Editor’s Note: ‘Indemnification for Influence in a Jobless Economy (Part 2)’ is a piece of a series. Click here to read Part One. Part Three will be published on 10/11/13.
Too Connected To Fail:
Our relations in our close and extended networks are what provide the tangible value that other individuals and institutions derive from us. As social beings we are somewhat obligated to interact well. While this sheds no light on egalitarian ideals, it does provide an opportunity for less-introverted individuals and institutions to be indemnified for participation. For example, at HBS participation often accounts for 50% of the total course grade. That method is good enough to start with, no? Lowering our degrees-of-separation from our peers and attracting new connections is what elects the people at the top of the classes at Harvard Business School. People learn how to communicate more effectively through the rigor of participation, and their value sky rockets relative to the rest of the business community.
[easyazon-image align=”left” asin=”B0013FRNKG” locale=”us” height=”160″ src=”http://ecx.images-amazon.com/images/I/41gtLiEuNdL._SL160_.jpg” width=”126″]In the past decade the global “great recession” exposed our systemic vulnerability and ties to each other at the micro and macro scale. Financial innovations have enabled risk transfers that were not fully recognized by financial regulators or by institutions themselves, complicating the assessment of a “too-connected–to-fail” problem. Companies in FinTech are closing the communication gap like Quantify Labs: CRM and Content Platform for Institutional Finance. In plain English they show all communication between bank’s customers and vendors; scenarios like who checked which communications and their supply-chains. Anyone who has ever watched a movie about finance and trading of equities knows that traders and brokers mostly talk to each other to buy and sell stakes in equities for mutual benefit. Expanding communications or even knowledge of existing communications on creates more threads to an ever-expanding web of connectivity. As an evolving species, we need our web to continue to grow in order to support our initiative for growth, or creating technologies on a more grand scale.
The mentioned initiative can be found in every facet of our lives. The International Monetary Fund (IMF) Figure 2. below is a diagrammatic depiction of co-risk feedbacks, and presents the conditional co-risk estimated between pairs of selected financial institutions. In plain English, the numbers on the diagram are communication linkages between people/assets at these banks.
While there is some debate on exactly what the framework should be to quantify co-dependence or co-risk, the best solution should be a growing group of qualified rating methods and agencies evaluating data differently as it changes and expands, as it does. Similar to this type of co-dependence is our civilization’s most important institutions. Our most important individuals are also co-dependent on a group of near and distant peers. We are all dependent on others to discover, develop, and deploy solutions to problems of a more personal kind.
Software services like Klout, Kred, Peer Index and at least a dozen more are making efforts to mine through the data that we communicate to influence in order to deliver a score with regards to our varied value (depending on their methodology and focus). This is similar to the IMF individuals need to evaluate co-dependence and influence on their peers but on institutions as well. Applying Klout-like methods to measure our value will enable us to make formidable legal and political arguments for out just due, and perhaps a more manageable transition through structural unemployment and globalization is possible via what’s due. Note: I am using influence and co-dependence to reference social value on entities. We all play a role in the negotiation that is life’s happenings but those of us who aren’t entrepreneurs rarely know that we’re a part of the conversations affecting decisions.
[easyazon-image align=”left” asin=”B00E3CP9UM” locale=”us” height=”160″ src=”http://ecx.images-amazon.com/images/I/4179llgFU2L._SL160_.jpg” width=”160″]Connectivity is starting to span beyond social connections and socialization in general. It is starting to be quantified in new ways, as there are no shortages in places to install sensors and things to understand. Physical sensors that help us recognize, colors, odors, heat, distance, sounds, etc. are all being created as devices that empower an application programming interface (API), which is another way to allow information technology to quantify how we engage sensors. The appification of sensors like Node or Canary or Leap Motion are the next generation of sensors that we’ve used on watches and cameras. Looking forward to days where nano-robotics can monitor mitochondrial stability to forecast and avoid apoptosis to help cells cheat death, of course, we still have a long way to go. Today, the case can be made to spread some of the abundant wealth by validating the abundant value each individual creates through info tech.
Image Source: Flickr
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