Official Blog of Center10 Consulting

Social Networks As Validators and Smartners: You are my "Firm"

on Friday, February 1, 2013

Key Takeaways: My networks validated my research and helped me invest in my CRM platform. Social media seems to be giving entrepreneurs that moral and material support to spread our wings and fly earlier, higher, faster! Oh...and yes, the "Firm" should feel threatened, as suggested by the Theory of the Firm.

A little over a month ago, as I contemplated my New Years greeting to my business contacts, I did a few days worth of research into CRM systems that support small enterprises. Web research, some phone calls, some financial modeling - and I had some clear front runners. I even created my login.... However, I couldn't quite pull the trigger. Oddly enough, since I'm prone to quick and generally good decisions. And the financial impact was minimal (we're talking the cost of 2 lattes a month here, folks.)
Fast forward to today. I've put money where my research is. And what helped with my decision-making? I reached out to my social network - Linkedin, Facebook, Twitter. Turns out, my Linkedin group really does know what I'm talking about. My husband, Sree Sreenivasan (follow him @sree on twitter) posted on twitter and received a series of recommendations there. 

What I learned along the way:

    The right answer generally emerges early: was mentioned at least once in 21 of the 25 recommendations I received. But I knew by the time I read the fourth recommendation - Zoho had made it into all of them.
    Our networks vary, in scale, nature and value: Linkedin was my most valuable network - with clear, thoughtful responses. My Facebook and Twitter feeds were not helpful. Sree, who has a powerful Twitter community, had hugely helpful responses there.
    Technology can help you get beyond "Type": Having spent a large chunk of my life as a bit of a loner, with a perverse pride in my small group of intimate friends, I am learning to enjoy the benefits of social media. I can have meaningful friendships with a huge population without damaging a rather delicate personal space that I have tended to wrestle with all my life. I'm a "I" in Myers-Briggs terms, but with technology, I can be an "E" on my own terms and in a way that respects and cherishes my broader network
    For entrepreneurs, there is strength in social media numbers: Large companies have tended to watch their numbers - they understand that customers "vote with their feet." For a small enterprise, though, social media is a huge decision support system. Knowing that there is a world of people whose judgement I trust, based on my monitoring of their progress and opinions, and knowing they recommend a service, contractor, new source, etc., helps me take the plunge.
    Social media builds confidence and provides the value that is behind the "theory of the firm": I have to wonder what Coase makes of all this chaos? His Theory of the Firm from 1937 is based on transaction costs, but also some sense of decision support  - "people begin to organise their production in firms when the transaction cost of coordinating production through the market exchange, given imperfect information, is greater than within the firm." A purist may cavil with me around whether my 25 data points constitutes "perfect information"...but hey, it was perfect enough for me!!