Successful Social Business Starts From Within

Guest post by Mark Fidelman, CEO of Evolve! Capital, Inc., and author of Socialized!  How the World’s Most Successful Businesses Harness the Power of Social.

History is littered with innumerable organizations that failed to adapt to changing market conditions. Industry leaders Polaroid, Kodak, Commodore International, F.W. Woolworth Company, Montgomery Ward, Tower Records, Tribune Media, Circuit City, Blockbuster Inc., and Borders Group did not adequately respond to changing market conditions and either filed for bankruptcy or went out of business. Each had a different reason for its demise, but each failed to adapt to circumstances despite having superior financial and human capital.

To make matters worse, the business dynamics in play today are far more difficult to navigate.

Markets are incredibly fluid, dissatisfied customers can disrupt any business on the planet, and executives who build shrines to themselves are far less powerful.  That’s why the popular command-and-control culture, with a top-down information control and little tolerance for contrarian views, is dead.  It’s well suited for yesterday’s business climate, where customers had little broadcast influence, and executives became powerful by building walled gardens around themselves.  Today, it’s a surefire path to employee demotivation and, I would argue, a threat to a company’s very survival.

The most successful social businesses like IBM,, and Yammer (now Microsoft), are highly adaptive and hypercompetitive because they’ve adopted the philosophy and strategy of using social tools to create more adaptive businesses.  Their business cultures encourage new ideas and feedback, leverage the wisdom of crowds and operate with a great deal of transparency.  In each of these examples, innovation is connected to every facet of the business. From product development, customer support, and marketing to employee career development, these empowered workers care less about the financial impacts of failed innovation experiments (while of course learning from them) and more about developing high-performing cultures that drive customer value over time.

According to a McKinsey & Company study, the value of creating a digital village is a 20 percent increase in customer satisfaction, a 20 percent decrease in the time it takes to bring products to market, a 30 percent cost reduction in talent management, and a 30 percent reduction in the time it takes to find knowledge experts. From my experience, this is just a short list of the benefits.

In Socialized! How the Most Successful Businesses Harness the Power of Social, I elaborate on the infrastructure for a digital village, or internal social network, where employees can go to connect, share, collaborate and receive help from colleagues within the company.  The village metaphor is appropriate because you’re creating an online location that over time will become a rich, vibrant community that will be the core of your social business.  I also lay out eight internal social business requirements that executives can follow to both build and jump-start their company’s internal growth engines.  For example:

Get the Right Team and Budget in Place.  It’s difficult to create a social business with executive support. It’s nearly impossible without it. Find the directors who really wanted us to become more social, and ask them to pay for the social platform.  Then identify stakeholders with the greatest support, influence, and need to get the big picture on the rest of the organization. Don’t wait for your mid-level and frontline employees to push for change. Find the right team and change agents to build and carry out a program of change. I’ve never met an executive who thought social business was not a priority, but I’ve met many who limit the budget and restrict their involvement to seeing that it happens. Worse, most of them were not monitoring progress against a set of objectives set by the team.

Create a Digital Village Code of Conduct.  In any township or city, the citizens are governed by a set of laws and rights. In your digital township, you will create the same— but yours will be better suited to a digital environment.  For example: read and abide by the company’s social computing policy; endeavor to contribute quality content or participate in quality discussions; and be interesting or be invisible.  Create your own code of conduct, but remember to update it as the village evolves.

Realign the village to create a social environment.  Knock down silos to make way for cross-department employee communications.  It can be difficult to knock down entrenched interests, but you have to do so.  Recruit early adopters in each to shape the organization’s future technology platform.  They’ll begin collaborating on the new platform and invite others to do the same.

Senior leaders who have implemented these policies, systems, and workflows have created opportunities for growth that were never before possible given the constraints of a command-and-control business model. In my experience, companies can surpass the benefits identified by McKinsey, while preparing the business to adapt to future challenges.

What do you think? Can a business be smart socially on the outside, without being social on the inside?  Why are why not.

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  1. says

    Mark hits (as my long-departed father used to say) the head right on the nail in his description of the value of social to businesses and the end of command-and-control. To answer his question, I would assert it is possible to be marginally successful with social only pointed outward but it wouldn’t be very smart. I also don’t think it would have a snowball’s chance in hell of being truly successful; certainly not in the long run. I think one’s customers would quickly outrun the company’s capacity to change and adapt and, as a result, would soon become dissatisfied and look elsewhere for a company that understands the meaning of being socialized (to coin a term ;).

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