Community First – 9 Elements of Corporate Strategy

October 4, 2011 6:32 am 14 comments

This is a Note to all the CEOs and Investors who are wondering how to make it in all the economic madness that exists around them, is there a new mantra of Corporate Strategy that can be our salvation? Surely, if you keep your ‘Community First’.

Greetings of the day! I have been working on a presentation for one of my next lectures. It is a theory that has been in my head for an while but is taking a more solid shape now. Before we get into the theory a bit of background.

Background

We have all heard of Customer First, no not the standards organization in UK but the management theory that says you put your Customers First (meaning ahead of everyone else, your Shareholders, your Employees, your Management etc.). Various companies including Westinghouse have implemented Customer 1st as a company wide initiative as recently as 2003. Understandably so, Twitter was born in March 2006.

Some of us may even have heard of Employee First Philosophy tried out by Starbucks and other firms. Not many, but some have even gone to the length of saying ‘Employee First, Customer Second’ I wonder if that is a real management philosophy or a marketing tag line to assuage clients worried about employee turnover of your firm or industry.

Community First

It should not be such a shocker if I state a new management philosophy ‘Community First’. We may wonder how and where to find case studies for such a philosophy and who outside of the CSR department of any Enterprise worries about Community.

We may also question that while focus on the Community maybe a great social statement or philosophy converting it into a annuity revenue business model with stable cash flows may well be hard.

Surely, Facebook and Twitter stand out today as examples of firms that followed the model Community First. It may be a strange thought to look at it as Management Philosophy as I don’t think Mark Zuckerberg or Jack Dorsey were ever sitting in a room with McKinsey & Company or Peter Drucker to decide their course of action but surely they were ‘Management’ of their respective firms making the right decisions to focus on growth of the Community, which I will now take the liberty to define more broadly as not just users but the entire ‘Ecosystem’ around the firm.

Web start-ups have experimented with various business models. One strikingly stands out, the Freemium business model which focuses giving out a limited set of features to non-paying ‘users’ for free and additional features to a set of ‘paying’ users at a ‘premium’. This model has led to some successes the ones that stand out are Skype, LinkedIn, Flickr and Pandora. While all of these firms have models centered around Community and/or Marketplaces bringing Advertiser and User liquidity or a stable subscription base, it is interesting to note that none of these organizations have had a successful IPO, other than Pandora.

What did Pandora do differently? Could it be Pandora Everywhere? One would not give Pandora credit so much for their Developer Platform (that is an area where we would give marks to Facebook or Apple). However the wide and deep partnership spectrum across Blu-Ray Players, FiOS, TVs, Table Top Devices, Digital Media Players and Home Theater systems that was built by Pandora under Pandora Everywhere can be thought of as an example of Community First. Build it and they will come, well they are already there building it with you.

While, it surely helps grow the total number of users ‘paying + non-paying’ but is no guarantee to a higher conversion rates from your freely growing comet tail into the meaningful subscription comet head.

The key is to look at the term Community more broadly as more than just users, advertisers and developers.

We may however, want to write Facebook or Pandora off as examples of evolving or non-traditional Business Models, maybe. Let us then look at another example: Salesforce and see how Marc Benioff and built an ‘Community First’ = ‘Ecosystem’ around the Cloud.

It is interesting that Marc should now talk of the concept of a Social Enterprise, no not Social Entrepreneurs. Social Enterprise talks about bringing your Employee Social Networks and Customer Social Networks together into 1 single ‘social’ data model so that you have a ‘Social Customer Profile’ which can be thought of as the next level of the ‘Single Customer or Client View’ a certain and elusive challenge of any large enterprise that has grown through M&A.

While, I can’t be sure if Marc is talking about the ‘Community First’ philosophy, I surely see it as the first glimpse of an attempt to bring the ‘Community First’ model within the Enterprise.

What the hell is Community First?

Surely, I hope by now you are wondering why this long winded discourse on Community First and what is the point?

Lets Unravel!

A. Community Means: Everyone (not just Employees and Customers)

What made Facebook grow is not their focus on Customers(users) or Employees but building a strong ecosystem around themselves e.g. Developers who write apps that make Facebook more useful. e.g. Partners like Zynga Networks that wrote Games on Facebook and helped people grow.

What your community finally ends up being can be just pure common sense or be modeled mathematically as an ‘attractor’ to determine a physical the shape of your community that you can visually see on your Corporate Dashboard. What will keep it together will be glue elements two such elements are paramount:

a) Enablers – Elements that ensure that the community can share, interact and communicate freely. In the old school this was done by Events, Agreements and Collaboration. In the new world, the digital reality of these enablers is the accelerator you can depend on. Events today are not just offline but also online companies like Blogtalkradio let you broadcast yourself from your POTS phone! and Livestream lets you create your own Live Television Channel from you webcam. Agreements and Collaboration are no longer just about newsletters, bulletins and forums(online or offline) but opening up your organization with a Community APIs so anyone can talk to you.

