How a Dutch B-school is helping its diverse student body develop lasting networks:

One answer, at least at RSM, is technology. Dianne Bevelander, executive director of RSM programs, is using software to map the networks that students form among themselves and track the student connections over time. School administrators hope to use the lessons learned to teach students how to more effectively create the networks they’ll need to succeed in a global business environment.

Two weeks after students arrived in October, Bevelander asked them to identify their personal networks. A questionnaire asked them to name students with whom they work, those from whom they seek ideas, and those with whom they socialize. Then Bevelander color-coded the three types of connections to produce an image of the current class that, on a PC screen, looks like a lacework project gone haywire.

But patterns emerge. “This group works well together as a team,” says Bevelander, pointing at an octagon representing one student work group. “But if you look at the social network, they don’t talk to each other at all.” Indeed, the lines representing social connections all lead to other groups. The lesson: Teams can get the job done even if the members don’t like each other that much.

more…

Despite the growing prevalence of virtual communications business, there’s still plenty of information that doesn’t get digitally encoded. Recent research (Egocentrism over e-mail: Can we communicate as well as we think? By Kruger, Justin; Epley, Nicholas; Parker, Jason; Ng, Zhi-Wen, Journal of Personality and Social Psychology. 2005 Dec Vol 89(6) 925-936) shows that people correctly interpret the emotions of others over e-mail only about half of the time, although they think that they have made the correct inference almost 9 times out of 10. We need nonverbal cues to most effectively interpret the raw data—the words that we hear or read. In fact, according to Epley and Kruger, “it is not uncommon for paralinguistic information to more than merely supplement linguistic information, but to alter it completely.” This is one of the reasons for the frequency of online flaming.

Needless to say, it seems that in-person interaction skills will remain valuable for the foreseeable future.

(via Jonathan Rhinesmith)

This week’s Carnival of Marketing is up at Eric Mattson’s MarketingMonger. Eric decided to toss out the “7 best posts” restriction (which I use at the Carnival of Entrepreneurship). Eric says:

I believe that the restriction really holds back the growth and popularity of the carnival.

I see his point. If people’s posts aren’t posted, will they still continue to submit, host and read the carnival? And do the hosts and submitters make up the bulk of the readership?

My contention is that it’s ultimately all about the readers, and readers rely on blog carnivals to be a filter — it’s impractical for most people to try to keep up with 50+ blogs. So if you want a filter, just how much of a filter do you want?

Consider, for example, the Carnival of the Capitalists, which I recently hosted here on The Virtual Handshake and last month on About Entrepreneurs. Both times, it had over 60 posts. I suppose that’s still a filter vs. reading all of them, but how digestible is that? Is anyone other than the host really going to read all 60+ posts? Or is that not the point?

What do you think - should blog carnivals accept pretty much all entries, as long as they stick to the guidelines, or should they keep to a small, digestible size?

aSmallWorld (profiled here) just raised a confidential sum from the Weinstein Company, the production business started by Bob and Harvey Weinstein after they left Miramax.

Harvey Weinstein said, “I think we’ll become very successful with one million people,” he said, “but we have to find the right one million.”

more…

MySpace is now offering downloadable episodes of the Fox show 24 for $1.99 per episode. I was interviewed by Jennifer LeClair for E-Commerce Times. This is a pretty intriguing mash-up of social networking and traditional media. I applaud them for experimenting with it — someone has to, and this is easy for them to do — no big strategic alliances and joint ventures to work out — just do it.

One of the questions Jennifer asked me was whether MySpace is losing any of its “cool” factor because of this and other recent changes. That’s been a concern since their acquisition by News Corp. But here’s my answer:

“Big shifts can always happen, but MySpace members are pretty invested in the brand, with bulletins, friends lists that hold thousands of people, blogs and groups,” Allen told the E-Commerce Times. “MySpace would have to really make a huge error to lose any more than a small handful of members.”

But I am a bit skeptical. Doesn’t everyone have a DVR or VCR? And do people really want to watch full-length episodes on a mini-screen?

