The Ingenesist Project

The Next Economic Paradigm

Tag: interaction

Data: The Ultimate Shared Asset

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On April 29, 2011

In General Information

People always ask me how The Value Game will work and how The Value Game will scale, and how The Value Game will make money.  These are great questions, albeit straight from the b-school crib sheet; good questions nonetheless.

At first glance, The Value Game as we are deploying in Social Flights looks like a rich kids party barge.  The idea is that people can share an airplane just like they did with that stretch limo on prom night.  Yes, the idea is the same – the jet is a shared asset and status on prom night is special.

The Value Game also produces a lot of very important data that is owned by the players.  So when the passengers arrive at their destination, their data can now transform the hotel into a shared asset. As such, a new Value Game plays again.  If the players own their data, and they only share it with the other players in the associated Value Game, they can command substantial value for the collaborative purchase of hotel rooms – or any shared asset.

Likewise, the players will need restaurants, tour guides, golf courses, concert tickets, entertainment, etc.  Their data – if they own it – is their discount coupon…like a Group Coupon, except relevant to the need and exercisable on-demand.  By the time the trip is over, their Value Game data can result in hundreds or thousands of dollars in discounts for the individuals in a travel tribe if, and only if they own their data.

The next time they want to take a trip, their data is not only a discount coupon; it becomes a passport to opportunities that money cannot buy. In the End Game of the Value Game, data are the shared asset.  This works if, and only if people own their data and they can share or restrict it from view of others.

Seriously, think about that for a minute.

You give your data away for free.  Companies collect this data and they have no intention of sharing it with you.  Data is a multi-billion dollar industry.  Why?

Aren’t most life lessons about figuring out who is NOT playing The Value Game and avoiding those people and situations?

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How To Play The Value Game

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On February 22, 2011

In General Information

The Value Game is a new class of business methods that converts financial currency into social currency and vice versa.   The benefits of the Value Game are innumerable since social currency is the only true alternate means of storage and exchange for value that can hedge a weakening dollar.

The rules of the game are really quite simple

  1. The Value Game Starts and ends with Dollars (financial currency)
  2. All new value is created within the game is denominated as “Social Currency”
  3. Value is created from 3 or more communities interacting with a shared asset

How to build a Value Game

In order to build a Value Game, the social entrepreneur finds an asset that people are willing to share, and then identify three or more communities whose interaction with the asset creates social value.  The following are 3 Case studies currently under development at The Ingenesist Project:

Example 1: Social Flights is a new startup that aggregates private jets and deploys them to the social graph.

  • The shared asset is the Jet.
  • Player 1 is the traveler,
  • Player 2 is the charter operator
  • Player 3 are Local vendors who issue discount coupons against the airfare.

The traveler creates “time-value” by avoiding commercial aviation and developing their social graph.  Charter operators penetrate underserved markets.  Entrepreneurs supply relevant services to a known client instead of advertising.

Example 2:  High Net Worth Individual (HNWI) Reputation Management System. This business method helps influential persons improve their reputation in a community.

  • The shared asset is a shared reputation.
  • Player 1 is a HNWI.
  • Players 2 are the community organizers associated with a social cause.
  • Player 3 are social media gurus.

The HNWI adopts a social cause by exerting their political/financial influence in favor of the cause.  The Social media guru uses this content to demonstrate their ability to move search engine results, which enhances their on-line influence.    The community organizers receive social influence, managerial knowledge, and financial support for social cause.

Example 3: Collaborative Production. A Socially Important Film Project needs $250K to fund production and estimates 5 Millions views at distribution.

  • The shared asset is the final product film
  • Player 1 are the film producers
  • Player 2 are the Community that will benefit from the film’s production
  • Player 3 are product vendors selected by the community

The community provides detailed demographic information about themselves and their buying habits and the film producers processes these data for anonymity.  The film producers sell $1K options to 250 select corporate vendors for the right to issue a “Groupon-like” device to the 5M viewers of the film. Select vendors use the demographic data to target their message. The people who fill out the demographic surveys can purchase the Coupon for themselves or sell to other people for profit. Sales occur in lieu of advertising. The interaction between these communities produces social value in favor of the vendors, the film producers, and the benefit community.

Gaming The Game

As people learn to build The Value Game, they will innovate new and increasingly creative ways to leverage shared assets and interact with communities for profit.  Given the magnitude of the financial problems in the US, several hundred thousand Value Games will be needed to provide people with their daily needs for education, health care, municipal services, energy, transportation, food, etc.  After a while, the need to return to dollar currency will diminish as the value of the dollar itself diminishes under the weight of the impending debt burden.   As such, The Game will be Gamed by The Value Game.

