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Rethining the school bus

Save money, save energy and stay fit
This is one of those really simple hacks that works on so many levels. Reminds me of Jaime Lerner's fantastic transportation solution in Curitiba Brazil. This idea is home grown though. A "Walking to School Bus" is simply a group of children who get together to walk to school on an agreed route, picking up children on the way and all the time supervised by adults. Parents take turns in walking with the children so that they don't have to do it every day. The more families participating in the walking school bus scheme the easier it is on everyone.

Security Hack for the recession

Great piece about common security clubs that are springing up everywhere to manage the need for heightened security as the economic situation worsens. The great thing is that this includes sharing and collaborative action rather than guns and weapons. Check it out here

Keeping it awesome

It's not often the I'm inspired by a museum blog
In describing how museums need to evolve, the author describes a deliberately unsustainable approach to running a business or a creative endeavor.

"Do great stuff while you can, an when you can't do it any more, stop!"

Many of the businesses that are struggling today were once awesome but have overstayed their welcome and in doing so lost their excellence. Same could be said for how treat our careers. Forget long term sustainability. Do something you believe in and that is innovative and groundbreaking even if it has no future. The future will come regardless and you will have been doing something you were proud of and will be better prepared for your next awesome project.

NEW! Recessionhacking wiki

Recession Hacking is becoming quite the topic of conversation and people are taking up some of the topics discussed here - such as alternative currencies, jobs and entrepreneurship, entertainment etc. I was just invited to a WIKI that started last week on the topic Nothing to do with this site but breaks the issues up into different topics. Rest assured I will be stealing liberally from these suggestions - or is that simply called 'open sourcing' these days?

Hack for Wall Street Bonuses

Give them what they deserve.
It still amazes me the millions in bonuses that were given out on Wall Street this year. Sure, a lot of people lost their jobs and those that stay need to be incentivised. What I don't understand is why they are given our money, rather than some of the bank's worthless assets that they helped create and sell to our pension funds.

Here's a hack that will fix the economic situation: The banks have billions of $ of assets that they cannot find buyers for - Sub prime mortgages, Asset Backed Securities and CDO's. Why can't these 'toxic assets' be off loaded to the Wall Street big wigs as bonuses at current market value? This gets the assets off the banks books, feeds the greed for bonuses within a broken industry and makes the fortunes of the 'over-paid' directly dependent on the financial future of the 'over-loaned'.

Towards a useful alternative currency?

The more our financial systems fail the more appealing alternative currencies become. It's only a matter of time before someone creates an alternative currency that uses social media platforms like twitter or Facebook. Twitter, for example, has all the requisite elements - an account, an accurate record of transactions, and a user specific ID. Twitter units could be traded at an agreed rate per hour for work done for each other. Every time you did work for someone else, they could be paid in Twitter units at an agreed rate per hour. Similarly, every time you wanted someone to do something for you, you could incentivize them withTwitter units (I'm sure someone can think of a better name). This could became a useful currency for anyone working in a creative collective or small business/start up community .

So, what do you need to create a social currency?
(Significantly edited from

An account is the place where information about ONE currency is aggregated and transformed for output - e.g. "account balance.”

2) A transaction is an interaction between two accounts. It is a record of what happened and describes a mathematical relationship between the two accounts.i.e. On February 10th 14:50 “account A” pays 50 to “account B”. This transaction describes the relationship between the two accounts, and records the time it occurred. Transactions could be transferable (debited to the payer, credited to the payee), or non-transferable (not debited to the payer, but still credited to payee) such as a reputation transaction or a thank you.

In order to have the maximum extensibility to this platform, receipts for all transactions within a currency could be aggregated on a server(s) (such as Twitter). These receipts would contain all the information about that transaction specified by the currency.

3) Currency – A currency is set of rules defining the types of accounts, how their balances are calculated, and how these accounts can transact with each other. A currency could have multiple different classes of accounts. For instance, a mutual credit currency might only allow businesses to be issuers of the currency (allow their balances to be negative).

