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breaking silos toimprove performancethe socialmanagementof workRolf E. Kleiner and charles Bedard
03 Introduction04 Why we need social management practices07 Why it works08 Linear management processes don’t work09 Perpetual processes are enabled by social management10 It’s new technology and a new mindset15 Which technology?18 Conclusioncontents
introductionPeople are inherently social. The trouble is, organizations typically do notharness this natural inclination well. Rather, they create barriers that hinder howemployees engage with one another, and limit agility in how they collaborateand make decisions.They do this by forming complex hierarchies and reporting structures,excessively layering new processes and controls without reviewing orremoving existing ones, as well as creating functional silos with definedyet competing interests.In an effort to control and converge the way people work, organizations havehindered their productivity and increased bureaucracy—so much so thattraditional management think is no longer working. Employees and employersalike are looking for a new way of interacting that’s more productive, moreefficient and more responsive to what’s happening here and now—not whatwas happening when all these processes and hierarchies were created.By redefining how we manage, and by striving to better reflect how peoplewant to work in an information-based knowledge economy, we can improvecommunication and collaboration, and eliminate waste. This is what socialmanagement at work is all about and we’re already doing it ourselves.In the next few pages, we will take you through our thinking, our approach andshow you why “social” is the next evolution in good management practice.Rolf E. Kleiner Charles Bedard3
From the outside, we perceive companies as unified wholes.In reality they are often a series of silos, each with their ownobjectives, management practices and ways of operating.Why we need socialmanagement practicesThe challenge every large organization faces is to move from being a groupof fragmented silos working in parallel, to becoming a unified ecosystem. Andunfortunately, many of the controls and processes managers have used toimprove employee functioning have, in fact, inhibited it.The silos present in many traditional business structures have the effect of limitingaccess to critical communication—not only vertically but also horizontally. This isproblematic for four reasons:1. Only top leaders can give strategic communications the appropriateweight, yet few employees receive this thanks to hierarchical “cascading”communication styles.2. Strategy involves trade-offs, which are more easily accepted when put in abroad perspective, without parochial filters.3. Messages passed from person to person seldom arrive intact—so employeesare left operating without the key information they need.4. Critical messages from the “frontline” do not filter back up the managementline effectively or efficiently. Often, key customer insights are lost becausecascading doesn’t work in reverse.The “social management” of work is about effectively communicating andmanaging at least these two things:1. The operational goals of the corporation; and2. The impact individuals have on operations.4
Traditional management approaches often concentrate heavily on achievingthe first point, but do not have the technology, processes or managementpractices to deliver on the second.At their core, social management practices aim to recognize and harness thesymbiotic relationship of the organization and the individual. When executedproperly, the outcomes are:• increased workforce engagement• lower turnover• better governance of process• improved efficiency and effectiveness• better financial results• establishment of a performance culture and, ultimately,• successful execution of strategy.While some hierarchy is necessary—the buck has to stop somewhere—socialmanagement ignores the idea that “cascades” must only occur within silos.Instead, it embraces a more transparent and flattened business structure,facilitated by perpetual (rather than linear) processes, and by social technology.Why we need social management practices5What we think happens What really happensA unified collective A series of silosOne goal Many goals, different objectives, competing interestsOne way of operating Multiple operating practices and management routinesWorking collaboratively Disjointed, in conflictInformation flows/”cascades” as needed fromone layer of the organization to the nextInformation tends to “pool” rather than “flow”—some areashave access to too much, while others have access to too littleEmployees are well connected to theirmanagers and understand the objectivesEmployees are disconnected from managers and do not alwaysknow how they are performing against the plan
6The cost of disengaged employees to U.S. employers per year1:$370bThe percentage of return on the salary of a disengaged employee2:60%The percentage of return on the salary of a fully engaged employee:120%The average proportion of employees that return high engagement scores:12%1 Blacksmith, N., & Harter, J. (2011, October 28). Gallup wellbeing. Retrieved from http://www.gallup.com/poll/150383/majority-american-workers-not-engaged-jobs.aspx2 www.blessingwhite.com/.../blessingwhite_2011_ee_report.pdfWe need todo better
