Strategy class sucked, it was simply the most boring class of my Schulich career. It didn't make much sense to me because I love strategy, and our Professor while not the most engaging speaker was a brilliant Harvard graduate who had worked with the famous Michael Porter. It only just hit me after reading the Social Era by Nilofer Merchat, but most of what we learned in traditional strategy class was no longer valid! Apparently traditional strategy is dead, now it all makes sense.

Traditional business strategy is giving away to the social era, where flexibility and the ability to adapt to change are the most important attributes for an organization. It’s about connections, networks and most importantly, SOCIAL, which means PEOPLE. As I read the book I realized the social era is the natural extension of, “culture eats strategy for breakfast” (my favorite quote by Peter Drucker). I can’t put it any better than Nilofer herself (gorilla=traditional massive companies, gazelle=new fluid organizations).

Unlocking talent is not the frosting on the cupcake as it was in the industrial era. In the Social Era, it’s the key ingredient in how we make the cupcake itself, and whether the cake is viable. Whereas the gorilla was about having the right strategy and having a few people own the direction, gazelle work is about distributed ownership where talent at all levels is unlocked to contribute onlyness and bring value in working together. When someone proposes that we can put that talent engagement stuff until later, we can all answer with a resounding, “No, we can’t.”

It’s not as if organizational and talent engagement stuff didn't come up in our classes, but it was definitely treated like the “frosting on the cupcake”. Value chains are now value flows, there is much more fluidity in the social era. The book is a must read for anyone interested in strategy but I want to talk about how the social era will change the way we work. The three most important points are:

Work is freed from jobs, allowing for more freelancing and outsourcing

Social purpose is used to align the organization

Fluid organizational structures, top-down hierarchy is meaningless in the social era

WORK FREED FROM JOBS

Applying to jobs sucks, if you have watched any of the USA Election Debates you have heard Romney repeat, HALF OF COLLEGE KIDS DON’T HAVE JOBS! A travesty! Canada is probably doing better, but people are still under-employed or in jobs they don’t really care about. I can look at my MBA class, and know this is true. A new phenomenon is taking over though, who even wants a job anymore? So boring! Routine, frustration, managers that don’t get it and super long hours! Then again, stability, steady income, room for growth and of course there are many who are happily employed in jobs they love. In the social era people are freed from the shackles of jobs. They do the work without the job, and this is extremely powerful.

Traditionally this is in the form of gigs or freelancing. It’s becoming far more common, “in 2005, some 30% of the US workforce participated in the freelance economy, and some measures suggest it could be as high as 50% in 2012, accelerated, in part, by the recession” (Social Era).

There many who have made a living like this in the past, freelancing musicians, journalists, photographers, artists, consultants and so on. It’s not new, but what’s different is how prevalent it is becoming and that the Internet has made it so much easier to connect. Organizations now have the tools via technology (Skype, Yammer, THE CLOUD) to easily work with individuals in virtual offices.

Hiring, firing, training and development, benefits and so on make the cost of full time staff very high. On top of that, needs change so rapidly, it’s really difficult to predict talent needs, freeing work from jobs allows organizations to be much more flexible and dynamic. I particularly liked this line, individuals will not be thinking about “resume building” but about “portfolio building,” as they will come and go to put together a series of projects as “work.”

This has huge implications for talent management. People working for your company will increasingly not be employed by the company. Organizations are already used to outsourcing but as the trend grows, consultants and contractors will be the norm rather than the exception. Finding how to work in this model is going to be a challenge for everyone.

SOCIAL PURPOSE IS USED TO ALIGN ORGANIZATION

One of the biggest challenges for an organization is to get everyone aligned and working towards the same goal. Money and incentive systems help, you can build a reward system that demonstrates the right goals. You can post vision statements, communicate heavily and have town hall meetings. There are many strategies to help align an organization, but the most powerful, is proving to be social purpose.

Purpose is a better motivator than money. Money, while necessary, motivates neither the best people nor the best in people. Purpose does.

People want meaningful work, they want to know that they are working towards a powerful social purpose. Simon Sinek, author of Start With Why discusses the power of purpose in inspirational leadership with this must see TED Talk. The main point is that by beginning with the WHY, the purpose of the organization, you connect with people in an incredibly powerful way. Nobody gets inspired by how or what, they get inspired by WHY and if they share your purpose, they will be much more motivated to help you.

Social purpose is not only the leading cause of engagement, it is the cheapest way to get everyone focused on the same goals. You don’t need a tonne of rules and policies to structure people when they all believe in the same purpose. How to deal with a customer, a product change or any other issue becomes clear when the purpose is known. Zappos which is known for its incredibly powerful company culture centered around customer service demonstrates this well. People don’t have to ask, how much of a refund can I give?How should I manage this complaint? They will go above and beyond and do whatever it takes to solve the customers problem because that is their social purpose.

An even more powerful example is TED. The entire organization, made up mostly of volunteers are aligned around the vision, ideas that matter. TED and TED Global used to be the only events, once a year and highly exclusive. There were great talks, and there still are, but in 2009 they opened TED up with TEDx. Mini conferences held all around the world and it has exploded. TED Talks are now a household name, and the marketing was basically free because it was driven by an army of volunteers. TED’s mission is clear and simple though, so it works. People can naturally align themselves within the world of TED.

Money is not motivating, working to get more profit can’t galvanize a workforce. There needs to be something more and it needs to be powerful! In the social era, social purpose becomes a critical component of any strategy.

FLUID ORGANIZATIONAL STRUCTURES

The social era is about connections, and those connections aren’t simply top-down. They are fluid and dynamic and there really isn't much use in having strict hierarchical structures in this new age.

Organizations that “let go at the top”— forsaking proprietary claims and avoiding hierarchy—are agile, flexible, and poised to leap from opportunity to opportunity, sacrificing short-term payouts for long-term prosperity. No longer can management espouse the notion that good ideas can come from everywhere, while actually pursuing a practice in which direction is owned by a few.

The most important aspect of the social era is flexibility because things are changing so much. Pinterest came out of nowhere, airbnb is completely changing the hotel industry. Zip Cars have changed the car rental system. Kickstarter, Square and others are making an impact on the financial industry. NetFlix took out Blockbuster and now they face their own set of challenges. Apple destroyed RIM. Kodak disappeared. Facebook is still pretty new, Twitter is even newer! The pace of change is faster than our learning and the only way to survive is to have every individual working with you. The only way to do that is to empower them and have a structure where they don’t need permission to act.

There is no reason why ideas can’t come from all parts of your business, why you can’t be connected to every individual in your organization. Fast, fluid, dynamic! That’s what the social era calls for.

This TED Talk by Rachel Botsman discusses how the social era is changing the way our world works.

CLOSING THOUGHTS



Nilofer herself says that there is no sure fire way to succeed in the Social Era, it is still incredibly new and it is changing all the time. I think it is exciting because every individual is now able to make a difference and challenge the status quo. It doesn’t mean that everyone will, but you don’t need millions in advertising to get the word out, TED is known to hundreds of millions without almost any advertising. It also eliminates the need for being physically present all the time, again giving rise to so many more possibilities. Virtual offices are much more effective now than ever before, so talent management is not restricted by geographical proximity. The implications of the Social Era are massive, and we really can’t say what’s next. Social Media is probably the first shoe to drop and it has changed our lives, but it is only the first step. Can’t wait to see where the Social Era takes us next!