The Physical Web | Pervasive Memory | Digital Sensors | Social Influence
Pervasive memory means nothing is forgotten. Not the time your firm embarrassed itself. Not the time someone lied about their experience in your store. And not who bought which blouse.
Image by Tori Kelner. Click to view original.
Digital devices are revealing the truth about the way both companies and people behave. Dealing with the radical, unvarnished truth is going to come as a huge shock, because for all of human civilization we have dealt with personal versions of the truth.
Every time you use a digital device, you create a record of your actions. These records, stored in databases around the world, document not only what is happening in your life, but also in the lives of most other people in the world. The more digital devices that exist, the more pervasive memory will become.
Of course, digital devices now surround us. When you walk through security in an office building or pass through a toll station in your car, digital devices create a record. Phones, video cameras, credit cards, passports, and cars create records every time you use them.
These records create a complex and comprehensive tapestry of our lives. They reveal where we go, with whom we interact, what we buy, when we buy, and how we buy.
Coming to terms with the truth
Most companies don’t deal with the truth. Managers present statistics in ways that support their recommended course of action. Marketing teams work to position their company in the most appealing manner. Most managers make decisions with imperfect data, or none at all.
Until now, customers have made decisions based in large measure on positioning claims from the companies themselves. This is changing, and soon it will change dramatically.
Third parties – communities of individuals, really – are starting to rate and rank companies. This information will proliferate, and get increasingly granular in nature. You will be able to easily see which companies get the highest – or lowest – rankings, which products have the lowest quality, and how these factors are changing month to month, or week to week.
At the same time, companies are gathering huge volumes of data, and this information will reveal which customers are profitable and which cost the company money. It will show which employees put more time and energy into lunch than generating new revenues. It will show who contribute ideas, and who merely repackages the ideas of others.
The truth makes people nervous
There is only one reputable company we can name, Bridgewater Associates, that has woven an extreme dedication to truth into its culture. This large asset manager goes to great extremes to deal with the truth, openly and consistently. Even its founder, Ray Dalio, admits that the truth makes many employees uncomfortable. He says its takes up to eighteen months for new hires to get used to a culture in which employees speak the truth, even if it means criticizing a superior or humiliating a peer.
One of the reasons Dalio embraces such a culture is because it enables his firm to adapt rapidly to changing conditions. Companies that adapt based on inaccurate feedback miss market trends and make strategic errors. This is what happens at the huge majority of firms.
Pervasive memory will ultimately make both companies and individuals stronger and better adapted to the world around us. But the transition will be wrenching and painful.
What do you know about your customers that your competitors do not?
It is inevitable that companies will increasingly use their access to the truth as a source of competitive advantage. Why? The greatest possible competitive advantage stems from knowledge your company has of customers that your competitors lack. If you understand what a customer likes, what they buy, when they buy, and how they buy — then you have a significant advantage.
Think about it: your competitor can duplicate your product quality, your prices and even your service levels. But if you have truly learned what makes that customer different than other customers, you have an advantage – assuming, of course, that you use this knowledge to better serve that customer.
The key to using radical truth in a profitable manner is to use it to benefit customers as well as your own firm. You have to create win/win relationships. If you don’t, your firm will end up being attacked on social networks, criticized by bloggers, embarrassed by newspaper headlines, and in the very long run eventually being sued by Attorney Generals as they struggle to keep up with the pace of technology advancements .
Unfortunately, history shows that most companies – how shall we put it – miserably fail in using a customer’s data to benefit that customer. This fact has given rise to initiatives such as The Locker Project, an open source effort to collect an individual’s “data exhaust” in one place and then motivate developers to build apps on top of this data. The goal is to benefit the individual, and to give the individual control over his or her data.
Kaliyah Hamlin, Executive Director of the Personal Data Ecosystem Collaborative Consortium, is optimistic about The Locker Project. She observes, “A nascent but growing industry of personal data storage services is emerging. These strive to allow individuals to collect their own personal data to manage it and then give permissioned access to their digital footprint to the business and services they choose–businesses they trust to provide better customization, more relevant search results, and real value for the user from their data.”
For example, a start-up, Personal, recently raised $7 million in venture funding. CEO Shane Green says, “We believe in your fundamental right to control and benefit from your personal information.” There aren’t many details available yet about their precise business model, but their web site is pretty clear about where this is headed. It says: you set the rules for your data, not companies.
Next: Digital Sensors