The Real Point about Social: Value and the Culture of the Organization

Aside

It’s unfortunate that I wasn’t able to be in Milan last week for the Social Business Forum. Aside from the fact that any reason to be in Italy is a good one, the Forum brought together some of the most illustrious names in the social space together with major corporate players. See the valuable links below.

Reports from the Forum plus my own participation in SOBCon in Chicago a few weeks ago and last week’s Tech Policy Summit in Napa have focused my thinking on the question of “corporate culture.” It’s a term we use lightly though we know its import is huge. Many are the mergers that have failed for lack of matching cultures. Culture is an extraordinarily difficult thing to shift. It is difficult enough even to define. For a terrific book-length exploration, see my friend Naomi Stanford’s Corporate Culture: Getting it Right (published by The Economist). For the moment, a simpler reflection.

Let’s look at the two core aspects of the digital age in which we are working.

1. Change, innovation, Moore’s Law – the marks of products, markets, and the context for both are shifting; in many cases quickly, and in all cases faster than they have ever before. The more digital the effort, the faster the actual or potential change. We know this well. We forget it every day. It is more important, more disruptive, more full of potential value, than almost anyone has realized. Only by looking back will you see.

But the same tech revolution is bringing us answers.

2. The disruption of communications, marketing, sales, all aspects of the company’s interface with the wider world (and B2B as much as B2C, though that is not much grasped) is also the corrective. For the business significance of social is to open the steel barriers that we have erected around the organizational boundary to enable coming and going with that party for whom the entire enterprise exists: the customer. Not the customer as defined by marketing departments and product designers, by focus groups the kind of polling that still leaves most new launches a failure, but the actual customer, the end-user of the fruit of the business effort, that living, breathing, tweeting, Facebooking, always changing, creature in whose hands lies the power of success and disaster.

Social marketing has recognized this, even though it is in its infancy and we keep reading bizarrely unworldly statistics – like only 10% of CIOs are on Twitter, or the average Facebook page is only change twice a month, or 69% of B2B companies have no systematic way of tracking the gold dust which is social feedback (I’ve blogged about each of these; go search if you are interested). Point is, we are ambling along toward a social understanding of marketing and customer relations. We have hardly even noticed that the key to revamping corporate culture – the value holy grail in the context of disruptive change – lies also exactly here. For what social has begun to do is connect corporate culture with the culture of the market. And it is precisely in the alignment of those two that there lies competitive advantage.

http://www.socialbusinessforum.com/

http://www.socialfish.org/2012/06/can-social-business-reshape-the-organization.html

What social business is. And isn’t. | johnstepper.

#Facebook and the #IPO again . . . @Wadhwa ‘s latest salvo

Aside

Vivek Wadhwa has emerged as one of the sharpest critics of conventional wisdom at the meeting-point of innovation, business, and finance. As entrepreneur, biz school prof, and now leader at the NASA-hosted Singularity University, he has plenty of street cred. And he is also a ferocious writer.

His critique of the IPO model is timely, and Facebook offers an example too good not to address. As he points out, they now have $16bn on hand for new tech and acquisitions; on the other hand, they face market pressures to deliver profit and growth that in their innovative space will unquestionably be hard to reconcile with the “social” purpose they have set – and on which, a la Catch-22, hopes of long-term success probably lie.

I’m interested in examples of innovative financing and governance that straddle the IPO/private/acquisition/nonprofit standard options. I think they will emerge at the interface of social, social enterprise, and new technologies. Perhaps in Facebook’s successor.

Don’t get tangled in the IPO yarn – The Washington Post.

#Groupthink – public enemy number 1 as we face the future

Posted on June 8, 2012 by Nigel Cameron

Groupthink hasn’t worked, it’s time to embrace the maverick

Giving credence to the outlier thinkers in our midst might have avoided things like the Wall Street crash. Photo: AP

As the Arab spring continues to unravel into an Arab summer, the most important lesson is that hardly anyone knew it was coming. Much like the collapse of the Soviet Union, and Wall Street could it be that as much as conventional wisdom may be conventional it is not always reliably wise?

