Social Media, Value Creation and the Risk of Missing Out

SummerSweet

I have been pondering and writing about the on-going change in the way we work, now and in the future. I especially love to evangelize about and to the people like myself, the middle-aged knowledge workers. A new kind of social pressure is on us.

I feel this need for change everyday in my work and in the business environments I am actively part of. Yes, I particularly chose to say feel. I have one skill I like a lot: I combine numerous signals and facts, added with intuition. And yes, I am 100% layman futurist. You may laugh at that, however there are many reason-reasons to take the social revolution seriously. Here are two recent blog articles on the topic.

Firstly, Shel Israel wrote in Forbes:

“For the most part, social media—like rock and roll—is here to stay. And organizations that continue to ignore it will simply fade away. And that is our key point (in a book The Age of Context he’s collaborating with Robert Scoble). In a very short period of time social media has risen from oblivion, and is part of the lives and work of most people in the developed world.”

Secondly, check out my friend Oscar Berg’s blog post “Time is Ripe for Social Business” in which he lists recent research about this topic. Here’s one pick from his post:

“The potential for value creation when social technologies are used to improve collaboration and communication within and across enterprises is twice as big as the value that can be created through all other uses across the value chain. Based on numerous case studies and in-depth research in four sectors (consumer packaged goods, consumer finance, professional services, and advanced manufacturing), McKinsey Global Institute analyzed the potential value that could be obtained through the use of social technologies. The total potential value at stake in these sectors is $900 billion to $1.3 trillion annually. A third of that potential comes from business function-specific applications of social technologies in product development, marketing & sales, operations, and customer support, but two-thirds would arise from using social technologies to improve the collaboration and communications of knowledge workers within these functions and across the enterprise. (McKinsey Global Institute)”

Impressive figures, one of the key notions being value creation.

The Soft and Hard Elements of Value Creation

What an interesting combination of the soft and hard elements value creation has. I cannot help reflecting back to the year 2001 when I wrote my Masters thesis about value creation in business processes. My 11-years old Analyzing Framework for Value Creation is a very simple model on how organizations are creating value; the ways of enhancing the supply chain processes, and how they can find new ways for cooperation within the business ecosystems.

A bit outdated, but I was on the right path then, wasn’t I? But wow, I had no idea about how powerful new ways of communication there will be.

Here below a not-at-all-fine-tuned picture of my old framework from 2001.

On the outer circle there’s a blend of ‘soft’ elements: Culture, Commitment, Leadership, and Strategy. The middle circle represents the two main tasks associated with managing business processes: Coordination and Integration. On the inner circle I’ve chosen three set of pairs: Infrastructure & Architecture, Relations & Processes, and Information & Knowledge. All these further having an effect on the ultimate target in the middle – Value innovation and Creation.

Kind of Social Business 1.0, or Enterprise 1.5, isn’t it?

Now we all know that the real powerful value creation happens at the edge of organizations and that requires very different management and communications practices. No news here for you.

Transformation Ahead

However, there’s one specific aspect that bothers me almost daily, and makes me work harder: How will the “professionally middle-aged” (not necessarily chronologically) knowledge workers cope, and how to work on with our attitude towards the rapid change, and further to value creation. 

I have gone a long way on my transformation path, and already feeling mostly good about the change. But of course, there are many of us who hate this, fear this and/or despise this change. Most of us conveniently somewhere in between these two. There is both healthy and not-so-healthy skepticism towards social technology and social business, regardless of the length of your career. This change comes close to your very personal sphere and therefore causes the most interesting reactions and fears. Nothing wrong with that, we need time to think, learn and unlearn. The reactions are naturally based on the personal experiences, but also on the attitude that one have towards the future change. We all do have our own way of coping with it.

On the organization level, many businesses are facing huge challenges; global competition, economic issues and insecurity, and missing the right leadership skills. From the knowledge work perspective, the people and innovation should be in the core. That requires a new kind of leadership, and strategy as well.

My pet peeve is to observe and learn from this phenomenon, and to help my fellow knowledge workers whenever I can. Finally, what about the risks? There are many, and I chose one: the risk of not taking the risk.

Risk of Missing Out – ROMO

After reading an interesting New York Times article “Turn Off the Phone (and the Tension)”, a new idea and an expression came into my mind: Risk of Missing Out. Let me explain the background first. In the article Anil Dash, a writer and entrepreneur, is speaking about “Joy of Missing Out,” or JOMO. The beauty of sharing and enjoying moments also when not present.

“There can be, and should be, a blissful, serene enjoyment in knowing, and celebrating, that there are folks out there having the time of their life at something that you might have loved to, but are simply skipping,” he wrote.

A beautiful thought. I am often jomoying.

The idea of JOMO was a continuation for FOMO, or the “fear of missing out,” a term coined by the founder of Flickr, Caterina Fake. She wrote about how social media has made us even more aware of the things we are missing out.

