A new book comes out tomorrow entitled Why Nations Fail: The Origins of Power, Prosperity, and Poverty, by MIT professor of economics Daron Acemoglu and Harvard professor of government James A. Robinson.
In the New York Times Magazine yesterday, Adam Davidson wrote a great piece about it. I pre-ordered the book and look forward to reading, but in the meantime, the New York Times article hints at some key conclusions the authors reach. From the article:
“…the wealth of a country is most closely correlated with the degree to which the average person shares in the overall growth of its economy… when a nation’s institutions prevent the poor from profiting from their work, no amount of disease eradication, good economic advice or foreign aid seems to help… If national institutions give even their poorest and least educated citizens some shot at improving their own lives — through property rights, a reliable judicial system or access to markets — those citizens will do what it takes to make themselves and their country richer.”
A relatively simple concept: Nations that give citizens opportunities to improve their lives—to create value for themselves—give them the incentive to create value—both for themselves and for the nation collectively.
According to the summary on the authors’ website, the book highlights examples of the theory in action around the world and throughout history, “from the Roman Empire, the Mayan city-states, medieval Venice, the Soviet Union, Latin America, England, Europe, the United States, and Africa.”
So how might this theory apply to the study of how organizations can build passionate and sustainable brand communities? If we think of brands as nations, what might make them fail or see great success?
Michael Porter wrote a now-famous piece in HBR last year entitled Creating Shared Value that to me articulates the business equivalent of the principle. Here is how Wikipedia describes Porter’s concept of creating shared value:
“The central premise behind creating shared value is that the competitiveness of a company and the health of the communities around it are mutually dependent. Recognizing and capitalizing on these connections between societal and economic progress has the power to unleash the next wave of global growth and to redefine capitalism.”
I think there is a strong connection here, and I would frame it as simply as this:
Brands (and nations) that exist only to extract value from their communities are, in the long run, less competitive and less sustainable than brands (and nations) that exist to create and share value with their communities.
Think about the brands you interact with on a daily basis:
– Which of them are clear value extractors (i.e. they unabashedly exist in order to extract as much money as they can)?
– Which of them are extractors in “shared-value clothing” (i.e. they hide their true selves behind a veneer of shared value)?
– Which of them truly create and share value with the communities that care about them?
If you are like me, some specific organizations immediately come to mind when you see the three categories above. Humor me for a second as I remix the quotes I shared from the New York Times article earlier, but putting them in a brand context:
“…the strength of an organization’s brand community is most closely correlated with the degree to which the average community member shares in the overall success of the organization and community… when an organization prevents the average community member from profiting from its work, no amount of PR, advertising, or charitable giving seems to help… If organizations give even their average community members some shot at becoming more successful — through providing innovative products, experiences, and connections to new people or opportunities — those community members will do what it takes to make themselves, the organization, and the overall brand community richer.”
I suspect that organizations interested in building passionate brand communities have a lot to learn from Why Nations Fail.
And I’ll let you know what I personally learn once I’ve had a chance to read it.
There was an interesting article in the New York Times Magazine this weekend about the metamorphosis of the word fail from verb to interjection. I know, I know, most of the computer-y world has been using the word in this way for quite some time (need some examples? go check out FailBlog). It’s old news.
Anil Dash wrote an interesting post called The End of Fail a few months ago where he articulated some of the reasons why FAIL is such an ummm… FAIL for collaborative cultures.
Fail is over. Fail is dead. Because it marks a lack of human empathy, and signifies an absence of intellectual curiosity, it is an unacceptable response to creative efforts in our culture. “Fail!” is the cry of someone who doesn’t create, doesn’t ship, doesn’t launch, who doesn’t make things. And because these people don’t make things, they don’t understand the context of those who do. They can’t understand that nobody is more self-critical or more aware of the shortcomings of a creation than the person or people who made it.
When attempting to build a collaborative culture where innovation flourishes, the biggest enemy, as Tom Kelly has pointed out, is the Devil’s Advocate. I almost feel like the person who shouts FAIL is a worse member of the same species. At least the Devil’s Advocate brings some opposing ideas to the table. The FAILman delivers only judgment.
I just finished reading the new book Free by Chris Anderson, which I read on my sweet new Kindle for the low, low price of… you guessed it… free (the Kindle edition was free for the first month, but you missed it, $9.95 now).
For those of you who aren’t familiar, Chris Anderson has been with Wired Magazine since 2001, and is currently the Wired Editor in Chief (a fact that I copied directly from Wikipedia, something he has also been accused of doing).
I’d consider Chris a member of the pantheon of Folks Who Can Decently Explain What the Heck Is Happening On This Planet Right Now, alongside Thomas Friedman, Malcolm Gladwell, and Michael Pollan, among others.
However, I have only recently forgiven Chris for his long tail concept that unleashed hordes of marketing droids blathering on for hours about the long tail of this and the long tail of that a few years back. I’m not saying he wasn’t right, it was a great book. But, dude, you have no idea what you put us through. Torture.
Here is my attempt to paraphrase the 300 pages of Free in two sentences:
The price of digital content is moving quickly toward free. So stop bitching about it and figure out a business model that allows you to make a decent living anyway.
It’s a brilliant book. And I’m not just saying that because I work for a company that figured out a way to build a profitable business model that plays well with free. As I was reading, I kept thinking how eloquently Chris was stating complex concepts that I’ve been living with at Red Hat for years, but had never been able to articulate (he even mentions us in the book three times, score!).
I also kept thinking what another great truthteller named Bob Dylan once said: “You don’t need a weatherman to know which way the way the wind blows.”
Or maybe you do. Turns out there are a lot of people out there who passionately disagree with Chris Anderson about the conclusions he draws in this book that I found rather obvious.