Innovation Economy

Watertown firm tracks how workers interact

Employees volunteer to wear devices developed by Sociometric Solutions. Employees volunteer to wear devices developed by Sociometric Solutions.
By Scott Kirsner
Globe Correspondent / July 18, 2011

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Excerpts from the Innovation Economy blog.

Imagine this scenario: You show up at work and are handed a small white device attached to a lanyard. Your boss says management consultants are studying the ways people at your company interact, and the device will monitor whether you ever visit the engineering department, for instance, or how often you talk to people from marketing.

Would you wear it?

The digital dog tag, which Watertown-based Sociometric Solutions calls a “sociometric badge,’’ has a built-in microphone that can gauge how much you talk (versus how much you listen); an accelerometer that can tell how much you sit, versus how much you move around; and an infrared sensor that can tell when you’re facing other people wearing the badges.

“When a consultant comes into a company, they look at org charts and do interviews,’’ said Ben Waber, chief executive of Sociometric Solutions and a senior researcher at Harvard Business School. “But our approach is to use these sensors to see how people really interact, over a period of a month or two.’’

They are especially useful, Waber said, for tracking informal communications people might not report in an interview, such as a conversation in a cafeteria line. “Surveys and interviews are just bad at getting information about sporadic interactions,’’ he said.

And human interaction is a big factor in all sorts of organizational initiatives, product development, and mergers. The device, developed at the MIT Media Lab, was used in 2009 by a Bank of America call center in Rhode Island. They found that call center workers who interacted more with their colleagues felt less stressed, handled calls more quickly, but had equivalent customer approval ratings to those who did not interact as much.

Forbes magazine observed: “Informally talking out problems and solutions, it seemed, produced better results than following the employee handbook or obeying managers’ e-mailed instructions.’’

As a result, the bank scheduled employees’ breaks so they could talk more often with one another, rather than less; previously, their breaks had been staggered.

Combined with information about who e-mails whom, data the badges generate about interpersonal interaction can highlight who spreads information and who the experts are on given topics.

It’s also a way to show which departments don’t tend to communicate with other departments, Waber said. Working with a bank in Germany, the company noticed that people often did not talk face-to-face with customer service staffers - until a new product ran into problems.

Waber said that when Sociometric Solutions works with a company, wearing the badges is voluntary, but more than 90 percent of employees usually participate. The devices need to be recharged daily.

It’s fun to imagine the hijinks that would ensue if two employees surreptitiously switched badges, or if an employee attempted to make herself seem more important by walking around talking to people from every department - but asking something inane, like where the nearest soda machine is.

Sociometric Solutions has five staffers and hasn’t raised outside funding. “We’ve been boot-strapping on revenue, and we’re very profitable,’’ Waber said.

Looking for investors A few months after receiving $41.7 million in loans from the State of Rhode Island, the videogame start-up 38 Studios is soliciting private investors. UBS Investment Bank began circulating a teaser in June, describing it as a “pre-IPO fund raise.’’

That’s quite a stretch for a company that has yet to release its first game. The Rhode Island loan, which lured the company to the Ocean State from Massachusetts, has been 38 Studios’ largest outside funding to date.

Through a publishing arrangement with Electronic Arts, that big California game company is probably funding most of the development costs for the first 38 Studios game, Kingdoms of Amalur: Reckoning, due in 2012. But the company’s most dedicated backer has been founder and chairman Curt Schilling. A 2010 Harvard Business School case study on the start-up noted he poured nearly $20 million into 38 Studios between 2006 and 2008.

The case study also detailed Schilling’s inability to agree to terms with an array of prospective investors. (Schilling, in case you’ve forgotten, was the pitching ace who helped the Red Sox win the 2004 and 2007 World Series. He’s also a diehard gamer.)

UBS’s investment overview said 38 Studios’ first game, the single-player role-playing game Reckoning, will be out in the first quarter of next year, and its second game, Copernicus, a massively multiplayer online game similar to World of Warcraft, will be released in the fourth quarter. It noted Reckoning was previewed last month at the E3 gaming conference, winning several awards.

“Success at E3, considered the preeminent gaming conference,’’ the UBS bankers wrote, “has been a major indicator of eventual commercial success for game releases historically, and the Company intends to build on this positive momentum with further media events leading up to the game’s launch.’’

“With Reckoning and Copernicus launching in 2012, 38 Studios expects to achieve over $100 million in revenue in 2012,’’ the bankers wrote, and the company expects to be “extremely profitable’’ by 2013.

The document stressed the experience of the 38 Studios team and noted their success could create opportunities for toys, collectibles, movies, and comic books.

Two big questions:

How much is 38 Studios seeking to raise, and does it need the money to finish its Copernicus game?

Unfortunately, chief executive Jen MacLean did not return calls or e-mails, and a PR representative said the company had no comment.

For the full Innovation Economy blog, updated daily, visit