introducing loose
DESCRIPTION
Summary of thinking behind my latest book, LooseTRANSCRIPT
Loose: The Future of Business is Letting Go
Martin Thomas @crowdsurfing
The Future is Loose
o Loose thinking
o Loose organisations
Loose Drivers
1. Chaos, complexity & need for speed
2. New forms of collective behaviour Emergence of new, informal organisational models
3. New generations emerging at top and bottom of corporate hierarchy
4. New technology
5. Failure of tight
1.Chaos, Complexity & Need for Speed
o Macro-economic meltdowno Socio political upheavalo New patterns of consumer behaviouro New expectationso New technology
1.Chaos, Complexity & Need for Speed
Defies rational analysis & neat, simple solutions “The Simple Lie or the Complicated truth?”
“The 21st Century is not a place for tidy minds” Sir Martin Sorrell
2. New forms of collective behaviour Emergence of new, informal organisational modelso Capable of delivering political, social or
commercial change … without structure or formal leadership
Underlines deficiencies of tight, bureaucratic structures that have to deal with them
Arab SpringTea Party Movement
Wikileaks
Shared Grief in Wootton Bassett
3. New Generations
o Emerging at top and bottom of corporate hierarchy– Gen X in the Boardroom with a post-Boomer
mindset– Gen Y entering the workplace with new
expectations
Demanding new ways of working
4. New Technology
o Social media is driving new behaviours & expectations
Dramatizing institutions’ structural, operational & cultural weaknesses
Connected Consumer
Disconnected Corporation
meetsmeets
Why Many Institutions Struggle
o Not configured to work in real time, in terms of speed or resources
5. Failure of Tight
o Illusion of controlo Growth of auditing, risk assessment, compliance,
consulting, reporting, planning & forecastingDelusion of controlDistortion of prioritiesHuge bureaucratic & cost burden Inability to respond to real world
Emergence of Looser Ways of Thinking
o Economists discover Behavioural Economicso Business Schools embrace critical & creative
thinking o Politicians talk of “a post bureaucratic age” &
introduce Big Societyo Conventional political parties challenged by
informal movements e.g. The Tea Party
Thriving by Loosening Up
o Five simple operational & cultural traits of successful organisationsTrustingOpenAgileInformal Collaborative
Tight Thinkers Need Not Apply
o Organisations & people that struggle with this new worldHierarchicalBureaucraticProcess orientedDistrustful
Trusting
o Bedrock of strong internal cultureo Allows shared responsibility & real time
decision making
The best company rulebook ever written?
Nordstrom Revisited
“Prescriptive rules have the effect of infantilising staff & make it harder for them to adapt to different situations. This goes as much for digital communications as for selling socks … Like the Nordstrom handbook we’re trusting staff to follow the spirit, not just the letter, of our guidelines”Meg Pickard, writing about The Guardian’s new social media guidelines, November 2010
Trust & Zappos
o Call centre operational that successfully breaks all rules– No scripts– No time limits– Devolved decision-making
o … because it trusts people on the ground to make the right decisions
o …because it places huge emphasis on recruitment, training & building the right culture
Open
o Transparency & honesty non negotiable
Capable of transforming reputationse.g. Asda & ‘Democratic consumerism’ = commitment to transparency & involving customers in decision-making
Agile
o Ability to improvise & operate in close to real time
o Limitations of excessive faith in longer-term planning
o Speed more important than absolute accuracy
Business plans that used to take six months to develop and approve, can now be put together in a week
Organisational Agility
o Reinvigorated innovation process:– Devolved decision making power from small group of senior
execs to network of cross-functional councils & boards= “a distributed idea engine where leadership emerges organically, unfettered by a central command” Fast Company
– Focus on agility & speed“all the windows of opportunities I’ve missed – areas that got ahead of us that we couldn’t get back into without doing big acquisitions or something – have been when I’ve moved too slow” Cisco Systems, CEO John Chambers
Informal
o NPD: Living life in Beta
o Design: Messy vitality
o Creativity: Authenticity more important than production values
Informality in the Workplace
o Emphasis on freedom & trust
o Encouragement of creativity & individual responsibility
“We’re giving people the latitude to go off & do their own thing. We trust them to do their regular jobs & to experiment, innovate & have fun”Microsoft Snr Mgr, quoted in Business Strategy Review
• No job titles, formal hierarchy or organisational charts• Teams self organise around specific projects
Informality Drives Innovation
o Granted 2,000+ worldwide patents
o “The most innovative company in America” Fast Company
o Consistently ranked as one of the best places to work
Collaborative
o Tapping into spirit of collective self expression
Numbers are Compelling
o 70% of companies regularly create value through use of web-based communities
o Using customer communities to solve customer problems costs 10% of traditional call centres
* McKinsey 2010
Lessons from Software Industry
o Cathedral = traditional, tightly controlled innovation model
o Bazaar = loose, open source approach, harnessing the skills of the wider developer community– Not particularly effective at
originating concepts, which still rely on the spark of individual geniusto make them happen
– Very effective at testing & improvingthem
Collaborative
Opening up new business models
Community Commerce
Self-sustaining creative community Members submit designs => 80,000+
submissions Opportunity to pre test beta versions Community votes => 800+ designs Designers receive $2,500 + marketing advice +
retain IP
No professional designers, no salesforce, no distribution, no market research, no advertising=> $30m revenues … high margins
Community Commerce
People-powered mobile network (from O2) Members receive points for recruiting new
people, making suggestions & solving problems => converted into cash
20% actively involved Aim that 25% of members will get half of cost of
calls returned to them for contribution to community
Plans to involve community in pricing & marketing decisions
Not reliant on call centres, expensive marketing & product support
Formula for Collaborative Success Ensuring strategic focus
Publicity as bi-product not sole objective
Planning – who, what & how? Obama’s 100
Devolving control to community Continuous feedback loops
Anticipating subversion Bieber in North Korea
Managing IP rights
Thriving by Loosening Up
TrustingOpenAgileInformal Collaborative
@crowdsurfing