I recently hosted a conference in Washington on the future of nanotechnology. All kinds of experts were round the table talking tech and policy and business. Then one of them made a stunning statement. She was there on behalf of a big, mainstream environmentalist group. “I have never,” she stated, “been on such a diverse panel in Washington.”

There was a brief but palpable intake of air around the room. I thanked her for the compliment before adding that I was now more concerned for Washington than I was before.

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Whom do we invite round the table when the questions are big and the stakes high? It tends to be those in the centre; the mainstream thinker whose wisdom is regarded as conventional.

When will we ever learn? We are still paying for the lesson we learned from Wall Street in 2008.

Conventional wisdom can be dead wrong, even in the hands of the smartest people because they tend to agree with each other. People with way-out views are kept at arm’s-length.

Whatever the issue, if your views deviate too far from the mean, however articulate you may be, you are unlikely to get invited, funded or promoted.

We have learned a lot this past generation about the value of diversity in age, gender, and ethnicity but we have learned little about the enormous and growing value of diversity of opinion.

Of course, we do disagree about a lot of things. With friends, and with co-workers. But we live in communities of ideas that set boundaries around acceptable diversity of thinking, and make sure we keep out those who challenge our shared assumptions.

We don’t want to rehash old issues we regard as closed. We don’t want to give room to opinions we find deeply objectionable – or threatening. Most of us find it challenging to take forward our thinking when there is someone in the room always, always asking why?

So our natural tendency is to put unconscious faith in Groupthink, the tendency for everyone’s thinking to move in the same direction to the exclusion of any serious questioning.

People in management know all about this as a problem for work groups and other teams. But it is more insidious and far more dangerous on the grand scale.

What brought Wall Street down, and with it threatened the entire global order? The G-word. And on smaller scales: what led Monsanto into huge losses in the late 1990s and ensured that Europe rejected genetically-modified food? What led Detroit to near-oblivion as they insisted on producing 1950s-style autos into the 21st century? What about the power company TEPCO and the nuclear disaster that the entirely predictable tsunami sparked in Japan?

Knowledge is building very fast, disciplines are converging, globalisation is changing the ground-rules of everything. Change powered by Moore’s Law, the digitisation process and the revolution in communication is driving shifts in the technical, economic and social order that most of us strain to grasp. Yet the faster change takes place and the greater its disruptive, innovative power, the harder it will be to make good choices.

So who should be party to the conversation? This is where the outliers come in; people who are articulate and serious, but outside the mainstream assumptions that generally drive conversations. Experts tend to resist the participation of thosewith unorthodox opinions. It needs to become the norm for them to sit round the table in every discussion. All articulate voices round the table; all the time.

This approach is hardly new. The century before last, US poet, essayist and journalist Walt Whitman asked the question his own way. “Have you learned the lessons only of those who admired you, and were tender with you, and stood aside for you? Have you not learned great lessons from those who braced themselves against you, and disputed passage with you?” In the 21st century, great value lies at the extremities of opinion; and we need to harvest it as we move through change faster than we have ever known before.

First appeared in the Sydney Morning Herald, June 9, 2011.

Is #Facebook Doomed?

Posted on June 4, 2012 by Nigel Cameron

Perhaps the strangest feature of the Facebook Phenom is how pervasive the network has become, how much time so many people spend on it, and how little we actually talk about it. This is a taproot of the crisis in valuation that has led the stock to sink today down above the $26 mark. I’m not bearish, at least in the short-to-medium term, as Facebook is making money and may yet find ways to make a ton of money. I’m more, shall we say, weirded out by the whole situation.

I’ve touched on this before, but to sum up and move along a bit here are some key statements I would wish to defend:

1. In general, I’ve argued that social media will soon be utilities, interoperable, and therefore not capable of generating economic profit or, in consequence, justifying these very high valuations. The future is not an AOL-style walled garden named Facebook with X billion inhabitants.It is something a lot more like the USPS. Or the power grid. I don’t know how long “soon” is. But it’s soon.

