Tuesday, September 2, 2014
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The Insider Brain Gain

NEW YORK – Unfortunately, many new technologies and business models make money for investors without creating jobs for workers. That causes unemployment and increases what the blogger Clay Shirky calls “cognitive surplus” – unused brainpower. 

I won’t argue about net job creation here (though I think most innovation fosters it in the long run, so long as the education system prepares people for the new jobs that result). But it is exciting to see a company designed to extract some of the highest-value cognitive surplus around, and to make money both for the company and its – well, they are not exactly workers. Call them members – or even sellers of their own cognitive surplus through an exchange set up for that purpose.

The story starts with yet another recent phenomenon: an increase in corporate transparency, whether companies want it or not. In the old days, most companies sold products and had specified spokespeople; more recently, many have added call centers, creating about 3.5 million jobs in the United States alone, and many more outside it.

But now employees of all kinds, not just those in customer support or public relations, have an online presence. Some mention their employer; most do not. This makes most employers a little nervous. Companies seem to have become fishbowls, their contents visible to customers and strangers alike. You could say that they have a larger “surface area,” composed of employees who interact with outsiders.

Insidr.com is now trying to make this phenomenon into a business. (I should disclose that I plan to invest in this company – not necessarily because I think that it will be the next hot IPO, but because I think that it exploits some interesting and accelerating trends. Moreover, I will inevitably learn a lot by being involved, and its business model will likely undergo several transformations while disrupting some existing ones. Along the way, one of its models is likely to work superbly well.)

The problem Insidr addresses is familiar to almost everyone; there are about 45 billion customer-service calls per year in the US, according to Insidr founder Antony Brydon, and six billion of those concern what the customer considers a problem. There are now also one billion tweets of complaint a year.

Insidr.com’s answer is not special access or a Twitter feed that will work until the volume overwhelms it, but rather a market for connecting current customers with former insiders who can tell them how to work the system. In other words, it is an open market for information, operating more or less parallel to the closed, non-market systems run by most companies.

Do you want, for example, to pay a service representative to do his job better? That would be a bribe. But it’s common in customer-centric jobs to tip your waiter, your barista at Starbucks, or the concierge in your hotel. If you can reach that same person after he has left his job for advice, both you and the former rep can benefit from a fair exchange.

Specifically, Insidr brings together consumers who have practical questions about how to deal with a specific company and (mostly) former employees of that company. For example, you want to know whether you can still get the unlimited-data-roaming plan that your friend has, but the company refuses to give you a straight answer. Somewhere, a former employee (or perhaps a knowledgeable phone-store saleswoman) knows the answer.

Amazingly, says Brydon, two companies have embraced the idea. Dish Networks now seems to encourage its employees to join the system, while a manager at another company has asked for a “white-label” version that would serve only it and its customers.

But, inevitably, the whole idea will make many companies anxious. Insidr lets users select the companies by posting questions, and adds the most-mentioned companies first; so far, it has 10, including AT&T, Bank of America, Sprint, and United Air Lines. I can imagine some advertisement of the future that boasts, “We’re so helpful that Insidr.com ignores us!”

The users post questions, with or without a reward. (Insidr gets a 50% cut of rewards when they are offered). “We originally thought that it would be mostly about information,” says Brydon, “and that the free answers would erode the revenue opportunities. But it has turned out to be more about relationships and connecting a person who needs help with a person who can and wants to help. This basic desire to help seems as important as the rewards. Questions are answered more quickly when there is a reward, but many of the workers help even when there is no reward.”

In fact, the free answers are a way for the “workers” to establish a reputation, and they make more money actually performing services, whether helping someone book a complicated flight route or get a new loan officer. In one case, a current United Airlines employee asked for a telephone number for a person, not a machine, in the company’s human-relations department.

By making the market for insider knowledge and access transparent and open, Insidr raises a lot of questions about why companies operate as they do. People inside companies are paid to provide a certain level of customer service on the assumption that they will help to sell products, instruct users how to benefit from them, and improve customer satisfaction. 

But customers are generally stuck with one-size-fits-all service. Can Insidr.com do a better job by unbundling the market and allowing a more direct relationship between consumers and workers, and give more power to both of them vis-à-vis companies?

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