companies deliver consistent earnings by using technology to “transform labor, capital, materials, and information into products and services of greater value” (Christensen, 2000, p. xiii).  In the book, The Innovator’s Dilemma, Christensen (2000) argues that well-run companies avoid disruptive technology because disruptive technologies tend to have lower profit, smaller initial markets, and address customer’s future, rather than current, needs, and therefore, good business leaders are reluctant to invest.  Put another way, the investment is fraught with risk.  Were Blockbuster and Borders simply risk-averse organizations in a traditional innovator’s dilemma, or did Amazon, for example, have other advantages besides technical innovation?  To answer this question, we need to look to the equalizing power of the Web.

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As we examined earlier, ubiquitous access to information has an empowering quality and in the business world, the crowd of consumers can not only access more product and service information than ever before, but can also produce product and service information, creating far more consumer power than existed in previous generations.  Amazon is a great example of a company that harnesses the power of the crowd to provide product information in a metaphor that now dominates the retail industry as companies like Walmart, Best Buy, and others attempt to replicate the transparency and engagement Amazon provides.  In addition, Amazon recognized that the Web offered greater customer reach and the ability to commoditize brick and mortar stores that required expensive storefronts and the labor to operate them.  The result was compelling, as Amazon consumers were offered more information and cheaper products, but more importantly because consumers were offered product insights from other consumers.  Amazon understood that the Web could change the relationship between consumers and products and built a platform that enabled the consumers to engage in a direct relationship with product manufacturers in a show of both altruism and activism; altruistic when sharing positive product experiences, and active when sharing negative experiences.  In short, Amazon built its business on an understanding of changing consumer behavior enabled by the Web.

Risk and Opportunity: A Progressive Example

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In order to understand the changing power dynamics of the Web, I conducted an experiment that simply pitted a consumer and customer, namely me, against a dominant corporation, in this case Progressive Insurance Company.  The opportunity presented quite naturally as it simply required a corporation to behave in its own interests, rather than the interests of a single customer, a situation not terribly difficult to find.  I recently had a family outing on our boat and found that it was losing power and taking on water.  We quickly got the boat out of the water and found that the engine ruined because a mechanical malfunction allowed salt water into the engine.  After filing a claim with Progressive, the claims investigator took the claim information and determined that they would likely deny the claim.  I saw the opportunity to explore the power of social media and to observe what affect it might have.  I put up a blog on WordPress and registered the domain name of Progressivefail.org, putting the story of Progressive’s impending denial on the Web.  Next, I began posting links to existing customer stories of claim problems and consumer satisfaction surveys on Progressive’s track record of paying claims and published the posts via Facebook and Twitter (Rock, 2011c).  I also posted links to Progressives Facebook and Twitter sites and received an immediate response from Progressive’s Twitter account indicating they would look into it.  Within a day, the blog had 87 views and was the first hit on Google when searching for the term “progressive fail; within four days I had received 242 views and the check was in my hands.

The Progressive example highlights how the Web can shift the balance of power between a corporation and their customers.  By simply sharing customer stories on Progressive’s social network, a nearly immediate change took place.  The surprising element of the example is not the immediate payment, but the implication that a single consumer was able to use the Web and Progressive’s own social network to potentially inflict brand damage far beyond the monetary scope of the initial claim.  While Progressive likely intended their use of Facebook and Twitter to open a positive two-way asymmetrical dialogue with their customers, they opened themselves up to significant risk by simultaneously providing consumers with the ability to damage their brand and reputation.  In this example, Progressive is the dominant hierarchy and the legitimizing myth is that of capitalism; it is more necessary for Progressive to profit than to address the specific need of a single customer.

The implication is that a corporation that opens a two-way dialogue with customers on the Web has both risk and opportunity.  If the corporation treats its customers fairly, the Web will work in its favor, while the reverse holds true; should a corporation be perceived as unfair, customers have the power to negatively affect a corporation’s brand and either way, the Web has given consumers far more power over corporations than ever before.

Conclusion

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Individuals, corporations, and governments are all part of a major transformation afforded by the Internet and the World Wide Web, characterized by ubiquitous access to all the information of human society.  Serious implications exist that have yet to be fully understood, or explored; notions of privacy, intellectual property, ownership, relationship, consumer, and producer are all being challenged and reinvented on the Web.  Corporations and governments both have a significant opportunity to take advantage of the Web to build better versions of their selves as they engage the power of the crowd; but they need to beware, because 20th century intentions and behaviors are transparent to the crowd.  Corporations that use the Web to engage customers, need to recognize that social networks are not simply another channel to reach additional customers, rather that use of social networks require ethical business models, because the crowd is vocal. Corporations can no longer exist in the space between the traditional business models of the 20th century and emergent business models, and are likely to experience significant business disruption by both competitors and consumers alike that take advantage of the new balance of power inherent on the Web.

References

Baym, N. K. (2010). Personal connections in the digital age. Cambridge, UK ; Malden, MA: Polity.

Christensen, C. M. (2000). The innovator’s dilemma : when new technologies cause great firms to fail (1st HarperBusiness ed.). New York: HarperBusiness.

Gilmore, J. (2011). John Gilmore’s Home Page  Retrieved September 3, 2011, from http://www.toad.com/gnu/

Hanly, F. (Writer). (2010). Programme 2: Enemy of the State? [Internet]. In R. Barnes (Producer), The Virtual Revolution. U.K.

Ingram, M. (2011, September 2, 2011). Is journalism as we know it becoming obsolete?  Retrieved September 4, 2011, 2011, from http://gigaom.com/2011/09/02/is-journalism-as-we-know-it-becoming-obsolete/

Pratto, F., Sidanius, J., & Levin, S. (2006). Social Dominance Theory and the Dynamics of Intergroup Relations: Taking Stock and Looking Forward. European Review of Social Psychology, 17, 271-320. doi: 10.1080/10463280601055772

Rock, R. (2011a, September 4, 2011). journey24pointoh. journey24pointoh  Retrieved September 4, 2011, 2011, from https://journey24pointoh.com/

Rock, R. (2011b, August 30, 2011). New Media, New Perspectives. journey24pointoh  Retrieved September 3, 2011, 2011, from https://journey24pointoh.com/2011/08/30/new-media-new-perspectives/

Rock, R. (2011c, August 30, 2011). Progressive Fail. progressivefail  Retrieved September 3, 2011, 2011, from http://www.progressivefail.org

Rock, R. (2011d, September 1, 2011). Social Dominance Theory: The U.S. Minority Experience. journey24pointoh  Retrieved September 3, 2011, 2011, from https://journey24pointoh.com/2011/09/04/social-dominance-theory-the-u-s-minority-experience/

Shirky, C. (Producer). (2009, July 23, 2011). How Social Media Can Make History. Talks. Retrieved from http://www.ted.com/talks/clay_shirky_how_cellphones_twitter_facebook_can_make_history.html

Sidanius, J., & Pratto, F. (1999). Social dominance : an intergroup theory of social hierarchy and oppression (Vol. x, 403 p.). Cambridge, UK ; New York: Cambridge University Press.

Smith, P. (Writer). (2010). Programme 1: The Great Leveling? [Internet]. In R. Barnes (Producer), The Virtual Revolution. U.K.

Wesch, M. (2010). From knowledeable to knowledge-able. Kansas City: TEDxKC.

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