Chapter 5: 9 areas of Openness (areas 5-9)

OK, here’s the second set of the areas of Openness.

Thanks to some great feedback from Pete Burden there are now 9 areas, as I’ve added Competition which is an interesting dynamic in the mix.

Let me know what you think!

——

5. Environment

As we all wake up to the huge environmental challenges ahead of us, so the role of businesses in the creation and solution of those challenges quite rightly comes into focus. In fact, if there is any reason why we need business to evolve, it is to address the environmental challenges we have ahead of us.

Openness will play a substantial role here: governments and activists will continue to use visibility and profile to influencer businesses to change and as the world takes the environment more seriously, this will be increasingly impactful; and secondarily, progressive businesses that make changes sooner than their competition (whether driven by a Purpose of Significance or in response to the influences and changes in their market) will promote their strengths and gain competitive advantage.

Carbon Disclosure Project

An example of this is the Carbon Disclosure Project, a brilliant and well-connected organisation  headquartered in London with regional offices around the world that ‘launched to accelerate solutions to climate change and water management by putting relevant information at the heart of business, policy and investment decisions’. In other words, using the power of Openness to drive a change in behaviour of corporations. CDP creates this openness by inviting businesses to complete an annual questionnaire about their emissions, water management and climate change strategies.

Responding to the questionnaire is voluntary but one of CDPs great insights has been that a failure on behalf of businesses to manage these aspects of their operations would represent a threat to their future business success, in a world where a business that is not environmentally sustainable will become a business that is not economically sustainable, and in doing so CDP has gained the interest of the institutional investment community who increasingly demand that the corporations which they invest in begin to positively manage the sustainability of their business. As such, CDP creates demand from the investors for transparency from the companies which they have shareholdings in, which in turn drives up the profile and importance of such information inside the businesses.

Walmart

Whereas CDP could be said to be operating from the top down, there are also initiatives driving greater openness and transparency around environmental impacts bubbling from the bottom up: one is initiatives like Patagonia’s Common Threads programme which we looked at earlier, whilst another which has had huge impacts in the sustainability of business has been Walmart’s massive moves towards becoming a greener business.

Amongst an interesting and positive heap of initiatives it has created since 2005, perhaps the most open of its sustainable practices has been the creation of Sustainable Value Networks. As Walmart says on its website: ‘SVNs bring together leaders from our company, supplier companies, academia, government, and non-governmental organizations (NGOs.) Together, we explore challenges develop solutions that benefit our business, as well as our local and global communities.’

Effectively, the SVNs are a vehicle to allow Walmart to invite in some of its biggest critics from activist groups and NGOs, bring in brains and perspectives from academia and government and also – vitally – draw in its supply chain too. These Networks have the responsibility and scope to simultaneously substantially reduce the environmental impact of Walmart business AND drive down costs in the business. The range is broad: SVNs span in focus from Greenhouse Gas to Chemical Intensive Products.

The brilliance of Walmart’s SVNs is their configuration − this really is openness at work, the opening up of a single-organisation’s ‘monoculture’ to greater diversity of ideas and values.

6. Marketing and communications

In the famous words of comedian Bill Hicks at a stand up gig ‘if anyone here is in advertising or marketing, kill yourself’. He continues: ‘You are satanspawn, filling the world with violent garbage..’.  Marketing and communications has a huge opportunity in the 21st, and it is not just to cease being satanspawn!

Unfortunately, too often, those in marketing and PR were the creators of opacity – obfuscating and obscuring simple, easy-to-access truths like the fat or salt in a food product, or the true cost of a financial services product, or coaching the CEO to evade difficult questions in interviews, instead droning away at their key messages, disrespecting their interviewers and their audiences.

Alternatively, marketing has been too late and too lacking in influence to substantially improve the given product or service: it has been the recipient of the finished article, told only to ‘get it out there’ and so it has lobbed freshly packaged products over the corporate wall, bombarding those on the other side with a hail of incoming messages. “INCOMING!”.

What is more, marketers stand accused of creating aspirational expectations for the average Joe that leave him or her feeling miserable with what they really have. They – the argument goes – created the demand for the shiny car, the puffy lips and the orange skin, for the expensive mountain bikes (plural), the two foreign holidays a year. Which led in turn to the spiral of over-borrowing, of credit card debt and general financial woes.

Marketing in the last century was an industrialized process of shoving stuff into the world. There wasn’t a great deal of dialogue, there wasn’t a great deal of participation and there wasn’t – by the end of the century – a great deal of love or respect for Marketing with a capital M.

That ethos of marketing will not cope with the challenges and changes of the 21st century. It just won’t pass.  The opportunity for marketing today is in harnessing this momentum towards greater openness. Here are some examples of how.

Customer service as marketing

In an open and connected world, consumers and businesses experiences of the products and services they buy are no longer isolated. There is no longer a kind of asymmetry in the power between the provider and the consumer because as you will know well, within minutes of finishing a meal – or even during, if you so wish – you can leave a review of a restaurant that will be findable through Google. The power is more balanced now: if tens of customers have bad experiences of a tradesperson or a lawyer, or if tens of thousands of businesses have bad experiences of an energy company or a government department, they can interlink, aggregate into a more formidable whole and distribute ‘the truth’ about company X far and wide.

This creates a new imperative for marketers which I believe is already making business better: the imperative to take customer service more seriously than ever before.

As such, customer service is an integral part of the new marketing.

