Tag: art

Social Capitalism and The Culture of Data

On June 30, 2010

Data are the raw material of the next economic paradigm. Data, information, knowledge, innovation, and wisdom are all related; but it all starts with data.

In order to produce anything valuable in the domain of social capitalism, the creation and formation of data is hypercritical. The better the data, the better the information, knowledge, innovation, wisdom and culture that will follow. Each stage of transformation along the chain reaction from “data” to “culture” is an opportunity for both great value creation AND astonishing corruption.

Data is King:

Yet data are often collected and processed with very little vetting. We all know that information is most easily spun from the data collection process. We know that bad knowledge comes from bad information, and we know that unsuccessful innovation comes from inappropriate knowledge. Obviously, to be an unwise leader is to be unimaginative leader. A failed culture creates failed data…and the circle completes itself.

Data is an asset:

On the other hand, the ability to collect data is often the most tangible intellectual property that an organization can hold. It is easy to copy a patent but difficult to recreate the system that generates patents. Excellent data results in excellent technology from the moon landings to the Internet. The trick is that all assets must contain two components; a quantity and a quality. This means that some rigor is needed in the data collection process. When data are produced, the quantity is the “measurement” but the quality is the certainty or uncertainty that what is being measured is actually what is being observed.

Data Relationships

Phenomena such as art, politics, emotions, capital markets, and spirituality are difficult to measure because the item being observed exists as a function of the observer’s interaction with it. Still, the quality of the data includes the certainty that all data were measured the same way AND some disclosure of the uncertainty that remains. This is an area of great omission and where severe problems arise especially where the most people rely on the data to make decisions. The term “comparing apples to oranges” is a real problem and it is particularly elusive at very early and highly incremental stages of ideation.

Mouse goes squeak:

Often the people involved with the intensely small or incremental portion of the data design and collection process are the least powerful people in the supply chain. Often they have the least say in how the data is analyzed and certainly have no visibility of what happens upstream. It is tragically amusing that the dominant characteristic of most hierarchies is that each level of management “filters” the data from lower levels and delivers it to the next level where actions are authorized.

The Culture of Data

Social media is entering the human culture at an incredible rate. Social media has also shown us what happens when the good data becomes the important information, which increases knowledge among the most people leading to increasingly effective innovation and changing the conventional wisdom about an increasing diversity of subjects. Social Capitalism will replace Market Capitalism simply because the culture is superior.

Hint: Culture Produces The Data.

The Fertilizer Economy

By Admin

On March 15, 2009

In General Information

The bad, the good, and the ugly

The bad news is that United States has a global comparative advantage in producing bullshit. The good news is that we may actually be able to till it into fertilizer for the Innovation economy.

America’s financial crisis was caused by money created from money which was in turn a derivative of wild-eyed speculation in assorted proxies for real productivity, including real estate. Stock prices were supported by imperfect information in a Tickle-Me-Elmo culture while broker fees are embedded in every conceivable transaction.

America has become a world leader in hype, marketing, lawsuits, and fantasy. None of these industries actually produce anything yet nobody can say they are not immensely creative, induce sweeping social movements, and their propagation demands extraordinary intellectual resources, flexibility, and adaptability.

The Theory of Comparative Advantage

It is not efficient for, say, Ghana to produce rice and Vietnam to produce cocoa. If they each produce their natural endowments and then trade the differences, fewer resources are expended to produce more goods. This theory is the basis of global free trade and the efficiencies are irrefutable so globalization is here to stay.

Meanwhile, the literature on the subject of innovation agrees that innovation is maximized as a function of endowments in social capital, creative capital and intellectual capital. Silicon Valley is widely held as the poster child for emerging from the deep social movements of the 1960’s attracting an inflow of diverse people where high tolerance, creative art and music were abundant in close proximity to intellectual centers of Stanford and Berkeley.

Comparative Advantage for Innovation:

By the theory of comparative advantage, if a country does not possess a comparative advantage in intellectual capital, creative capital, and social capital, they would not hold a comparative advantage in an innovation economy.

For example; China has a huge endowment of intellectual capital and throughout history they have been an inspired creative force. However, the current government thwarts social capital. Therefore, whereas China has a comparative advantage in a manufacturing economy, they would not necessarily have a comparative advantage in an innovation economy.

Many other countries have endowments of intellectual capital as well as democratic governments, but cultural norms may still constrain diversity related to gender roles, social classes, lifestyle tolerance, or the acceptance of “outsiders”. As such, they may have comparative advantage in a knowledge economy, but the relative deficiency in creative capital would inhibit a comparative advantage in an innovation economy just as quickly.

The Fertilizer Economy:

That said, the United States has a vast abundance and tremendous economies of scale in social capital, intellectual capital, and creative capital in comparison to any other country in the world. The problem is that these assets are sequestered behind the corporate veil, suppressed from true wealth creation by the priorities of a financial system built to produce nothing except analyst expectations. Like sugar calories, lots of energy is delivered, but sustainable health is not.

The harvest in the wind

The brokers, speculators, and marketers are not bad people – in fact, they are brilliant. They are simply stuck with the wrong set of incentives. The Ingenesist Project dramatically changes the incentives and promises a far better allocation of intellectual capital, social capital, and creative capital. By making such assets tangible outside the construct of the Wall Street, the comparative advantage of the United States in an innovation economy will be astonishing.

Where there is fertilizer in the wind, Wall Street will lead. Where there is a harvest in the wind, Wall Street will follow.

The Next Economic Paradigm

Tag: art

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