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Excerpt from “Wealth & Wellbeing – Volume 2: Profit & Values”

by Imdat on August 25th, 2013

Companies in the Age of Changing Values

Talking about “Changing Values” and calling our current times “The Age of Changing Values” might sounds presumptuous since values are changing all the time.

But the speed of change has increased so dramatically during the last 15-20 years that we can safely call this “The Age of Changing Values” without distorting its meaning.

During my own forming years (up to the age of around 20), most discussions about what one wants to do in life centered about the profession: I want to become a doctor, journalist, police officer, engineer, etc.

Nowadays, more and more young people express it in terms of what they want to do and achieve in their lives: help fight poverty, sickness, fight for human rights, protect the environment, reduce green house gases, increase fairness, increase wealth of everybody on the planet, protect animal rights, and more.

Two of the key reasons, it is the belief of this author, is the impact of the Internet (specifically social media) and the increase in the number of so-called Third Culture Kids (TCK) or Cross Cultural Kids (CCK).

 

Since the collapse of the Soviet Empire the globalization expanded at a break-neck speed. Some saw and still see it as detrimental to society. Others see it as the biggest source of wealth- and wellbeing-increase since time immemorial. This author believes the latter.

But globalization not only had an impact on the economy, but significantly more so on the society and on the values that individuals in the society have or are having. This newer individual value-systems are, at the same time, having a major impact on overall society-value-system.

Whereas social responsibility (sustainability) was seen in regional or national context until about 25 years ago (except for a few idealists), it is nowadays seen in a global context. Young people are more concerned about long-term future impacts as well as global impact of any action taken by individuals, groups or governments rather than the impact on their own personal life (as it used to be until around begin of 1990’s).

The two contributing factors, as mentioned above, are the availability of information on an unprecedented scale and speed thanks to the Internet and the significant increase in the number of Third Culture Kids.

TCKs are people who have spent their forming years in their passport-country as well as a significant part of it in a different culture. The second generation of Turkish Guest Workers in Germany is an ample example for this. These people spent some part of their forming years in Turkey and another significant part in Germany. They are neither German nor Turkish according to the local definitions of these cultures. But what they are opens them up for the mix of both cultures – the positives as well as the negatives of each of the cultures.

Additionally, these are the people who understand the needs and desires of people of both cultures. Lastly, this ability to understand two completely different cultures enables these people to empathize with people from completely different cultures – more so than could ever be understood by the previous generations.

TCKs are not only those that grow up in two different countries but also those that grow up within one single country but in two different communities. An example is a dear friend of mine from North Carolina, who, as an African-American woman, grew up in an African-American community as well as spent time at Harvard and in NYC in a predominantly white community.

Being a highly brilliant person, she worked in investment banking at Wall Street, received a scholarship for Harvard, graduated with highest degree and worked in various multi-cultural environments, including in one of the most multi-national companies in the world.

She managed to create enough financial wealth for herself that she could buy herself an apartment on Madison Avenue, still have enough wealth that she doesn’t need to worry about it. Nowadays, being mid-30’s, she is significantly more interested in doing “something good” rather than making even more money (which she could, if she were interested in it). She is currently mostly concerned with “giving back” to her home continent what she thinks could bring some of the biggest changes in the continent’s history. She is working on offering cheap Internet access in sub-Saharan Africa and is quite successful in doing so. She is more driven by how she make an impact in that area than how she can increase her own wealth. When I talk to her, I realize more often than not that she has burning desire to help the people in Sub-Saharan Africa to help themselves than anything else. What is more, she fully understands the people’s needs there, their desires and their hopes, wishes and so on.

 

The increase in the number of TCKs is obviously not enough. After all, that increase (thanks to globalization) started already in the 1990’s and didn’t have such an impact in the speed of value change until the middle of the last century. 

What changed in the meantime was the availability and the access to information.

When, before 1994, the only means of information about people’s lives in Africa, Asia, Latin America was either through mass-media or books (redacted, edited and in some cases even censored), it is now uncensored access to highly detailed and unredacted information over the Internet and social media.

The impact of social media in the change of speed of value-change can not be underestimated: it is such a tremendous change that it can’t even be quantified or foreseen at the moment.

