How Confucius can help us liberate organisations

Photo courtsey of Steve Webel on Flickr

Confucius dedicated his life to convincing Chinese leaders that they must act virtuously. But as modern organisations struggle to deal with the increased complexity of the network era, Confucian thinking provides a valuable reminder that we as individuals must strive to transcend the cultures of the organisations in which we find ourselves. Let me explain.

More than ever before, organisations are shaping the human condition by determining how we live and work. To improve the human condition, we therefore have to ensure that we are consciously shaping our organisations, and not simply being subservient to their cultures and values.

Culture and tradition have historically been the way in which stories are passed on, and the way in which the human species remembers. But the networked era gives us access to so much information that we are able to construct a much more personal, individual understanding of the human condition.

The networked era makes it possible for us to realise our individuality within a community. In fact, the network era demands that we do so - this is what is driving the demand for authenticity. The opportunity of the networked era is that we no longer have to hide behind organisational culture - each person can create their own culture, their own unique set of beliefs and values.

This is what it means to be enlightened: to be free of the passive conditioning of culture and to actively shape your beliefs and values. And it is this enlightenment that drives engagement.

But isn't this dangerous? What sets our moral compass if we free ourselves from the tyranny of culture? Is it the transparency and authenticity that the network era brings? If we are fully exposed, we cannot hide behind cultural practices - it is the radical transparency of the network that makes us accountable, the fact that we are fully visible to others. This is where Confucian thinking is invaluable: if we abuse this new-found power and act without virtue, we risk being publicly shamed and losing our credibility.

Organisations are sub-cultures. But while the network era demands that we realise our individuality, the hierarchical power structures of our organisations make it almost impossible for individuals to challenge the dominant culture. It is unsurprising that employees become disengaged when confronted with the colossal walls of organisational culture.

A core function of leaders then is to transform the lives of the people they lead. But in the capitalist era, leadership has become too focused on making money. The capitalist culture of shareholders has made business leaders beholden to the profit-driven demands of people external to the organisation, rather than to improving the lives of those working within the organisation. This results in many leaders breaking Confucius' Golden Rule: "Do not impose on others what you do not wish for yourself".

In the network era, the challenge is for every employee to create and adhere to their own set of beliefs and values. The radical transparency of the network age demands authenticity, and enables us to challenge those leaders and organisations who act without virtue. If we are to reinvent organisations for the benefit of society and humanity, we must strive us to remain autonomous in the face of the dominant organisational culture, and consciously choose to act according to our own personal set of beliefs and values.

And, as Confucius says, to conduct ourselves with virtue.

How do knowledge, power, and influence affect customer experience?

 This post was written in conjunction with Carl Lyon for The QoE and was first published on The QoE blog

Our first topic of 2016 explored knowledge, power and influence in organisations. Or to be more specific, where is the knowledge, who has the power, and how is this affecting the ability to influence behaviour?

Searching for trust
 
To understand this topic, it’s useful to use the metaphor of going to the doctor. In the
industrial age, we went to the doctor to seek their professional opinion on a particular
ailment. The doctor was the ultimate source of knowledge about our issue. We had
little alternative than to have blind trust in him/her, and as such they held almost
all the power to influence our behaviour.
 
Fast forward to the information age. What do the majority of us now do before going
to the doctor? We Google our symptoms. The ability to search online has dramatically
shifted power away from the doctor to such an extent that the best question a doctor
can now ask us is ‘what have you Googled?’
 
This has a dramatic effect on trust. If the doctor fails to address our concerns arising
from our Google search, our trust in them falls to a new low. But if the doctor asks
us if we have any concerns, listens to the knowledge we have obtained from our Google
search into account, addresses our issues, our trust in the doctor then increases
to an all time high.

The power of context
 
Search has significantly shifted power away from organisations by putting information
and opinion in the hands of the customer. It is highly likely that customers will Google
a problem before calling a call centre. And in some cases, it is likely that the information
they find online will be more up-to-date than the information available inside the
organisation itself.
 
