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A Social Organization means business

by Mark P. McDonald  |  November 13, 2012  |  2 Comments

A few people have asked me about the applicability of the social organization to business.  They are of the opinion that anything with the moniker ‘social’ is associated with societal or ‘soft’ issues  rather than solving real business problems.

When I asked why, they mention that the many of the examples of social media involve causes like sustainability, finding organ donors, organizing local communities, etc.  This has led them to believe that social media and a social organization does not apply to business or other forms of economic activity.

I can see how they have come to that view, but its incomplete.  I believe that part of this view is based on an assumption that business requires a lose-win exchange.  You lose while the company you work for wins.  That type of relationship is possible and perhaps prevalent in most companies.  Just because it happens does not mean that it has to be that way or that a lose-win exchange is the only way a business works.

Leaders are learning how to use mass collaboration, underpinned by social media, to change that equation.  They are showing how a social organization is a real business organization that finds new and innovative ways to create business and societal value.  Creating a more comprehensive set of value requires changing traditional management behaviors and techniques that include:

Envisioning business solutions that go beyond ‘doing more with less.’  That form of denominator management thinking is satisfying in the short run, but rarely delivers value and year over year value associated with innovation and being different in ways that matter to customer and the market.

Recognizing that hierarchy and bureaucracy rarely creates innovation as it is heavily invested in the status quo.  It is easier to squeeze suppliers, sweat assets and starve employees when authority flows top down,  The only problem is that competency, capability and capacity flow bottom-up and side-to-side.  You need engagement of a large group of people to create meaningful results. Engage them in new ways that are not just another representation of a corporate task force.

Understanding that in order to gain engagement they need to share responsibility for results but  ‘let go’ of the means to achieve those results.  Control and collaboration are two ideas that go together like ‘lamb and tuna fish’  you need to recognize the need to relax the former in order to get more of the latter.

Thinking and defining the business issue — the purpose — in a way that is attractive to the individual, the group and the organization. This is perhaps the greatest challenge and the area where you can get the impression that a social organization can only tackle soft issues.

Leaders are creating social organizations by recognizing these points as they deploy social media technologies in support of mass collaboration.  Here are a few examples.

Example: Balancing organizational realties against operational needs

An organization is highly decentralized in order to make it flexible, adaptive and closer to the customer.  But decentralization increased costs and reduces the company’s buying power with suppliers.  Attempts to create shared service organizations have been rejected as the first step down the ‘slippery slope’ of consolidation and the destruction of local autonomy. Leaders needed a way to get the benefits of scale without compromising the benefits of their decentralized organization structure.  How do they do that?  They create collaborative communities that socially build a coordinated response through collaboration rather than forcing through a reorganization.

Example: Value creation without violating regulatory restrictions

An organization wants to enhance its value proposition by sharing its knowledge and experience with customers only to be find that such a relationship violates regulations seeking to protect customers from undue influence or manipulation.  The challenge is how to make products and services more valuable by creating more knowledgable customers without falling on the wrong side of regulation?
How do you do that?  They create collaborative communities of customers where they can share their experiences, insights and knowledge to help each other.  They monitor the environment for abuse, but they have extended the value of their offerings in ways that benefit customers and preserve their independence.

Example:  Making my job easier makes everyone better

An group of plant technicians support multiple factories around the country.  Each plant is a little different, having its own unique configurations, ways of working and idiosyncrasies.  Technicians move from plant to plant installing, maintaining and repairing equipment. While each change is minor, each project changes the plant configuration a little bit requiring technicians to relearn the plant and equipment layout and in some cases technicians have to rebuild a project in a way that they understand.  The challenge is how to capture the contextual and unstructured information a technician needs to be successful?

In this example, technicians create a collaborative environment where they keep notes about their project, how they did it, problems they had to overcome and the configuration of what they did.  Often using video shot by their own smart phones, technicians can quickly understand the work done to date, the reasons why it was done a particular way and in that way make their life and the lives of every technician a little easier.  Not only are the technicians more productive, they make fewer errors and the quality of their work improves.

These examples provide small illustrations of mass collaboration and its ability to benefit both the individual and the organization.  Coordinated decision making, creating customer value without compromising regulatory restrictions and raising the productivity and quality of work are all solid business issues — issues that social organizations tackle in new and innovative ways that engage people.

Yes the term social means people, but that does not preclude social from also meaning business.

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Category: leadership  social-media  social-organization  

Tags: business-leadership  business-management  business-strategy  social-computing  social-organization  

Mark McDonald, Ph.D., is a Vice President and Fellow Emeritus in Gartner for General Managers Program.

Thoughts on A Social Organization means business

  1. Mark
    Thank you for your insightful comments: I especially took note of: “hierarchy and bureaucracy rarely creates innovation… It is easier to squeeze suppliers, sweat assets and starve employees when authority flows top down, … Competency, Capability and Capacity flow bottom-up and side-to-side.” (brilliant 3 C’s of collaboration), just as our brain and consequently minds work associatively and not hierarchically! Thanks for very insightful thoughts! Greetings from this side of the pond (Hamburg Ger) to you! @brunogebarski

  2. Brian Barela says:

    As an organizational leader in a global nonprofit with a decentralized structure I resonate with this article’s perspective.

    “Leaders needed a way to get the benefits of scale without compromising the benefits of their decentralized organization structure.”

    Centralizing information and making it as accessible as possible across the organization has been one initiative that has produced results.

    A desired next step would be mapping out the informal networks that drive business decisions and providing tools and resources to help these networks thrive.

    A truly successful enterprise will use both informal and formal leaders to achieve their goals.

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