2. Back to my point about lack of discussion: My suspicion is that most of the enthusiasm for the Facebook Phenom has come from two groups: Generally older people who have little first-hand experience of social media (little, not none) (Group 1); and much younger people whose entire experience has been decisively shaped by one social medium, namely Facebook (Group 2). Group 1 has generally looked to Group 2 to confirm its sense that the Facebook Phenom is a big, big deal – whether their kids or the youngest people on their staffs. This scenario offers, at the least, a rather dire approach to risk management.

3. In the article linked below, an analyst has pronounced that by 2020 Facebook will have gone the way of Yahoo – still likely a profitable enterprise, but with far lower value and in a position of strategic insignificance. He is probably correct, although his focus on the problematics of mobile may be wrong. We all know that the shift to mobile, which is more rapid than anyone expected, has proved challenging as ad revenues are much more difficult to come by in the mobile environment. My suspicion is that Facebook like the many other companies caught in the same situation will come up with some ideas that work, even if they are not obvious today. In parallel, the shift to mobile may help power the move (which I see as highly desirable and in the long term inevitable) to subscription-based social that is protective of user privacy. And, at root, while ads make a lot of sense in search, they make little in social. There are other ways in which companies can occupy social space (branded high-end content will become increasingly important, for example), but if you want to see your friends’ pics you are not ever going to be that interested in clicking links for autos.

4. Sorry, many smart people, but the idea that Mark Zuckerberg‘s very clever development of the Aol/MySpace enterprise will end up as a multi-billlion-member walled garden I find risible. Aside from the glow already fading from what was once almost (never quite) hip, as granny signs on, there are just too many reasons why barriers to entry will fall (or be knocked down by regulators) and basic social become part of the comms wallpaper.

Which draws attention to what I find enormously creative and popping with potential about Twitter. Facebook is very complex, keeps getting moreso, and has really only one core role. Twitter is very simple, has stayed that way, and has many roles. It’s the pathway to tomorrow. Which is one reason I hope it can be saved from the Facebook IPO fate by something a lot more creative in the financing/governance arena.

http://nigelcameron.wordpress.com/future/why-twitter-matters/

Facebook Will Disappear by 2020, Says Analyst.

#Apple CSR #Strategy – #Risk risk risk

Posted on May 30, 2012 by Nigel Cameron

Triple Pundit has just published a strong critique of Apple’s approach to corporate social responsibility.

The leadership point is especially telling (see my post earlier today), but in general what this sharp series of points suggests to me is that with the passing of the baton a fresh approach is being explored that has yet to find its feet.

Any company so dependent for its high profits on its reputation should be first in line to address all of these concerns and others also. It should also consider, seems to me, whether taking over Foxconn or developing a joint venture in which it was the senior partner might nor prove a more aligned and coherent way of addressing the huge issues that its reliance on Chinese manufacturing has begun to raise. To be able to address these issues within rather than outside the organizational boundary would shift their status and character in a way that could only help Apple going forward.

5 Reasons Why Apple’s CSR Strategy Doesn’t Work.

#Facebook being dumped, says Reuters: What’s the real issue? Well, there are 3.

Posted on May 21, 2012 by Nigel Cameron

US STOCKS-Wall St rebounds, but investors dump Facebook | Reuters.

Whether Facebook is “worth” $100bn or (as one serious voice suggests) $30bn is neither here nor there – unless, of course, you bought your stake on Friday. The P/E ratio is way out of whack with comparable companies like Google – though, as can be plausibly argued, Fb is on the way up and its biz model has yet to be fledged. But that (see below) is at least as big a problem as it is an explanation.

To my mind, three issues are at stake here.

1. The deeper we move into the digital economy, and the more digitally-powered a company or product is, the faster we may expect the forces of innovation to do their terrible work. That is, companies such as these are already aging fast. I was much amused by the blogosphere discussion last year – as IBM’s remarkable 100th anniversary was being noted – of “which great companies will be around 100 years from now?” The innovation process is not building vast new brands to take the place of those slipping into the sinkhole of the “old economy” 20th century. It is developing pathways of creative destruction along which products, services, brands, companies, will flow with less and less friction. Facebook may yet prove a cash cow before it goes the way of all cash cows. I’m doubtful. But whatever the future holds, the exponential character of digital disruption will ensure it holds it more quickly and more briefly than we would anticipate. (AOL. MySpace. Oh, I know it’s different this time. It’s always different this time.)

