Continued from Part 1: Arrange Technology Around Your People
Build Customer Contributions
Maximizing people’s generative capacity isn’t just about your employees. Lines that once separated people inside your firm from people on the outside are rapidly giving way thanks to new technologies that make it easier for customers and other external stakeholders to contribute value. This blurring of organizational boundaries takes many forms and goes by many names, whether it’s the “prosumer“ movement, user-generated content, the sharing economy, and even co-creation.
Learn how to do this trick and you build a huge advantage over companies that don’t know how to do it. This is “engagement leverage“ and it’s what you get when your business invests in systems and processes for engaging people who aren’t even on your org chart. It’s a huge lever – especially with the rise of online social networks – a kind of force multiplier for increasing the things your business can accomplish with a relatively small increase in resources. “Many hands make light work” and it’s this kind of opening to outside contributions that is what makes social business really tick.
Social business turns your company into a “contribution platform” for attracting and coordinating contributions from your stakeholders.
Google, Facebook and Amazon are obvious examples of large-scale contribution platforms, but they’re just the leading edge of a bigger trend in business. This radically networked approach to scaling the number of people who can contribute value to a business is already spreading beyond the technology sector, and, as we’ll see in part 3 of this series, it will be particularly powerful in mission-driven business.
Partner with Customers on Your Mission
We’re used to seeing the value that employees, suppliers and distributors contribute to our products and services, but often fail to fully realize just how big the customer’s contributions actually are.
Customers don’t just fund your business with revenue streams or co-create your products and services with you. They also create value simply by using your products and services in ways that unleash their quintessential purpose. A drill creates holes – but not without a customer to do the drilling. The only way you really fulfill your company mission is by partnering with your customers to achieve your desired impact. In short, you achieve your mission through your customer.
Get More Viral
Companies increasingly look like the networks on which they run. The more I use Facebook, the more valuable it becomes to my friends and colleagues, and in our highly networked economy, this “rich get richer” phenomenon is an increasingly important source of competitive advantage.
It’s not just about building connections on Facebook though. Think about what happens when lots of new customers start using one of your new products. Those customers help attract other companies, interested in building solutions that piggyback on your success. Those new products and services then make your product even more attractive to more customers, which increases its attractiveness to additional firms and additional customers in a upwards-spiraling, positive feedback loop.
This kind of feedback has always existed, but now it’s a lot more powerful because when customers connect with your products and services, their social networks make that connection much more visible to their social contacts. This “virality” affects how easily a product or service spreads from one customer to others – and it’s now a key variable in the business models of most high-tech startups. It’s a powerful lever that even low-tech firms will soon ignore at their peril.
As network technologies grow the “virality” of your products and services, the value of your relationships increases exponentially.
Build Your Stakeholder Networks
When your suppliers retool to meet your specifications or customers invest time and energy into learning your product, they’re making investments that give them a stake in the future of that product. People in your community also have a stake in your business, since they’re affected by its operations.
Collectively speaking, these people are your stakeholders – and they all contribute value to your business, either financially, through co-creating your products and services, fulfilling their mission or helping them go viral through social and professional networks.
The business leaders of tomorrow will no longer primarily view stakeholders as costs that need to be minimized, but as critical contributors of value to their business. They will adopt organizational strategies and technologies that maximize their ability to accept contributions from a wide array of stakeholders. They will turn their businesses “contribution platforms” that build on powerful networks of employees, customers, distributors, suppliers and other people with a stake in their success.
What we’re talking about is a radically networked, thoroughly modern, approach to stakeholder principles of management and governance.
When your stakeholder networks have a true stake in your company’s success, it also attracts a much deeper level of contribution to your business.
Up next in part 3: Attracting Deep Stakeholder Engagement