This is why many call centre employees increasingly resort to Google searching in order
to resolve customer queries. The most up-to-date information lies within the customer
community, not within the official knowledge management system. The knowledge of
the community is being updated in real time, whereas it can take weeks (if not months)
for official sources of information to be updated.
 
But more importantly, the knowledge of the community is contextual. Whether customers
realise it or not, their query will arise from their specific context. Answering their query
effectively will therefore require an understanding of this context.
 
We instinctively seek answers to our questions from people who understand our
context, whether this be our friends, work colleagues, or our online network. And we
are more likely to trust the answers we receive from people who understand that
context. So how can organisations tap into the deep ocean of contextual information
that surrounds its customers, and use it to improve customer experience?

Organisations as dynamic, omni-channel communities
 
To tackle this growing problem, we need to re-imagine the organisation as a dynamic,
omni-channel community made up of both customers and employees. The community
has the knowledge and power to influence the behaviour of the organisation and help
it adapt to the rapidly changing demands of its customers. And the community may
well be made up of both customers, employees, and general observers.
 
This transformation has been given many names, including open innovation, bringing the
outside in, or even simply customer/employee engagement. The music service Spotify
is a great example, as is the Chinese Telecom giant Xiaomi who release a new version
of their operating system every week in response to user feedback.
 
The ability to listen and adapt has been key to the success of these information age
organisations. By minimising the effort required to engage with their community,
organisations can gain access to a wealth of untapped insight that can be used to
improve the business. And crucially, making the pockets of specialist information held
by customers, employees and departments more searchable by the community,
allows this contextual knowledge to be shared and leveraged in new and valuable ways.
 
Organisations that can listen, think, adapt and act in response to their community are
those that will successfully evolve and ride the wave of digital transformation. But while
a community can be grown inside any organisation, a common barrier is the tendency
for the organisation to act without listening, or worse, continue to believe that
‘it knows best’.
 
Many businesses still behave like an industrial age doctor by assuming that customers
haven’t searched online before calling. But if a business is engaging with the contextual
knowledge being co-created by its community, it will be perpetually evolving in response
to customer needs.
 
And that, surely, is just what the doctor ordered.

How reputation and ownership affect knowledge sharing

Here's the thing: I regularly share information on LinkedIn with a network of contacts, most of whom I've never met. And unless one of these people offers me a job, none of them are in a position to give me any financial reward for sharing. So why do I share?

And here's the other thing: I don't share this information internally in my organisation, with people whom I have met, some of which are at least in a position to reward me financially for sharing. 

So if money isn't an incentive for sharing, what is?

Dan Pink has demonstrated that money only can only motivate to a certain point, and that beyond this point financial reward actually de-motivates people. Even if a company would offer such an incentive for sharing, the promise of a promotion or a pay rise can only be delivered infrequently. So what else might be going on?

Reputation

Why do we share information on LinkedIn? Or Facebook? For example, why am I sharing this post on LinkedIn rather than on my company's intranet? If we don't share for financial gain, one incentive may be to do with enhancing our reputation - and our influence - in our personal/professional network. If someone shares a cat video on Facebook it is usually to make people laugh, but the flip side of this is that it increases their reputation in their network as someone who has a sense of humour.

But why doesn't this compulsion to share extend to sharing work-related knowledge on a company intranet? Perhaps we don't consider this kind of knowledge to be sufficiently interesting and therefore not worth sharing. Extending this logic suggests that we don't think that this knowledge will enhance our reputation or influence in our network, or - worse still - that my internal reputation may even be damaged by sharing what others might perceive to be 'boring' information.

So 'what people think of me' is potentially more valuable that financial reward. In other words, I share on LinkedIn so that other people in my network think that I am informed, insightful and useful. It is their perception of me that is valuable, as it increases my reputation, influence and social capital. And that's not to say that reputation is without financial value; reputation is increasingly becoming as important as profitability as a key strategic driver, hence the growth of the reputation economy.

