Winning by Sharing

The social media revolution inside

Big thank you to Fran, Justin and Ben for inviting me to talk at the Social Media Leadership Forum to debate: How can senior executives best use social media to communicate with stakeholders?

Here's my take on the subject in 90 seconds!

 

Can't wait to see Don Tapscott (my hero!) talk on the same subject later this year at the Social Media Leadership Forum.

 

 

Change comes from within

Hotel Technology Next Generation (HTNG) is a membership association comprised of companies that provide technology services to hotel groups around the world.  I was invited to speak at their European Members meeting in Lisbon on the wider implications of Social Media.

My biggest frustration with social media commentary is that it’s almost always focused on the latest functionality from Twitter, Facebook, Google and the plethora of other Web 2.0 platforms, gadgets and services.  Very few industry pundits provide an insight into the impact of social media on business and society, and even fewer explore the end game.  So the purpose of this presentation was to provide some thought leadership in these areas backed up with some practical insights drawn from personal experience in deploying social media platforms with British Airways and Mornflake.  The key theme is based on what I describe as the biggest untold story of the 21st Century being played out right under our noses – the increasing irrelevance of command and control organisation as a the default structure for the production of goods and services, and why social media is most transformative inside the company.

Change Comes From Within

View more presentations from Leon Benjamin.

I’ve done a lot of public speaking over the years and I have to say that HTNG is easily the most well organised event I’ve spoken at.  Spanning three days located at the Lisbon Marriott (a hotel of course!) it combined the best aspects of an exhibition, a standalone networking  event, formal presentation and knowledge exchange (by way of break out and workshop sessions). 

HTNG just struck me as being a particularly good example of a Community of Practice, led by CEO, Douglas Rice with a small army of highly competent technicians and administrators.  I was well looked after by Sara Pardo and Merry Marwig before, during and after the event and was really touched by the personally written card pushed under my hotel door the evening I arrived, wishing me luck with my presentation the next day.  This is customer service.  Big thank you to everyone at HTNG.  I enjoyed the experience immensely.

What are the ethical risks of social networks?

I was invited to speak at an event organised by the British Computer Society (BCS) this week, on the ethical risks of social networks. The event was hosted by the Royal Society in London.  Really liked the format.  Three short 15 minute talks from an eclectic mix of commentators. Guests debated the issues over dinner (how civilised!).  At each table there was a chairperson, a recorder (or rapporteur) collating responses and aggregating them into two key statements from the main questions being debated. Richard Justins & Clare Blunt of the BCS have published their notes and report on the evening's proceedings here. 

Each table presented their findings in turn and after summing up from the event chairman we all went home. Thoroughly enjoyed the experience (and the excellent bottle of red wine - thank you!) and professional, friendly approach taken by the BCS. Here's a summary of my talk;

• In bringing together experts from various disciplines this debate aims to find answers to the following questions:
• What are the ethical risks of using SN's?
• We’re in completely new territory
• Business 1.0 to Business 3.0
• Unintended consequences of human behaviour
• Consumers/citizens acts of piracy, file sharing, devaluation of previously viable industries
• Twitter’s role in the Iran
• Unintended consequences of government behaviour
• Routine, wholesale spying on citizens, e.g. Echelon, RIP etc
• Use of Terrorism act by local government
• Reputational risk
• Individual, organisational (e.g. Nokia in Iran)
• We all have skeletons in the cupboard!
• Let he who is without sin, cast the first stone.
• When do those risks outweigh the benefits SN's can bring?
• The genie’s out of the bottle.  Is it too late?
• What’s the prize?
• Self-organisation (e.g. Open Source)
• Peer-to-peer production as a replacement of 200 year old industrial model of work
• A new era of openness & transparency - Higher trust societies, lower transaction costs (the cost of distrust)
• How do we control SN's ethical risks without stifling the benefits?
• If we regulate SN’s they will become very boring places
• Help not hinder – create a code of ethics, kite mark, quality marks etc
• Ground breaking 2002/3 paper – The Augmented Social Network

My position

The sociological and economic benefits of social networks far outweigh the ethical risks associated with their widespread use.  And in any case, just about every government, ISP and intelligence agency in the world will be recording your every word, 'like', comment and Tweet.

The case for social media inside the company

Are customers suffering from ‘Work Rage’?  This phenomenon hit the news as far back as 2001 when Gallup surveyed 1.4 million workers via 100,000 divisions in North America and Europe they discovered that 17% found work satisfying, 63% were not committed and actively looking elsewhere
20% were disenchanted, disaffected and often militant in expressing dissatisfaction.  Also reported at this time, 80% of men and 71% of women are unhappy with the number of hours they work (source: Economic and Social Research Council, 2001) and 72% of managers are criticised by family and friends for overwork. (source: Institute of Management).  All this resulting in a one in five chance of a customer interacting with a disaffected employee, and crucially, the loss of a valuable customer relationship.

