Brand Management

When
Crowd TED Lost Control of Its
by Nilofer Merchant
From the Magazine (April 2013)

Summary.   
In 2009, TED, an organizer of highly respected conferences on “ideas
worth spreading,” threw its doors open, allowing anyone, anywhere, to manage and
stage local, independent events under its banner. In the next few years, an army of
volunteers produced some 5,000 such TEDx events in more than 130 countries.
The brand extension and new content TED gained through these gatherings would
have cost millions to produce by traditional means. But they came with a risk: TED
no longer completely controlled its brand, and an extended community of people
who didn’t work for TED were now capable of damaging it. And when TEDx
licensees began putting dubious pseudoscientific presentations on their programs,
that risk became a real threat. The blogosphere trashed TED for producing dumb
content and questioned its overall credibility.
In this article, Nilofer Merchant describes the uproar and the lessons it offers: (1)
that “open” does not mean “easy” or “free” and (2) that you need to get the crowd
working with you, not against you. TED did that, turning things around by adopting
three practices: “listening loudly,” realigning the community through shared
purpose, and being strategic about the parts of the business it opened to the
crowd and the parts it kept under tight control. close

“Wow. Such f—ing bullsh-t.”

 No, this is not a snippet from the
latest Quentin Tarantino film.
It’s Stanford professor Jay
Wacker responding, on the Q&A
site Quora, to the now-infamous
TEDx talk “Vortex-Based
Mathematics.”

Photography: Curtis Steinback

Artwork: Jacob Hashimoto, Forests A member had posed the
Collapsed Upon Forests, 2009, acrylic,
paper, thread, bamboo, wood, Martha Otero question “Is Randy Powell
Gallery, Los Angeles
saying anything in his 2010
TEDxCharlotte talk, or is it just total nonsense?” Wacker, a particle
physicist, was unambiguous: “I am a theoretical physicist who
uses (and teaches) the technical meaning of many of the jargon
terms that he’s throwing out. And he is simply doing a random
word association with the terms. Basically, he’s either (1) insane,
(2) a huckster going for fame or money, or (3) doing a Sokal’s hoax
on TED. I’d bet equal parts 1 & 2.”

Powell’s talk had been given in September 2010, at what was one
of numerous local TEDx gatherings spun off by TED, a nonprofit
that puts on highly respected global conferences about ideas. But
the talk went relatively unnoticed until the spring of 2012, when a
few influential science bloggers discovered it—and excoriated it.
One dared his readers to see how much of the talk they could get
through before they had to be “loaded into an ambulance with an
aneurysm.” Another simply described it as “sweet merciful crap.”
By August the uproar had gone mainstream, as other questionable
TEDx content was uncovered. The New Republic wrote, “TED is
no longer a responsible curator of ideas ‘worth spreading.’ Instead
it has become something ludicrous.” As others piled on, TED
staffers called Powell and asked him to send the research backing
up his claims. He never did.

The TEDxCharlotte talk, which had received tremendous

applause when delivered, was one of thousands produced
annually by an extended community of people who neither get
paid by nor officially work for TED but who are nonetheless
capable of damaging its brand.

TED’s army of volunteers has

extended its reach to more than 130
countries. But TED no longer
completely controls its brand.

When it was founded, in 1984, TED (which stands for

“Technology, Entertainment, and Design”) brought together a few
hundred people in a single annual conference in California.
Today, TED is not just an organizer of private conferences; it’s a
global phenomenon with $45 million in revenues. In 2006 the
nonprofit decided to make all its talks available free on the
internet. (They are now also translated—by volunteers—into
more than 90 languages.) Three years later it decided to further
democratize the idea-spreading process by letting licensees use
its technology and brand platform. This would allow anyone,
anywhere, to manage and stage local, independent TEDx events.
Licenses are free, but event organizers must apply for them and
submit to light vetting. Since 2009 some 5,000 events have been
held around the world. (Disclosure: I spoke at the main TED event
in February this year.)

The brand extension and new content TED gained by setting up a

decentralized community would have cost millions of dollars to
produce through traditional business means. Such a community
can create value in many ways. Look at the benefits Apple reaped
by opening app development to the crowd. By designing a tool kit
that lowered the cost of development from $1 million to $10,000,
the company harnessed the creativity of thousands of developers.
Ask yourself what Apple’s business model would be without its
diverse app store. When the security-software maker McAfee
allowed volunteers known as “McAfee Maniacs” to offer
customers answers to technical support questions, it cut overhead
expenses by 5%. At Intuit, users of Mint, QuickBooks, and
TurboTax serve as “live communities,” providing peer-to-peer
advice for everything from special tax circumstances to
competitive pay issues. To date they have answered more than 25
million questions—about 74% of all questions that have come in.
“In one product line, this approach has slashed support costs by
35%,” says Per-Kristian (Kris) Halvorsen, the chief innovation
officer of Intuit. And then there’s the upside of having a
community of superusers built around and invested in the Intuit
platform, creating a competitive moat.

