Elaine Rumboll
Elaine Rumboll

Weapon of mass collaboration (or how the market has just gotten smarter)

Rapid change is integral to how we operate these days. Although South African businesses have often been praised for the way in which they are able to harness rapid change for organisational results, the impact of this quicksilver modus operandi has not however been fully digested for our businesses practises in the long term.

Ever-accelerating internet and other mobile marketing technologies have brought the world to the brink of a revolution in the way we live and work. The new internet age, sometimes called Web 2.0, with its plethora of social networking opportunities — Facebook, MySpace and a infinite number of blogs to choose from — together with technologies like Mxit are quietly bringing about a revolution in the way human beings engage with each other.

What many still don’t grasp is that this will have implications not only for how we engage in our downtime (it’s no one’s business but your own if you spend all night in SecondLife) but how we engage in our work time. Businesses need to take note of this or risk not just getting left behind — but simply becoming irrelevant.

These ideas are not new. Almost ten years ago the seminal book The ClueTrain Manifesto set out to examine the challenges to business that the internet posed. A few years later Don Tapscott and Anthony D Williams picked up and expanded on subject in their extraordinary book — Wikinomics, which gave examples of businesses who were successfully starting to ride the waves of change.

Well into the first decade of the brave new 21st century, it is clear that the changes these prophets spoke of are irreversible. Not surprisingly therefore, some of the more responsive businesses and organisations have started to move into the virtual world. The company blog, once a rarity held up for example in marketing seminars, is now a common phenomenon. In June 2006, Harvard Business Review ran an http://harvardbusinessonline.hbsp.harvard.edu/b02/en/common/item_detail.jhtml?id=R0606B&referral=2430″>article on the opportunities presented by virtual worlds such as

  • SecondLife
  • to advertisers and businesses have been lining up to move into that space ever since.

    But many of these brave new initiatives are running into problems. Nay-sayers claim it is because the potential of virtual worlds for marketing and business is over-hyped, however there are enough examples of those who are getting it right to contradict this.

    Local wine business Stormhoek, for example, successfully managed to boost its exports by six times in a two year period solely by using virtual technologies — mainly blogs — to market its product to international markets. And on a grander scale Microsoft won critical acclaim from its key clients by being one of the first to initiate a blog that is staffed by the company’s technical experts who spend their days having conversations with Microsoft users around the world on how to implement and improve Microsoft systems.

    Failure to thrive in the virtual world is therefore less about the nature of the medium and more because the businesses concerned have not understood one fundamental thing: the mental shift required to do business successfully in these new environments is bigger than simply using different technologies to do the same old things. Just showing up in a virtual world is not sufficient — you have to be prepared to engage and interact with consumers in a real — and very different — way and you have to be prepared to let go a little.

    As HBR contributor Paul Hemp puts it “brand-building initiatives by real-world companies in virtual worlds must engage users. … A mere presence in the world isn’t enough.”

    The reason for this, some say, is because of the ability through social networking technologies to tap into an age-old human impulse to forge relationships and share information. What is new is the scale on which it is happening. The new internet creates the platform for two-way traffic on a scale never before imagined in human history and this is enfranchising millions of consumers to engage directly with brands and service providers. Tapscott and Williams call it the “weapon of mass collaboration”.

    Maybe this freedom is going to everyone’s heads, because the result is consumers are starting to reject brands that don’t talk back to them! As the Cluetrain Manifesto states: “A powerful global conversation has begun. Through the internet, people are discovering and inventing new ways to share relevant knowledge with blinding speed. As a direct result, markets are getting smarter — and getting smarter faster than most companies.”

    Product and services driven businesses need to understand that in this environment, simply delivering a service or thrusting a product upon consumers may not be enough to get them through next few decades. They need to realise it’s about relationship — and not in the old CRM style of sending a client a birthday card either — but about meaningful engagement and conversation.

    The days of Henry Ford’s “you can have a car of any colour so long as it’s black” philosophy are numbered. In the 20th century products and services were bought and forgotten. Thus, key competitive advantage included pitching a service, selling benefits and protecting IP. In the 21st century, by contrast, services only have meaning if they are a part of a past, present and future conversation. In this world, competitive advantage lies in collaboration and co-creation with your customer and a genuinely visible curiosity around where you are going to take it.

    These three Cs — collaboration, co-creation and curiosity — are the keys for successful operation in this new world. There are numerous examples of how companies who have successfully embraced these concepts have quite literally migrated to a new level.

    For example, IBM shocked the R&D world recently when it decided to open up the innovation process and invite outsiders — including some competitors and academic institutions — to collaborate with it in an effort to re-invigorate its flagging chip business. The decision paid off, not only by saving the company billions but by putting it firmly back at the leading-edge of the market.

    Boeing, Eli Lilly, BMW and Procter & Gamble have done similar things. A recent article in Businessweek reports that as a result of collaboration, Boeing cut 12 months off the time it took to bring the 787 Dreamliner to market and Procter & Gamble improved its R&D productivity by 60%. Another collaborator, telecommunications giant bt Group spawned $1-billion in incremental sales since 2002 as a result of a collaborative process.

    Wikinomics opens with the story of how a small gold mining company Goldcorp transformed itself from an underperfoming $100-million company into a $9-billion juggernaut by throwing open its prospecting business to the wide world. First it made every scrap of information about its 55 000-acre property available on its website and then it launched a virtual prospecting competition — hoping to tap into some of the best minds around the world to help identify the right places to look for gold.

    In an intensely secretive and competitive industry, the old 20th century way of thinking would baulk at what Goldcorp did, but it worked because that world is on its way out.

    And the approach can work at all levels — not just for the big R&D giants of the world where collaboration makes sense because it means tapping into many more minds than even the best R&D department could afford. By embracing these three principles in the realm of business education the UCT Graduate School of Business is getting attention worldwide. Last year, the school was identified by UNICON as one of six business school innovators around the world and will be presenting its new model, that advocates a process of curiosity driven co-created learning — called Alchemical Learning — at the UNICON executive education directors conference in Australia in April 2008.

    The UCT GSB is also practising what it preaches and this too is paying off. In 2007 it snatched a prime contract out from under the noses of heavyweights — London Business School, INSEAD and IESE in Spain to develop a high-level leadership programme for J&J’s women leadership because the client was delighted with the school’s curiosity driven, collaborative approach.

    Like Tapscott and Williams, the UCT GSB believes that: “To innovate and succeed the new mass collaboration must become part of every leaders playbook and lexicon. Learning how to engage and co-create with a shifting set of self-organised partners is becoming an essential skill, as important as budgeting, R&D and planning.”

    The more organisations we can take along with us, the better for our future economy.