Radical Transparency – Why Exposing Yourself Is The Future Of Business

The saucy, irreverent hyperbole cited above is the front-cover message on the most recent Wired Magazine.  The article that addresses the promise on the front cover is titled The See-Through CEO, by Clive Thompson.

Here’s the first paragraph:

Pretend for a second that you’re a CEO.  Would you reveal your deepest., darkest secrets online ?  Would you confess that you’re an indecisive weakling, that your colleagues are inept, that you’re not really sure if you can meet payroll ? 

Sounds crazy, right ?

After all, Coke doesn’t tell Pepsi what’s in the formula.  Nobody sane strips down naked in front of their peers.  But that’s exactly what Glenn Kelman did.  And he thinks it saved his business.

The Wired article on radical transparency chronicles the arrival of widespread awareness of how clickable hyperlinks and networked-based relationships are having an impact on the corporate world.  The article contains all the usual suspects … stories and examples from the blogosphere that are now tired and shopworn.  I’d have to admit I expected to learn more and I am surprised that Wired has published what I consider to be somewhat of a puff piece (see my rant-and-whine disclosure at the end of this blog post).  Additional rant context … many other bloggers, writers and theorists (Malone, Davis, Shirky, Boyd, Weinberger, Searls, Locke, Sessum, de Castells, Turkle, Semple, Mardle, McGee, Paterson, Barefoot, Scoble, Tapscott, Israel, Anderson, Ratcliffe, Ito , Blaser, Funch … on and on) have offered their takes on this emerging awareness … so I am really taking the Wired article as a signal that the early weak indicators have settled into place.

One of the more recent "hot topics" … Shel Israel and Jeff Jarvis complaining about Dell (squiffing about a company and then people linking to the squiff, thereby driving the entries and references above Dell itself on Google),  can be retrofitted to hundreds if not thousands of examples that have occurred over the past decade or longer.  It’s just that Shel Israel and Jeff Jarvis have blogged enough loud enough and been linked to by enough other A and B-list bloggers that they now serve as a point of instantiation for the link-driven transparency phenomenon.

While the Dell example is useful in a business-oriented magazine, it’s sourcing represents a decent example of the circle-jerk blurb-of-mouth referencing that is unfortunately over-common

Don Tapscott’s The Naked Corporation and now Wikinomics are also featured prominently in the Wired piece.  I’ll give Don his due … he’s done his homework and has been an astute observer and chronicler of things digital as they have emerged over the past decade and more.  But it is not original thought, and he is a master marketer (I just learned during a discussion today with an organization that they enquired after having him speak … $35,000 per day). In my opinion, there are a lot of other people out there who grok this stuff just as well who can do a stellar job for 10% of that; but of course that price tag will make some executives and senior managers sit up and take notice, even if they’ve heard the same stuff elsewhere before.

Here’s another brief excerpt from the Wired article:

The Internet has inverted the social physics of information.  Companies used to assume that details about their inner workings were valuable precisely because they were secret.  If you were cagey about your plans, you had the upper hand; if you kept your next big idea to yourself, people couldn’t steal it.  Now, billion dollar ideas come to CEO’s who give them away; corporations that publicize their failings grow stronger.  Power comes not from your Rolodex but from how many bloggers link to you – and everyone trembles before search engine rankings.  Kelman rewired the system and thinks anyone else could too.  But are we really ready to do all our business in the buff ?

"You can’t hide anything anymore," Don Tapscott says.  Co-author of The Naked Corporation, a book about corporate transparency, and Wikinomics, Tapscott is explaining a core truth of the see-through age.

I’ll admit to being surprised that Wired did not also roll out Robert Scoble as the leading example of the transparency effect, even though he is by his own admission the most important Robert on the Internet because of his yeoman service in humanising Microsoft over a couple of years.  I mean Robert no disrespect.  I admire his enthusiasm and I think that enthusiasm, a good understanding of social software, and the decision by Microsoft to experiment with letting him say more or less whatever he wished, went a long way towards making him a star in certain orbits.

Whatever one thinks, I think that Microsoft was smart to open itself up somewhat (and I stress the somewhat) during the period that Robert Scoble was blogging.  I don’t know that they’ve yet been able to find a second act (Michael Gartenberg was tapped but then tapped out quickly)  The Scobleizing-of-Microsoft  may have been a one-time phenomenon because of its worth as a novelty act, and there must be significant pressure to do it better on whomever may eventually be chosen.  Scoble was a guy in the right place at the right time, but I suspect that there are a reasonable number of other articulate, friendly and open tech bloggers who would have done as good a job.  Nevertheless, he will always have been the guy that The Economist dubbed Microsoft’s Chief Humanizing officer.

What has always astounded me is that an organization made up hundreds of thousands of people needed, or needs, to be humanized.  Just think about that for a moment.

Compare and contrast the two excerpts above from the article and the generally-recycled examples I’ve cited with this introductory paragraph, written in the early spring of 2002 as the introductory draft chapter for a book proposal …

(the heck with it, I’ll post the whole introduction.  It also served as an early draft of an article for the World Future Society, published in May 2002.  Some of the examples are dated, and of course blogging is a much-multiplied force now)

What do you do as a leader – a CEO, a Vice-President, a senior manager – in the Knowledge Age when past traditions of gaining rungs on the professional ladder by being the smartest, the most decisive, the clearest, and the strongest are less effective?  When much of your power and clout came from your position, and from having more information than most of the others?  What do you do when suddenly, many people in your organization, and many of your customers and competitors are loaded with that same information, and you no longer have privileged access to anything? How do you “unlearn” your old mental models? How do you need to communicate and behave in order to establish credibility in the Knowledge Age?