Internet by itself had less an impact than social media. Internet allowed for wide distribution of information, including unredacted raw information. But it lacked the personal connection. It was “… just information out there…” published by some “faceless” … something. Yes, some human somewhere had written the content but he or she was “faceless”. There was no direct relationship between the consumer of the information and the producer. The people could not create any relationship at all.

YouTube started a small revolution as it, for the first time, allowed to present information in a more personalized manner by allowing everybody on the planet to publish videos. Digital cameras and photo platforms such as Flickr helped equally well. Flickr and YouTube were the first steps in creating a relationship between the producer of content and the consumer. Still, it was only one-way: from the producer to the consumer. Admittedly, the producer could place herself in the center of the event by taking a photo or a video of herself, but that was all. There was no human relationship.

It all changed with Facebook and Twitter.

Both, Facebook and Twitter, will probably be seen as tidal waves in the way they helped shaping the people’s values. In ten or twenty years, we will probably look back and finally understand that these social media services had a stronger impact than any other change, tool or media in human history in forming values.

What these services achieved was connecting the producer and consumer of information and through the exchange of information creating a relationship that went significantly beyond just exchanging it.

When a consumer can assign a name, photo and history of a person to an information, that information becomes significantly more valuable than by itself alone. It becomes Knowledge and at one point Wisdom. When the consumer can, additionally, contact the producer and initiate a two-way communication, it becomes an even stronger bond. Lastly, when the consumer of the same information can, at the same time, become a re-producer by re-distributing it to her network, this consumer and the original producer create such a strong bond that they become real friends – even though they may never meet physically. They both create such a strong bond that they start being interested in their respective backgrounds, cultures, environments and situations. 

This bond results in a highly strong emotional bind that the consumer empathizes with the producer and vice-versa.

This bonding and empathizing allows for the creation of strong interest in the other person’s situation, values, needs, and feelings. This interest, at one point, opens up a plethora of possibilities for both parties to learning from each other, which finally becomes (at least) the first step in understanding a different culture and thus starting to question one’s own values and value-system.

Whether a German internet user creates a bond with Turkish internet user from Turkey; or an American user with an Iranian; or a Chinese user with a Japanese; the possibilities are endless and people start learning from each other faster than was ever imaginable before.

And the root of all this change is the possibility of creating a bond through two-way communication over social media. 

One could say that we did have cheap two-way communication with Email for quite some time and ask what is so different about social media… The difference is that Email was always a single two-way communication. I.e., one emailed with another person, who, in personal emailings, was another friend – to and fro – and that was it.

With social media, it is quite different. It initially starts as a communication between real-world friends. But when I email with my friend Hong Kong, it is mainly about private matters (or business matters) between him and me. I very rarely meet his other friends and even more rarely understand or see what other interests he or she has or what other things she might find interesting.

In social media, once I subscribe to her “stream” (Facebook) or start “following her” (Twitter), I might discover other topics that is of interest to her as she will publish whatever she thinks is interesting to all of her social media friends or followers. I, then, decide freely and voluntarily whether that information is relevant for me or not. She doesn’t need to worry about making sure to send me only information that interests me. She doesn’t fully know me anyway (which is impossible in any case).

In social media, she just publishes whatever she thinks is interesting (without having to filter for her friend’s interests) and her friends take over the filtering for themselves.

This is major technical difference: In case of Email, one person (the sender) filters information for each of her recipients – using different filters each time based on the recipients interests from her perspective.

In case of social media, the sender (publisher) doesn’t need to filter based on assumed recipient’s-filters at all. She uses her own filter (“What do I find interesting and/or important”) and sends it to (broadcasts it) to all her “friends”. Then these friends use their own, personal and well-known conscious or subconscious filters to decide whether that information is relevant or not.

What is more, the information thus received has, depending on the trust level between recipient and sender, an automatic, implicit trust-level. If my friend Stefan publishes an information such as “Company XYZ is using slave-labor in country ABC”, I will implicitly trust this information to be true because I trust my friend Stefan. I.e., the information inherits the trust-level between the friends and doesn’t need an additional source to be validated. The higher the trust-level between friends, the lower the barrier for an information to be accepted as true.

