The Secret to Modern Economics: Linchpins, Trust Agents and Ninjas

Trust Agents, Linchpin, and Web AnalyticsSeth Godin calls them Linchpins. Chris Brogan and Julien Smith call them Trust Agents. Avinash Kaushik calls them Ninjas. Essentially, they're all talking about the same type of person. These are people that get things done. These are passionate people that care about the customer. They're willing to go beyond due diligence to measure, learn and improve. And in reality, Linchpins, Trust Agents and Ninjas are the secret new drivers of modern economic value.

Before we get started, let's take a closer look at how the authors/marketers/experts above define these "personality types."

 (book links go to Amazon and are affiliate ads, of course)

  • Linchpins - A Linchpin is an indispensable person. Linchpins possess a magical combination of charm, talent and perseverance. Linchpins stand out, exert emotional labor and produce interactions that organizations and people care about deeply.
  • Trust Agents - Trust Agents are power users of the new tools of the Web. They learn quickly by trying and connect with more people than anyone else and are therefore able to spread influence faster, wider, deeper
  • Ninjas -  Used by Kaushik in the context of web analytics in Web Analytics 2.0, Ninjas cut through mountains of data, reports and noise to produce just the few precious nuggets of actionable insights. Direction. The path to profit, customer satisfaction and glory.

So how do Trust Agents et al. translate into economic value? For that we need to review a few basics concepts of production in modern economics.

The basic production model:

Y = A x Lα x Kβ

  • Y = Total Production
  • L = Labor Input
  • K = Capital Input
  • A = Total Factor Productivity
  • α and β = Output Elasticities

Modern Economic ProductionHuh? Let's break that down a bit.

  • Y = The total value of products or services you produce. Generally, this is as much as you can sell.
  • L = The cost of labor
  • K = the cost of "capital." Capital includes computers, cubicles, offices, iPads, etc.
  • A = Believe it or not, a total factor productivity is like a modern economic je ne sais quoi, or intangible quality that multiplies production. Good weather leads to increased total factor productivity when growing crops. Education of the labor force leads to increased total factor productivity as economies develop.
  • α and β = Think of output elasticities as indicators of ROI for additional investments in the variable they modify. For example, if α > 1, then every 1% investment in labor (L) will result in a positive ROI. If α < 1, you're wiser to invest in something other than labor.

Modern Economic Production with LinchpinsIn recent years, modern economic math has expanded to include the concepts of human, intellectual and social capital as additional total factor productivity variables in the productivity model. Which brings us to the punchline: these are all qualities of - you guessed it - Linchpins, Trust Agents and Ninjas!

With this realization and given an appreciation for the realities of our modern economy (i.e., post-recession), three advantages emerge:

  1. Ninjas have an multiplying effect on output because they add a "Linchpin total factor productivity variable" to the equation (similar yet distinct from "A")
  2. More Ninjas is your best possible investment, as the output elasticities are incredibly high
  3. Most of production these days is a commodity - α and β continue to drop. Being a Ninja is one of few remaining differentiating, and thus profitable factors.

Trust Agents and Linchpin EconomicsAnd what happens when your Ninja/Linchpin leaves your company? Suddenly there's a drop in efficiency. A particular group or whole departments just don't seem to produce as much. Enthusiasm dies down. There's no one volunteering to lead new efforts and projects. You've lost so much more than just another body. You've lost the human, intellectual and social capital too. Losing your Linchpins, Trust Agents and Ninjas leads to significant drops in production relative to the monetary costs associated with the labor lost.

Are you a Linchpin, Trust Agent, and a Ninja? If you left your organization, would anyone notice? Would the corresponding dip in production be in line with everyone else or could your departure be fiscally palpable? Leave a comment below advance the conversation of the new modern economics.