Social technology is in its infancy. As it becomes morepopular, business leaders can use this dynamic change tobreak down the silos and create unity in their businesses,thereby allowing every person to contribute to success.why it worksSocial technology is changing the way we work and manage because of thefollowing reasons:1. Community networks are inherently social and create an opportunity tostreamline hierarchical processes, resulting in flatter organizational structuresthat are more agile, responsive, collaborative and aligned.2. It is replacing laggard reporting with real-time or near-real-time alerts and KPIdashboards. This allows current feedback, not post-event, reactionary data.3. It allows organizations to connect employee performance with operationsmanagement.“Social management” capitalizes on the gains made by performancemanagement and moves a step forward, bringing the constant communicationof the modern world to bear on the business. This continuous communication,when combined with a clear focus on business goals and personal responsibility,can help leadership teams create a thriving, high-performance business.However, this growth will not be spontaneous—business leaders must controland monitor the successful transition. As social technology changes the way wework, perpetual (not linear) management processes must be implemented tomaximize the gains.7
8Organizations spend a lot of time creating elaborate processes fortheir staff to follow. These are meant to guide and intentionallyrestrict who does what, when they do it, where they do it and why.Linear managementprocesses don’t workThis is roughly what a linear management style looks:On the surface, this may seem like the responsible way to run a largeorganization. Yet, the key problems with this approach are:• All steps/processes are manual so the process itself becomes are burden/drainon productivity• Version control of documentation is onerous and ineffective• All decisions are made on past/historical information• Analysis is hampered because key data is held inside forms, not transparent,accessible systemsWhile we all want to reduce risk and effectively manage resources, these complexand lengthy process maps haven’t always achieved the ends we hoped theywould. And there have been other costs along the way.HR Employee Manager HR executivesProcess Initiation Completing Review Form Collecting Data Analyzing ResultsConduct environmentalanalysisprojectinitiationdevelop, revise & alignstrategic planintegrate planning,develop tactics & measuresimplement, monitor,evaluate & adjust
9Perpetual management processes are rather different to linear processes. They take acompany’s strategy and create information and communication process flows to eachteam and individual. With each communication cycle, work becomes more efficient.Perpetual processes are enabledby social managementThis is how a perpetual management works:HR team can look at skillstrengths and gaps; anduse this information toplan workforce trainingand recruitingManagers can use skillscaptured during process tohelp staff projectsExecutives get timelyfeedback from HR onalignment of workforcewith corporate prioritiesEmployee goals arelinked to manager goalsand corporate goalsEmployeesexecutivesHRManagerstrategicallyalignedorganizationperpetualmanagementprocessGoalsettingActivity & KPImonitoringCommunication &collaborationfeedback &recognitionlearning &Strategy
10The benefits of perpetual management include the following:• Employees are given continuous, real-time (rather than periodic) feedback,recognition, engagement and goal setting.• Employees’ goals and objectives are aligned to that of the organization.• A single, unified understanding of the operating performance.• Improved awareness and alignment—better alignment between strategyand execution. • Simpler management structure and flatter management hierarchies.Perpetual processes are enabled by social management
Companyinteractions arebecoming lesslinear anyway11The boundaries between employees, vendors and customers will blurTeams will self-organizeDecisions will be based primarily on the examination of datarather than reliance on opinion and experienceThe organization’s formal hierarchy will become much flatter or disappear altogetherData used for decision-making will mostly be collected through experimentsFinancial transparency will increase dramaticallyInternal markets or other voting mechanisms will be usedto allocate resources (eg, talent, capital, ideas)Strategic priorities will be set from the bottom upIndividual performance will be evaluated by peers rather than by managersEmployees will have much more discretion in choosing which tasks to work onEmployees will play a much greater role in selecting leadersLarge companies and/or business units will disaggregateCompensation decisions will be made by peers rather than by managers353232272019181714121093Likeliest organization changes in next 3–5 years, without constraints% of respondents,3n=4.2613Respondents who answered “none of the above” or “don’t know” are not shown.
