Tom Friedman had a good article up in the Sunday Review Section of the Times in late December on the implications of “the merger of globalization and the Information Technology revolution”. The crux of his reasoning and conclusions lies in this quote:
The days of leading countries or companies via a one-way conversation are over,” says Dov Seidman, the C.E.O. of LRN and the author of the book “How.” “The old system of ‘command and control’ — using carrots and sticks — to exert power over people is fast being replaced by ‘connect and collaborate’ — to generate power through people.” Leaders and managers cannot just impose their will, adds Seidman. “Now you have to have a two-way conversation that connects deeply with your citizens or customers or employees.
Netflix had a one-way conversation about raising prices with its customers, who instantly self-organized; some 800,000 bolted, and the stock plunged. Bank of America had a one-way conversation about charging a $5 fee on debit cards, and its customers forced the global bank to reverse itself and apologize. Putin thought he had power over his people and could impose whatever he wanted and is now being forced into a conversation to justify staying in power. Coca-Cola repackaged its flagship soft drink in white cans for the holidays. But an outcry of “blasphemy” from consumers forced Coke to switch back from white cans to red cans in a week. Last year, Gap ditched its new logo after a week of online backlash by customers.
Tom calls it a problem of one way conversations. He’s spot on. And he cites kerfuffles that many of us are all too familiar with.
This morning, I dipped into the Social Business Atlanta Summit twitter stream, organized by the super smart Brent Leary. I encourage you to take a look at the hashtag on Twitter but this comment made by GetSatisfaction Executive Jeff Nolan and syndicated by Paul Greenberg (both fellow Enterprise Irregulars), stuck with me:
So how do you have a two way conversation as Tom suggests and move customers to the core, as Jeff says?
You do it by being connected to your customers in the public forum and on your customer communities, of course. But also making sure that your employees and partners are as wired internally to collaborate across the entire engagement chain. The kinds of pickles that Tom describes above emanated from different spark points across the organization. Sometimes the root cause is in marketing, other times its a product design issue and other times it could be a logistics problems. All these constituencies need to be connected to the customer and to each other if were going to get anywhere close to a two way conversational model and putting their needs “at the core of it all”.
Neither that two way conversation nor customer centricity will come from your traditional ERP or HR or CRM systems, alone. It comes from having a collaborative fabric (and social software) that transcends the work done in your process systems and data served by your performance and analytics systems by connecting people who are silo’d by a functional organizational design. Today’s customer expects us to break old notions of front and back office, or primary and support activities made famous by Michael Porter’s value chain framework that most large organizations subscribe to. SuperVALU is doing it, Toshiba is doing it, Target is doing it, Spotify and WebTrends are doing it. The list goes on.
To be clear, I’m not advocating that you throw these process systems out. They are your systems of record. I’m saying you need to cut through them with people engagement layers.
Coca Cola didn’t turn the cans from red to white because they were bored – they thought the customer would like it. But they didn’t tap the network effectively to test their hypothesis. Similarly, Bank of America probably thought that 5 bucks, the price of a morning venti Mocha, won’t matter. It did and the jokes on them for not testing the idea first which is dead simple in todays socially networked customer world.
As executives trying to understand what information flow and people connectivity in the 21st century means means to you and your organizational performance objectives, its the very concepts around social and collaborative approaches that become the central design theme for such-directional connectivity to keep your employees, customers and partners in synchronicity.
I’m not a fan of overtly revolutionary / FUD’ish tones on why you will be forced to embrace social and collaborative ways of work. True – it sometimes takes catastrophes to give us the needed kick in the rear to change how we organize and share. 9/11 was one such catastrophe that made governments re-think how they share intelligence. And for many Heads of State and politicians, WikiLeaks was another that also led to design change. But it doesn’t have to be so. Get ahead of it and start understanding how traditional process technology has shackled knowledge, data and content into silos and how simple engagement platforms can free the best talent up, to rally around business objectives and customer needs.
The snafus that Tom describes occurred not because of the social web. But Tom’s post supports the notion that the customer / purveyor contract has changed thanks to the social web which gives prospects and customers organized power to voice opinion and that we need to adapt accordingly.
His list of public, and even market-moving failures above, will sadly remain a dynamic one. So enhance your process-laden one way communication at customers, with conversation synchronicity across customers, partners and employees so you’re not in his sequel post any time soon.
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