“There is a lot of potential here for MySpace,” said Allen. “I think it will grow as more consumers have portable video players. Right now, people would still rather watch ‘24′ on their televisions.”

In my conversation with Jennifer, I speculated as to Fox/MySpace’s reason for doing this, and it turned out I hit the nail on the head:

Beyond branding, MySpace.com’s decision to sell episodes of “24″ opens the door for the company to morph itself from a social platform only to a content delivery channel, Levinsohn [president of Fox Interactive Media] mentioned. It may be a long-term play, though.

I just received a copy of the latest edition of Networking Times, the premiere magazine for the network marketing industry. The latest issue focuses on virtual networking. I was interviewed a couple of months ago by John David Mann, their Editor-in-Chief, and it was one of the most pleasant and thought-provoking interviews I’ve ever done. Also in the magazine are a review of The Virtual Handshake (free reg. req.), an interview with Ecademy chairman and co-founder Thomas Power, and a review of his Networking for Life (free reg. req.).

Here are a few highlights from my interview (see below for some from Thomas’s):

NT: What do network marketers most need to learn about networking?

Me: The relationship is more valuable than the transaction. People need to understand that the lifetime value of a relationship–even with someone who never buys from you, maybe someone you never even tell about your opportunity–the lifetime of the relationship itself will be worth more to you by orders of magnitude than any one individual sale itself.

NT: Sometimes you have both the relationship and the sale…

Me: Right, but people often try to jump in too fast. A guy in a discussion forum recently described how he was trying to meet people and build a referral business, but it wasn’t working. The email he was sending out was very nice: he would introduce himself and say, “I want to learn more about your business so I can refer business to you.” He thought he was being selfless. But this was his first contact. How can you refer business to me when we don’t even know each other?

NT: And people weren’t born yesterday.

Me: Right: they understand what’s implicit. If you’re saying you want to refer business to me, you’re also expecting me to refer business to you.

NT: He was trying to do too much too fast.

Me: Exactly. The initial conversation, and we’re already talking about referring business. One of the most important tips of networking is know where you are. Understand the context. You have to look around and see, what are the posting rules, what’s general feel of the conversation. You don’t walk into Toastmasters, get up to introduce yourself and give your thirty-second business pitch. It’s not appropriate. The same thing is true online. You’ve got to know your context and be appropriate to that context. The top network marketers know that the three-foot rule is not what you do. If there is a three-foot rule, it’s this: Anybody within three feet of you is worth getting to know a little better.
…
NT: When do you tell someone about your opportunity?

Me: When you have permission. This doesn’t necessarily have to be explicit permission. Ideally it will be, if you’ve done it right, they’ll say, “You know, tell me a little more about that thing you’re doing.” It doesn’t necessarily mean they want to be a rep, but they want to know about what you’re doing, because they care about you and what you do, and they’re interested in being a part of your life.

NT: Because you’ve honored the context of the relationship and not forced it on them.

Me: Exactly. But they may simply give you implicit permission. They might tell you about something, like not having enough energy or not having enough income, and that in itself gives you permission. But whether it’s implicit or explicit, the right time to talk about something is when you have permission, and never before.

And from Thomas’s:

NT: Have network marketers figured out what to do with the Internet yet?

TP: No. We’ve had to forbid network marketers and multilevel marketers from Ecademy, because they don’t know how to behave online. If we allowed them in, Ecademy would be ten times its present size…[T]hey only know how to sell. They don’t know how to buy, and they don’t know how to network. We say to multilevel marketers, “You can join Ecademy, and meet and connect and so on–but you can’t recruit and you can’t sell.” Because their attitude is that their product is the best product. But networking is not about selling. Networking is about giving connections to other people.
…
NT: Do you see the network marketing world ever learning the lessons here and figuring out how to apply them to our business?

TP: Yes, I do, but recognize that change in an industry tends to take a generation, and a generation is generally thirty years long.

NT: So take a long view!

TP: I think so. I started what I’m doing at thirty-four, and I think it’ll be mainstream when I’m sixty-four. VCs say to me, “We can’t hang around that long,” and I say to them, “Then go invest somewhere else!” It takes a long time. You look at the video recorder, the mobile phone, the personal computer–these products took twenty or thirty years to enter society.

