Social Business Summit 2010- Looking at the Big Picture
Image by Worldle.net
The Dachis Group’s Social Business Summit 2010 in Austin has come to an end. Like many conferences, it featured a variety of dynamic speakers providing their view on the topic at hand whether it was macro trends or the specifics of their experiences. But what comes from this conference is a little bit more interesting than most…
Taken as a whole, the Social Business Summit 2010 presented a compelling case of how doing business has changedand how successful organizations like Intuit, Citibank, Comcast, Yum Brands (KFC), and many others are dealing with the change in a way that creates value for their organizations. But where the summit differs is in the organizational aspect of that change. Having taught Organizational Design & Behavior during my MBA program, this is always an area of business that I believe is overlooked when a disruptive event or technology occurs. My eleven years and counting in the online community/social media/interactive industry have provided numerous examples of how organizations embrace the change or ignore it.
For example, in Charlene Li’s session on “Making the Case for Open Leadership” I could identify with my own experiences in the Property & Casualty Insurance industry where closed, top down leadership is practiced with vigor. At Safeco Insurance Company, we sat on huge volumes of customer data that were stored untouched in company databases. In 1998, working with several agencies, brokerages, and employees, I put together a business plan for using the data as a means to drive down the combined ratio (the main metric for insurance companies) and generate new revenues. The plan was shot down immediately with the statement “we’ve been doing it our way for over 100 years and it works, why change?” Management at Safeco was unable to be open to ideas that came from its sales team (agencies) and employees in the field. Instead of listening and treating them as partners, and adapting to the market’s direction, Safeco was stuck in its past where control dictated that you told your sales team and employees what to do and didn’t want feedback. This idea was so culturally enmeshed at Safeco that as business practices changed with the adoption of the Internet in the late 1990′s, it could not and would not adapt. By believing that only one way communication worked, Safeco missed opportunity after opportunity in its business to stay successful. Instead it slowly died with consistent management turnover and poor financial results until finally Liberty Mutual purchased them. It’s not that Safeco senior management missed one opportunity, it’s that their management style and lack of vision missed so many that their organization became less relevant over time.
But don’t think this type of thinking is relegated to heavily regulated industries. Citibank’s Jaime Punishill relayed to me at lunch that it takes time and a lot of pushing to move your organization, but it can be done if there are senior managers willing to listen. Citibank whether it wanted to or not is moving towards open leadership and working with its stakeholders to drive change (and hopefully value) to its shareholders.
Where does Open Leadership work? Our client Cisco was mentioned by Charlene. We helped Cisco launch its first online community in 2000, the Cisco Network Professionals Community. Over the years, we’ve helped launch and manage numerous communities for Cisco around the globe. There is one constant. While Cisco may have many of the same issues as any other large organization, it recognizes that command and control model of management doesn’t work. It lives and breathes the strategic and tactical oxygen of change, adaptation, and listening to the customer. While macroeconomic forces certainly helped Cisco in the 1990′s, it culture has helped it succeed where others like 3Com, Lucent, and Nortel have failed. Other successful organizations with this approach include our clients NetApp and SAP.
The second most important theme of the summit to me was the network. Not just a social network, but the network of customers, suppliers, employees, shareholders, and competitors. Too often conferences confuse strategy with tactics. Taken together, the summit’s sessions provided a strategic look at how business is moving quickly to a social business model and presented the tactical results to back that assertion up.
While I don’t agree with some of the comments about how corporations have ruined networks, trade, commercial transactions, etc. or how we’re moving back to a peer-to-peer economy, I do agree that the network has always been in place. First it was local, then regional, then super-regional (think Europe), and more recently global. Large multinationals have made the economic process more efficient than it has ever been. Yet, it is still rife with inefficiencies. The understanding that building relationships with your network can make you more efficient is just catching on. For all the talk of rapid adoption of social media, we see far too many disjointed efforts where marketing, support, sales, and internal efforts are all operating independently (and inefficiently).
One great example of using the network properly is that of Intuit’s TurboTax team. Christine Morrison gave a wonderful talk on how it is about making money with the network while also meeting the network’s needs. The overall takeaway was that it is more profitable to pay attention to the network and become part of it than to try and dictate to it or worse, ignore it.
While there are differing opinions on how to utilize the network, several key features of successful networks are:
- An executive who believes in the power of interacting with stakeholders and has the power to implement a plan, hire staff (in-house or outsourced), and measure the results objectively
- An organizational culture that truly wants to listen to its stakeholders (lip service doesn’t work) and take action based upon what it learns
- A focus on results that matter to the audience (customers, employees, suppliers, investors, etc.) which in turn translate into value for the organization in the long run
Corporate culture leads the way to long term success or failure (the Safeco example above shows what can happen when you believe that your organization can dictate to the network rather than work with it). And that’s what social business is all about to us. It’s not the technology, it’s about understanding how your targeted audience wants to interact with you and if your culture can withstand the change or not. In our consulting and management projects with Global organizations such as Cisco, SAP, NetApp, Intel, and others we’ve seen how this idea is so much a part of the firm’s success.
So what was missing? Well from our standpoint, there were a couple of items that were either untouched or glossed over which are incredibly important to the success of any social business project. First is the issue of trust. Until the last session of the day by Lee Bryant, trust wasn’t even mentioned. Social business runs on trust. If you are unable to trust your audience, peers, employees, and other stakeholders you will be unable to act upon their input.
Second, the idea of globalization and culture was not discussed despite its implications on social business. There is a very large difference in how people do business because of their cultures. Social businesses must account for this. The culture in Japan is different than Poland which is different than Germany which is different than the U.S. Online activities reflect that difference. We’ve seen it in action in our work with Cisco’s NetPro Poland as well as SAP’s local communities around the globe. The one comment about global efforts was from KFC’s Rick Maynard who said ”We don’t have a global strategy, we have a strategy that we localize for differences.” While the network is global, local tactics that meet your audience’s needs demonstrate that you understand the local culture and how it impacts your communications.
Overall, the Social Business Summit was a success.If you take a strategic view of the content presented, you hopefully came away with a better way of looking at social business. There are several other folks who attended who have shared their comments and the tweetstream from the event as well:
- Steve Ellis
- iMediaWorks
- @CarrieBugbee (Tweetstream of #SBS2010 tweets)
- @adamcohen (Tweetstream)
We’re looking forward to next year’s event, you should too….
Mike Rowland, President
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This entry was posted on Sunday, March 14th, 2010 at 4:34 pm and is filed under Best Practices, Social Media Industry. Both comments and pings are currently closed.
3 Responses to “Social Business Summit 2010- Looking at the Big Picture”
[...] Social Business Summit 2010- Looking at the Big Picture by Mike Rowland, President of Impact Interactions [...]
Congratulations on a successful presentation at Internet World! The use of online communities as another tool for companies to reach out to their customers and their partners is becoming better known worldwide. It is still in the early stages of growth as more companies realize its powerful potential. (Maybe, someday in the future we can say goodbye to the user-unfriendly phone systems… dial 1 for , dail 2 for, dial 268 for…..etc.??)
[...] Impact Interactions – Mike Rowland [...]