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In a Harvard Business publication Tom Davenport argues that E2.0 is the new expression for KM. This is good news for my book, until some other guru invents a new expression, when we get tired of E 2.0. Let's imagine what it could be...

The McKinsey Quarterly: Exploring business's social contract: An interview with Daniel Yankelovich

The values of the generations that grew up before 1950 are embodied in the concept of enlightened self-interest—not naked self-interest, but enlightened self-interest. Enlightened self-interest is when you make a profit by meeting a need, by fulfilling a social function. The unintended consequence of the shift in moral values during the 1970s has been the ascendance of unenlightened self-interest—winning for yourself; I win, you lose. The Enron psychology was winning for yourself, being out for yourself. The rationalization was, “We didn’t do anything wrong, because we didn’t break the law.” Well, Enron did break the law, but many of the people who are undermining the trust of the public hold the view that morality simply means not breaking the law. To my generation, that’s moral blindness.

Still in The HBR List: Breakthrough Ideas for 2007, an article on the buiness value of social networks, by Christopher Meyer

Networks lend themselves to at least five basic tasks. They can scan the horizon, as the Global Business Network does, for events and patterns with implications for corporate strategy. They can help to solve problems: InnoCentive does this by posing problems to a far-flung population of scientists. A network can innovate for its own benefit. Members of the Polycom User Group, for example, seek new ideas for using Polycom’s conferencing products by interacting with other users and by sharing best practices. Networks can be used to exert influence: It was only when researchers experiencing errors with the Pentium microprocessor banded together that Intel took the issue seriously. And a network can efficiently allocate resources. The staffing company Aquent uses its substantial network to match marketing and communications professionals with projects that need them.

Then the author explains the five steps in designing a valuable network:

• 1-Define the work
• 2- Identify the talent
• 3- Engineer the exchange
• 4- Design the experience
• 5- Assemble the technology

Surprisingly, the word "community" is not to be seen in the article, which to me is a big problem, especially when the author mentions some of the "bad bets" than can ruin everything:

The founders of Facebook, a network to enable students to make and manage their social contacts, learned this lesson in the summer of 2006, when they moved to allow nonstudents access to the network in order to create the possibility of greater ad revenues. Core members considered this an invitation to stalkers and staged a revolt.

Why is it that the strongest advocates of a networked economy fail to see the importance of communities, which they wrongly equate to social networks?

Stil in The HBR List: Breakthrough Ideas for 2007 an article reporting on a systematic study of innovation in relation with the size of an organization, here a city:

We did indeed find that cities manifest power-law scaling similar to the economy-of-scale relationships observed in biology: a doubling of population requires less than a doubling of certain resources. The material infrastructure that is analogous to biological transport networks—gas stations, lengths of electrical cable, miles of road surface—consistently exhibits sublinear scaling with population.

However, to our surprise, a new scaling phenomenon appeared when we examined quantities that are essentially social in nature and have no simple analogue in biology—those associated with innovation and wealth creation. They include patent activity, number of supercreative people, wages, and GDP. For such quantities the exponent (the analogue of 3/4 in metabolic rate) exceeds 1, clustering around a common value of 1.2. Thus, a doubling of population is accompanied by more than a doubling of creative and economic output. We call this phenomenon “superlinear” scaling: by almost any measure, the larger a city’s population, the greater the innovation and wealth creation per person.

This is interesting because it seems to challenge the widespread idea that large companies are not as innovative as small ones. But there's a snag. The study is about cities, not firms, and cities are far more self-organizing and adaptive than large companies, which tend to be far more bureaucratic as a side-effect of pyramid-shaped org charts. But still, the result of the study is encouraging. There is no reason why a large organization should be intrinsically less innovative than a smaller one, and quite the opposite in reality. But it probably needs in that case to be organized as a complex adaptive system, and not like the Red Army.

In The HBR List: Breakthrough Ideas for 2007 Duncan J. Watts argues against the overstated importance of charismatic leaders to induce change. Very interesting article that shows that the ability to influence others is after all far less important than their tendency to be influenced.

Our work shows that the principal requirement for what we call “global cascades”—the widespread propagation of influence through networks—is the presence not of a few influentials but, rather, of a critical mass of easily influenced people, each of whom adopts, say, a look or a brand after being exposed to a single adopting neighbor. Regardless of how influential an individual is locally, he or she can exert global influence only if this critical mass is available to propagate a chain reaction.

[...] Cascade size and frequency depend on the availability and connectedness of easily influenced people, not on the characteristics of the initiators—just as the size of a forest fire often has little to do with the spark that started it and lots to do with the state of the forest. If the network permits global cascades because it has the right concentration and configuration of adopters, virtually anyone can start one. If it doesn’t permit cascades, nobody can. What seems in retrospect to be the special influential quality of a particular person (or group) is, therefore, mostly an accident of location and timing.

In other words, it's better to be on time than to be right, and leadership is mostly about resonating with the spirit of the time and revealing the hidden and untapped energies of people. Leaders are like sparks igniting latent energies eager to be revealed in a population of already connected people. So it's largely driven by circumstances after all, and by the level of social capital in the network in particular. You can't do much as a leader if the social network of your organization is broken. You have to rebuild it first. by weaving people together by climbing the ladder of collaboration. The leaders who "make it happen" are harvesters of the seeds planted by others. So why do we worship them so much? Maybe just because we need gods, and we want them to be winners, even if winners are first and foremost people with unusual flair, people who know exactly when their time has come.