NT: What can we best do to help create that?

TP: Understand that what people want is connections. If you want prospects, you have to give them away to other people. When people go to conferences and seminars, they go because they want information and contacts. So when you meet them, give them information and contacts! That’s what they’re there for! If you do, they’ll remember you all their lives.

I’m really glad to see so much emphasis being put on the long-term relationship-based approach to network marketing. I have seen some of the best and the worst of network marketing. I continue to believe that it is only a business model, that its success provides lessons for every businessperson, and that the real problem with MLM is not the business model itself, but the lack of experience and training that many who enter the field have.

On a related note, I’ve been approached by John Milton Fogg, author of the best-selling network marketing book of all time, The Greatest Networker in the World, to participate in his latest book project, It’s Time… In Search & Praise of Network Marketing Excellence. Again, I’m very happy and flattered to be included in this project. More details as they’re available.

Adobe offers a converter to PDF format on their site (for a fee), but there are countless other options out there that cost zero. Try www.Pdfonline.com or PDF Creator. They’ll convert documents from Microsoft Word, Powerpoint, and so on.

Via 101 Fabulous Freebies

Step right up! Step right up and behold the wonder of the Carnival of the Capitalists, a traveling weekly roadshow that celebrates the many, many ways in which we earn, manage and spend money to educate and entertain you. Depending on your politics and your mood, they may make you cheer, boo, laugh, cry or scream, but above all, they will make you do one thing… think!

Posts are self-selected, i.e., bloggers submit their best posts of the week, and all those that meet the guidelines are accepted. I have marked my "editor’s choice" in each category with a simple asterisk (*) for those who may want to filter their reading a bit. If your post didn’t get run, it’s most likely because either a) it wasn’t "substantially original" (links and re-posts of others’ articles and posts don’t cut it), or b) you submitted more than one post (you’re supposed to pick your best, not make the host do it).

So without further ado, on with the show!

The Economy

• * Jewelers Dangling takes a look at how the 37% increase in the price of gold since January is impacting jewelry businesses. I love stories like this that take the impersonal numbers we read on the market pages and make them personal.
• Is SOX Dragging Down the US Economy? Yes, says Professor Bainbridge, and new legislation is intended to ease Section 404 requirements for entrepreneurs.
• The Fed’s New Conundrum: Slowing Housing explains the thinking behind last week’s 1/4 point interest rate hike.
• Corporate Debt Financing Is on the Rise, which might be a good thing if it were being used to fund revenue-generating projects, but the fact that it’s being used to fund acquisitions has blogger David Foster concerned.
• An Interview of Abundance argues that we need to have more free-market privatization of health care, not less, and that one of the keys is to have patients make more adult choices about their care. It’s thought-provoking, but I think the interviewee misses the mark on why so many people are uninsured. I’ll be leaving a comment there.
• Getting Transparent continues in the same vein as the previous post, saying that pricing has to become transparent in order for consumers to make informed, rational healthcare decisions.
• Bad Loans in China reports that more than $900 billion is invested through the Chinese economy in non-performing loans, mostly to state-owned enterprises. What does this mean for those who are so eager to get a piece of the action in China? Read and find out.
• Wage Increases for State Workers says that urban workers are reaping the benefits of Chinese economic growth and leaving migrant workers out in the cold.
• Zimbabwe Inflation Hits 1,000% - Imagine using a wheelbarrow to haul enough cash for a simple shopping trip. Yikes! That’s what tyranny tends to do to a country.
• Iranians Blaming Ahmadinejad , Nukes For Sluggish Economy - The Khaleej Times reports that Iranian businessmen aren’t happy about the current extremist president’s recent isolationist moves.

Economics and Capitalism

• * The Friendly Version argues that capitalist theories of justice are more substantial than leftists, or even most right-wingers, give them credit for. In particular, he explains how they can give rise to a duty to implement a Friedman-style "negative income tax", or some other equivalent of an unconditional basic income
  guarantee.
• Social Justice - Who’s In the Right? Are $10-million-dollar salaries justified or not? This blogger says that the only true social justice is "where you receive resources and popularity proportionally to the perceived value of your contributions, and give proportionally to how you perceive other people’s work."

