September 20, 2012
Ranked in the top 10 management books on Amazon, 11 Rules for Creating Value in the #SocialEra by Nilofer Merchant explains the old mindset – taught by businesses schools and some startup advisers – that is handicapping businesses today.
That mindset, which Merchant observed while working with both Fortune 500 companies and startups, goes something like this:
- Scale by getting big.
- Create in-house.
- Motivate employees with a paycheck.
- Employees have a very narrow role to fill.
- It’s the marketing department’s job to interact with customers on social media.
The new mindset she proposes blurs the lines between the company and the customer and focuses on higher goals:
- Scale by leveraging your community. For example, with a very small team, Singularity University is able to recruit passionate experts and professors.
- Co-create with your community. For example, Kickstarter projects like Everpurse get the community involved by letting them choose a product color.
- Motivate employees and community with a higher purpose. For example, TEDx unites intellectuals around the goal of sharing knowledge and improving the world.
- Help employees hone in on their unique skills. For example, Google’s famous “20 percent time” – one day per week that some employees can spend on their own projects – encourages them to focus on their talents and passions.
- Every department embraces a social approach. For example, Zappos trains all its employees – no matter what department – on answering calls from customers. This cements its focus on customer service.
Below is an excerpt from 11 Rules for Creating Value in the #SocialEra on embracing “onlyness”: the unique skills, passions, and history of each employee. Merchant will be speaking on this topic at The Pitch Refinery in Chicago this weekend. (Use the discount code “TechCo” to get 50 percent off the ticket price.)
The first step [to unlocking talent] is celebrating something I’ve termed onlyness. Onlyness is that thing that only that one individual can bring to a situation. It includes the journey and passions of each human. Onlyness is fundamentally about honoring each person: first as we view ourselves and second as we are valued. Each of us is standing in a spot that no one else occupies. That unique point of view is born of our accumulated experience, perspective, and vision. Some of those experiences are not as “perfect” as we might want, but even those experiences are a source for what you create. For example, the person whose younger sibling has a disease might grow up to work in medicine to find the cure. The person who is obsessed with beautiful details might end up caring about industrial design and reinvent how we all use technology. The person who has grown up under oppression might end up advocating for freedom of speech and thus advance the condition of his country. This individual onlyness is the fuel of vast creativity, innovations, and adaptability.
Embracing onlyness means that, as contributors, we must embrace our history, not deny it. This includes both our “dark” and our “light” sides. Because when we deny our history, vision, perspective, we are also denying a unique point of view, that which only we can bring to the situation. Each onlyness is essential for solving new problems, as well as for finding new solutions to old problems. Without it, people are simply cogs in a machine – dispensable and undervalued – and we’re back to the 800-pound gorilla approach. With it, gazelles [employees and partners] are singularly unique and able to contribute meaningfully.
It’s not that everyone will, but that anyone can.
Some people, when we start talking about “unlocking all talent,” roll their eyes and ask who would pour the coffee or stock the shelves in this new world. Well, let’s look at an example where people are literally pouring the coffee. Every time we walk into Starbucks, something amazing happens without most of us really noticing. It is this: every staff member from the order taker to the café barista manages to make full eye contact with every customer. That signifies something. When people feel seen, valued, and respected, they can see, value, and respect. Starbucks has a long history of providing health-care benefits, decent wages, and a cultural norm of dignity as it prepares its 200,000 employees to do work. It trains people who come from a wide variety of backgrounds, sometimes from families that have no history of knowing how to organize their lives and get to work on time. It does more than instill procedures; it unlocks self-worth and personal dignity. That effort shows up the small ways we don’t notice (eye contact), but also how we as consumers experience something in totality. Think of the comparable that does not instill a sense that everyone counts: Walmart, where people are largely treated as replaceable parts.
Now you could argue that Starbucks has higher margins where Walmart does not, but I would argue that the margins reflect the value created in and by the organization by its approach. Starbucks says everyone can contribute in a meaningful way, and then people do. One is a precondition of the other, not a by-product of the other.
While organizations have honored the gem from Jim Collins to get “the right people on the bus,” once those people have been hired, too many organizations often ask them to sit down, shut up, and let someone else drive.
In chapter 1, the obituary for traditional strategy, I mentioned that the predominant way we’ve handled strategy was to focus on getting the idea right. This is necessary, but not sufficient. Implicitly, then, shifting from merely “thinking right” to “doing right” is key in the Social Era. Let’s talk about what that looks like in practice.
In most organizations, one small group creates or “owns” strategy, and another much larger part “owns” execution. Across industries and countries, research shows only 5 percent of people know the strategy in an organization.
When only 5 percent of the people in an organization knows the strategy, then only 5 percent are ready to make decisions that align their work to that vision. It means only 5 percent are able to apply themselves to building that strategy into reality. Typically, this means that a part of the organization develops a great idea that is only fully understood in a small corner of that company. The larger organization then gets to work on the execution plan without ever really owning the strategy. While the strategy-execution gap is a persistent bugaboo, it becomes nearly catastrophic in the social era: you can’t be fast, fluid, or flexible if 95 percent of the people in your company have no idea what direction they’re supposed to be running toward.
This strategy-execution gap creates an “Air Sandwich”—an empty void in the organization between the high-level strategy conjured up in the stratosphere and the realization of that vision on the ground (let alone owned by anyone outside the organizational perimeter). The filling in an Air Sandwich consists mainly of misunderstandings, confusion, and misalignment, rather than the effective connections between the vision and the on-the-ground, fast-changing reality that make a good strategy a reality.
The Air Sandwich exists any time different participants lack a clear, shared understanding of the big picture. Usually, executives try to address it by working on their “communication skills.”
But in practical terms, even a good communication plan does not create what is necessary: individuals to think through things enough to prepare to make the one thousand little decisions that are essential to make change really happen. When people are not involved in the formulation of a direction, they can never make it reality.
What needs to change is not the CEO’s ability to communicate, but the premise that strategy creation can be separate from the people who will execute it. The Air Sandwich prevents us from reaching the desired end.
Strategy as a separate concept from execution is a relic of the past. It is something that was created when organizations needed structure to direct people who didn’t have much education, where information was limited, and when markets and competitors moved slowly. In a world where we increasingly outsource or mechanize repetitive work, in which we’ve unlocked the free flow of information and built teams of highly educated millennium-generation talent that demands a seat at the table, we need to shift our approach from telling the strategy to co-creating it, so that it is owned throughout the organization.
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