A few years later the UK Work Foundation conducted an applied research programme with Sainsbury’s to discover the impact on P&L of a highly satisfied employee work force.  It focused almost exclusively on customer facing employees in the store and in contact centres.  The research unequivocally demonstrated a bottom line impact in profit terms to a business with ‘happy’ employees. 

In both these scenarios, there’s a common thread around the value of interactions, of customer interactions, of relationships formed, or what our accountants define as relationship capital or intangible assets.  These assets contribute as much as 70% to the share price of a company and yet there is no widely accepted way of measuring them.  A prolific amount of academic research is being done in this area, partly driven by mandates in the US Sarbannes-Oxley Act, created to er, prevent collapses like Enron and Andersens from happening again.  Interestingly, post mortems following Enron et al revealed ‘chatter’ in online groups predicted the collapses as far back as two years before with stunning accuracy of the people and companies involved.  What is the value of these intangible assets (‘markets are conversations’) given the cost of the company collapses to people’s individual wealth and careers?

Social media is most transformative when deployed inside the company and the implications of its use are far reaching because it creates network centric forms of self-organisation.  The financial savings derived from the removal of ‘organisation and management overhead’ are extraordinary. People forget that Google, Amazon, Facebook and Yahoo could not exist without Open Source software. Open Source software has been made possible because contributors are peers arranged   as a ‘flat’ democratised self-organising, self-directed network.   The single biggest story in 21st century ‘industry’ is the tectonic shift from command-and-control to peer-to-peer forms of production and collaboration which by definition, changes the very nature of capitalism.  Actually, to collaborative capitalism, but that’s another story. 

The tension that exists between these two models will continue for many years with a great deal of resistance from the incumbents for whom this kind of change is a step too far.  But globalisation between individuals rather than companies and nation states is unstoppable and some people will need to be dragged kicking and screaming; "The traditional theory of the firm is about the unitary, rational actor that more or less controls all the pieces of the puzzle that it needs in order to produce its outputs. Today global companies are a part of a huge set of interlinked networks across the planet.” Paul Kleindorfer, Director, Risk Management and Decision Processes Center, Wharton Business School.  In other words, value is being created by any means necessary, no longer dictated by organisational relations and boundaries.

It should be obvious by now to most people that social software changes people’s behaviour.  Most large companies try to mould employee behaviour in a wide variety of ways all of which try to raise productivity levels because higher productivity means more profit right?   With some intelligent, authentic approaches, companies can develop and design new ways of working, new models of work that massively raise levels of productivity by making layers of management surplus and irrelevant and at the same time, removing the primary cause of workplace stress. By enriching the employee experience with imaginative social media platforms, interactions and relationship capital can be measured, customers get the benefits of employees’ new levels of energy and enthusiasm, and the bottom line impact on P&L is dramatic.

I was told a story about BT’s response to an earthquake in Pakistan a few years ago.  There was a mission critical need to restore telecommunication transmitters that served both business and government in the entire region.  There was no time to implement formal project management disciplines.  A leader was appointed and given carte blanche permission to select the resources needed and manage an open ended budget.  This leader built a network of expert volunteers from around the company, devolved decision making right to the edges of the project and gave groups of people permission to make decisions ordinarily made by weekly steering meetings.  BT in effect, adopted a network model of project organisation and delivery, a peer-to-peer model of working.  It was at that time, BT’s most successful project in every department; under budget, delivered early, few errors, no re-work, operationally stable.  After this, BT were quite happy to continue with prevailing project management practices; over-budget, late delivery, scope creep, and so on.  Why does it take a crisis to perform this well, and is it possible to make this way of working the norm?

Well consider this.  “The future of a company depends less on the nature of it issues, and more on its capacity to invent social structures able to solve them”, Jean Francois Nobel. The adoption of social media in the workplace is of such strategic importance that it must start with discussions about behaviours and models of trust and end with debates about software and platforms.  That’s the point.

Classes of social software services

Julian Bond came up with a means of grouping social software into four core categories.  The services in each quadrant are by no means exhaustive.  However, I've found it helps to explain the different social media phenomena and how they relate to solving problems in the business world.

