The Reason Why Companies Don’t ‘Get It’

I was talking to Benjamin Ellis at #SMiB last Friday about the change in culture that is being accentuated by Social Media. Notice I say accentuated by Social Media – the change is not Social Media itself. Talking to Benjamin was a meeting of like minds and confirmed what I’ve been thinking for sometime:

100 years ago, most businesses had a factory-mindset and a production process that was managed. Money was made by fine tuning the production process to either reduce cost, or increase productivity. The production process was a series of mechanics – variables that were minimised to increase predicability and consistency – with human quality control.

Role along Peter Drucker‘s prediction of the increase of Knowledge Workers and skip to today. We now have a decrease in factories and an increase in offices. We have a decrease in tangible production, and an increase in intangible knowledge work. These offices are not run by mechanical processes that can control variables and minimise inconsistencies – they are run by people, who are anything but controllable variables and are inconsistent by nature. But people also have potential to develop,  intuition, the ability to learn and solve problems – unlike a peice of machinery.

I think most companies that ‘don’t get it’ don’t get it because they are trying to manage people like they manage production. If you manage people like this, then you are treating them like parts in a factory that must be controlled and standardised. People need to be lead and developed. If you begin to develop a person you access a great resource that will grow, adapt, solve, initiative, innovate, envision, and lead others. These companies, instead,  have a factory mindset, not a knowledge mindset. They want to manage people, not lead them.

Even consider Starbucks – leadership at the top of the chain, but by the time you get to the store, it’s just management. There is no leadership, no development, no placing people according to their strengths and working with them to maximise their potential. It’s just plain management of a process, in which humans are treated as mechanics. And it’s the same in offices and companies across the world.

It is governance vs. gudance.

You govern a factory. You guide people.

No wonder these companies have a problem with Social Media. They hide behind “What’s the ROI?”, whilst looking for a way to quality control and automate their Twitter account, out of shear fear that they cannot govern this channel to be exactly how they, The Man, want it to be. Nor do they have the ability to trust their own people to have the potential and initiative to guide a conversation towards a successful outcome of brand advocacy and even financial return.

Guidance requires leadership, and leadership requires influence, and influence requires meaning. And this is what many are lacking.

Working in Church for 10 years, where my teams have been made up of volunteers, has taught me how to motivate without financial incentive. The greatest influence is the influence that is non-financial – because it taps into meaning and purpose.

Of course, this kind of talk is controversial, ahead of the curve, and will probably get a hunk of criticism. But let’s not forget that a generation is growing up in a world where people, not machinery and process, are the greatest resource – and they are able to speak to pretty much any other person in a moment of time. Their working world is going to all be about communication, and the ones who win that game, are the ones who can communicate most influentially – and who can influence without financial incentive, but with meaning.

Thanks to Lawrence Whittemore for the cool photo.

Archived Comments

  • http://www.eaonpritchard.blogspot.com eaon pritchard

    some good points. businesses still have to make money, however I’m with you on the ‘meaning’ part. Just read a book you may find interesting about this topic. Meaning Inc by Gurnek Bains, check it out.
    I’m down with Guy Kawasaki on this point.
    The great companies have always looked to make meaning first, then the money will follow. thats the ROI. (his examples include Apple, Google et al)
    nice to meet you last friday, albeit briefly. E

  • / Scott Gould

    Of course they have to make money – but they can do so with a knowledge mindset as opposed to a factory mindset.

    I’ll give Meaning Inc a look – thanks for the tip. And yes, twas great to meet last week – thanks the comment mate :)

  • http://www.eaonpritchard.blogspot.com eaon pritchard

    some good points. businesses still have to make money, however I’m with you on the ‘meaning’ part. Just read a book you may find interesting about this topic. Meaning Inc by Gurnek Bains, check it out.
    I’m down with Guy Kawasaki on this point.
    The great companies have always looked to make meaning first, then the money will follow. thats the ROI. (his examples include Apple, Google et al)
    nice to meet you last friday, albeit briefly. E

  • Scott Gould

    Of course they have to make money – but they can do so with a knowledge mindset as opposed to a factory mindset.

    I’ll give Meaning Inc a look – thanks for the tip. And yes, twas great to meet last week – thanks the comment mate :)

  • http://www.scipmark.org.uk/ mark

    This podcast from the BBC talks about a UK company that empowers people in its branches http://www.bbc.co.uk/programmes/b00lvlv3

    great stuff I think…

  • http://www.scipmark.org.uk/ mark

    This podcast from the BBC talks about a UK company that empowers people in its branches http://www.bbc.co.uk/programmes/b00lvlv3

    great stuff I think…

  • http://twitter.com/JimAnning Jim Anning

    It does seem that traditional companies are struggling with the ‘new world’.

    I guess in the days when things didn’t change so quickly, the ‘factory’ model worked. Companies had the time to set up regimented processes, governed by command and control management which reliably churned out ‘static’ products & services into largely ‘static’ markets.