Same is true if Stefan writes on his Facebook page that “… I think climate change is mainly based on CO2 and we need to reduce it if don’t want temperatures to rise by more than 2 degrees within the next 40 years…” In this case, I don’t need to check whether CO2 is really one of the major source of climate change because I believe it automatically due to my trust-level to Stefan.

Social media increases this information-distribution and the impact of trust-levels by at least an order of magnitude of not more. 

The last impact of social media is obviously the network-effect: when Stefan publishes such an information and I re-publish it, we can reach not only the two of us but the totality of our two networks. Within my social media networks, I have people all around the planet. Only about 2% of them are common friends of Stefan and me. The remaining 98% has never heard of Stefan but they know me and they have a certain trust-level to me. Inheriting that trust-level to the information I can thus influence thousands of people around the world to help them form new values.

 

There are so many examples for social media’s impact on the increase of value-change speed that it would fill hundreds of volumes of books to list them. I recommend the reader to do few Google searches to find stories about people starting initiatives against cancer, malaria, child poverty, labor laws, human rights and more by using social media.

 

There is a third reason for the increase in value-change speed over the last decade and this one is about the ubiquity of technology in general. Technology, especially Internet technologies, has become so cheap that anyone with an idea to better the world can quite easily test out the idea without a huge investment.

 

Khan Academy is one such example: creating a math video, uploading it on a server and distributing it to anyone on the planet is so easy and cheap today that anyone who has knowledge in an area can do it.

Even $100 smartphones are capable of recording acceptable quality of video. One just needs the right setup (there are tutorials about how to record good quality teaching videos on the internet), record the video (again: tutorials), upload it (tutorials?) and distribute it (did I mention “tutorials available on how to do this”?).

Server costs for hosting such videos, photos, text and audio has declined so much over the last decade that it isn’t even calculated among “operating costs” in such situations but only under a line item labeled “other costs” or “misc.” (except, obviously, one has thousands and thousands of videos and millions of users, in which case it would still be a small cost compared to the potential revenues).

Today, one doesn’t even need to be able to program to publish such content. One can just create the video, upload it to YouTube and send out the link of Facebook, Twitter, Google+ and … hope for the best.

These videos are not only available on laptops or desktop PCs but also on mobile phones. Most video hosting sites can automatically adapt video quality to the consumer’s internet access speed and device.

 

In any case, people who have an idea to better the world can … just do it. Just try it and see if it works. It is so much easier to better the world today than it was 20 years ago, that people just do it.

Alas, the (technical) ability to better the world is not enough – the intention, or rather: the desire is what is the initial driver. And this is, thankfully, happening thanks to the younger people’s better ability to understand the world and to be able to empathize that is changing significantly. Thanks to Internet and especially social media.

 

What can be observed over the same period is that it seems that the younger generation has an equally strong impact on the previous generation: when, in “Ancient Times”, it was quite difficult for one generation to influence the previous generation to change their values, it seems vastly easier today. There are strong signals that the author’s generation (people around 40-50 years of age) seems to be strongly influenced by the younger generation (people around 15-25 years of age) to change their values. Whether it is because the author’s generation was a “transitional generation”, i.e. one that grew up with Cold War, Post Cold-War and Internet-Age and thus is naturally inclined to change or whether there are other reasons is beyond the scope of this book. But it can be observed, time and again, that the previous generation (the author’s parents’ generation for example) was less influenceable on values than the author’s own generation (this is probably an interesting topic for sociologists).

Regardless of why it is so, the impact is that by two generations working together the change in values is accelerating even faster and change that required 2-3 generations is now happening within one generation. We can only welcome this, as this time, this change is more about societal values than personal wealth or personal interest.

•••

How should, then, companies act within “The Age of Changing Values”?

As I mentioned above: observe, listen, communicate.

Observe what the next generation is doing, what tools they are using and how they are behaving.

Listen what they are talking about, what interests them, what drives them, what encourages, motivates them and what infuriates them.

Communicate with the people by asking them questions, asking their opinions about ideas (products, services, approaches, processes) and require their input into your organization, into your company.

But most importantly: do all three of them on an ongoing basis because this is the Age of Quickly Changing Values – so fast indeed that sometimes it seems incomprehensible or invisible for most people.

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