The Market / Investing

• * Return on Capital & Equity Growth explains two of Warren Buffett’s favorite indicators that demonstrate how fast a company can grow the money it has to invest in itself.
• Keep an Eye on the Fundies gives an overview and offers a template for keeping track of a company’s fundamentals.
• Vanguard STAR Fund Performance Analysis shows how just managing the allocations in this balanced fund has produced an 11% higher return over 10 years than an individual investor would have realized putting money in the same secondary funds at current allocations. It never ceases to amaze me how much money can be made just by shuffling it around.
• Ultimate 2006 Berkshire Hathaway Annual Meeting Guide provides links to all the best meeting notes, press coverage and photos from Warren Buffett’s annual confab. The next best thing to being there.
• The Week Ahead is Tom Hanna’s weekly guide to the announcements and events that impact our economy.

Entrepreneurship

• * Please Stop with Your Chinese Math explains that small numbers aren’t necessarily related to easy success and urges entrepreneurs to stop presenting low percentages of a huge market potential to investors as if that means it’s a sure thing.
• Entrepreneurship Gap says that Gen X’ers are not starting businesses at as high a rate as those before or after them, but that it may be a part of where they are in their life at the moment more than anything. Jeff goes on to summarize five ways to start a company without quitting your day job.

Energy

• * High Gas Prices Are Overrated makes a compelling argument that gas prices are not really having a substantive impact on either personal spending or the cost of doing business.
• What’s the Big Deal About Gas Prices? This blogger has a slightly different take, saying that gas prices cut into the disposable income of the bottom 60% of wage-earners, who don’t have much disposable income to begin with.
• Congressionally Mandated Shortages looks at the Energy Price Protection Act of 2006 that is supposed to prevent "price gouging". Of course, it doesn’t actually define price gouging - they have six months to figure that out. I buy Hamilton’s argument to a point - the thing he’s missing here is that neither consumers nor business owners always act completely rationally, fully considering the long-term consequences.
• My Crystal Ball Knows All reports that one year after price caps on gasoline were implemented in Hawaii, legislators are eliminating the caps under public pressure. This is what happens when politicians try to control the market.
• Bursting Into Flames: The World’s Battle for Oil says that for all we may rail against it, the fact is simple: we as individuals have to decide to consume less oil and spend more money on alternative fuels.
• Climate Change vs. CO2 Capture Technology makes the case for CO2 capture technology in order to prevent CO2 emissions from reaching critical levels in about 35 years.

Career / Personal Development

• * Six Steps for Learning Difficult Subjects Quickly offers a strategy for cramming dry and difficult material. This is a great way to expand your knowledge base, or at least not feel completely lost at the next dinner party with all your intellectual friends.
• Goal Setting: Why So Many Fail challenges conventional wisdom about goal-setting. Goal-setting should be simple and private, says Adrian Savage.
• Basic Training for Everyone draws a lesson from the military about the importance of basic skills.

Human Resources

• * 10 Reasons Why Organizations Are Not Able to Retain Employees - A great list, but Ghautam Ghosh leaves off the most obvious one: a better offer.
• Good Will Hunting tells the story of a job reference that perhaps shouldn’t have been used. Lessons here for job seekers, recruiters and former bosses.

Management

• * Gresham’s Law and Leadership makes a compelling case that "the only way to produce a working environment worthy of a civilized nation is to value some things more highly than financial results."
• * Meet the Nick Carr of Organizational Change Management - Cambridge Professor Chris Grey’s new paper, "The Fetish of Change", challenges the idea that constant change is a given and says that the practice of change management has been largely a failure.
• Six Sigma and Employee Satisfaction reports on a recent study showing that focusing purely on customer satisfaction and financial results is short-sighted, and that employee satisfaction must be a consideration for long-term success.

