Here’s a statistic for you: the value of the Social Money Market is estimated at $103bn.  Now, if you’re not sure what the Social Money Market is and why this statistic should concern you, let me explain.  It represents the value of debts between friends.  In other words, that drink you bought for a colleague after work lives on in the great social balance sheet, and until they buy you one back, it contributes to this impressive overall figure.

I found out about the Social Money Market because someone has set up an online service which allows people to keep track of their social debts, and make it easier to call them in.  While I wait to receive my first ‘what about that Cappucino I bought you two months ago, currently appreciating at 5.4% p.a.?’ email, I find myself pondering the deeper resonance of this commercial enterprise.

There are many possible moral and/or philosophical positions one can take on this new phenomenon; as befits a self-styled intellectual dilettante, I shall maintain a discreet distance and confine myself to the observation that, at last, we seem to be able to put a value on friendship.  Perhaps this may turn out to be a Good Thing.  It all depends, of course, on what we mean by ‘value’.

Best not to ask Tesco.  I’ve just about calmed down from the lexicide their ‘value’ range of products is responsible for. Come on, since when was ‘value’ a synonym for ‘cheap’?  The best ‘value’ food I ever had was about 20 years ago at the Roux Brothers’ restaurant The Waterside Inn.  We paid £60 a head excluding wine (well it was a long time ago) and the quality of food and service left me wondering how they could possibly make a profit. And we had change for a meat pie and the cinema on the way home.  Kids today don’t know they’re born.  (A quick tangent for marketing aficionados: ever wondered why the packaging of Tesco Value products is so unappealing?  It’s to make sure that only people who really can’t afford a more expensive Tesco product buy them.)

Back to the Social Money Market.  It is, on reflection, only a small extrapolation of the philosophy that drives most organisations, which is that one must put a financial value on something in order to make it tangible.  That’s the theory at least.  The fact is that, as with friendships, most transactions within the workplace – even financial ones – are rather more nebulous when it comes to quantifying them. 

Take consultancy fees for example.  On what do I base the value of my services?  On the impact my service will have on the business?  On how much everyone else is charging?  On how good I feel about myself today?  Or perhaps it works rather like house pricing: the enthusiasm with which the client thinks “I want that” gets translated into money.  But surely, you argue, there must be budgets for this?  Hmm.  Peter Block (the ‘Consultant’s Consultant’) observes with some justification that, budgets notwithstanding, managers are very good at finding money for things they personally want to do (at least I think that’s what he says; I lent his book to one of my clients ages ago and never got it back.  Perhaps I can seek recompense through this new website.).

If ‘value’ was an absolute, then surely every management development consultant would peg their fees to the impact of their services on the organisation.  The fact that most of us choose not to is a reflection not of our cowardice (no, really….) but of the fact that evaluating the impact of such services is something of a challenge.  Clients are always keen for ‘impact’ evaluation to form part of the contract, until you tell them how much it will cost to do properly – all of a sudden, they value it a lot less.  It’s the organisational equivalent of spoiling the ship for a ha’porth of tar. [Message from our sponsor: there is another way.  Visit] 

There’s something about a financial transaction which dehumanises us.  To operate on a ‘no win, no fee’ basis in my business requires a high level of trust, since otherwise there is a ready made financial incentive for the client to prove the intervention didn’t work.  If the human bits of the client relationship work, the true ‘value’ emerges.  Which is why the Social Money Market is a sobering reflection of the human condition: if your relationships are so transactional you need a website to manage them, you may have your priorities a little askew.

Meanwhile, to prove to me they understand the true concept of value, I await with interest Tesco Value Roasted Loin Of Lamb With Crisp Parcels Of Risotto and Curry Scented Carrot With A Savory Infused Jus – for £1.99.


© Phil Lowe, 2006.  All rights reserved.