SwarmTeams is a special case as it enables people to form groups using techniques that mimic the biological & social dynamics of swarm intelligence.  The BBC has recently aired an amazing two part documentary, Swarm: Nature's incredible invasions.  The second film, One Million Heads, One Beautiful Mind visually captures and expertly describes how collective intelligence has made insects the most sucessful species on the planet,  but fails to ask the question: what if human beings could self-organise this way?  How useful is that to organisations today? 

Shameless self-promotion?

I'm amazed and honoured that after four years since publication, readers of Winning by Sharing are still being touched by its key messages.  At the risk of boasting here's an excerpt of an email I received a few weeks ago from a delightful film maker in America that would make any author feel it was worth while writing anything to get just one reaction like this;

I guess my "frustration", not lack of recognition, led me to do some research on the Web 2.0 movement. I wanted to find some common ground with someone or a group of people that could identify with how I was feeling about my job and my duties, and how the technological changes that are currently happening and evolving as we speak are opening and transforming the work environment and all the stuff that goes along with it. So I found your book Winning by Sharing!!!

After reading it I was like "right on!!!" You summarized it all in nice easy-read. I couldn't believe it, all of a sudden my perspective changed. I understood what was happening to me and why I was feeling frustrated. So it was a pretty awesome awakening and much more.... And perhaps that is the reason why I dreamt about you? My dream was about your book, it was about the message of your book, it was about the potential we all have to gain a wider perspective, it was about the opportunities that are available to all of us that are willing to "jump higher" while being propelled by thinkers such as you. You obviously made a pretty deep impression on me and my psyche. The dream was very symbolic and special.

Thank you!!

Thank you Daniela - you really made my year.

Workstreamr. Fractional work for corporations

Stowe Boyd has started talking about his new venture, WorkStreamr. If this platform, especially when used by corporations, can "tell me something or somebody, I didn't think I needed to know", then it could quite easily become a de facto means by which companies execute all their projects.  Furthermore, if it's able to identify available resources to work on projects both inside an outside the company, then it can enable fractional work or the next small thing!  That is, people on demand. The value to companies of all sizes is almost incalculable because it can dramatically reduce the salary bill - making it kind of 'just in time" - a variable cost, rather than a fixed cost.

Free is easy. The rise and fall of networked societies

Update on 7th April 2008.  Two contrasting views on free social software;

Free is killing us - blame the VCs & Chris Anderson's Free. Why $0.00 is the future of business (complete 'noise' IMHO).

There’s been a lot of chatter recently about Facebook’s drop in growth marking some kind of turning point in the world of social networks.  Opinions vary from ‘people are all networked out’ to it’s a ‘cycle of life’ thing.

In 2006, I read a paper called ‘The Rise and fall of a networked society: A formal model.  Very academic, mathematical and difficult to decipher.  I meant to write about it then but got busy and filed it under ‘material for blog’.  A friend reminded me of the article in a recent email conversation thread on The Influencers are Influenced (more on this later). Then this week, Thomas Power told me that Ecademy had seen a surge in registrations (apparently so has LinkedIn) and he couldn’t understand why. 

In the early days of social software (when I worked with Ecademy) the academic literature was mostly theoretical. In the last few years a lot of (anonymous) social software data has been made available to academics.  Actually, it’s possible to gather data without the explicit cooperation of the provider. So this paper and others supporting its findings are based on real data.

In this study the scientists seek to understand the statistical properties of social networks so they are able to predict their behaviour.  The findings can be summarised thus;

• Networks in a steady state are easily excited by external forces (they call this meta-stable), just like ice molecules can be melted by an external force called heat. 
• External events trigger the growth or decay of a network. Sometimes these can be very slight changes in the environment
• Sometimes the timing of this trigger can be predicted (using the science of wave and phase transition theory)
• Dense networks (like Facebook) become increasingly excitable and frequently ‘break up’ into smaller clusters, although dense networks are far more effective for (personal) search

It was recently reported that 37% of Facebook’s traffic is derived from third party applications.  So it should come as no surprise that behaviour change is taking place as people discover each other in smaller, more diverse clusters.  This helps to explain why other networks are experiencing growth at Facebook’s apparent expense.  It’s sheer size and presence has educated individuals, in the same way Youtube has forced TV companies to re-examine their business models.

One final point.  Free is easy. Paid for is hard. 

The reason there may increased interest in Ecademy from UK media companies is because it actually makes money, and not from advertising.  It doesn’t have Orkut, FriendsReunited or Facebook’s scale, but it has achieved something few (if any) social networks have achieved:  Creating something of sufficient value that people are actually prepared to pay for.  This is different, and it is difficult to achieve beyond most people’s imagination.  Let's hope potential suitors don't destroy that value with  their frequently oppressive command and control mentality.