Intellectual Property

• * When Is "Fair Use" of News Media Not? Does the end justify the means? Can a watchdog group use copyrighted material in its entirety under the terms of fair use? Steven Silvers says no, and I agree, as I’ve written about before.
• Wal-Mart Faces Smiley Trademark Dispute demonstrates the complexities of intellectual property law. Before you decide this is one more reason to hate Wal-Mart, read the whole story.

Marketing

• * What Do the Simple Folk Do? According to this corporate marketer, folks at the local florist and fish store have a lot to teach corporate types about marketing. Highly educational for businesses both small and large.
• Starbucks = Coffee claims that Starbucks may be positioning themselves to become a generic word for coffee, a la Kleenex, Band-Aid or Xerox.
• Make Your Baby Stupid Even Earlier With BabyFirstTv deconstructs the marketese of this atrocity.
• Cultivate Loyalty Through Great Customer Service & Support - It’s cheaper to keep a customer than to get a new one, and great customer service is the key. Here are four simple steps to better customer service.
• Yvonne Discovers The Power of We looks at female bloggers and sets up Yvonne’s interview on Synergy Weblog (follow the link at the bottom).
• Advertising And Customer Service Are Just Like Family says that advertisers and customer service people don’t tell us the truth — they tell us what we want to hear.
• On Pricing explains value-based pricing and why software developers have such a hard time with it.
• Using Gasoline And Other Creative Ideas To Add Fire To Your Business shows how tying in to current events can add spark to your promotional campaigns.
• Novell: Branding Open Source reports that Novell is following in the footsteps of IBM and others in jumping on the open-source bandwagon.
• Another Green Bus? Green marketing rings hollow if what you actually do is visibly out-of-sync with your marketing message.

Personal Finance

• * Home Improvement Investment lists ten home improvements that should increase the value of your home by more than they cost. The ROI varies greatly depending on the type of improvement and where you live, so if you’re doing this to improvie your home’s value, and not just for your personal taste, invest wisely.
• Another Advantage of Education: It Saves You Money on Your Car Insurance - In states where rating factors can legally include education and occupation, insurers are now charging drivers in certain jobs lower insurance rates. Politically incorrect? Maybe, but the facts are the facts.
• Dance Dance Revolution shows that many of the same strategies for a healthy diet are parallels of healthy money management.
• Time for Medical Checkups says that freelancers need regular checkups, just like employees do, and offers some tips on how to find the time and money for them.

Real Estate

• * 11 Secrets to Buy-to-Let Property Rental Success Abroad offers a checklist of points to consider if you’re considering owning rental property in another country.
• Making Prepayment Penalties Illegal explains why, distasteful though they may be, making them illegal would not be in the best interest of consumers.
• Welcome to 1884 East Locust Place! Ordinarily I wouldn’t include something that is purely promotional, but this intrigued me. This owner/broker is using a blog format to provide more in-depth information about the home than the MLS listings provide. Could this be the start of a trend?
• Home Improvement Investment gets another mention here because it really needs to be in both places.

Business Blogging

• * Business Ideas: Bloggers As Partners shows how to use blogs to identify and connect with potential business partners. I love seeing stuff like this that helps expand the view of new media tools beyond just journalism and marketing.
• When Blogging Meets the Law asks if the 500-word legal disclaimers found on the comment submission forms of many Fortune 500 blogs detract from the blogging experience. I suppose it might if I actually read them.

