Pistols at dawn: Om challenges Zuck – and looks ahead

Image representing Om Malik as depicted in Cru...

Image via CrunchBase

In a strong and curious post, Om Malik takes Mark Zuckerberg to task for his FWD.us push for immigration reform – while many of the titans of Silicon Valley have gaily signed on. The Zuck manifesto is here: http://www.fwd.us/immigration_reform.

It’s hard to argue with the initiative itself, and that is not quite what Om is doing. He’s raising the questions that in polite tech society one is not supposed to raise, about the fate of flyover country in post-industrial decline, and the naked power of those who control the new economy. How’s this for a contrarian claim: “Sorry Mark, but in the age of data, Facebook is Standard Oil and you are Rockefeller. ”  And as Om notes, there are plenty who work for these new knowledge companies who do not get invited to the parties and given free iPhones. What about them?

It’s a plea for comprehensive engagement in the social-political implications of the knowledge revolution. But, of course, as we have noted, that is not how Washington works, where comprehensive and integrative and long-term get no votes. To the extent that the Valley’s efforts to win attention in Washington have had success, they have fit neatly into its approach (with the single, glaring exception of the SOPA revolt; and even that was a fit since Washington knows about take-downs, novel though the methods involved were). Whether the disruptive emerging industries will be prepared to engage with the policy community to address the vast impacts of their disruption poses an interesting question, at a time when neither one nor the other seems interested. If Om Malik is interested, we should all be.

Oh yes, here’s my take on the Washington/Valley divide.



Why I have issues with Mark Zuckerberg’s FWD.us — Tech News and Analysis.

Brands will shape Global Labor Standards: Apple-Foxconn Company

Tim Cook, Apple COO, in january 2009, after Ma...

Tim Cook, Apple (Photo credit: Wikipedia)

When Apple signed on to Fair Labor I wrote a column in which  suggested that the logic of their decision – a big shift in approach post-Jobs – would be to bring about alignment between western and  Chinese labor standards. Nothing that has happened since has changed my view. Not that this will happen overnight, of course. But it’s the result of several potent forces that are shaping, not least, this company’s effort: branding and global communications. Whereas these forces twisted the unwilling arm of Nike what seems a long time ago, the superlative quality of the Apple brand and the explosion of social media are together pouring gas on the flames.

While it has been traditional to label western brand efforts to ensure decent manufacture conditions for their products as “corporate social responsibility,” the logic of the Apple case demonstrates that it is naive to see CSR as an adjunct effort, or a marketing ploy, or as anything other than central to value. It’s a case where the values-value connection (another theme of mine) is especially glaring.

The harrowing case of the Foxconn worker with severe brain damage, whose family is now going to the Chinese courts to seek to maintain full company support of their son, drives the point neatly (if tragically) home. This man is, as all can see, a de facto Apple employee, whose conditions of service are so far removed from those of the guys at HQ as to be hard to compare. As his family struggles to ensure that he has long-term care after an undenied industrial injury, they have a bullhorn to the world, and that includes the fashionistas for whom the latest Apple gadget is a must, and who have helped drive up its astronomical share price and stack up a mountain of dollars that could buy Facebook twice over for cash (or buy everyone on the planet a half-decent bottle of wine). As the technological gap, and the design gap, between Apple products and those of its rivals narrow, the brand magic is going to be even more key – and therefore even more exposed.

It was a smart move for Tim Cook to jump into Fair Labor, and then arm-twist Foxconn into big wage increases. It would be even smarter for them to leapfrog the moral/CSR competition and drive excellence in Chinese manufacturing and labor practice without needing to be pressured further.


Foxconn goes to court over severely injured worker | Business Tech – CNET News.

To the Bankers of Sibos: Integrate and Innovate from the Board down

Banking District

Credit: bsterling

The world’s global financial community’s annual bankers’ “Davos” should be a time for urgent reflection and remediation for our financial institutions.

It’s time for high-level integration for innovation – and that begins with the Board and the C-Suite of this very traditional set of institutions at a time of explosive disruption. They have a long way to go.

