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Gain Control By Giving It Up

April 29, 2010 by  
Filed under B2B, Newsletter

Open Leadership coverCharlene Li’s new book will be out in a few weeks, and if you’re interested in how social media is transforming the way business gets done, you’ll want to pick up a copy.

The book is called Open Leadership, and I would classify it as the first of the post-social media books. By that I mean that it looks at the consequences democratized communications rather than at the media itself. Expect to see wave of similar books in the coming years. This one is a very good first entry. Open Leadership will make a lot of people uncomfortable because it proposes that the only way to govern effectively in a transparent business world is to give up control and trust people to do the right thing. Li makes a persuasive case by citing many examples of companies that have done exactly that with great success.

Li is a former Forrester Research analyst, founder of Altimeter Group and co-author of Groundswell, the breakthrough 2008 book that provided the first demographic profiles of social media users as well as a rigorous methodology for evaluating the ROI of social programs. In Open Leadership, she builds on some of the economic models first presented in Groundswell, but the new book is more of a call to action than a financial exercise.

The premise is encapsulated in the title of Chapter 1: “Why Giving up Control Is Inevitable.” Li asserts that today’s business world is too complex and competitive to permit organizations to continue to manage the way they have since the Industrial Revolution. That top-down philosophy assumes that people who can’t accomplish tasks without instructions, rigid rules and constant oversight are idiots. That worked okay when companies had some control over their environment, but today too many factors are out of their hands. So one man’s story of how an airline broke his guitar and refused to fix it becomes a cultural sensation while the airline stands by helplessly and fumes.

Charlene LiLi (left) asserts that the only way to gain any level of control over today’s turbo-charged business environment is to give up as much control as possible. New business leaders set examples, demonstrate confidence and create cultures that tolerate intelligent, well-intentioned failure. And guess what? It turns out that when smart people are given the latitude to make decisions, they tend to make better ones than if someone else makes decisions for them.

Open Leadership provides some refreshing new examples of how this new management philosophy is working:

  • Meetup.com replaced a top-down approach to project management with one that requires stakeholders to persuade engineers to spend time on their projects. Productivity exploded;
  • BestBuy outlasted competitors in the brutal electronics retailing business in part by developing a culture that lets its employees guide customers toward the best decision, even if that means buying from a competitor;
  • Electronics distributor Premier Farnell distributed low-cost digital video cameras to every employee in the company so that they could document their best practices and share them on an internal network. Employees are more empowered and the quality of information is better.

Li is particularly inspired by John Chambers, the CEO of Cisco, which has undertaken a massive program to drive decision-making down to local levels. Chambers says the idea unnerved him at first, but that Cisco is now a faster, more responsive and more innovative company as a result. And he’s working fewer hours. Chambers provides critical support for the concepts outlined in Open Leadership; he has the unwavering support of Cisco’s board of directors, which enables him to talk honestly about his own reservations and the mistakes he has made.

It is on the issue of mistakes that the author is most emphatic. Li stresses that businesses can only be innovative if they learn to accept the fact that failure is a necessary by-product of risk-taking. Companies that successfully practice open leadership evaluate decisions based upon the thought that goes into them rather than the results. Failure is an opportunity to learn and try again, and the only unpardonable sin is making the same mistake twice.

Most businesses do a lousy job of this. They publicly declare a commitment to innovation, but privately punish employees whose ideas don’t succeed. Tolerance for failure is sometimes cited as the most important reason that Silicon Valley has outclassed every other region of the U.S. in technology innovation. Reading Open Leadership, I get the impression that such tolerance is the only option for businesses that hope to lead in uncertain markets.

B-to-B Social Marketing — Really!

My new presentation on social marketing for b-to-b companies drew a nice audience at NewComm Forum last week, and many people have asked about the slides. The presentation, entitled “B-to-B Social Media – Really!” cites numerous examples of businesses that have applied all sorts of new communication tools to building brand, generating leads and improving customer support. It’s available on SlideShare, along with all my other past presentations, and you are free to download it and use it as you wish. As always, I appreciate attribution. I’d appreciate even more a chance to present my findings to your company or professional association.

Tip of the Week: OffiSync

I love Google Documents, the suite of office applications that lets people collaborate on text files, spreadsheets and presentations without worrying about version control or synchronization. Dana and I wrote Joy of Geocaching on Google Docs and found it to be a godsend when we weren’t at home but still needed to access each other’s files.

Google Docs has shortcomings, however. The apps aren’t nearly as feature-rich as Microsoft Office, so fancy formats and off-beat fonts aren’t nearly as easy to use. Also, applications delivered online run more slowly than those that run on a fast PC. I’d say I’m twice as productive with Word as I am with Google’s rudimentary word processor.

OffiSync is finding a middle ground. This hot startup has come up with a cool utility that runs inside Microsoft Office and automatically connects to Google Docs as a back-end. You can load and save Docs files as if they were on your local hard drive. The tool also integrates Google search and real-time collaboration, meaning that is two or more people are working on a file simultaneously, their changes are synchronized every time they save to the server.

These high-end features are only available in the paid version of the product, which sells for a modest $12 annual fee, but the free version does a good job of managing the back-end interaction with the server. Your creativity is limited by the least common denominator or Google Docs support, but if you want to enjoy the power of local Word apps while shortcutting the tedious process of sending files to and from the server, this tool is pretty sweet. Here’s the download link.

Just for Fun: Those Nutty Skydivers

Skydivers in formationSkydiving looks like fun. And if it wasn’t for pesky things like responsibility and the fact that they can’t guarantee I’d live through it, I would have done it years ago. So I respect people all the more who not only skydive, but do so on a regular basis and attempt to set records. Woman’s Day collected 10 pictures of phenomenal feats of people flinging themselves from mountaintops and airplanes. We just hope all of them made it safely to the ground!