But why are people more inclined to try and increase their social capital and reputation externally and not internally? Why are we inclined to share information outside of our organisation than within it? Is it because there are no official 'structures' in our personal network? Harold Jarche notes that structure drives behaviour in large organisations, but perhaps in our personal networks it is a lack of structure that drives behaviour. What is different about sharing our knowledge and expertise on social media, but not within our own organisation? One important reason is because our personal network 'self-organises' - I.e. the lack of hierarchy means that knowledge is free to travel between any individual in the network and does so based on factors including how interesting/topical/humorous/insightful it is.

Ownership

Alongside reputation, 'ownership' also plays an important role in driving sharing behaviour. When I am sharing on my own social media channels I 'own' my communication, and I alone reap all benefits gained from my increased visibility. But within the walls or an organisation it is primarily the organisation that benefits from employees sharing their work, not the employees themselves.

An example of this could be the resentment generated from organisations not sharing revenue and profits fairly amongst employees. Although this would appear to run contrary to the above argument against financial incentives driving behaviour, it is actually 'resentment of inequality' that brings disengagement. And few things reinforce the sense of inequality than an overly hierarchical structure.

A good example of this can be heard in the HBR podcast 'Are robots really coming for our jobs?' which tells the story of weavers in 19th Century America. As technology developed, the weavers were able to use their skill to bring about a significant increase in profitability for their organisations, but the weavers' wages remained stagnant for some 30 years. This highlights the problem of the 'them and us' mentality, a problem which can drive employees to feel disengaged and disconnected from both their work and their organisation.

If employees feel a greater sense of ownership over their work, it is likely that they will be more engaged and feel more invested in the success of the company. And this greater sense of ownership may make them feel more inclined to share their work in order to help colleagues.

If the goal is to increase knowledge-sharing, the challenge is to move away from an 'us and them' mentality. A greater sense of ownership and clearer reputational benefits to an individual's social capital are two key factors that are likely to drive greater participation and engagement in internal networks.

Leadership 2.0

Leadership 2.0 from Denise Caron

While going back over inspiration for previous blog posts I came across this thought provoking presentation about 'Leadership 2.0' by Denise Caron. What is Leadership 2.0? The excellent Social Media Garden report by Denovati has some useful soundbites:

"Leadership 2.0: embracing change, being open to experimenting, demonstrating transparency, working collaboratively and creating dialogue. Fostering a culture of innovation. Open to the voice of the people, stimulating sharing, acknowledgement of expertise" (Denovati, 2013)

And why is it important?

"Use of Web 2.0 will only be successful in an organisation if Leadership 2.0 is in place" (ibid.)

"Collaboration and transparency will be the vital business characteristics that will make all the difference in the digital era. Within organisations, co-operation, as opposed to rivalry, will be the main determinant of business success" (ibid.)

Given the growing social complexity in the workplace due to the exponential increase in use of social tools, you could be forgiven for assuming that management structures would automatically move from the pre-internet model of hierarchy towards one of 'wirearchy' as highlighted by Harold Jarche. But this isn't the case. In fact, the 'social media stuff' is still often the job of the intern - you only need to look at the number of internships currently springing up in which the term 'social media manager' is a key responsibility.

The amount of tacit knowledge in an organisation is a huge source of potential innovation (Cook and Brown, 1999). The ability of social tools to enable senior managers to tap in to this creative reservoir presents significant opportunities for senior managers to maximise the creative potential of their workforce. But the recent Altimeter report into The Evolution of Social Business indicates that "only 34% of businesses believed that their approach to social media was connected to the goals and objectives of the business". And more worryingly, "half of all executives are not informed, engaged or aligned with their company's social media strategies in any capacity".

It's no wonder that tools such as Hootsuite, Yammer and others are experiencing such strong growth. There's a long way to go before social business becomes the norm rather than the exception.

References

Cook, S. D. N. and Brown, J.S. (1999) Bridging Epistemologies: The Generative Dance Between Organizational Knowledge and Organizational Knowing. Organisation Science, Jul/Aug 1999, Vol. 10, No. 4. pp.381-400.

Jarche, H. (2013) Wirearchy.

Li, C. and Solis, B. (2013) The Evolution of Social Business; Six Stages of Social Business Transformation. Altimeter Group