The benefits of open innovation are clear. Yet many companies

still worry about an approach that involves collaborating and
sharing power with many. Openness is indeed risky, as the TED
example clearly shows. TED’s army of volunteers has extended its
reach to more than 130 countries. But because TED allows nearly
anyone to contribute, it no longer completely controls its content
or its brand.

Leaders might wonder whether the rewards of openness are

outweighed by its risks—especially when they have a public
company to run and predictable results to deliver. To gauge the
trade-offs, you first need to understand that “open” does not
mean “easy” or “free.” Second you need to know how to get a
crowd working with you and not against you. That will mean
adopting new practices: listening harder, aligning through shared
purpose, and opening your organization in the ways that matter.
How Open Is Open?

TED has different approaches for different contributors

and audiences. ...

Learning by “Listening Loudly”

Crowds will organize themselves far faster than you could
manage, which is great when they’re holding events for you
around the world—like TEDxKibera and TEDxAntarcticPeninsula
—but not so great when they’re setting up ones that feature
“experts” in pseudoscience topics like “plasmatics,” crystal
healing, and Egyptian psychoaromatherapy, all of which were
presented at TEDxValenciaWomen in December 2012. That
conference was described by one disappointed viewer as “a
mockery…that hurt, in this order, TED, Valencia, women, science,
and common sense.” Within 24 hours commentators on Reddit
had picked up the charge; by the next day more than 5,000 people
had weighed in on Reddit, Twitter, or other social channels.

Two months earlier, in October 2012, TED had removed Randy

Powell’s “Vortex-Based Mathematics” video and had begun to
respond to public concerns about that particular talk on a few
influential websites like Quora. But those small steps did not
address the fundamental problem: The TED name had become
associated with bad content, as the chortle-inducing lineup of
TEDxValenciaWomen made clear. People who didn’t even know
the specifics of those situations but had grown to dislike what
TED represented used the occasion to trash the brand—both for
its perceived elitism and, somewhat paradoxically, for dumbing
down ideas. An angry mob was forming. The dialogue was mean.
And, organizationally, it was life threatening because the very
premise of TED was being questioned.

TED’s leaders needed to look beyond the complaints about the

Charlotte and Valencia events and hear the bigger message. They
had to start “listening loudly”—engaging in a dialogue through a
variety of public forums to understand what had gone wrong and
to learn how to fix it.

As soon as Emily McManus, the editor of TED.com, waded into

the blogosphere, the tension started to subside. Through posted
exchanges on the NPR, CNN, and LA Times websites, and the
Huffington Post, Slate, Quora, BuzzFeed, and other online venues,
she reached out to 100 different communities. By communicating
publicly and person-to-person, TED achieved two things. One was
to signal that it was paying attention to people’s concerns. But
more strategically, TED learned about a systemic problem that
demanded a broad solution.

Don’t confuse listening “in public” with “public relations.” First,

it’s not just about sharing your perspective (PR) but about being
open to change that is prompted by the interaction (community
building). With the former, you just want the crowd to feel better
about your brand; with the latter, you want the crowd to work
with you to solve problems.

So although Lara Stein, the TEDx program head, first joined the
ValenciaWomen Reddit discussion with a flat explanation of
policy (“While we do vet licensees carefully, we do not review or
approve every speaker lineup….From time to time, a licensee gets
it wrong….If we feel there has been a blatant disregard for the
TEDx rules, we will not renew the license”), she and her
colleagues eventually started engaging with critics, asking them
questions and teasing out more-constructive feedback. For
example, one such dialogue led a crowd member to point TED
staffers to a Forbes article titled “10 Questions to Distinguish Real
Science from Fake Science,” which they ultimately built on to
create new content guidelines for the TEDx community.
According to Stein, “TEDx policies have gone from a set of 10
simple guidelines to pages and pages of specific rules including
things like branding, messaging, sponsorship, speaker selection
and so on, based on the input we’ve gotten.”

Realigning the Crowd

It wasn’t enough to respond rapidly to and learn from online
critics by writing new policies. TED also needed to redirect the
crowd.

Changing an organization’s focus is hard enough when the people

in it work for you. Consider the challenge Howard Schultz faced
when he famously returned to the helm of Starbucks, determined
to steer the company back to its core mission of providing a “third
place” for customers and away from its policy of rapid expansion.
But a shift in direction is even more difficult when it involves
people who don’t work for you. You can’t “manage” a crowd—or a
community—through transactional exchanges or economic
incentives. You need something stronger: shared purpose. Of
course, cash-strapped nonprofits and similar organizations have
used the power of higher causes to align and motivate people for
years. Businesses have begun to do so only recently. But shared
purpose is now integral to how people create value, especially
through the crowd. And TED’s experience again offers some
useful lessons.