From JOMO and FOMO, I did think of ROMO, Risk of Missing Out.

I look at this from the knowledge worker perspective. I believe that any knowledge worker who is not active at all in social media has a huge risk of missing out…the many possibilities of the future work life, lots of learning, and an opportunity for necessary unlearning. A knowledge worker, who is not participating and collaborating in the ocean of social, will face interesting times. At least professionally, and maybe on other areas as well (as in JOMO).

We must change, adopt and adapt: the way we learn, listen, help, discuss, search, collaborate, innovate, combine, produce, and create value. For the sake of the innovation, we need to focus on knowledge flows, instead of knowledge stocks, as John Hagel wisely puts it. You might also like to read my old blog post about Systems Intelligence, by my favorite Professors Esa Saarinen and Raimo Hämäläinen. I do love their thinking.

I am not going any deeper in this right now, but please continue playing with this idea with me. I promise I will.  The value creation, innovation, knowledge work, the attitude of the professionally middle-aged, ROMO.

Can you see the connection between value creation and the social way of working? How do you feel about the idea of Risk of Missing Out, in general and especially in your work life?

Innovation and Social Leadership

Mårten Mickos – and some source code – on the stage @ TEDxHelsinki

My brain is bubbling after the TEDxHelsinki event – a creatively built lineup of innovative speakers. The themes were exactly those I’ve been working on lately: Entrepreneurship, innovation, age & generations, and leadership. So here are random thoughts I’d like to share.

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Systems Intelligence, Serendipity and Listening for the Better Decisions

A beautiful moment I managed to capture in the Helsinki summer!

I’ve earlier blogged about how I find intuition and seeing the value of the tacit knowledge as very interesting perspectives for the decision-making. As social business and new ways of working are now changing the organizations and the entire business landscape, and further adding to the complexity I’ll find it even more interesting to study decision-making and how understanding is created.

I was looking for something else from my bookshelf and found the good old book by Stephen P. Robbins “Essentials of Organizational Behavior”, and randomly checked out the chapter about individual differences in decision-making.  What I found was an interesting quadrant that describes the leadership styles related to the decision-making, it has two axes: Way of Thinking and Tolerance for Ambiguity. The four styles of decision-making are:  Directive, Analytical, Conceptual, and Behavioral.

Decision-Style Model. Source: A.J. Rowe and J.D. Boulgarides, Managerial Decision Making (Prentice Hall 1992)

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Entrepreneur: An Adventurer with Inbuilt Crap Detector

Guy Kawasaki’s Note to Me @ Paris 2010

Inspired by an interview of Francis Ford Coppola and by an old article about Ernest Hemingway, I compared their advice to my experiences as an entrepreneur.

I’ve blogged earlier about my favorite topic, tacit knowledge and its role in personal and organizational learning. Francis Ford Coppola’s words took me back to these thoughts. In the web magazine The 99 Percent’s interview  ‘On Risk, Money, Craft & Collaboration’ he describes his working methods and techniques, for example how making notes, e.g. writing down the first impressions of a novel, helps him to find what’s essential in it.

I have a habit of making notes all the time, not only in work related meetings and workshops, but also of novels, TV programs, movies, and discussions. When I look back at my notes I often find a new angle to the subject at hands, and realize that often my notes are implying something tacit, a piece of knowledge, an idea based on the quick unconscious association.

In the beginning of interview Mr. Coppola presents his code of ethics that directs his filmmaking. I’ll find it very interesting:

  1. Write and direct original screenplays
  2. Make them with the most modern technology available, and
  3. Self-finance them.

With little bit of imagination I dare to compare this to mine and my friends’ situation as entrepreneurs. These points tickle my thinking: Firstly, for an entrepreneur it is important to have a clear vision based on your big idea, which in turn should be based on the real customer need you’ve seen, maybe based the weak-ish signals you’ve seen before others have. Anyways, your basic idea must be robust. It is your original screenplay, your starting point.

Secondly, Coppola’s request for the most modern technology: that’s an easy one. In my case it is about utilizing Cloud Computing and during the coming months I need better understanding what part Social Technology have in my business. I have no clear picture of it yet. There’s luckily a very interesting discussion on-going (in Twitter) about social business. Just search #socbiz or #e20 in Twitter, and you’ll see what I mean. Learning new things daily!

Francis Ford Coppola’s third point about financing is one of the key (worrying) issues for an entrepreneur. As both in filmmaking and for entrepreneurship, it is a question about how much independence you have. For Coppola financing must be easy nowadays, but for young entrepreneurs it is often a major pain. It takes a lot of energy and time, which temporarily can cut off some of the enthusiasm.