The winning marketers will celebrate the potential of reviews, they will create word-of-mouth through outstanding customer experiences, they will create cultures and processes that imbue their employer’s with customer-centricity. They will lead each element of the organisation to appreciate their role in the customer’s end experience. And as they do, brands will rise and fall based on their transparent, openly available customer service experiences.

Openness as marketing

Secondly, beyond customer service alone, marketers will find ways to create value and advantage from openness in how their organisation communicates and interacts with the outside world.

Some simple examples:

Skittles & econsultancy

Skittles, the American candy brand, and econsultancy, the global marketing membership organisation, don’t share a great deal of characteristics. One is B2C, a ‘food’ while the other is B2B and a publishing and community business. But both have experimented with the power of open in their marketing by transparently displaying tweets about their brand names on their own homepages.

During their now-famous campaign, Skittles turned its whole website homepage over to tweets from people – anyone – mentioning the word ‘skittles’ in their 140 character update. The result was a minimally-filtered stream of consciousness from a global audience of Skittles lovers, haters and people playing a old-fashioned game of bowling! The rationale here is: ‘we are what people say we are – and we’re bold enough to project what they say about us on our own sparkly website’. econsultancy continues to do this to this very day: across their popular marketing resource (but no longer on their homepage) website is a stream of recent tweets mentioning the brand.

Crowdsourcing as marketing

Kickstarter is an incredible exemplar of what is possible with openness in marketing. Kickstarter is a platform where I – a creative – can outline a project I’d like to bring to life: a film I’d like to shoot, a book I’d like to write, a technology I’d like to develop. After describing my would-be project, I can invite the world to become ‘backers’ – that is, to co-fund the development of the project in return for a small reward – a signed copy of the book for $25 or a private reading for $250!

Some projects are hugely over-subscribed – those that ‘go viral’ and are passed through social networks as must-help projects, whilst others just meet their targets and some don’t at all. The crowd decides, and the crowd funds: this is crowdfunding.

Given that an established marketing practice is research, focus groups, test marketing and piloting and so on, why won’t this kind of early-stage openness and participation become mainstream marketing in the development of products and services? And what a powerful prize: to turn consumers into investors, into co-creators.

7. Finance

In the progressive business of the 21st century, openness plays an incredibly important role in the finances of an organisation. So important, in fact, that there is a whole chapter dedicated to that topic here: Finances

8. Privacy

One note of caution: privacy must not be confused with Openness or – worse – actually lost in this drive towards a more open world. It is true that notions of privacy are changing, particularly in younger people growing up having never known anything but a world with an Internet. But for some that is an excuse to ride roughshod over people’s reasonable expectations and rights to robust personal privacy.

So as managers, employers and marketers, we must treat privacy with the highest regard. In general, people must have control over their own data and must not feel exposed without their consent and forewarning.

‘Open and appropriately private’ is the goal.

9. Competition

Given all of this openness, where does competition fit? What even is competition in the context of a more open, more connected 21st century? Who are we competing with? And why?

As my business partner and long-term collaborator Pete Burden commented as I published this extract on my blog ‘Competition (as we have previously understood it) only makes sense in a world of scarcity and underlying a lot of what you are saying about openness is the opposite of scarcity – an abundance of easily replicated information and data’. He is right. And it is unresolved both in this book and in my mind.

It is true that notions of competition are changing. You must have noticed, as I have, the rise of the use of terms like ‘frenemy’ and ‘co-opetition’. What is interesting is how digital culture is beginning to change organisational culture. On the internet, linking to other good content is what makes the web tick. Which led old-school business people to question ‘why would we link to him, he works for the competition?’. And on the internet, communities grow organically, messily, collaboratively and together create valuable ecosystems – and then the question from old-school (and logical) business is ‘so who owns this?’ which creates all kinds of brain-wrangling challenges for intellectual property law and for community members. Take Facebook for example – is the value in the platform, or in the user base (ie the community)? And if it is indeed the community, what is their reward, their share scheme and payback?

Finally on competition, it may seem that we are entering a world of abundance but one crucial constraint may be our attention. In the end, whilst we collaborate much more and work closely in co-opetition with traditional competitors, the available attention for what we provide may be scarce. Competition is not going away (for many, it is massively intensifying) – it is adapting and evolving in this more open world.

Summary

Openness is a fascinating topic and trend. Like a force of nature, it is awesomely powerful and not always benign or kind to those on the receiving end. And like a force of nature, that huge power that it possesses can be partially harnessed. In business, our tendency is try to resist openness. Business usually wants closed-ness. It wants control, narrowness, monopoly, few rather than many, integration, quality, secrecy. Very often, business wants to be opaque. Generally, business people find openness terrifying.

But regardless, its power grows. Society is becoming more and more connected, which is leading to more and more openness. We can batten down the hatches, hate what it brings, and hope that it passes, and ideally soon. Or we can harness its energy, go with it, run full force with it and throw everything we have into being more open. In this chapter we have looked ways to do so. To make it happen, as everything else in this book, will require grit and vision, and will lead to extremely positive cultural change.

As progressive business people, this is a wonderful opportunity and a force we can channel to help us make things better.

Further reading

Wikinomics – Don Tapscott & Anthony D. Williams
Open Leadership – Charlene Li

How was that? Please provide feedback: via comments on this post, via email to wmcinnes@gmail.com, tweets @willmcinnes #cltrshck.

Next extract: starting the Change Velocity chapter…

Thank you for your support,

Will

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