 “The past,” as novelist L.P Hartley famously wrote, “is a foreign country: they do things differently there.” When it comes to the future, we ain’t seen nothing yet. The pace of change is picking up very fast, and institutions – and whole industries – unable to keep up are finding themselves on the wrong side of history. 

Let’s be candid. Banking has never been everyone’s favorite industry. Hardly a customer has had a consistently happy experience on the retail end. And the events of 2008 have left a sour taste that may last a generation – like the losses that millions of citizens have accrued as a result. “Too big to fail” sticks in the craw of Americans of left and right – and makes capitalism, markets, risk, look ridiculous. It takes a lot to make Big Oil look good. And one way or another, the business-as-usual revolving door relationship between Wall Street and the Treasury/supervisory agencies and the Hill and the While House (donors . . .) is tottering. It may survive an election cycle or two. Not more.

So what’s ahead for the bankers? They are sailing into a perfect storm.

First, three potent waves they need to ride. If they don’t, can’t, won’t, then all the clever innovation ideas on the planet will not help them.

1. Service. Banking has to rebuild its brand from the ground up as a “service” industry that is actually seen and experienced as a service. Example: GEICO. Insurance is boring and costly. GEICO customers love their company. I called them the other day to sort out a problem, looked forward to it, enjoyed the experience, and am smiling as I recall it. Banking must be seen to be re-inventing itself as a service.

2. Shared. While “corporate social responsibility” (CSR) has now been almost universally adopted as an element in corporate strategy, by banks like everyone else, it continues to be handled by most players as an adjunct exercise. Michael Porter‘s notorious prognosis that “shared value” is properly the only source of value, incorporating the traditional bottom line and the “CSR” extra, has been treated with derision in private and sometimes in public. Banking must be seen as a leader in building shared value.

3. Social. “Social media” remains an outlier in most mainstream businesses, and barely registers in banking. Not only is social vital to customer service and marketing; more fundamentally it is emerging as the driver of innovation and the continuing renewal of corporate culture – which, as we know, is the cause of all competitive advantage and value creation. Banking must be seen to take the lead in social engagement.

Second, two (of many) special challenges coming their way.

4. Retail. Retail banking is ripe for dramatic innovation. It is almost entirely mechanical, and the perfect subject for machine intelligence. While we debate separating retail from banks’ investment operations, the former is peeling off in its own. The launch in the past few weeks of the Wal-Mart/American Express Bluebird debit-card based banking system is the first major shock. Look at the fee structure (to the consumer, there are none at all), the utter convenience (I opened an account online in literally 3 minutes), the services (huge range and they will be added). Traditional retail banking is ripe for collapse.

5. New currencies. This is more esoteric, and for another post, but from barter to Bitcoin the consumer need for standard money-based transactions has begun to shift. Just begun.

Third: What banking needs in the midst of all this and more is the skill-set it has so far shown it lacks above all else: flexibility, imagination, the capacity to turn on a dime, all those smarts that are distinguishing both New Economy successes and traditional organizations demonstrating themselves capable of re-invention. The core enabling capacity lies in a combination of board governance and executive leadership, and, specifically:

 6. Diversity across generations, genders, perspectives, and disciplines. I discussed this in respect of gender diversity and engagement in social media in an earlier post –  https://futureofbiz.org/2012/07/07/the-two-most-stunning-facts-about-american-business/

We know the problem, but to give an example: in a recent study American Banker found that of 9 large financial institutions operating in California 8 had boards that were at leas 80% white and 80% male. http://www.americanbanker.com/bankthink/board-diversity-greenlining-1039171-1.html

It’s unfortunate, to my mind, that gender diversity issue has been widely perceived as an issue of equity. It’s about value. And whereas in times of stasis a non-diverse board may have worked very well, in times of revolutionary change is represents the voluntary addition of a huge and indefensible element of risk to every decision. Boards and C-Suites need to represent diverse perspectives of all kinds. Only thus will these institutions designed to thrive in an entirely different environment have an opportunity to flourish a second time around in a dramatically different and ever-changing marketplace.

