The Cultural Imperative For A Social Business

HandsAlthough effective collaboration has always been a cornerstone of a successful business, one could say that the unrelenting speed and sophistication of the social consumer web is making it more so. The changing dynamics of the marketplace expose broken processes and are forcing employees to work together better, in order to provide an unprecedented level of customized experience for customers. To be externally social, an organization must problem-solve, exchange information and collaborate across departmental lines.

How does one become social internally? Just launch an internal social network like Yammer of course, and wait for magic to happen? Not so fast! No matter how intuitive a platform is to use, roll out or administer, this effort has to land on the fertile ground of the right culture. Culture is the hardest element of success, because it’s 1) hard to define, 2) takes a long time to change, and 3) there are serious disincentives to changing it. With any kind of internal social networking, you are effectively changing behavior from everyone working inside a silo to a more open, transparent and collaborative environment. And as we all know, every time you attempt to change behavior, you run into resistance. The better you can anticipate resistance and channel it into positive energy, the higher the chances of success.

What is the “right” culture, and is there such a thing?

While there isn’t one right culture, just as culture is tough to compare across organizations, there are certain common elements of organizations that do well with these types of initiatives. Charlene Li sums it up best: “be open, be transparent, be authentic”. While this is easier said than done, and there are as many definitions to “authenticity” and “transparency” as there are people who define them, here are some key things:

  1. Transparency and openness require the braveness of “opening up the kimono”, not when convenient, but all the time. It involves letting people know what’s happening and why, with advance notice, providing a channel to share feedback, and closing the feedback loop – in the open. Companies that are truly transparent, are usually transparent inside and outside. When I was young and worked in very top-down organizations, announcements and organizational changes were delivered without sharing any reason and without a forum to ask questions / contribute ideas. This made me feel like I had no control of my life, and my opinion didn’t matter – so I left…   In an open culture, on the other hand, managers are and their subordinates feel like they are in the same boat, on the same team. This type of openness has to be vertical as well as lateral.
  2. Knowledge hoarding is replaced by sharing. Traditionally, our educational systems have emphasized becoming a specialist. We have hoarded our knowledge in fear that if we shared what we knew, we will become more replaceable. In his bestseller “A Whole New Mind“, Daniel Pink states that globalization, automation and abundance brought forth by technological advances, have greatly affected what’s defendable as a competitive advantage. Rote memorization and textbook knowledge is no longer enough, especially since Internet has made knowledge more accessible. A true competitive advantage is the ability to learn, synthesize, share it back to the group and drive change. Check out this great video by Steven Johnson that describes what’s possible when functional silos come down.
  3. Authenticity rules the day. Because internal and external social mindset expose inconsistencies between what you say and what you do — if there are any — you really need to examine your value system as an organization and establish processes to ensure that everything you do is consistent with this value system. Does your value system support your mission? Do you know what your mission is? If you define and commit to these values as an organization, decisions will actually become easier, as you ask yourself each time “is this consistent with our values?” Of course, every employee has to be empowered to act to support these values, without going through red tape. To use the textbook example of Zappos, that’s exactly what makes them successful: every action they take maps back to their mission of providing unparalleled service for their customers.
  4. Organization is flat. Finally, as a result of the above points, a new type of flat and collaborative organization starts to emerge. Senior management engages in a dialogue with employees. Middle management gets out of the way and enables team cohesiveness instead of mandating actions. Employees are able to communicate and collaborate across silos.

What are the barriers to this kind of culture?

The above sounds great, doesn’t it? Is this achievable, or is it a Utopian rhetoric? Why aren’t more companies like that in real life? I’d say that many are trying, but it takes a lot to get 100% there. There are some serious barriers to this type of culture, some of which are:

  • Command and control mindset: Traditionally, corporations have been structured with tightly managed controls at the top, which were passed down through levels of management, down to the people who actually performed the work. Tasks to be done, as well as the processes by which these tasks had to be done, were mandated from the top. This is starting to change drastically, as teams are now acting as fluid organisms vs. machines. Check out this fantastic post by Dave Grey on this matter.
  • Functional silos: Perpetuated by functional isolation and years of specialization, many organizations ended up with functional silos. Of course, departments still need to exist in order to divide up the work and avoid a “free for all” situation. After all, marketing should be marketing, sales should be selling, the product team should be defining the product and engineers should be building it. However, all these groups don’t exist in a vacuum; the decisions that each group makes affect all other groups. Thus, cross-functional collaboration is absolutely key to exchanging ideas, doing a better job, making better decisions and avoiding work duplication.
  • Rigid hierarchies: Scarcity of information pre-Internet, combined with specialization, has contributed to knowledge hoarding. At times, this asymmetry of information, and not the right leadership skills, allowed people to rise up the corporate ladder. Hierarchies were developed to preserve this status quo. However, things are changing rapidly, and democratization of information is definitely putting the emphasis back on leadership style, and not access to information, as a competitive advantage.
  • Wrong things are measured: There’s a saying: “what gets measured, gets done.” No matter how grand your vision and strategy are, if people aren’t incentivized to take certain steps, their behavior isn’t going to change. Focus on short-term results is understandable, as Wall Street puts a lot of pressure on organizations to perform in the short-term. However, we need to make sure we are also incentivizing behaviors that will help us succeed in the long-term, and measuring their effect.

What do you think? What have been some barriers to a more open culture that you have come across? How did you get over these barriers?

Check out part 2 of this post, dealing with steps you can take to improve your culture.

Image source: lumaxart