Social is the new production line, not the new water cooler

One of the common knocks heard about social tools in the business world is that people are simply gossiping or exchanging information that is inessential to business operations. This view was recently countered by Ginni Rometty, IBM’s CEO, in an address to the Council on Foreign Relations. It’s heartening to me to hear the CEO of a major IT firm say,

Understand the social network not as your new water cooler, but as your new production line.

While much of the presentation is grounded in what I would consider an industrial orientation to the future of business — too concerned with big data and predictive analytics — in the interview following the talk, Rometty offered the quote above, which shows a more human-centered perspective and perhaps one less scripted and nearer to her own perceptions.

In those companies that are configured to take the greatest advantage of social tools and technologies, social networks will supplant the business-process model. Instead of people filling roles defined by a statically defined business process with deterministic push communications, people will create dynamic connections directly to other people based on pull communication paths, where social networks define the flow of information, work products, and the delivery of value to customers.

Not surprisingly, the companies best-situated to take advantage of the power of social are those companies that are more-network-oriented already, companies with an inherently looser social affiliation. This is in distinction to more-process-oriented companies, with tighter social affiliation.

Here’s a peek at some thinking going into a new report I am writing this month, contrasting processed businesses with those that are more networked:

connective collective

I contend that companies whose culture and psychodynamics are oriented toward cooperation are naturally more inclined to extract value from social tools and techniques. These companies share a set of characteristics:

  • Cooperative at the core. Individuals decide to work together because the relationship and the work is a means to their personal long-term goals, as contrasted with companies that are collaborative at the core, where individuals are supposed to align or subordinate their personal goals to the long-term strategy of the business, typically defined by a small management elite.
  • Networked. Individuals and smaller groups (“duals” and small networks) form temporary relationships with others (i.e., projects) and work out how the projects will be laid out from first principles. Contrast this with processed organizations, where each project is perceived as another instance of some well-defined process and the individuals are directed to take their assigned roles.
  • Fast-and-loose work. Work relationships, and the way that work is conducted, are constantly evolving as individuals and groups continually experiment with new tools and techniques. In tight-and-slow organizations, experimentation and change is actively resisted based on risk avoidance and profit-margin-based analyses.

Returning to Rometty’s remark, in cooperation-based companies, social connection and communication will naturally be viewed as where and how work gets done. In collaborative work, the defined process is seen as the site of work and the primary factor in value creation and delivery, with social connection viewed as ancillary: a luxury to be tolerated as long as things are going well.

Based on this dichotomy, I maintain that companies based on the value of cooperative behavior operate as connectives and have a culture that reflects the inherent beliefs and values associated with social connection as a source of individual meaning and business advantage. On the other hand, companies that are fixated on collaborative behavior develop collective culture, where social connection is something going on at break time, and subordinate to the needs and feeds of business processes. And those processes are designed to extract maximum value from well-understood, simple, and unchanging economic conditions that don’t fare so well in a time of volatility, uncertainty, complexity, and ambiguity.

My sense is that Rometty might click with what I am getting at here, even if her speech writers haven’t moved that far to the cooperative end of this dichotomy.

[Disclosure: IBM is the sponsor of a new personal project of mine, an interview series with visionaries, practitioners, and theorist of the social revolution in business, called Socialogy. I’ve been compensated by IBM, but the opinions expressed in that series are my own and don’t necessarily represent IBM’s positions, strategies, or opinions.]