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New Rules for a New Age

May 16, 2009

Socnet Just started reading What Would Google Do? by Jeff Jarvis and have to say that Jarvis has captured much of what I've learned about the Internet, economics, and the psychology of networks in ten easy-to-grasp rules:

  • Customers are now in charge. They can be heard around the globe and have an impact on huge institutions in an instant.
  • People can find each other anywhere and coalesce around you -- or against you.
  • The mass market is dead, replaced by the mass of niches.
  • "Markets are conversations" (The Cluetrain Manifesto). That means the key skill in any organization to day is no longer marketing but conversing.
  • We have shifted from an economy based on scarcity to one based on abundance. The control of products or distribution will no longer gurantee a premium and a profit.
  • Enabling customers to collaborate with you -- in creating, distributing, marketing, and supporting products -- is what creates a premium in today's market.
  • The most successful enterprises today are networks -- which extract as little value as possible so they can grow as big as possible -- and the platforms on which those networks are built.
  • Owning pipelines, people, products, or even intellectual property is no longer the key to success. Openness is.

Over the last decade, we've seen those "rules" disrupt and reshape industry after industry, from computers to photo processing to classified advertising to recording and music distribution. Philanthropy? Not so much. But change is coming, and more quickly than we may want to admit.

So here's your weekend assignment. Which of the above rules is likely to be the most disruptive in terms of philanthropy as currently practiced in the U.S.? Which has no application to philanthropy at all? And what would you add to the list?

-- Mitch Nauffts

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Posted by Bruce Trachtenberg  |   May 17, 2009 at 04:06 PM

I agree change is coming. But I'm not sure I see those rules on your list as the ones that will cause disruption to philanthropy. Unlike industries, market sectors and companies that have been forced to adapt to new ways of behaving, philanthropy is still pretty much a supply, not demand, driven business. After all, philanthropy is anything but customer-centered. And two, it's not like grantees can pick and choose whose money they'll accept or that funders have to waive incentives to get nonprofits to clamor for their funds.

However, you are absolutely correct to say that the same kind of forces that have led to new rules and new ways of behaving throughout society will, over time, disrupt philanthropy. It may take longer because, short of changes in tax laws, funders are more or less guaranteed to stay in business no matter what they do, how well they perform, or what's happening around them. At least for now, anyway. Whether the form and structure of philanthropy, as we know it, changes, that could be up for grabs later on.

Those, though, who see opportunities, rather than threats on the horizon, and who are inspired to take advantage of them now, can become more effective agents/promoters/facilitators of social change. The formation of networks alone comprising organizations doing similar work and willingly sharing information with each other could help speed knowledge transfer and lead to better, more collective asset allocation, rather than the go-it-alone approach that we're all too familiar with.

That could be big.

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