Otherwise, as Kodak and other failed and failing once-great companies like RIM are constantly reminding us, the market is unforgiving. Technology and other emergent forces are toppling the very assumptions that made old-style organizations successful. The logic of service, shared value, social media, and radical diversity at the top level, is finally the logic of the market.

My take? The next decade will see the disruption of financial services on a scale comparable with what has happened to print publishing in the last one. There is everything to play for. But thanks to Moore’s Law and globalization and other forces on the loose in C21, the clock is speeding uo all the time.



Sibos – Sibos – Osaka, 29 Oct – 1 Nov 2012.

Of Risk: Weather Threatens Infrastructure


Since success in biz and politics alike come from managing risk, it’s remarkable how bad we are at it.

This report in the NYT takes further the discussion we noted earlier (see below) on resiliency and risk in the context of the areas around Washington, DC, which were badly hit by recent storms.



Rise in Weather Extremes Threatens Infrastructure – NYTimes.com.

Sustainability, #CSR, and the Disconnects


One of my occasional anxieties lies in the fact that CSR has been such a success story that plugging it organically into the core strategy of major enterprises will actually get more difficult and not easier. The current evidence of deep disconnects between “CSR/sustainability” functions and marketing, brand, other departments drive this home.

Seems to me that logic is on the side of strategic alignment, and competitive advantage. That is, CSR properly tackled aids the mainstream and is not tacked on to aid corporate image (though aiding image over the long term is part of the package). Which is not to say that in every product or market this will be at all evident. It’s a gamble on the long term.

But not an unreasonable one. Social, transparency, growing brand subtleties, there are many factors driving things this way (Michael Porter may have over-stated things in his bombshell essay, but the right things).

Some good data and discussion below:

Your Sustainability Message: Not Enough Charisma To Light Up The Room?.

Facebook, Diversity, and Leadership in the C21 Corporation

In her latest Reuters column, Lucy Marcus (@lucymarcus) smart, suave authority on board governance, welcomes Sheryl Sandberg’s appointment to the Facebook board – as the first woman, and a second executive voice from inside the corporation. She also notes, though, that since Zuckerberg controls more than half the stock, when push comes to shove he will get his way.

The Facebook story will no doubt be used for case studies of several kinds as we move ahead, whether or not it justifies its vast valuation and survives into the next decade as the mainspring of social networking (both propositions, as I have argued before, to my mind highly doubtful).

4 key issues are raised here that go much wider.

1. It’s unfortunate that the term “diversity” has come to be associated with the need for women to be better represented in traditionally male preserves, and other ethnicities in traditionally white. There are indeed issues of equity to be addressed. But the core need for “diversity” on boards and in leadership more generally has less to do with gender and pigmentation and everything to do with perspective. Monochrome and monogendered bodies are far less suited to governance. And while that has always been true, at a time of rapid, exponential, change, it is risible that anyone could suggest anything other. Radical diversity of perspective is crucial to managing increasingly rapid change.

2. As Lucy Marcus notes, Facebook has shown itself out of step with the slow “spring” in corporate governance – both in board diversity and also, strikingly, in the old-style control that is built into Zuckerberg’s position. That is (in my words) we have a company presented as the key to the new social economy being governed like a Victorian family business. I am not without deep admiration for Zuckerberg’s creativity and vision; but it is his plain failure to understand this point that makes me most uneasy about the company’s capacity to weather the coming years. Such a concern is constantly reinforced by the plain bad decision-making that keeps flowing from the top. Latest: the ridiculous email switch this week – pitching 900 million people into unwanted email accounts.

3. What 21st century corporations need above all, and especially those driven by digital technologies and congruent social attitudes in constant flux, is an agile capacity for decision-making and responsiveness that will come only from deep and open-textured conversation at their heart – and candid social engagement across the organizational boundary. That is, contrarians need to be appointed to boards, and social engagement to reach far higher than the joke of a privacy referendum recently triggered in the aforementioned Facebook. Both contrarians inside and an open boundary with customers, prospects, and the wider culture, will prove worth more than their weight in gold; and prove key drivers of competitive advantage. Facebook has displayed interest in neither.