To get its crowd recommitted to the objective of “ideas worth

spreading,” the TED team sent a lengthy letter to the TEDx
community (made public the next day via the TEDx blog)
reminding members that the organization’s mission was theirs to
uphold. While elements of the note are clearly transactional
(“Presenting bad science on the TEDx stage is grounds for
revoking your license”), the bulk of it is instructional: a definition
of pseudoscience, a list of common red flags, and examples of
topics best left untouched. The letter (which ran pages long)
explained in much greater depth than ever before what type of
content TED considered appropriate, a judgment previously left
entirely to each event planner. The TED team asked members of
the “TEDx movement” for more feedback and for help monitoring
the quality of events. The team also offered help with vetting
speakers. The message was clear: Spreading important ideas was
the shared purpose, improving quality was a shared problem, and
it would take a shared effort to fix it.

Remember that TED’s initial response to the TEDxCharlotte

fiasco was to call the presenter and ask him to defend his
assertions. But as the December conflagration made clear, this
private approach—which would have worked well for an internal
employee—did little or nothing to get the crowd back on course
before TEDxValenciaWomen. Instead, TED had to openly clarify
to the TEDx crowd what TED isn’t in order to help sharpen what it
is.

When TEDx Events Went Astray, Critics Blasted

Them

“Just see how far you can get through this TEDx talk
before you get loaded ...

Stein describes it as a collective teaching opportunity. “This was

not a case of TED saying no, no, no,” she explains. “It was letting
the people in the TEDx community say to one another that the
trust had been breached, we had strayed from our shared purpose,
and we had to get back in alignment.” TED’s role was that of
adviser and shepherd, not director or dictator.
Being Open in the Ways That Matter
Because the events described here happened in a public court, not
in private, you might infer that an organization applying the ethos
of openness must be fully open. But that’s not at all true. For the
strategy to work, what needs to be open should be open, but other
parts of your organization can remain closed.

Indeed, open as TED is, pieces of its ecosystem are highly

managed. For example, while 25,000 TEDx talks have been
produced so far, as of the time of this writing only 228, or
approximately 1%—the best of the best—had made it to TED.com
for broad-based distribution and endorsement. People who
complain that TED is not curating its content are ignoring how
selective it is when posting TEDx content.

Apple manages its mobile platform in a similar way. The platform

is closed in its hardware design but open to app store
contributions, so it allows in a wide range of ideas and solutions
from developers. Apple then benefits as “1,000 flowers bloom” on
its platform. The app store accounts for only 4% of the firm’s
sales, but by making smart outsiders feel welcome and rewarded
in its fold, Apple ensures that they’re not aiding—or becoming—
competitors. (Whether the even more open and rapidly expanding
Android system will turn out to be a serious threat to Apple’s
semi-open system remains to be seen.)

Apple, McAfee, Intuit, and TED have all found ways to engage the
crowd by drawing a clear line between their own offerings and
what they’re willing to let the public contribute.

Everyone’s a Crowd Manager

Today talent is increasingly untethered. Well over 30% of U.S.
workers are now self-employed. This isn’t just a U.S. trend; on the
popular websites Freelancer.com and oDesk, most freelancers hail
from India and the Philippines, respectively. These are not
workers who couldn’t find other jobs; they are talented people.
Another popular freelancing site, Elance, reports that 71% of its
users have either a bachelor’s or a master’s degree. Value is being
created by all categories of people—workers and volunteers, paid
and unpaid, contributors and consumers. Organizations that still
believe they can and should keep the crowd out may find
themselves in an undesirable position—alone and apart.

Anyone leading an organization today is already managing a

crowd—whether it’s composed of consumers, the media, or
citizens of the towns in which the enterprise operates. What TED
faced is the new reality for all of us. “Nothing is predictable,” Stein
concludes. “This flies in the face of leaders’ being asked to plan
and predict and know more than others. Today we have to create
scale for our mission by being open. The TEDx construct is an
example of how being in a community lets us learn, adapt, and
grow together.”

Even though management experts have long argued for looser

organizational models and against command-and-control
leadership, most executives are still ill equipped to manage
crowds. As humans, we want to be perfect and in control. We like
knowing more than we enjoy learning. We want to get it right the
first time rather than iterate. But crowds—and the community
constructs we’re talking about—are not about flawless execution;
they are about allowing anyone (quite possibly everyone) to
contribute and gathering a large volume of potentially powerful
ideas from which to pick the best.

AReview.
version of this article appeared in the April 2013 issue of Harvard Business

Nilofer Merchant has personally launched 100

products amounting to $18 billion in revenue,
and has served on both public and private
boards. Today, she lectures at Stanford, gives
talks around the world, and has been ranked
one of the most influential management
 thinkers in the world by Thinkers50. Her latest
book is The Power of Onlyness: Make Your Wild
Ideas Mighty Enough to Dent the World.

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