If we could quantify what an individual gets from the network and what the network produces altogether, we could begin answering some interesting questions like:
- Where is our network most at risk?
- How much contribution does each person make to the network?
- What changes could enhance the productivity of the network?
Quantifying an individual’s perception of value received
The value received by a person would be the sum of all the values that they get from each relationship in the network (and from the community as a whole). Here's what Sue gets and gives from people in a network.
A challenge would be converting all the different kinds of value received and given to one metric that you can sum across types of value. For example, how much is an order perceived as being worth by Sue, as compared with emotional support? We could figure out how much Sue values different benefits (or how much her different contributions cost her) by asking her a set of questions using conjoint analysis, which is expressly designed to ferret out this kind of comparison. Then we can quantify what she gets and gives in units we can add together.
Quantifying the value of the entire network
Quantifying the value of the entire network seems a little harder. It’s straightforward to say that the value of the network is the sum of the values received by each person, but it’s not straightforward to compare values between people. If we measure with our unit of currency set by what each person views emotional support to be worth, we’d get a different answer than if we used a different currency, such as the value put on having your “reputation enhanced.” So the best answer for now (and I am definitely open to better ones) might be to look at multiple views of the network using all the available currencies, and perhaps average the results.
In the next post, we'll look at answering some questions using the information these quantifications provide.
Again excellent questions and a good suggestion. The only "real" value is perceived value. Even money only has value if people perceive it has value. Your suggestion to look at all of the available currencies is the right approach and it is not as difficult as it might first appear. You might want to check out the way we approach Perceived Value here:Perceived Value and Brand Management in the blog series on indicators and metrics for performance. http://valuenetworks.com/public/item/237131. Interestingly enough it is not that unusual for people to place a higher value on intangibles received than tangibles.
Posted by: Verna Allee | 07/10/2010 at 03:35 PM
Verna -
You have developed lots of useful metrics in your analytic tool. Can you typically provide useful insights with the semi-quantitative levels (i.e., very negative, negative, neutral, low, medium, high)that participants use to value each interaction? Would it be valuable (or possible) to add a quantitative measure? My guess is that adding quantitative measures would make the process more appealing to hard-nosed business execs.
Here's the link that's in Verna's comment above - it didn't work for me so here it is for others http://valuenetworks.com/public/item/237131
Posted by: David Friedman | 07/13/2010 at 02:16 PM