b) Aligners – Elements that ensure that the community interests are common and aligned. Growth for 1 means growth for all. The aligners are things that motivate people to move cohesively in the direction you want your organization to head. People are motivated by simple things Freedom, Mastery and Motive. Freedom is the hardest to tackle as while the 20% model of Google or every Wednesday model of Atlassian may work for some organizations, with great freedom comes great responsibility and it eventually takes you down to complacency. Mastery is easier to tackle but is very effort intensive as it means constant reorganization of people and roles to ensure that they are happy honing skills in an area that benefits the organizations objectives the most, The Question? how long before Joe gets bored in his new role. Motive is the easiest to tackle but the one that most organizations find hard to fathom as its about a ‘mission’ or ’cause’ or ‘religion’ that the entire community pursues with a higher goal than money. One trick to make this work is to build a living icon or mascot that the entire community holds in high regard and their word is gospel. Question? Ms. Mascot has got to be consistent or else they just simply define which ‘strange attractor’ your community and organization will eventually consistent with.



B. 9 Elements Matter: Employees, Customers, Analysts, Competitors, Investors, Vendors, Media, Partners, Consultants

First Element: People on a Mission: Its said that Charity begins at home. An organization cannot start without a few set of core people who
are committed to a ‘Cause’ or ‘Mission’ and then they bring others to that cause or mission.

Without a the dream of a Mission NASA would just be a Transport Company.

Second Element: Customers: If we can’t get people to pay for value that is created by a few people working towards a cause, be it a donation or value for service or product sold, then there is no business let alone the need for a Management philosophy.

While this can be concluded as Employees First and Customers Second but I am not making that conclusion or assertion just yet.

Third Element: Analysts: Not all Industry sectors are covered by Analysts and surely not in all countries. If you are in a mature market or are looking to grow a business in a new market which is covered by Analysts, then strengthen these Analysts Relationships. Unless, they stay accurate to your message this element of Community First will be the golden button missing from your Corporate suit.

Fourth Element: Competitors Understanding, Mapping and Analyzing your Competitors is done by a lot of firms often at the cost of focusing on Innovation and maybe rightly so if you are not one of the Top 5 players in your market.

Making your Competitors your Vendors or Partners is the golden way to ensure alignment in your Community First model. This is the hardest thing to understand and get. Something that I will explain in greater detail in my 9 Elements Presentation.

Fifth Element: Investors If you recall your childhood you would remember how you remembered your parents every time you wanted pocket money. It is not very different from how Management in any firm works, guess some people have not grown up yet. We remember Investors when we need their money. At all other times we are too busy, as we have got a Business to run. Investors are also people and remembering them more often than when you just need their money is another sure way to strengthen your Community First model.

There is nothing more useful than making your Happy Customers constantly meet your investors.

Does your Social Data model account for that yet?

Sixth Element: Vendors While equal partnering is a great model it usually fails to deliver when it comes to vendors. Complacency is easy, it sets in fast in any Vendor unless they know that you have options and switching is easy. Most enterprises today struggle with the ‘fixed cost’ of vendor replacement, especially in a large relationship.

Business Agility of the future is the speed with which you can switch a vendor.

Cloud has the potential to provide that at least from a technological stand point as long as you can ensure that you follow an Open Standard, now the fact that these standard itself are still evolving is quite another story.

Seventh Element: Media Most Enterprises have a strong PR group or an agency often more handling their relationship with the Media. Keeping some distance is essential for Corporate Governance reasons

Ensure your organization has a ‘Living’ Mascot, not Bunny the Bear.

It can be your CEO as long as he is a reasonable stockholder. So, if that is not the case, either you must given him more stock or find someone to run the firm who you would be willing to give that stock to.

If you don’t get this right it is likely that the Meta news won’t be very different from the poor news you are already pushing out via your PR engine. (If you are a CEO reading this, do yourself a favor, send this article out to all your investors).

Eighth Element: Partners Partners work like a charm in the business where barter is the norm. This is one good reason why Media businesses do a lot more Partnerships even between fierce Competitors.

The concept is called ‘Buying in’ if you buy from your partners they will buy from you.

This is based on the fundamental Gains from Trade 101 of economics, try to defy that and you will not get the best out of the ‘Community First’ model.

Ninth Element: Consultants Consultants are people who you call when you have a problem. Its like the Plumbing Company that usually gives diagnoses your problem, gives you a fancy estimate and you finally call the local Handyman the next morning to get the job done at a better price. Mistake not they are the same people your Neighbor or your Customer calls when they have a problem.

The Consultants always know what the hottest parties in town are, they are the Event Managers, Hosts and Caterers to these parties.

If you want to be in on the largest deals, blockbusters and make your enterprise grow faster to the next level, your Community First model must not miss this element.

In Summary

It is critical to note that together all the 9 Elements form a ‘Social Ecosystem’ around your organization and their collective power is what takes your organization wherever it goes.

Making the 9 Elements work for you in the right way so all 9 forces are aligned and making you move forward is called ‘Community First’.

For a cohesive Management strategy it would therefore be important to not just subscribe to a ‘great and comprehensive social data model’ but also get your organization structure and business aligned to listen and act cohesively across all the 9 Elements.

As an Enterprise CEO one of the Views in your Dashboard for Enterprise Information has got to be the 9 Elements Dashboard if you want to keep your ‘Community First’.

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