The social enterprise, more equal or more successful?

Last week I attended the connectingHR unconference on the theme of ‘The Power of a Socially Engaged Organisation’.  Many things were discussed (See here, here, here, here, here and here.), but the question that I want to focus on is: what is the case for social media tools in the enterprise?

Democratic work place

Miranda Ash (@mirandaash) from WorldBlu spoke about freedom and democracy in the workplace, “Organisational democracy is a system of organization that is based on freedom, instead of fear and control. It’s a way of designing organizations to amplify the possibilities of human potential — and the organization as a whole.”  Enterprise social media (i.e. the use of social media tools to connect people within an organisation) is one of the enablers of organisational democracy. Read our post about HCL technologies for a case study.

In an excellent post – Less formal doesn’t mean more equal – @FlipChartRick   reminds us that, in general, while hierarchies are becoming flatter and company culture less formal, pay differentials across organisations are growing and the control of  resource allocation remains in the hands of those at the top.

“So, while it is difficult to deny the impact of technology and changing social attitudes on organisations, I’m still not convinced that this will lead to any form of organisational democracy. Real sharing of control would mean that big decisions about resources would be opened up. Corporate leaders are still extremely reluctant to do that.”

This is an interesting debate, but it is a debate about organisational design and control. Is this the core issue? I think that is it more useful to ask: can social media in the enterprise contribute to success and how? After all, an organisation is a group of people who come together and hope to achieve more than they would as individuals.

Organisational success

In ‘Organisational Deign’ 101 I was taught that the primary goal of any organisation is to survive, and after that to grow and be effective. Survival is a crude measure of success, but it’s a good indicator that the organisation is achieving it’s mission effectively, otherwise it will cease to exist over the long run. Some of the most successful organisations in history are the world religions and universities. These organisations have very different designs, with religions tending towards a bureaucratic design and universities towards an organic design, i.e. with more autonomy and a flatter structure. If both can succeed then what is the right one for your organisation?

It depends on the environment. For organisations where there is a slow rate of change in the external environment a more bureaucratic type of organisation is more effective, whereas in a fast changing environment with a lot of information to process a more organic structure is more effective.

Not in Kansas anymore

In the past most organisations were bureaucratic. A small number of organisations, for example R&D intensive organisations, were more organic.

Deloitte’s career lattice

Today an increasing number of organisations operate in an environment where a high level of information processing is required. This is driving the trends of flatter organisations and more knowledge workers. It’s not possible for a bureaucratic hierarchy to control and coordinate everything in a fast paced environment like this, it’s better to have a more organic structure where individual employees have greater autonomy over their activities, coordinate with their peers and make more of their own decisions.

In addition the career ladder has been replaced by the career lattice and individuals are expected to take responsibility for their career development. For all sorts of reasons (ensuring that the organisation has the right people and that they are highly motivate) it is critical that career development within organisations works.

Coordination: the role of social media in the enterprise

Typical informal communications network in an R&D laboratory – Allen 1971

Knowledge intensive organisations have always relied on informal networks, inside the enterprise, to process information and to coordinate activity. Enterprise social networks can support and amplify those networks. Yammer is a well known tool which can be used for this, although almost any other social enterprise tool can be used for this too.

Other tools such as basecamp and Jive are used for coordinating project work in a social way, allowing employees to socialise project tasks and collaborate across the enterprise. Thompson Reuters gave an impressive demonstration of this at the connectingHR unconference.

Control or alignment: the role of Social media in the enterprise

It’s clear that social tools can help co-ordination in the flat, knowledge intensive organisation. What about control? In a bureaucratic organisation control is exerted through specific detailed goals and a carrot and stick system of rewards and punishments.  We know that the carrot and stick is at best ineffective and can be counter productive in the case of the knowledge worker.

In the knowledge world some of the control via carrot and stick is replaced with alignment between the purpose and goals of the organisation and the needs of the employee. Knowledge workers who are intrinsically motivated by their work, feel a sense of shared purpose with the mission of the organisation, have some autonomy over their activity and are continually developing and achieving mastery in their role will be high performers and an organisation with these people will succeed. Daniel Pink has popularised these ideas recently in his book Drive, however they are not new in knowledge intensive organisations.

A good starting point is to hire for fit (intrinsic motivation and alignment with the purpose of the organisation) not skills, as discussed in this HRB piece.  Careergro is a social career development tool to help employees maintain a good fit (purpose, intrinsic motivation and ability) as they navigate the career lattice, to socialise career development goals so that achieving mastery becomes a continuous and collaborative activity and to give them a tool that makes taking responsibility for their career a realistic proposition.

Are you using enterprise social media tools in your organisation? It would be great to hear if they are contributing to success or not and the reasons why. If you’re not using these tools let us know why not.

Performance Management v Career Development

I listened in to a HR seminar given by Mike McDermott from HumanR yesterday and it answered a very fundamental question for me: what should drive learning and development in a knowledge sector organisation, performance management or career development?

Mike described how performance management up until the turn of the century was based on the following paradigm:

PM = ability * motivation

With the advent of performance management tools over the last decade, alignment started to play a more significant role:

PM = alignment * (ability * motivation * opportunity)

According to Mike, this process is based on work that can be planned with expectations set, where performance can be monitored and abilities developed, performance rated, ratings summarised and top performance rewarded.  This approach is based on scientific management ideas from the likes of Fred Taylor from the turn of the last century, ideas designed for largely uneducated factory workers.

Automating this process made it more administratively efficient, a record was kept, there was legal compliance and it drove compensation within organisations.  Unintended consequences however included the process becoming too formulaic, it became a numbers game, inhibiting meaningful conversations, reducing the voice of the employee and growing the gap between managers and employees with a greater emphasis on external motivators and where the PM process is seen as a necessary evil.

The question Mike posed is what type of performance management system should we use for highly eduated knowledge sector workers who spend their time establishing relationships, evaluating priorities, identifying trends, making connections, brainstorming, focusing, creating new capabilities and strategies?  Mike’s answer focused on intrinsic motivation which directs behavious towards particular goals,  leads to increased effort, increases initiation of activities and enhaces cognitive processing, essentially leads to greater employee engagement.

Mike’s answer involves taking an holistic approach to performance management with 3 cornerstones based on everyday conversations, engagement principles and leadership practices.  Engaging conversations include conversations about what is important, about goals, learning, meaning, recognition and appreciation.  Engagement principles include widening the circle of involvement, connecting people to each other, creating communities of action and promoting fairness.  Leadership practices include speaking honestly, being transparent and being authentic.

Mike concluded with a new paradigm for knowledge sector performance management:

PM = [Org Capabilities * (Conversations * Community * Leadership)] – Under Performers

Mike then went off to ride his bike in the Washington sunshine having greatly enlightened the members of his audience.  The answer I concluded to the question of peformance management versus career development is that it is the wrong question, the real choice is between industrial age performance management and knowledge age performance management.  The sooner knowledge sector organisations realise this distinction the sooner they will increase their performance.