2. More specifically, while Mark Zuckerberg has proved remarkably adept at driving his vision and pulling around him highly competent executives to enable it, the Murdoch-style governance structure that gives him enormous power in the public company and its sparkling but remarkably undiverse board do not bode well. This is not the place for a catalog of questions around privacy and business models; suffice to suggest that the lock-down approach that has been adopted is not well-suited to rapid adaptation and response in a rapidly-changing environment. How well the founder’s vision of a company intended for social good that only incidentally plans to make money (I hope that’s a fair summary) will cope with market pressures raises a related set of problems. It is a thousand pities that (as I have argued before) a more innovative and appropriate model than IPO was not developed that would secure the social purpose of Facebook.

3. Three specific factors convince me that within X years we shall not have, say, 3 billion members of a Zuckerberg walled garden. One is interoperability, and the fact that technologically the social media experience will fast become a utility in which hacks and competitive requirements destroy the moat around the castle and in the process the option for economic profit. Second, perhaps through the deployment of anti-trust measures, global governments will not permit the emergence of a Facebook that essentially serves as a private planetary telecommunications and postal system of several billions of members reporting to one man in an office on the West Coast of the United States. Third, and more simply, while Facebook was created for college students it has been driven by teens. Teen culture moves on. And with it the culture of cool. Now everyone’s mom, dad, and grandparents are being recruited to Facebookland, it will be no hard task for the Next Cool Thing to do its thing. Oh yes, barriers to exit are presently high. But that sure isn’t cool either.

Guys, innovation in Century 21 is all about change and disruption. It’s a really bad time to be making bets on the future of terrific inventions and great new companies that have yet to deliver. Which is another reason why the IPO model, as applied to entities like that one, may have had its day. IMHO.

California’s Golden Opportunity – #innovation #China

Posted on May 13, 2012 by Nigel Cameron

Dire budgetary news from California has become as tedious and predictable as the latest on its educational failings, tumbling from the top ranks of American higher education to way down the rankings. We know part of the reason, which is tax initiatives that ave crimped the state’s ability to undergird what were once world-leading educational initiatives. There are of course other reasons, which include dumb teacher unions and state representatives unable to offer leadership.

But there is a wider point to be noted. California stands ready to serve as the linchpin of the emerging global Pacific order; the U.S. representative that offers the fulcrum to the Pacific states as the world’s leading center of entrepreneurship. Is this happening?

Silicon Valley, earth’s chief creative organ, is as detached from the Pacific as it is from the continental body of the United States. Its denizens need to discover interest and enthusiasm for both the polity of their nation and the opportunities of their ocean if they are to take the lead in the most consequent generation that earth has yet seen.

Huge New Shortfall Predicted in California Budget – NYTimes.com.

#SocialEntrepreneurship, #CSR, and the #Imagination

Posted on May 10, 2012 by Nigel Cameron

I was delighted to join the Ideation conference in Chicago earlier this week, and can do no better than link with @tonyshen’s 22 learnings which sum up the impact of a series of terrific presentations from some of the most brilliant people in the social enterprise scene and its environs (link below). Charles Lee and my friend J. R Kerr curated a winner.

What fascinates me is how many moving parts we have in the values/business arena. Social enterprise (SE) itself covers a range of nonprofit and profit-seeking efforts in which social good is the goal, or a substantive part thereof. Then we have corporate social responsibility (CSR). Here our point of departure is within traditional companies, who seek to deliver social good (not my favorite expression, but let’s use it anyway) either to assuage the conscience and meet the charitable interests of the company/founder, or to spruce their brand, or at a more fundamental level align mission with other than directly profitable goals; or, as in Phase 3, to build “shared value,” as Michael Porter has called it, in which these goals are in the long term precisely aligned. A more modest but similar case was made in the report commissioned from McKinsey by the Committee for Encouraging Corporate Philanthropy, which despite its somewhat Victorian name was founded by Paul Newman and operates the key network on CSR within the Fortune 500 CEOs. (Pursue that at corporatephilanthropy.org – the report is a great read.)