4) Currency Complex defines the relationship between currencies.
Many different currencies could be cross-referenced to produce a rich and resilient tapestry. Because currencies are modular within the currency complex, currencies can quickly evolve in an extensible way. Rules for currency could be contingent on metrics both inside and outside a given currency.

For instance, let’s say you wanted to have a credit limit in a mutual credit currency be dependent on the user's volume of transaction in the currency multiplied by the percent of "thumbs up" ratings. The user would need two accounts within the mutual credit currency, and an account in a second reputations currency. The user's buying power in the mutual credit currency would be a sum of all transactions. The user's transaction volume would be the sum of the absolute values of all their transactions (calculated in separate account). The user's history in the "thumbs up, thumbs down" currency would be calculated as an average. The credit limit for the first, could be linked to the second and the third (credit limit increases to 1000 when you have conducted 10,000 worth of business with 90% thumbs up).

5) ID – A person using this platform will need to have some sort of identity boundary on the currency platform. This is distinct from having an account, since an account, as I am defining it, is merely the place where one currency is aggregated. An ID will be able to have multiple different types of accounts within one currency, participate in multiple currencies within one currency complex, and participate in multiple currency complexes. The ID simply allows multiple different currencies to be grouped and displayed according to user.

Anyone really interested in this subject: CLICKHERE

Hacking marketing budgets

Could brand ideas be the answer to the marketing budget puzzle.
(Sorry, I promised myself this wouldn't be a marketing blog but it is my day job and this felt like an interesting recession hack for marketers).
Seems to me, in 2009 particularly, there are a lot of brands out there that are not getting the marketing funding they need to be successful. Many of these brands are already well known and already have a loyal customer base. For completely different reasons (namely the spontaneous combustion of the finance industry) it is much harder for companies to borrow money to make an investment in a brand that has growth potential. As a result, many good brands face an unsupported year just when there is a huge opportunity to out invest the competitors to gain significant market advantage.

On the other side of the fence a lot of private equity, angel and VC investors want to play conservatively with their money - staying away from new, unproven business models - yet their other investment choices offer poor and equally uncertain returns.

So, what if we brought these two parties together. Broker marketing investment $ from private equity in return for a cut of the incremental business revenue generated by the brand. Brands get the marketing budget they need (as long as the plan delivers ROI) and the investors get an investment that is grounded in a proven business model from a brand that is already a known entity.

So, how could it work?

1) Create and publish a list of all the brands that will not be funded this year. (The endangered brand list?). The brands with most potential could then be approached to see if they want to participate...Why wouldn't they?
2) Invite the creative communities - either discreetly within agency network or on an open co-creation platform - to submit brand ideas on the promise that any brand ideas that is used will be rewarded with a % of the revenue generated
3) Package the best of these ideas and pitch them to private equity investors and the brands. All the brands have to bring to the table is a willingness to cede marketing control to the investment partners.

As I think about it, these three stages could be executed in varying order depending on what you have easiest access to, ideas, funding, brands.

We should create an identifiable logo that features on all products supported by this process. Negotiate retail and consumer support in advance. There's entertainment content in here somewhere too - Dragons Den for brand ideas.

Anyone want to play?

The new economy's cubicle

Check out New Work City collective-working
(although originally because NWC don't use a hyphen I thought this had something to do with farming - coworking.)
It's essentially a new approach to office space and community center for all those start up organizations that will spring up everywhere as valuable, creative and productive people find alternative revenue streams. Some great companies will come out of this. They should offer membership for equity too and get a cut of the action.

Finnish spending

(via Daniel)
Finland is running an advertising campaign to get its 5 Million residents to stop saving and start spending. I like the the devil/vampire pig for a couple of reasons - It reminds me of HBO's True Blood and the FAT pig that I helped create for HSBC Direct. However, as we have discussed below, just spending will continue to support this broken economy. What we really need is guidance on how to fuel a better/different economy.

