I attended a webinar sponsored by the Society for New Communications Research last week where Charlene Li presented an overview of her new book “Open Leadership: How Social Technology Can Transform the Way You Lead.”
In it, Charlene claims that the emerging growth of social media will have far-reaching implications on business and requires a new mindset around leadership. Given that the theme of this blog is leadership, I felt compelled to write this post.
While it is true that we are at the very beginning of the social media journey, it is equally true that, despite the hype, social media is not a fad, and many successful companies are already seeing concrete and tangible results (and while most of these early successes are in B2C, many B2B companies, including my employer, are experimenting).
What has been intriguing me for a while are the broader ramifications ‘social’ will have on companies’ entire value chains, beyond just marketing (where arguably most of the attention is today). I want to illustrate a simple example that will hopefully bring this to life.
At its most abstract level, most companies today have a very nicely defined and linear value chain. You first innovate and produce (whether it is a product or a service offering), you then promote and sell your offering and finally support your customers. While there are obvious inter-dependencies between these steps, it is a fairly linear and structured process that has been in existence for centuries.
Enter the world of social media, and this structured and linear value chain quickly turns into an ad hoc value network (or knot depending on how you execute). My premise that is the emergence of ‘social’ in business will cause a fundamental shift in not only how companies engage with their ecosystems (customers, partners, and employees) but will also wreak havoc on the current business processes and organizational structures that have served us well in the past.
Innovate and produce: Imagine a world where market intelligence is crowd-sourced, where customers and partners truly co-innovate (Innocentive-an SAP partner-has been experimenting with this model for the past few years), and where market success can be almost guaranteed before you even start to assemble your first widget
Promote and sell: Imagine a world where your users not only influence strategy and promote your offering, but help you accelerate your time-to-market and help you reach audiences you normally would not be able to reach
Support: Imagine a world where your customers help each other solve their support issues, and where your (significantly smaller) support department feels likes the Maytag man in those famous US commercials
Now imagine trying to understand the implications on your business processes (from innovation all the way to support) and organizational structures, when the same customer can simultaneously become an extended arm of your innovation, marketing, sales, and support organization.
Are we ready for this transformation? I would argue not even close, although I am very encouraged by the number of very smart people that are thinking through these issues and experimenting across both academia and the business world today.
As usual, I welcome your comments and thoughts.
PS. Yes, I am starting to read Charlene’s book