I believe social networks are not as much about “making humans smarter” as they are about connecting people to other people who can serve as resources to information.  Social networks are designed to support online connections to strong and weak ties.  Strong ties are people we interact with and often share similar interests (i.e., friends and family).  Weak ties refer to our connections to people where we have casual and infrequent interactions (i.e., friends of friends).  These are the people we do not know well, but trust enough to establish a connection for future reference.  According to research conducted by sociologist Mark Granovetter, the diversity of our weak ties offer resources that are often more beneficial to us than our strong ties.  As Andrew McAfee explains in a blog post, “weak ties might actually be the more important ones for innovation and knowledge sharing.”

Twitter is a great example of an open network of many weak ties.  This architecture enables information to spread at lightning speed across a global network.  For example, Twitter emerged as one of the primary sources of frequent information updates about the Haiti earthquake.  I find it interesting that Twitter is now branding itself as “a real-time information network powered by people” (versus the previous claim to be a mobile social messaging tool).

Social networks offer many benefits to the business world.  For example, a worker with a question that cannot be answered by immediate colleagues (strong ties) can socialize the question through the corporate social network (extending communication to weak ties) in an attempt to crowdsource an answer. Instead of spending hours searching for the answer, the worker can post his or her question publicly on the social network and move on to the next task while waiting to see if anyone else in the network has some insight.  Here, intelligence is derived not from having to know the answer, but in being connected to someone who knows the answer and shares that knowledge with you.

Knowledge sharing emerges as the most compelling driver for using social networks for business purposes, according to an IDC survey of more than 700 U.S. workers.  According to survey respondents, the top two reasons for using social media for business were:

1. To acquire knowledge and ask questions from a community
2. Sharing knowledge and contributing ideas to a community

The act of sharing knowledge through a social network also aids in the location of subject matter experts.  Org charts and titles are frequently outdated, making it difficult for workers to seek out colleagues for help.  Profile information stored in a social network is easier to update, and provides added context to information shared in the activity stream.  The openness of the activity stream of a social network allows all participating members to benefit from the information shared (one-to-many) versus communication sent through an email (one-to-one).  Hence, valuable tacit knowledge is recorded in the social networking platform and shared with the rest of the organization.  Ideally, this real-time information sharing across the network helps reduce redundancy and promote organizational efficiency.

Freeing the flow of information so more people can act on it is a major benefit of social business design.  Social technologies combined with corporate culture that supports information sharing behaviors enables a networked infrastructure.  The networked infrastructure helps organizations break down information silos to create a marketplace for information exchange.  Increasing the collective intelligence of your organization will drive efficiency and competitive advantage.  How networked is your organization?

Ries is right.  In today’s environment of technology immediacy, we have a conversational medium where people’s expressed interests, desires and opinions on products and services are recorded and publicly available.  This provides an incredible opportunity for businesses to listen, dialog and crowdsource products and services.  They no longer have to guess what constituents want – they can capture this information quickly, and at scale. Consumers are saying exactly what they want on sites like Twitter.

We are starting to see companies invite customers into the product development process more often. For example, IBM’s WebSphere team created an online community named Project Zero to allow customers, business partners, and the larger Web developer audience to collaborate in the commercial product development of sMash, IBM’s software platform for enabling agile, Web 2.0-based application development and execution.  According to IBM’s WebSphere team, the community of developers identified bugs and defects and provided feedback on the source code as the software was being developed.  Project Zero proved to IBM that inviting customers, business partners, and other key constituents to provide feedback early in the development process helped the company launch more relevant products that met real world needs.  According to IBM, sMash emerged as the number one growth product by 2009, a year after it launched.

During a time when competition for market share is fierce and trust for corporations is low, many businesses that have operated successfully for decades are forced to re-evaluate the value proposition of their products and services.  Social technologies enable businesses to crowdsource their customers at scale for ideas on new products and services.  It’s not just the private sector hoping to benefit from crowdsourcing.  In a bold move, the Republican Party just announced plans to crowdsource its platform for 2010.  If political parties are adopting these more transparent ways to exchange value with their ecosystem, then certainly corporations can too.