The following summary from Hannah Del Porto does a great job in identifying the State of the Art in Building The Social Economy. Such “Thought Infrastructure” is essential to what will evolve into the next economic paradigm. For years, we have specified an Innovation Economy Built on Social Media platform. The thesis is published Here.
The key, we believe, is for the Social Financial System to emulate the critical components of the Monetary Financial Systems that support capitalization. Hence, “Social Capitalism” will emerge as a replacement for both Socialism and Capitalism. We are deeply excited in observing this integration of knowledge assets
Posted by: Hannah Del Porto
Personal Democracy Forum Session: Building The Social Economy: Craigbucks, Newmarks, and Making Whuffie
Panelists: Tara Hunt and Doughlas Rushkoff
Who are they?*
Douglas Rushkoff is an author and though-leader. His most recent book is Life Inc. He is best known as the originator of the terms media virus, social currency, and digital natives, as well as for applying open source principles to government, religion, and economics.
Tara Hunt is the author of The Whuffie Factor which focuses on the importance of social capital in B2C relationships and pinpoints the rise of online communities as the force that makes social capital unavoidable for businesses going forward. Her next book discusses the the psychology and economics of happiness as the basis of your successful business model.
What are they talking about?
The basic premise is that there is a social economy that exists alongside our currency-based economy. Each person has (or lacks) social currency in the same sense that people have (or don’t have) paper currency.
Tara Hunt, one of the speakers, refers (rather incessantly) to social currency or capital as “whuffie.”
What makes a social economy?
As explained by the speakers, a social economy is the exchange of goods and services among individuals, rather than between individuals and corporations.
Doug calls this “reclaiming commerce as a human activity” and points out that commercial does not mean corporate. He described the rise of the corporation as a system of exploitation and gives the social economy as an alternative to outsourcing trade to corporations and banks.
What is social capital?
It was kind of hard to pluck a definition from the session, but you could think of it as your worth to others in non-dollar terms. It’s what you have to offer to the community – your expertise and participation.
Some rules of social capital from Tara:
– The inability to save social capital encourages reinvestment.
– The value of social capital increases as it circulates.
– The law of suckage says that social capital will attract the sucky [plagarizing] element that tries to monetize and detract from the quality of the original contribution to the social economy.
Doug adds that in order to create social capital you must contribute first-hand to the social economy. For example, franchises do not add original value and therefore have no, um, whuffie.
How do I know how much social capital I have?
You don’t. According to Tara, the “good thing” about whuffie is that it means something different to everyone. So, you can’t measure whuffie. You can’t compare it. You can’t cheat it. Don’t even try inflating your whuffie. It won’t work (unless you’re a talentless celeb with a great PR team).
How do I increase my social capital?
I’m not really clear on this. I think we all understand the concept of being valuable to the community by being willing and able to contribute time and talent. And that value is qualitatively perceived by the community.
But both speakers agree that “personal branding” – defining yourself by your professional expertise – is “an oxymoron” because individuals are not corporations and should not impersonate them.
It would seem natural that to increase your social capital, you would increase your talent then let the community know so that they can take advantage of (and revalue) your contributions. If you’re not able to brand yourself according to your niche or expertise, or to promote your talents, I’m not sure how social valuations change.
The necessity to discover each and every other economy member’s value organically seems extremely inefficient. I think this would create an obstacle to the replacement of the currency-based economy with a social one, which seems to be the ultimate objective of the panelists.
How can I be successful in the social economy?
Tara gave some tips for interacting in the social economy which can be applied to your online customer engagement.
1. Turn the bullhorn around: Stop talking and start listening to your stakeholders.
2. Be part of the community you serve: Be a member of social platforms before conducting commerce there.
3. Create amazing customer experiences: Look for feedback and build ongoing relationships.
4. Embrace the chaos: You can’t control (or measure) the social economy.
5. Find your higher purpose: You get back what you give.
*Bios stolen from the PDF conference website.