The World Wide Web burst into mass human consciousness only ten years ago, and its reach has multiplied exponentially since then. And yet, this dominant defining factor of a new era is only in its infancy. The accessibility and interconnectivity that it provides already responds to almost any need or desire, and much more capability is sure to emerge in the next few years

Meanwhile, web-enabled tools are transforming work processes in more and more important and pervasive ways. Human resources management applications are proliferating, websites like Ninthhouse.com, Smartforce.com and Learn2.com deliver the first wave of on-line learning in easy-to-use formats, and most Fortune 500 companies already have or are planning intranets.

As we learn more about how to integrate all this potential capability into our daily work lives, we will see various forms of employee portals, partnership portals, project management portals and more recently,  comprehensive real-time enterprise computing applications take root and grow in many organizations. Next … blogging ?

Organizations’ IT infrastructures, coupled with ongoing growth in the scope and use of smart software, will create a type of integrated nervous system, providing top management and workers with an improvement-and-learning focused feedback loop.

Information technology, business process re-engineering and upheavals to established business models created by the rapid development of the Internet are exerting significant pressure on long-standing business hierarchies. Top-down, command-and-control management structures and dynamics struggle to maintain effectiveness in the face of free-flowing streams of content-rich information, coming from all directions.  The dynamics of how people relate – to work, to markets, to bosses and to each other – are changing  “Wirearchy” –a dynamic flow of power and authority based on connections and conversations – is emerging as a social dynamic in both business and society.

Wirearchy suggests a fundamental change in the dynamics of human interaction in – and with – organizations of all sizes, shapes and purposes.  It represents an evolution of hierarchy as an organizing principle and dynamic. Wirearchy will not render hierarchy obsolete, nor the need for direction and control; rather, it will render them more necessary.  However, it will change the meaning of those terms and how they are used and experienced.

When software connects customers directly to business processes, and employees have “line-of-sight” responsibility for making a clear contribution or directly impacting business results –when most of an organization’s strategy and value proposition is directly coded into its CRM, ERM and B2B applications, will the types of supervision and management we learned in the ‘70’s and ‘80’s continue to be effective?

When interconnected software and citizens access and distribute information, opinion and facts about the policies and tactics of our governments, new standards for accountability begin to take shape.  Will governments seek greater control and secrecy, or will they adapt and focus on governing by principles rather than tactics ?

Wirearchy is a structure of governance, strategy, decision-making and control based on knowledge, trust, meaning and credibility. Things get done and results are achieved through connections and conversation. Wirearchy is generated by an open architecture of information, knowledge and focus, enabled by connected and converging technologies.

The concept of Wirearchy can help to develop a strategy for creating, implementing and deploying this new interconnected dynamic in ways that respond effectively to continuously changing conditions. The core components of Wirearchy are:

·      a crystal clear vision and values based on integrity and facts and built with input from customers and employees

·      a strategically designed and integrated technology infrastructure

·      comprehensive, clear and completely open communications

·      pertinent objectives and focused measurement

·      characteristics of culture that create, support and enable responsiveness, adaptability and fluidity.

·      leadership that is clear, focused, open, authentic and shared

Perhaps the shift to Wirearchy is a result of the conflict and dissonance generated by dated structures, mindsets and dynamics clashing with the irrevocable new forces created by the open access to information and knowledge. A cogent (and early) scenario describing this change is found in The Cluetrain Manifesto (www.cluetrain.com) – it consists of 95 statements of how fundamental shifts in values and attitudes due to connections, openness and cynicism demand openness, transparency and authenticity from the prevailing power structures in our corporate-led society.< /em>

People won’t accept authority easily any more. While old-guard keepers-of-the- keys still cling to authority and power, the older models of how to lead and follow are unravelling. Organization charts are still useful, but only as they become more fluid. Certainly, they appear in a much wider range of shapes than before, and often convey new messages about power, status and control. “Organigraphics”, or pictures of the way(s) organizations flow and operate, and are clearly more pertinent, accurate and useful these days, according to strategy and organizational structure guru Henry Mintzberg,.

How does today’s senior manager or government leader respond to these forces? Clues are evident in initiatives emerging in the fields of customer and employee relationship management, organizational development, human resources management and organizational change: the use of techniques such as scenario planning, dialogue, open space, emotional intelligence, coaching and mentoring have all grown significantly over the past several years. Together, these soften the rigidity of outmoded structures, and help people respond and adapt.

Yesterday’s success factors involved secrecy and control, size, role clarity, functional specialization and power. Today’s emerging factors are openness, speed, flexibility, integration and innovation. 

Most organizations carry out ongoing initiatives to create, clarify and improve capabilities in each of these emerging areas. Indeed, a large percentage of the global consulting industry is focused on diagnosing, developing and implementing strategies for these goals. Wirearchy is significantly different in that it focuses on the structural and psychosocial dynamics generated by interconnectivity and access to knowledge. It begins not only with what’s happening at the top, but also what’s happening in the roots and branches of an organization. Where hierarchy controlled the creation of focus and meaning through the control of knowledge, Wirearchy implies that it be used appropriately and respectfully.

It will take time and experience in this new era to know what “success” and “effectiveness” mean and look like.  In a wired and wirearchical world, where there is literal meaning in the phrase, “everything is connected to everything else”, we will have to watch, learn and imagine how to lead and manage in ways that lead to ongoing growth in human development. 

This organizing principle – Wirearchy – will evolve to impact business, governments and societies in ways that we have never before encountered in human history.