Redefining Leadership in the Emerging Social Business Environment

It’s 2010 and business has changed. The combined impacts of technology shifts like the social web, real-time mobile computing, and cloud computing; business shifts to an information based economy; and sociological changes in individual and group behaviors and expectations are creating a revolution in business. In a historical context the situation today looks reasonably similar to conditions that surrounded the start of the industrial revolution. The shift from agrarian business and social structures to industrial based structures changed almost every facet of life, modes of social interaction, social structure, hierarchies, management and leadership styles, education systems, etc.; all built to support the growing industrial economy and society. These structures have had more than 300 years to become ingrained social patterns and practices yet more and more they are coming under pressure to change to modes that will support the new imperatives in business and society.

I’ve spent quite a bit of time researching and discussing the business changes that are starting to have significant impact on the way companies interact with customers, employees, suppliers and partners. Out of this research we are seeing the emergence of a new business paradigm that incorporates the learning from the social web and the new interaction models and expectations of all of the business stakeholders. Social business requires new ways of engaging customers and prospects as well as new methods of operating a business. Part of the urgency to change is driven by people that have learned and gained new expectations based on their personal online life, people that make up a businesses customers and employees. People have a new level of empowerment because of their online voice and expect experiences from business that mimic those in their personal life. This has led to business looking and adopting new customer programs ranging from social web monitoring to social customer support communities. Internally companies are starting to look at employee tools and implement new ways to collaborate and interact across the business. All of this change is really related to the idea that business culture has to change to meet these new requirements and take advantage of the new opportunities presented by social business models. Along with this culture change leadership and management models are starting to feel the same pressure for change.

I’ve been keenly interested in leadership and management science for most of my adult life. I have worked almost exclusively in management positions including my 10 year career as a Naval Officer and even now in my player / coach role as a group VP at IDC. Educationally I studied / have degrees in history, sociology and business management, with a particular focus in my MS program on organizational design. As a Naval officer I learned a great deal of practical leadership. As a software project / engagement manager I also learned many management techniques. I list these experiences simply to say that this is an area that I am experienced in and have studied quite a lot. All of that has not prepared me for what I now believe is a fundamental change (or need for change) in the way management functions in most organizations.

Management structures in a factory are clear and the models are “tried and true, as the saying goes. If you want to produce widgets these methods will work. In an idea and information based economy that is fueled by creativity, empowerment and independence they will at best produce mediocre results and at worst fail miserably. The industrial model, which is to varying degrees the approach in most businesses today, is based on a strict adherence to hierarchy and the centralization of power. The model generally includes some or all of these traits:

Strict hierarchy with a clear chain of command both up and down
Need to know mentality, information is hoarded and can become a power base
Openness is not encouraged and often can be used against a person in a political struggle
Strategy is disseminated from the top
Decision making is centralized
Policy and rule based control driven from the top of the structure
Conformity is rewarded
Managers are “served” by employees
One way communications are common (from the top down)

In the new social business a model of management and leadership will be required and will feel very different from the industrial model. This is in fact, one of the reasons that the transformation to a social business model will be a long and difficult road. Many in management today could feel threatened in the new model. Some of the traits that I believe will be required in a social business include:

Coaching versus “managing”
Information and content is the life blood of the social business and is shared openly and frequently (hoarding is not rewarded or tolerated) (I call this content liberation).
Employees are empowered to make decisions (I’m not advocating anarchy, there will need to be some vision and strategy as a framework, but even the formulation of the strategy and vision is participatory and not centered in a select few). Empowerment also means the power and obligation to speak up when something is amiss.
Transparency which leads to ethical behavior.
Power and communication are networked not hierarchical and one way
Managers exist to serve not be served
Strong personal brands are encouraged and people’s individual brand gains advantage from association with the corporate brand in a symbiotic relationship
People become the enterprise platform
Everyone has a voice and can influence the company community
Personal responsibility and accountability are rewarded and valued

These are a few of the traits that I think will be increasingly important and lead to competitive advantage for companies and leaders that adopt them in support of a social business culture. I’m sure there are many more ideas, what should I add to my list?