The logic of “shared value,” as I pointed out in a commentary for the U.S. Chamber of Commerce, is the end of CSR. No more “triple bottom line,” just a bottom line. Porter’s proposal has been seen as outlandishly optimistic by some, but his essay offers a thought-piece that I believe we need to wrestle with as we look ahead at how sustainable value will be built in the emerging social-cultural-economic matrix of C21. Ironically, the most prominent funding of social good, by far, is coming from the Gates-Buffet-Soros old school of Carnegie-style philanthropy – giving away the riches won through business. So all three types of are operating in parallel.

But there’s a third category that needs to be noted in this meta-conversation: the need for innovative financing and governance models to be devised in response to the vastly innovative technological (and social) developments of the digital revolution.

Jimmy Wales’ Wikipedia offers (so far as I am aware) the only major project of the digital era that has struck out in another direction than IPO-dom. We need more. Google should have. Facebook should. The pressures of the market are not necessarily the ideal environment for the development of visionary, values-driven efforts. As Mark Zuckerberg wears his hoodie to Wall Street, we may well wonder why something as radically innovative as Facebook is beholden to the funding and governance system that sustains the enterprises of the “old economy.” That is, can innovation not run right through the system? Ahem, alignment?

Seems to me that we have here 3 more silos: social enterprise in various shapes; the three-fold CSR package; and innovative, generally digitally-driven, companies. We need above all a meta-convo that will bring these efforts round one table to focus these brilliant, diverse, projects for social good – and, in most cases, also for profitability.

The future? Moore’s Law, social media, globalization – these and other inexorable forces are re-shaping the landscape. It would be fun to work on some scenarios for 10 years’ time.

My take on Michael Porter’s proposal on Shared Value: http://bclc.uschamber.com/blog/2011-06-30/one-our-greatest-business-gurus-redefines-capitalism-perhaps

22 Hacks & Perspectives for Social Entrepreneurs | MOVEMENT 121.

We are now Post-IT: the Problematics of the #CIO – #CFO #CMO too. Chief Knowledge Broker.

Posted on May 9, 2012 by Nigel Cameron

Some weeks back we discussed the fact that Fortune 250 CIOs have remarkably limited engagement in social media. Indeed, it is so remarkably limited that there should be a slew of vacancies – once their bosses work out what is (not) going on.

Now comes a report that both underlines the seriousness of this situation for companies with an interest in the 21st century, and partly explains it. 42% of major company CIOs report to the CFO. In smaller companies it rises to 60%. Plainly, in half our corporations we are working with a depressingly old-economy model in which the CIO and the IT team are seen as technicians placing and maintaining the interconnected typewriters and filing cabinets which constitute the comms/data systems of the firm. Routine stuff, to be kept under the spendthrift thumb of the spreadsheet guy. (Really, who could make this stuff up?) So: CFOs have a major role in CIO recruitment as well as supervision and budget. And they are hardly likely to demand personal engagement in social media (what’s that?). If 4/250 CIOs blog, the proportion for CFOs is probably well under zero.

What these studies have highlighted is a cavern of unawareness deep in the heart of half our companies (at least).

My take? There shouldn’t be a soul in the C Suite who is not personally splashing around in the social space. If that sentence were taken to heart in the bastions of the U.S. corporate scene, it’s hard to conclude they would not be much better placed for what comes ahead. Because “social” is becoming central to marketing, product development, customer relations, and everything else that determines success – and the more central the younger the customer base.

Take home? CEOs and CIOs need to become best friends;and the CFO needs to be taken out of the loop, like tomorrow. The CIO/CMO relationship is also explored in this poll, and needs to be close. One problem with the whole “C” way of looking a things is that by defining executive leadership in functional terms it is increasingly out of kilter with the cross-functional efforts that emerging technologies and their social impacts enable and bring to the center of tomorrow’s needs and opportunities – and that, mercifully, excellent organizations have learned to engage at all levels.

