How successful 21st companies will do business to generate new value

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“Society, community , family are all conserving institutions. They try to maintain stability, and to prevent, or at least slow down change. But organizations are organized with the intent to destabilize. Because its function is to put knowledge to work – on tools, processes and products; on work; on knowledge itself – it must be organized for constant change.”

Peter Drucker

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”Companies are inextricably caught in a web of relationships with all things.”

Holbrook <2003>

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In the wayback-ish machine, Futureworks (now Kantar), in something called 21st Century Business, identified six significant shifts in the way companies will do business to generate new value:

• From disconnected to networked: The networked business understands that its different parts form a single system, and acts on that.
• From closed to open: The open business operates in a porous way, letting the outside world in and building mutual advantage.
• From fixed to fluid: The 21st century (fluid) business uses management and budget processes that respond to external change.
• From volume to value: Businesses increasingly tailor products and services to their users. wrapping products in a tailored network of services to do more with less.
• From risk to opportunity: Regulation and other external shifts will come to be seen as signs about the boundaries that society places on markets, so will become a platform for innovation.
• From consumers to citizens: Companies will succeed by delivering against needs that reflect their customers’ whole lives, as citizens as well as consumers.

Since then, well, businesses have been inching their way into all of these. That said. I would be remiss if I didn’t point out I could write an entire piece on all 6 of these things on how badly business had been at implementing let alone embracing each of these 6 things.

Which leads me to the fundamental issue on why business has been so inept at implementing these 6 things.

All 6 of these demands a different view on how business conducts business which inevitably means business needs a new structural ideology. If it doesn’t it will simply be applying fancy expensive Band-Aids on an existing business world rife with infections. I have argued, and continue to, that the success of any business, let alone business as a way of doing things, is grounded in a shift in business thinking ideology. I have argued, and continued to, any of the discussion is wasted energy until you embrace the ideological shift. What am I talking about? We talk a lot about how hierarchy is just not an effective agile model but less often talk about how business thinking has flipped. In 2012 I discussed this as a shift from the traditional thinking of construction (build up to a solution and implement) versus ‘reconstruction continuously’ (build a ‘good enough’ idea and deconstruct/reconstruct as it was implemented). In addition, while we discuss ‘digital transformation’ ad nausea, we miss the larger point about ubiquitous access to data and information – data distribution equals decision distribution. As business increases ability to make appropriate data available to farthest reaches of an organization, people will inherently desire to use it therefore decision making gets distributed. This conflicts with command/control and inevitably destroys it. In my mind, while it will not happen immediately, traditional hierarchy will kill itself simply because of alternative good business practice. As an older person myself, the organization also needs to morph to how the next generation thinks versus how people like me were taught how to think. And by ‘think’ I don’t mean encouraging any of that future of work bullshit, ‘leading from heart’ or even ‘purpose-drive’, but rather core principles of engaging everyone, optimizing everyone’s potential and constant development (learning, unlearning, adjusting what we have learned). Once again, let me state that all 6 of the Futurework identified shifts need the thinking I just suggested to be successful.

Which leads me to technology.

Remember when I said data distribution should lead to decision distribution? Yeah. So let me add on digital transformation is not about the technology, it’s about the people. In fact, all transformation is about people. Shit. All technology is about people. The more we can bring human aspect into how we design work, the more we aim to build environments where people can thrive, the more we encourage and enable sharing and learning together, well, the better individual work experiences will be and, consequently, the overall work experience will be satisfying to the entire organization. And just as I suggested with deconstruction/reconstruction, business success resides in more people attacking risk, opportunities and challenges with a more diverse mindset, i.e., in office skills as well as out of the office personal talents, the more likely problems will be solved and opportunities minded and peoples’ potential elevated. All of that sounds good.

So, I will end there. In the beginning I shared six ways of doing business and at the end I offered a framework within which to do those things. I kinda feel like a business would be successful if they did these things. Ponder.