Learning, Risk Taking and Collaboration as Key Capabilities

All these essential issues points at learning, our capability to unlearn and learn is central. To change and to be able to see what is not visible: the tacit things, the weak signals. One sentence in Coppola’s interview shows how important learning is even with 45 years successful career, he says:

I just finished a film a few days ago, and I came home and said I learned so much today. So if I can come home from working on a little film after doing it for 45 years and say, “I learned so much today,” that shows something about the cinema. Because the cinema is very young. It’s only 100 years old.

His humble quote is very true in any business. As our business environment is in huge change, we need to see it as new every day. For an entrepreneur this means making best guesses and taking risks. Francis Ford Coppola asks a striking question to which every entrepreneur can relate to:

If you don’t take a risk then how are you going to make something really beautiful, that hasn’t been seen before?

Indeed. Further Mr. Coppola shares his idea of collaboration and his role as a director, with wise words:

You must never be the kind of director, I think maybe I was when I was 18, “No, no, no, I know best.” That’s not good. You can make the decision that you feel is best, but listen to everyone, because cinema is collaboration. I always like to say that collaboration is the sex of art because you take from everyone you’re working with.

His words remind me of Mitch Joel’s recent post ‘Market of One’, where he writes:

Just because you do something (or don’t do something) is no indication of how the market actually is and reacts.

A recommended read, you may recognize the pattern in your business environment, among partners, business angels, VCs. For an entrepreneur it is vital to listen to everyone, be curious, to truly collaborate, and not make assumptions based on your personal opinion only.

To me entrepreneurship is about learning, experimenting, collaborating, and taking risks. It is an adventure. And I feel like an adventurer.

We all have our own personal methods and tools to manage the adventure. For me it is a cocktail of many things, the base on my beloved Systems Thinking, but to name one thing that has changed my way of working: social media. After I’ve managed to find ‘my people’, especially in Twitter, social media has opened a new world of knowledge sharing and valuable, most interesting global network of smart people. Whenever I have time to participate I learn.

Another result of intense learning and studying within social media sphere is this blog. I started blogging as I felt that I need to write down the (often unstructured) ideas and thoughts, and get feedback from my network of smart people. The feedback is very valuable for the learning process: when I write I am often developing an ad hoc idea and the feedback makes me think and rethink. I do need that.

Related to this experience of making notes and blogging too, I share a wonderful old article of Hemingway in Cuba (The Atlantic, 1965) which partly inspired me to write this post. Hemingway experienced writing as inventing. Here’s a quote by him which I like very much:

Fiction-writing, Hemingway felt, was to invent out of knowledge. “To invent out of knowledge means to produce inventions that are true. Every man should have a built-in automatic crap detector operating inside him. It also should have a manual drill and a crank handle in case the machine breaks down. If you’re going to write, you have to find out what’s bad for you. Part of that you learn fast, and then you learn what’s good for you.”

That’s basically what every entrepreneur needs too: Knowledge (network) out of which to invent, and a curious, open mind with a built-in crap detector.

I believe I don’t have to explain that.

Quiet is the New Loud

Photo by me @ Lanzarote 2010

I have chosen Quiet is the New Loud as my motto for January, and for the rest of the year 2011. With that I refer to tacit knowledge and its value.

I am inspired by the idea of tacit knowledge flow, a flow that relies on trust-based relationships. In these times of huge amount of data, paradoxically it is tacit knowledge that best supports value creation.

Rich flows of tacit knowledge are needed for success:

  • Tacit knowledge plays an essential role in our learning processes.
  • Tacit knowledge flow supports creativity. There’s lots of research on how diverse working groups are more creative, less dependent on old paths, and easier makes linkages between different domains.
  • Strategic success of an organization is depending how well it manages to blend available explicit and tacit knowledge.
  • Survival in competition is more and more based on capability to create and maintain fruitful and learning relationships with colleagues, partners, competitors, and customers.

We have unforeseen number of software tools and technologies available to support these flows. Still it is primarily not about the tools and processes. Most of all it is about an attitude – an attitude of the individuals forming a team, working group, or an organization. An attitude that embraces learning, openness, and transparency.

This is not happening overnight but I do believe that Quiet will be more valuable than Shouting Out Loud.

If you haven’t read John Hagel’s latest blog post about tacit knowledge, trust-based relationships, and talent development, please do so. It is an excellent read. Here’s a snippet from it:

As we enter a new decade, the greatest wealth will be created by a new set of entrepreneurs. These entrepreneurs will understand and address the unmet needs of those who want to participate in environments that foster deep, trust-based relationships across both virtual and physical space. These environments will focus participants on the opportunity to learn faster by working together in addressing challenges that draw on the tacit knowledge of each participant.

I hope that I can live up to what John Hagel calls for: being that new kind of entrepreneur. One of the first steps for me is to apply Quiet is the New Loud Attitude.

Have a great long weekend!

PS. My headline ‘Quiet is the new loud’ is actually album name of a Norwegian indie band Kings of Convenience.