    Now, aided by the speed at which people can communicate, it seems the world is starting to change faster than the ‘dumb’ processes can ‘learn’ to adapt. As you point out, enlightened organisations know that developing a quick-reacting, empowered workforce where everyone can be a leader is the route to thriving in a rapidly changing environment.

    Meanwhile the old-guard continue to throw more process and more command and control at the ‘problem’. It worked before….not so sure it will work now.

  • http://twitter.com/JimAnning Jim Anning

    It does seem that traditional companies are struggling with the ‘new world’.

    I guess in the days when things didn’t change so quickly, the ‘factory’ model worked. Companies had the time to set up regimented processes, governed by command and control management which reliably churned out ‘static’ products & services into largely ‘static’ markets.

    Now, aided by the speed at which people can communicate, it seems the world is starting to change faster than the ‘dumb’ processes can ‘learn’ to adapt. As you point out, enlightened organisations know that developing a quick-reacting, empowered workforce where everyone can be a leader is the route to thriving in a rapidly changing environment.

    Meanwhile the old-guard continue to throw more process and more command and control at the ‘problem’. It worked before….not so sure it will work now.

  • Scott Gould

    Hey Jim,

    “Meanwhile the old-guard continue to throw more process and more command and control at the ‘problem’.” – so good. The answer is not in a change in process but a change in culture. That’s tomorrow’s blog post :-)

  • Scott Gould

    Hey Jim,

    “Meanwhile the old-guard continue to throw more process and more command and control at the ‘problem’.” – so good. The answer is not in a change in process but a change in culture. That’s tomorrow’s blog post :-)

  • Scott Gould

    I really enjoyed that – I’m listening again and making notes!

  • Scott Gould

    I really enjoyed that – I’m listening again and making notes!

  • http://www.facebook.com/eswain Eric Swain

    Scott,

    Good post. I agree with the basic premise although I think it’s more than just a holdover from our manufacturing days – it’s also a function of size and trust (maybe trust is a subsection of size). That is, size informs corporate culture in a significant way, effecting trust and humanness and the personality of the business.

    For example, I have worked in a few companies that were relaxed and open and allowed, trusted, even encouraged, their employees to be individuals. However, as those companies grew, increasing amounts of structure crept in, putting in place more and more rules, regulations, and restrictions (governance, as you put it).

    Ah, I smell my own blog post coming.

    Eric

  • http://www.facebook.com/eswain Eric Swain

    Scott,

    Good post. I agree with the basic premise although I think it’s more than just a holdover from our manufacturing days – it’s also a function of size and trust (maybe trust is a subsection of size). That is, size informs corporate culture in a significant way, effecting trust and humanness and the personality of the business.

    For example, I have worked in a few companies that were relaxed and open and allowed, trusted, even encouraged, their employees to be individuals. However, as those companies grew, increasing amounts of structure crept in, putting in place more and more rules, regulations, and restrictions (governance, as you put it).

    Ah, I smell my own blog post coming.

    Eric

  • /becoming-p2p/ Becoming P2P – scottgould.me

    […] I discussed yesterday, this old thinking is one of mechanics and processes that are managed and optimised. And if a […]

  • http://www.ruudhein.com Ruud Hein

    I think a company wants to manage the processes, not the people.

    If you break actions and projects up in processes of the right size, the company works with processes and not people.

  • http://www.ruudhein.com Ruud Hein

    I think a company wants to manage the processes, not the people.

    If you break actions and projects up in processes of the right size, the company works with processes and not people.

  • Scott Gould

    Sure – some companies do. But starbucks, for instance, wants to manage people regardless of their skill set. There is no acknowledgement of the individual – they are managed along with the rest of the processes

    That’s retail life, and a large part of office life

  • Scott Gould

    Sure – some companies do. But starbucks, for instance, wants to manage people regardless of their skill set. There is no acknowledgement of the individual – they are managed along with the rest of the processes

    That’s retail life, and a large part of office life

  • Scott Gould

    Agreed – although size does not equal inability to function in ‘People2People’, as we’re calling it.

    There are the companies that are large, and mostly doing it: Apple, Google, Microsoft – the younger companies.

  • Scott Gould

    Agreed – although size does not equal inability to function in ‘People2People’, as we’re calling it.

    There are the companies that are large, and mostly doing it: Apple, Google, Microsoft – the younger companies.

  • http://twitter.com/alexthegreen Alex Green

    “this kind of talk is controversial”
    Not really but then I’ve been reading for a while and am with you on this, it makes sense!
    Good stuff, no criticism from here!

  • http://twitter.com/alexthegreen Alex Green

    “this kind of talk is controversial”
    Not really but then I’ve been reading for a while and am with you on this, it makes sense!
    Good stuff, no criticism from here!

  • http://www.facebook.com/eswain Eric Swain

    Well, I also agree that the younger companies are better at it, though I’m not sure I would put Apple in there, at least from a P2P point of view. I think they are still fairly restrictive when it comes to allowing employees the freedom of the social networks.

    http://www.geek.com/articles/mobile/opinion-how...

    E

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