Making sense of VRM

For many months, I have been reading the Project VRM list hosted by Doc Searls and Harvard. The putative Bill of Rights for Users of the Social Web has addressed this challenge, as well, but misses in ways similar to VRM, because of the implicit relationships between social web service providers and their customers.

A posting today on the Project VRM list by Alan Mitchell of the Buyer Centric Commerce Forum finally clarified for me the problem I have repeatedly run up against when trying to fit the Vendor Relationship Management into a social nomenclature. Alan writes:

When push comes to shove, the terms of vendor-customer relationships are either designed around the vendor’s value agenda (buy me!) or they serve the individual’s value agenda – is this the best decision for my life, circumstances, priorities etc?

However you cut it, you can’t avoid the fact that for the individual, value is defined by an improved ability to make and implement better decisions. Personal decision-making purposes and processes are the heart of the issue: everything we do follows from this.

The ‘R’ word in abstract simply skates over this elephant in the room as if it doesn’t exist. This doesn’t benefit anybody in the long run.

Ideally, in the scenarios Doc has laid out along the way, the vendor only comes calling when the customer raises a flag indicating a desire unfulfilled. That would work if life were like an economics textbook's description of rational decisions made in a market with perfect information. Instead, folks' attention is captured by something and they usually buy without doing any research. So, VRM is merely filling the gap between those that are satisfied with the information at hand and those that desire to negotiate or find a better deal.

Yet all these transactions take place in a continuum with our social behavior, which involves many roles and channels of communication that may serve as a catalyst to a transaction. Alan put it well: "The 'R' word in abstract simply skates over this elephant in the room as it it doesn't exist."

The problem in the extant social economy of information, both online and off, is that nothing personal is out of bounds of business interests, to the degree that we (the people formerly known as the audience) are not able to define the relationship and are forced to become "the customer" before we even want to be a customer.

The project I am currently working on focuses on what my team and I believe is essential to sustaining the difference between a social relationship and a commercial one: the control of personal information across many sites and relationships. Given that control, which is multi-directional and multi-faceted, which allows for a variety of types of relationships, we expect a lot of different forms of commercial interaction will be forged, as well as a richer variety of social relationships than the Web currently supports due to the emphasis on advertising as business model.

We believe the same information may be used in different circumstances for different types of relationships, and extracting the maximum value from that information depends on having it confidential in the new context. So, even if it has been shared before with someone, it should not be used in a different setting to elicit a transactional response, unless the customer wants it to be used that way.

Microsoft, or any of the other medical vendors out there working on this problem (look at WebMD and Emdeon, for example), will not solve this problem by creating a medical data silo, HIPAA notwithstanding. This is because the information about our medical or psychological health, for example, may be a powerful social anchor that moors us to a community, yet never becomes "public" for commercial purposes. We need to find ways to share that information selectively.

Neither will this problem be solved by building transactional silos in the midst of social fields. Both economic and social value flow over the same conduits, through the same information, so we need to focus on how and when that information may be shared as the basic unit of the problem VRM intends to solve.

I'm ultimately inclined to say that it is not a matter of putting the customer in charge, because that, too, defines a role that doesn't fully address the use of information in defining our relationships. No one in charge is the only answer, which is a big trick to pull off. The only way to accomplish this is to build systems that serve members first, before they become buyer or seller. It's a bigger social problem than VRM is fitted for.