12The adoption of social technology as a business toolhas happened mostly in the last three years.It’s new technologyand a new mindsetIn a recent study by McKinsey and Company, researchers discovered thatorganizations with the most widely utilized social applications were those mostlikely to see success, while those that implemented social tools only in selectbusiness processes or departments saw inconsistent and often short-lived results.McKinsey’s research shows that: “Respondents affiliated with fully networkedorganizations say that they continue to realize competitive gains and performanceimprovements...Integrating social technologies into the workflow and using themto optimize internal processes will, these results suggest, provide additionalcompetitive benefits.”4Central to McKinsey’s findings was the idea that silos are no longer working, andbusinesses must make the decision at the executive level about social technologyto experience the maximum benefits. This transition from silos to a unifiedorganization is a simplification of the way work is done. The multiple agendasand divergent business strategies of the past are eliminated as the corporationis able to move toward one agenda and a common goal. Truly holistic, perpetualmanagement is now possible when facilitated by the connection of socialtechnology with social management monitoring tools.Businesses willing to implement social technology and to adopt the mindsetnecessary to support its complete adoption have seen the greatest gains. Thosethat implemented social technology in one vertical only, or for just one process,have seen fluctuating gains and inconsistencies. According to the McKinseyreport, “Executives at internally networked organizations note the highestimprovement in benefits from interactions with employees; those at externallynetworked organizations, from interactions with customers, partners, andsuppliers. Executives at fully networked organizations report greater benefits fromboth internal and external interactions.”4 Bughin, J. (2012, November). How social technologies are extending the organization. Retrieved fromhttp://www.mckinseyquarterly.com/How_social_technologies_are_extending_the_organization_2888
13Perpetual management processes, aided by social technology, alloworganizations and managers to augment event management with processmanagement.In an organization that follows an event management approach, the goal isbusiness as usual, and only the exceptions are exceptional. However, in anorganization driven by a perpetual management approach, the goal is continuousimprovement on every front. When social technology is integrated into thisapproach, the gains can increase productivity up to 25 percent.However, the danger of social technology is similar to any other technology—companies that see the tool as the solution will stumble. It is critical thatinnovation and advancement occur simultaneously. Organizations that areinterested in seeing the benefits that McKinsey & Company predicts must be boldenough to bring both the social technology and the management tools to theiremployees in parallel.It’s new technology and a new mindset
% ofaverageworkweekImproved communication and collaboration through social technologies couldraise the productivity of interaction between workers by 20 to 25 percent.1425–35%10–15%20-25%30–35%25–30%ProductivityimprovementReading and answering emailsSearching and gathering informationCommunicating andcollaborating internallyRole-specific tasksTotal28191439100Interaction withworkers’ tasks7.0–8.05.5–6.53.5–5.04.0–6.020-25%Increased value-added timeSource: International Data Corporation (IDC); McKinsey Global Institute analysis
15Technology alone cannot deliver the benefits of a “social management”approach to work. Instead, businesses must align their processes, theirmindset/culture and implement the right technology alongside each other.Which technology?Once the organization as a whole has decided to implement a more holisticapproach to management, aided by social technology, the benefits are tangibleand definitive.Readily available, cloud-based tools (SaaS) enable users to integrateperformance and operational management in a very simple “dashboard”application—effectively connecting employee performance with operations. Inthis way, social management tools effectively automate execution.Social management monitoring is a key component to utilizing social technologyproperly in a business context, as it bases activities on outcomes and metrics.For example, social performance management monitoring tools allow executivesand managers to capture and record:• Time: employee productivity, downtime.• Output: Each employee’s work can be directly tied to the bottom line.• Social currency: The value of influencers, networks and othercommunications will become part of the key value of a new hire orpromotion.• Product feedback: Social technologies can be used to derive customerinsights and interactions during and after development.• Marketing and sales: Social technologies can be used to generate and fostersales leads; for social commerce.• Customer service: Social technologies can be used to provide customer careacross multiple mediums (chat, email, telephone, kiosk, video, etc.).
16Whichever technology you choose for your business (and there are many) itshould include each of these capabilities to ensure you capture all of the criticalinformation in one place. Its key purpose should be to replace manual, error-prone reporting with accessible KPI dashboards that improve governance andprovide direct (real-time) feedback to employees and their teams. Ideally, youshould be able to:Go from this: To this:which technology?As the old saying goes: what gets measured gets improved, and goodtechnology should facilitate this objective.
Social supply chain Social recruitmentTwo-thirds ofcompanies alreadyuse a social solutionof some kind.5175 Harvard Business Review. (2010). Sas business analytics and business intelligence software. Retrievedfrom http://www.sas.com/resources/whitepaper/wp_23348.pdfIt makes sense to integrate these and apply the same logic and processes across all areas.Social marketing and sales Social CRM and support Social product development
In an incredibly brief nine years, social technology has expanded and morphedinto a major game-changer for the business world. The way we work ischanging, and businesses must be ready to tailor social technology to their ownneeds; integrate that technology into their business processes; and manage thepeople, the technology and outcomes effectively.Instead of holding fast to linear, control-driven ways of working and managing,organizations must find ways to integrate social technologies across all areasof their business. They are now being challenged to manage differently, and ina way that better reflects how people want to work in an information-based,knowledge economy.Ultimately, social management—and the technology that facilitates it—is aboutimproving communication and collaboration and eliminating waste. It’s aboutfinding ways to make better business decisions, to engage employees in thestrategic intent of the organization and to improve performance.Social management has worked for us and for many of our clients. If you’d liketo know more, please get in touch.conclusion18