I still think that distinguishing between spending on people rather than things could be a good distinction. Giving money directly to people who do useful things for us ensures distribution of wealth to those who offer a valuable service - unlike giving money to corporations who disproportionately distribute it to management and other unnecessary spending (e.g. John Thain).

Money given to people is more likely to remain active in the economy - people will use it to do things they want to do/buy - while money that we spend on things, objects, possessions is likely to go nowhere. I recognise that ultimately paying for products goes to workers and producers but not before it sits on many different balance sheets and lots of people take a cut. If our new economy supports and incentivizes creativity and production we need to make sure the money we spend goes directly to the people who create and produce. The easiest way to do that is to buy as close to the source as possible so the people who actually create and produce get the money without it going to the 'middle men' who neither create nor produce anything.

Know the economy 2.0

Yes, there is a new release of the economy.
It feels just like when Apple releases a new iPod. Suddenly your old model is obsolete and although you hang on to it for a while, believing it functions just as well as the newer model, you secretly know there's no real, long-term hope. We all know how this little scene is going to end. You can't use the new software, the hardware freezes/starts behaving erratically and with no efficient way to fix it you slowly come to terms with the inevitable upgrade.

Our economy is not just a little sick - likely to spring back to life as normal with a little medicine - it is obsolete and needs to be replaced with a new model that reflects our altered attitude towards consumption, credit, information and investment. The proof of the demise of the old economy came when friends of mine in a large financial institution told me that all the economic models that they use have been thrown out because they simply don't work anymore. The only rational explanation for this is that there are new rules, new market dynamics, new forces and new influencing factors driving the economy. Economists in the financial industry are being forced to use old fashioned methods of decision making - namely, getting really smart people into a room and looking at every single piece of data and trying to work out what the *%&@ is going on – if that’s not a new economy I don’t know what is.

In order to take advantage of this new economic system we quickly need to attain a deep knowledge of its operating principles. Any business that wants to survive will have to understand these if they are to evolve their business. (I love the evolutionary metaphor - The meteor has hit and the world will be full of dinosaur carcasses very soon. Both big and small businesses will survive but the big ones had better start changing fast otherwise the smaller, nimbler creatures will start eating their lunch,or them.)

I can't pretend to know all of the new rules - I’m not sure anyone can - but I have a few observations that I feel are worth listing here as a start. Please feel free to add to them. Different perspectives will greatly help our collective ability to get a handle on what's really going on.

So, here are my 5 new rules:

1) Everyone knows everything.
The information infrastructures that we have built mean that business planning should start with the assumption that everyone knows everything. Employees, managers, customers, analysts, shareholders, competitors and suppliers have greater access to information than ever before and can publish that information incredibly easily. Sooner or later if information is available it will be publicly available and as a result we can no longer increase profitability, productivity or competitive advantage by assuming the people we are doing business with only know what we have chosen to tell them. This has profound implications for how we manage organizations, manage channels, market products, create perceived value, decide pricing, establish wages or fees for services provided from abroad, negotiate deals and create partnerships between individuals and organizations.

Already some companies are experimenting with open source, peer-to-peer communications and total transparency solutions with partners and suppliers.

It seems that more ‘open’ approaches to business have two evolutionary advantages. Firstly, we don't need to spend quite so much time and money managing information flows, spin, PR, keeping secrets etc. Information in an open-system flows to those who can make use of the information and is essentially ignored by those who have no use for it. Management no longer decide or spends time and money managing who needs to know what and everyone has open access to all the information they need to do their job efficiently.

The second evolutionary advantage is that an open system allows everyone to contribute to everything and as a result you are often surprised by who knows what and how willing they are to share their knowledge for the greater good. If, for a moment, we assume that everything that can be known is already known by someone, somewhere, then a very efficient way of finding information is to ask if anyone in an extended community knows the answer. (Think: Yahoo answers, “Ask the Audience” Lifeline on Millionaire etc.). It is amazing the network intelligence that exists within large organizations that never gets used because of management and information hierarchies. Early adaptors include: Google's use of Peer2peer technology, Pixar's use of collective creativity.