New Media Demands New Leadership

March 19, 2010 by  
Filed under Newsletter

I don’t go to the South by Southwest conference for the sessions as much as for the people. The most interesting conversations usually happen outside of the conference rooms. One discussion that stuck with me this week occurred after a presentation by MIT’s Andrew McAfee entitled “What Does Corporate America Think of 2.0?”

While I was waiting in line to introduce myself to Mr. McAfee, I eavesdropped on a conversation he was having with the young woman in front of me. She gave her age as 28 and said she had recently been hired to coordinate social media at a real estate company where her bosses were mostly in their 50s. She was clearly demoralized and frustrated.

The young woman had been brought on board to get the realty company up to speed in the new Web technologies. She understood that conversational marketing requires a culture change, but her management wasn’t interested. Her bosses, she explained, saw social technology as simply another way to distribute the same information.

For example, she had been ordered to post press releases as blog entries and to use Twitter strictly for promotional messages. She had been told to get the company on Facebook but not to interact with anyone on its fan page.Her communications with the outside world were to be limited to platitudes approved by management.

I felt bad for this young lady and also for her bosses, who will no doubt lose her in short order. I suspect they hired a social media director in the belief that she could create new channels for them, but they didn’t understand the behavioral change that was required on their part.

Open Leadership

A couple of nights earlier, I attended a dinner given by Altimeter Group, whose founder, Charlene Li, co-authored the ground-breaking book Groundswell. Charlene was handing out galley copies of her forthcoming book called Open Leadership. In it, she suggests that management strategies must fundamentally change in the age of democratized information. I’ve only read a third of the book so far, but I can already tell that it will cause considerable discomfort in corporate board rooms.

In the opening chapter, Charlene notes that “to be open, you need to let go of the need to be in control… you need to develop the confidence… that when you let go of control, the people to whom you pass the power will act responsibly.” This notion of leadership replacing management will shake many of our institutions to the core.

The traditional role of management has been to control and communicate: Managers pass orders down from above to the rank-and-file who are expected to do what they are told.

In the future, communication will increasingly be enabled by technology. Employees will be empowered with information and given guidelines and authority to do the right thing. Middle managers won’t be needed nearly as much as they are today. Organizations will become flatter, more nimble and more responsive because information won’t have to pass up and down a chain of command before being acted upon. This will result in huge productivity gains, but progress will only be achieved when top executives learn to let go of the need to control and to accept the uncertainties of empowered constituents.

No Pain, No Gain
The real estate company’s mistake was in believing that it could participate in a new culture without changing its behavior. It saw social media as a no-lose proposition; distribute the same material through new channels but don’t accommodate the reality that constituents can now talk back. Any company that takes this approach will fail to realize the benefits of the media. Once its customers realize that their opinions don’t count, they will stop engaging with the company. That doesn’t mean they won’t do business with the company any more, but the benefits of using the new media will be lost.

I have never advocated that all companies adopt social media. Each business has a different culture, and some adapt more readily to open leadership than others. If employee empowerment and institutional humility don’t fit with your style, then social media is probably not for you. You may do just fine for several years without changing your practices. But if you choose to play in the freewheeling markets enabled by customer conversations, then you’d better be willing to let go of control.

Over time, I believe all companies will have to give up the belief that they can control their markets, because interconnected customers are an unstoppable force. In the short-term, however, businesses need to do what feels right for them. If you work for a company that can’t adapt itself to the concept of open leadership, then start circulating your resume. These days, there are plenty of businesses that are eager to change.

Free Webinar: Multiplatform Social Media Strategies

You might recall from a couple of newsletters ago that I recently released an interim report on some research I’ve been doing into business use of multiple social media platforms. This research, which will be ongoing through the first half of 2010, documents the extent to which businesses of all sizes are adopting multi-platform social media strategies, assesses satisfaction with this diversified approach and records best practices and metrics that are emerging from their early experiences.

In addition to quantitative research, I’ve conducted in-depth interviews with companies like Ford, Coca-Cola, Cisco and Sodexo that have yielded incredible insight into how these companies are changing their practices in developing their social media programs. On April 1, I’ll be presenting the interim findings of this research and discussing what I’ve learned in a free seminar from Awareness. Just click on the link to sign up, and no, this is no April Fool’s joke!

Quick Survey: How Do You “Sell” Social Media?

As part of the research for a business-to-business social marketing book that Eric Schwartzman and I are co-authoring (Wiley, late 2010), I’d like to ask you to take this quick survey about how you “sell” social marketing to your internal stakeholders. It’s four questions and won’t take three minutes. Promise. Thanks so much!

Tip of the Week: Google “Create a Document”

If you use Gmail, you might have noticed this new link that’s popped up in the right-hand sidebar:

It turns out that this is a very useful feature.Google can now make a document out of any e-mail message. So if you’re tired of copying and pasting the contents of a message into a Word file, click that link and you immediately have a Google Document that can be saved, edited, shared and even downloaded in Word format.

Just For Fun: Free Games

The US computer gaming industry is bigger than the US movie industry, which isn’t surprising when you consider how many people shell out $50 or more for a new game every month. But not all games are expensive. Gizmo’s Freeware has assembled an amazing collection of 70 free and open source computer games you can download. We’re not talking Pong here. These games feature 3-D graphics and simulations you’d expect to find in expensive commercial packages. If the recession has cut into your gaming budget, give it a look.