Miscellaneous

• * Massively Multiplayer Innovation says there are organizational lessons to be learned from massively multiplayer online role-playing games (MMORPG) like World of Warcraft and Anarchy Online (my personal preference).
• How to Win Friends & Influence People is, in my mind, still the best book ever written on the topic of "networking". This 19-year-old entrepreneur offers a brief summary and a fresh perspective on it.
• Figure and Ground looks at the growing field of ergonomics. Particularly funny is the study which showed that people apparently make subconscious attempts to ingratiate themselves to their computer.
• Karl Rove at the Salem Communcations Annual Meeting is Jack Yoest’s humorous account of how he spent his wedding anniversary, including an intriguing quote from a Chinese academic about Western culture. If that doesn’t pique your curiosity, nothing will.
• For a Psychic, He Doesn’t Seem to Think Very Far Ahead shows why clairvoyance may be over-rated. Very funny.
• Series 7 is Joshua Sharf’s personal account of the cram course he’s taking to prepare for the Series 7 license. Also very funny ("I’m sure there must be films noir where the husband and the femme fatale can only raise the money to get to Brazil by getting the bearer bonds out of the unsuspecting wife’s safe deposit box."), but practical probably only if you happen to be cramming for the Series 7 yourself.
• The Hypocrisy of Anita Roddick comes down hard on the Body Shop founder who’s calling for a consumer boycott of Nestle, who is a major shareholder in L’Oreal, which now owns the Body Shop. This "guilty by association" chain stretches just a little too far for me - ’tis the nature of the networked world in which we live - but decide for yourself.
• We’re Losing in Iraq, Just Like We Lost in Vietnam - Chuck says that there is good news coming out of Iraq every day, but the mainstream media chooses not to cover it in favor of personnel changes on "The View" and who got kicked off "American Idol". I think what frustrates me is the lack of balance - we have individual shows and commentators that all demonstrated obvious strong biases, but virtually no one in the mainstream media presenting a balanced view.
• Nobel Prize Economics Game “Trade Ruler” shows that Wendy Boswell apparently has a penchant for unfair trade practices. I want to play!

That wraps up this week’s Carnival of the Capitalists - I hope you enjoyed the show! Next week’s carnival will be hosted at The Integrative Stream. To learn more about the Carnival of the Capitalists, including how to subscribe, how to submit a post, or how to host a future edition, visit TheCotC.com.

And if you like the carnival format, I also invite you to add the Carnival of Entrepreneurship, Carnival of Marketing and the new Carnival of Business to your weekly reading.

Personal note: Sorry it’s late - in retrospect, hosting a carnival at the end of a three-day weekend during which I didn’t touch the computer probably wasn’t such a great idea. Future hosts take note.

Via Marc, I was led to a blog post by David Manaster on recruiter efficiency. He reports that “It would seem that (on average) the optimal workload for a recruiter is between 11 and 20 open positions. ”

I’d argue that the main reason for this phenomenon is that most recruiters are using only the traditional toolkit: Excel, Word, email, phone, to keep track of their applicants. Nitron couldn’t function effectively if we were this inefficient. John Younger, CEO of recruiting process outsourcer Accolo, observed:

I actually find this research to be right in line with our surveys for the typical recruiter today. We have found the optimal workload to be between 4 and 18 unique full-time jobs simultaneously. At 18 or more, the applicant screening, follow-up and tracking take a severe dive. The astounding part is that this is the same recruiter workload of 1963! Think about it. What else in our lives has not budged a bit in productivity in over 40 years! This is the time before e-mail, job boards, the internet and Starbucks. The core reason is that the recruiter today operates in exactly the same model as the early 1960’s. All we have done is pave the cowpath. It gets worse… the hiring manager service and applicant experience have actually diminished with all the technology noise in the middle. There are new models emerging, but there is an army of people invested in keeping things the same.

According to a staffing.org survey of 2,294 companies, during 2005, the national average Recruiting Efficiency Index was 12.3%. REI is calculated by dividing total recruiting costs, including recruiter salaries & overhead, applicant tracking, advertising fees, etc. and dividing it by total compensation recruited. Accolo reports an REI of under 7% for clients using Accolo’s system. Among the drivers for that efficiency:
- much higher per-recruiter workload
- use of online networks for recruiting (more on that topic)

Knowledge @ Wharton reports on: MySpace, Facebook and Other Social Networking Sites: Hot Today, Gone Tomorrow?:

Popular social network sites, including MySpace and Facebook, are changing the human fabric of the Internet and have the potential to pay off big for investors, but — given their youthful user base — they are unusually vulnerable to the next new fad. As quickly as users flock to one trendy Internet site, they can just as quickly move on to another with no advance warning, according to Wharton faculty and Internet analysts, who offer some ideas on how these new sites can both increase user loyalty and generate revenues.