4. The core question is a model of leadership, personal and shared, for Century 21. The old-tyme Fordist models worked well back in the day – the Great Leader, the supportive and largely consensus-minded board of buddies, the trusting stakeholders/market. In all respects this situation is now history. Except that so many of our long-established companies are still trying to make it work. And leading allegedly new-economy companies such as Facebook, while they are driven by constantly exploding digital technologies, are striving to replicate a model that cannot thrive in the new context of constant, innovative disruption – while social is eroding the organizational boundary and shaping the possibilities faced by the corporation.

I see Microsoft as the last of the behemoth Fordist survivals. The titans of a century ago, Ford and Carnegie, would have recognized it, admired its founder, and generally resonated with his post-leadership generosity. Apple has straddled the models, driven by genius, and blessed so far by much good luck. Whether our focus is governance, leadership, social media, or social responsibility (to which Apple has slowly awakened through its sign-on to Fair Labor), the C21 company will look nothing like the grand successes of C20. Among the slew of first-generation digital behemoths (we can throw Google into the mix here), Henry Ford would just have been too much at home to give me confidence they can evolve rapidly enough to flourish rather than simply (if they do) survive.

And it’s notable that Rupert Murdoch, a C20 titan if ever there was one, discovered Twitter at the turn of the year and is engaging frequently and personally (you can tell; he can’t type well and keeps saying things that make his PR people cringe). Strikes me he may have it in him to adapt faster than Zuck. Sorry.


Is Facebook Doomed? https://futureofbiz.org/2012/06/04/is-facebook-doomed/

Facebook’s board needs more than Sheryl Sandberg | Lucy P. Marcus.

#Rioplus20: Jeffrey Sachs on the potential of #social


Jeff Sachs is not know for his temerity, and in this Guardian piece on Rio+20 he is outspoken in his criticism of the role of business in dampening democracy and undercutting the possibility of agreement on real change. It’s a serious interview and worth careful reading. Not everyone will agree with all his analysis, of course, but he is always a voice to be heard. It’s been my privilege to meet Jeff and I hold him in high regard.

In passing, he makes a comment about the potential of social media especially worth noting. His concern is that, since the basic business model is tailored ads, the net effect will be to draw us yet further into a consumerist society, response to marketing ploys and enmeshed in the ills of contemporary capitalism. Yet: “social networking has the power to break the existing power structures.” It does. I believe it will, in business and government. The process has barely begun.


Rio+20: Jeffrey Sachs on how business destroyed democracy and virtuous life | Guardian Sustainable Business | Guardian Professional.

via #Rioplus20: Jeffrey Sachs on the potential of #social.

via #Rioplus20: Jeffrey Sachs on the potential of #social.

#Rioplus20 “marks a beginning for the world”?


The UN Secretary-General has spoken in these ringing terms of the Rio event taking place this week – in which key world leaders such as President Obama decided not to take part.

My view is that we need to start over. The process is essentially running backwards. Whatever one’s take on the three core issues in the debate – whether the world is warming (looks like a Yes), whether humans caused it (lots of evidence, yet some smart people don’t buy it), and whether we can do much about it (hence Rio – and, note, the absence of key leaders, government and corporate) – we face growing issues of global risk (from financial collapse to nanobots) and the world needs to organize itself around sane and consensus risk assessment and mitigation processes. This issue is in fact one among many.

Here’s what I wrote after the Planet under Pressure prep con in April (expanding on the remarks I was invited to deliver). https://futureofbiz.org/2012/04/13/global-risk-planetary-pressure-and-rolling-down-to-rio20-2/


UN Secretary-General says Rio+20 marks a beginning for the world | United Nations Radio.