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80/20 Rule: The Value of Human Interaction

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On October 25, 2010

In General Information

If an IPod is shuffling in the forest, and nobody is around to hear it, does it make a sound?

This is a standard philosophical riddle that raises questions regarding observation and knowledge of reality. Alexander T. Jackson, one of the great minds of the 20th century, may have said that, “View points of this riddle differ based on the perceived definition of the word ‘sound’, often confused with the definition of the word ‘hearing’.”

A $300 Ipod is shuffling in the forest and nobody is around to interact with it, does it have value?

This philosophical riddle also raises questions regarding observations and knowledge of reality.  Viewpoints in this riddle differ based on the perceived definition of the word ‘money’, often confused with the definition of the word ‘value’.

To this question, Wall Street would say “Yes”, but Main Street would say “No”. In fact this brings into question the order of how we assign value in our world.

Suppose we constructed the same riddle for any physical asset such as a bridge, house, airplane, computer, car, university education, insurance policy, Marketing Department, tennis shoe, police officer, trumpet, leaf blower, FaceBook, Twitter, Linked In, fungus cream, guacamole, anything at WalMart, etc…..

Value of human interaction

Before long, we notice that the value of nearly all products and services is wholly derived from the value of human interaction with the object.  So where exactly is the true value of our economy, in the object or in the human interaction?   Wall Street would say “object”, but Main Street would say “human interaction”.

Credit Score

In finance, the credit score was established to assess the human interaction with a financial instrument called debt.  Yet, in the above example it is relatively clear that the vast majority of value created is dependent on human interaction with products and services that may or may not be financed with debt, not the debt itself.  It would seem that a social credit score and a knowledge inventory would be more appropriate way to assess the true value of economic activity. But where do we start establishing such an index?

The Social Value Index

We’ll start with a baseline 80/20 rule first identified by an Italian Economist named Vilfredo Pareto.  In our rendition, 80% of the true economy is created in the form of social value and 20% is created in the form of financial value.  Keep in mind that Dr. Pareto also defined a concept called the “Pareto Efficiency” for social resource allocation. This refers to the end-state of an economic game where no player can become better off without also making at least one other player worse off.

The objective then, is to design Social Value Games that are 80/20 (social vs. financial leverage) compliant and Pareto Efficient then, test the hypothesis and improve it toward optimality.

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Social Enterprise; Can Innovation Be Manufactured?

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On October 28, 2008

In General Information

Manufacturing is the use of tools and labor to make things for use or for sale.  When I think of manufacturing, I see images of machines spinning out high precision components into colored inventory buckets that are transported to clean areas to be precisely combined with other precious components creating some magnificent device such as an aircraft, computer, or medical CAT scan machine.  Each device is a product of countless human interactions.

Each little piece is designed, discussed, and depicted with great care and precision so that it fits perfectly with the next piece.  Everything about each part is planned long in advance; the composition of the material, the tolerances of all dimensions, and the strength/weight/wear characteristics.  However, each piece alone has little value without the other pieces.  Yet, if one piece fails the whole machine can fail.  When the machine has completed its service life – those beautiful, intricate, and worthy creations of human interactions are simply discarded.

Since the invention of the cotton gin, the economic growth resulting from the human interaction involved in precision component making (literally and figuratively) is undeniable.  Until the era of Social Networking, however, few could envision that human interactions are themselves components of an invisible inventory. Each element of human interaction is precisely honed from some invisible raw material by social machinery and deposited into colorful garments and transported to clean areas where they combine with other precious components creating some magnificent device such as an airplane, computer, or medical CAT scan machine.  When the machine is scrapped, the product of those human interactions lives on…but where and how?

The greatest constraint to the emergence of an innovation economy is the invisibility of knowledge assets; social capital, creative capital, and intellectual capital.  We have an inventory of every nut, rivet, and panel on an airplane, but not the knowledge asset that created things.  It is like society is keeping a big secret from itself.  This is the great opportunity for Social Media.

People are still asking “where is the money in all of this social media stuff?” The answer is “everywhere – the door is unlocked, but the lights are off”.  The irony regarding the visibility of knowledge assets is that they lay right in front of us but we refuse to see the obvious.  All we need to do is switch on the lights. Until we can inventory knowledge assets outside the construct of a corporation, social networks cannot themselves become the corporations of the future.

Can innovation be manufactured?  Of course, with the right tools, innovation can do whatever it wants.

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