2) Big purpose replaces big strategy.
In this new economy things move fast. During the manufacturing era you could spend a long time planning and strategizing how you go to market, what your brand should be like (the brand wheel/footprint/essence etc), who your core consumer is etc. You could be creative with the gamesmanship of positioning because the truth of ‘who you are’ was invisible to all but those on the inside. You could take your time because the manufacturing and distribution capabilities of your business were probably tightly controlled thanks to patents and aggressive litigation. These barriers meant that it was highly unlikely that anyone would be allowed to muscle in on the action while you pontificated and strategized for as long as you liked.

In the new global economy the monopolies of manufacturing have been eroded and controls over distribution are breaking down because of the creation of new channels. Strategic gamesmanship is likely to slow your evolution and while you work out how to sell an undifferentiated product with manufactured benefits or brand values it is likely that someone with a real differentiation or real purpose will burst onto the scene. Being true to a genuine purpose (beyond making money) is what creates brand values and real, meaningful difference (vs. perceived differences) is what creates a market position. As we move in to an economy that is not driven by over consumption and credit, products with real utility and value will triumph. If you don’t have either, no amount of PowerPoint, big strategy off-sites, or corporate responsibility strategies will protect you from a competitor with real different and a real purpose. (There are more companies like Method to come.)

3) Do more than you say. Just look at how much money is spent by businesses today managing what they say publicly and manipulating how they are perceived. It’s an excuse for not really doing anything. The dinosaurs of the old economy lived and breathed spin, manipulation, lobbying, deception and misrepresentation through tightly controlled media and discrete communication channels. They had little respect for their audiences or the consequences of their actions on the world at large – covering them up, brushing them under the carpet and just getting on with the business of making money. (In August there was a case of Canadian bus company suing to stop an internet based car-pooling scheme - what a dinosaur!).

As channels become less discrete and media channels multiply and become less controlled, individuals start broadcasting their personal experiences of brands in social media. Ultimately, anyone who looks for it can get a pretty complete picture of a company's behavior and judges them based on what others say they do, not what they say. The evolutionary advantage here is that companies that focus on 'doing' rather than 'saying' are forced to start working with the communities they serve. Turns out, when you focus on 'saying' you become overly self interested but when you focus on 'doing' your actions tend to be genuinely constructive, collaborative and dare I say more creative.

4) Pure innovation is an unnecessary expense.
Innovation is a very expensive process. Look at the amount of money the big fashion houses spend creating new looks and new styles only to have them ripped off, almost immediately, by the high street fashion shops like Zara and H&M. Similarly the cost or real technological innovation at the labs of IBM and Xerox did little to ensure their technological leadership in the long term. There are just too many innovations these days for us to adopt them all and 'fast follower' brands make buying at the bleeding edge something only a small niche of enthusiasts are interested in. The era of over-consumption defined innovation as giving us more new things to consume. In the new economy we see innovation slightly differently - more focused on finding better, more sustainable ways to do the things we already do. Whether that’s building homes; moving people and things from one part of the world to the other; sharing information and educating people; communicating with each other; feeding ourselves and our families; entertaining people or expressing our creativity. There is so much business potential in innovating new, more efficient and collaborative ways to do the things we already do. We don't need more, we need better. The innovators in the new economy will be feeding from the same sources as the big dinosaurs, just more efficiently and effectively.

5) We don’t need middlemen.
Consumer needs will remain the same but the power of the middleman is on the decline. The number of channels to market for content, products and services will continue to increase as will the consumer demand for these things. However, increasingly there is more opportunity for these producers to have direct relationships with these customers - cutting out the middle men - the retailer, the re-seller, the broadcaster, the publisher and the record label. If you use these middle men think about other options which will establish a direct relationship. If you are one of the middle men, make sure you adapt fast to add real value to the customer relationship - e.g. as curator or educator. We can't wait to see how political action will change now that Obama has the email of 13 million people. He can cut out the media filter and have a direct dialogue with his most active and vocal supporters. There's a lesson there for all of us.