10 Amazing Facts about Twitter

Read more: https://futureofbiz.org/future/why-twitter-matters/

10 Amazing Facts about Twitter

1. It is far simpler than Facebook and yet has far more uses.

2. It is accessible from almost any point on earth and at any time.

3. It connects people and knowledge seamlessly.

4. You can have one-on-one chats with friends and strangers 24 hours a day, either in semi-public through @ messages or in private with DM.

5. It supplies me with a free staff of hundreds of expert researchers and communicators, whose chief delight day by day is to tell me what’s new and what to make of it.

6. Twitter relationships can lead quickly to real-life connections, and when you meet a Twitter friend IRL it’s remarkable how much you already know of each other. Whitney Johnson, author of Dare Dream Do, has called this TWIRL – Twitter – In Real Life. Twirl can be an amazing experience. That’s how I met Whitney! @johnsonwhitney

7. As knowledge is expanding exponentially – faster every day – only one thing can enable us to digest, focus, grasp, what’s new and important: The Miracle of Reciprocal Curation. Each of us scans what’s new for each other, in a mutual gift relationship that has enormous power. Twitter is the best mechanism for it we have yet devised. It’s a Reciprocal Knowledge Engine.

8. A Reciprocal Knowledge Engine is key to enabling us to scan the future, as the future is coming in faster every day.

9. Every corporation and government can use Twitter to engage one-on-one with customers, prospects, and citizens. Forget focus groups and traditional market research. And turn elections from 2-yearly, 4-yearly events into continuous engagement.

10. Twitter opens the organizational boundary of the corporation. We now have two-way communication – the key to transformation in every institution, as the values of customers and employees sync – and customer needs reshape corporate culture.

Read more at https://futureofbiz.org/future/why-twitter-matters/

Has the Social Media #Bubble Popped? #sm #IPO #Facebook

I posted earlier on the debacle of the Facebook IPO and some longer-term considerations in respect of the valuation and staying-power of these early-generation social media brands. And they are early-generation. Part of the problem we are facing is that we are in the throes of exponential change. One thing that means is that we have faced dramatic shifts, which we are tempted to see as lasting and offering us a fresh gently-rising plateau as we look ahead. The fact that the exponential, disruptive bombs are getting bigger every day is too hard to grasp. So we don’t try. So we behave dumb. (Yes, there’s a book there to explain what I’m on about; and yes, I am working on it, so there. Back off, plagiarizers, but join the convo!)


1. In general, this is early early days. Which makes future-scoping (a) very hard, and (b) very necessary. More of both (a) and (b) every day.

2. We’re talking about the brands/companies that have been quick out of the box in, essentially, social media round 2. Round 1 was shaped and dominated by AOL; its curious corporate survival and the bizarre Time takeover blur our capacity to reflect on how  revolutionary was Steve Case’s invention ( which has pretty much defined everything social since; Zuck owes him big. . . .). The key brands of the past decade have been awarded huge valuations on the naive assumption that the barriers to entry will remain high and that interoperability and utility status is not around the corner. Yeah, right.

3. As we look ahead, we see multiple converging streams that include “social” a la Facebook, social marketing leading to profound shifts in “social business,” CSR/social enterprise parallel and convergent developments as a subset of the foregoing, Gov. 2.0 (3.0), wholly new developments in global governance (of which more in another post), and . . . well, point is, we have just begun. It’s why Facebook and Google, qua biz model and tech trailblazers, are so important. It’s why, qua brands, they will be proved to have been relatively insignificant.

4. While we are at it: Facebook’s curious upcoming vote on a privacy change reminds us that, ultimately, social networks will be mutually owned and driven by crowd-sourced decision-making. I am actually astonished that Zuck (whom I greatly admire) has not tumbled to this. But one thing one learns is that innovators are often successful precisely because they don’t see most of the context, rather than because they do.

The future is social. But that social is not ad-driven, privacy-destroying, IP-wielding, reaping economic profit. It is in general mutualized, open-sourced, and ultimately a thrilling constantly innovating utility environment for much human activity. Getting there is messy, but since when was getting anywhere worthwhile not?





The Social Media Bubble has Popped.