Perhaps the CIO is an anachronism of the days of “IT.” We are now post-IT. IT itself offers a component within the CIO role, but the CIO is not CITO. The CFO reporting stats suggest that is exactly how he/she is (still) seen. The issue is information, not technology. Information is the business of every function. The CIO needs to emerge as the information leader, the Chief Knowledge Broker (CKB), of the organization. With techies to back up as and when needed. The last person on the planet to whom the CKB should be reporting is an accountant.

My piece in response to the Fidelman/HBR report:

http://nigelcameron.wordpress.com/2012/04/13/social-risk-seems-cios-think-social-is-beneath-them/

The post I am responding to here:

Do CMOs, CIOs, and CFOs Embrace Each Other? – IT Management – myITview.com.

Why Spaces, Places, Matter – and Questions #SOBCon #risk #strategy

Posted on May 7, 2012 by Nigel Cameron

I’ve just emerged from SOBCon in its hometown, Chicago, with gratitude to @LizStrauss for the invitation and her colleague Terry @Starbucker St Marie.

Some quick thoughts after a remarkable weekend as the long tail of posts, tweets, texts, continues to flow. More thoughts may follow.

SOBCon is a conference like no other – in which infinite effort has been spent on process as well as content; a fulfillment, at one level, of the generally frustrated vision of unconferences to draw on everyone and avoid the fallacies of schooling; a pudding rich but never quite over-egged; a place, a space, a gathering of people decidedly in community. As I just shared with a new friend, I’m not sure if I spent the weekend being remade or beaten up. OK, you get the picture.

Here just one comment, about SOBCon as a space. The lush, deeply engaging, very personal presentations I leave for the moment to others to discuss, though they make sense only inn the context of the space. (Check the #SOBCon hashtag to get a whiff.)

But this. SOBCon is a place. A space. With rich features evident to newbies as they walk in. The air has been specially treated. The food infused with secret sauce. A magical kingdom, in which the quality of relationships new and old, and – because this is always how it flows in our human community – the character and depth of the communication, are heightened.

To those for whom conferencing is all in a week’s work, including some of the finer efforts, it is always striking when a space is created in which persons and ideas can actually engage; strangers can be open with each other; bonds can spring up almost as fast as cards are exchanged. Well, this weekend in Chicago that was true to a high degree. What’s especially interesting with SOBCon is that this is not the result of its being carried on in secret. I am no great enthusiast for the “Chatham House Rule” that is sometimes used to encourage candor and honesty – which basically renders an event and its participants off the record. SOBCon was streamed. I know because I got message from people saying they could see me in the crowd. The on/off the record approach has value in enabling officials to be interesting and remain employed. It has little impact on the quality of the engagement. Conversely, there can be engagement of a special quality without its illusions.

That’s why in our work at C-PET we have placed much effort and emphasis on the quality of the community we bring together to address the great questions of tomorrow and today. These are not communities of old friends, though they are enriched by such relationships scattered through them. They include many who are strangers. And what is said in public is not private. But the cultivated space means that trust, even between strangers, is set high. So in conversations public and private there is candor. And, as well we know, when one person is candid, shares personally, confesses challenges and discusses defeats, the resonance is potent and the character of the conversation infectious.

At SOBCon this goal of, shall we say, a cultivated public/private inter-personal space for ideas – was achieved to a high degree, spurred by the fact many participants had been SOBConners before, and the social setting over several days – which went all the way to karaoke (some pics from that are in the tweetstream!).

Our business and policy worlds are full of answers. What we need most are spaces in which we can pose questions. Questions can only be properly posed when the space is right. And while this has always been true, as Moore’s Law drives exponential technological change and human events move at a pace faster than we have ever known the questions become more important, and the need for a space within which we can gather to consider them more pressing.

So huzzah to Liz and Terry, and the SOBCon community. As I move back and forth between the worlds of policy and business I know there is nothing we need more.

Chicago 2012 Program | SOBCon.