As individuals assert more power in the marketplace, companies are being forced to re-imagine their traditional top-down philosophies. Those that can change and evolve to take advantage of this new ecosystem will thrive; those that can’t (or simply won’t) may not know what’s about to hit them. Read excerpts from the discussion below.
KIRKPATRICK: I’ve argued in Forbes that social software is fundamentally changing the business landscape. Do you agree?
JOHNSON: You framed it as a revolution. I see it more as an evolution. The first phase has started. Starbucks has 38 million fans on Facebook and 1.7 million followers on Twitter. Consumer-facing businesses are using these technologies to empower customers through feedback. They’re also using them within their companies to help accelerate decision-making and facilitate innovation.
HESSE: It allows us to test things very quickly. You don’t have to do as much market research and test marketing. At Sprint, we were able to harness data about why customers were contacting us and what their pain points were and organize the company around those numbers.
MAYER: Product development and innovation are moving faster because users and employees are much more vocal. It’s not obsoleting engineers—you still need someone to say,“I understand your complaint—you want faster horses. We’re not going to do that.” If you tweet and you’re unhappy, chances are somebody from that organization is going to be in contact with you because they can’t let those types of negative brand perceptions sit.
HESSE: We have 2,000 employees who help us communicate our message. We train them on products, etiquette, and transparency, so they identify themselves as Sprint employees. It’s important to make sure your point of view is heard. On our product website, we put what Consumer Reports and CNET and the professional reviewers think, but you also see reader ratings.
JOHNSON: Disruptive innovation comes when you reconfigure different pockets of expertise. We have 4,500 engineers across four major R&D centers, so how do we foster disruptive innovation across multiple geographies? That’s where social networking tools can be useful. Where are the informal networks within the organization? We’re trying to apply technology to help us do a better job of matching and reconfiguring expertise in ways that lead to disruptive innovation. We embrace the idea of bottom-up innovation.
MAYER: Organizations still have hierarchy because you need management and accountability, but different people are jumping in with different skills. Google is not a shy place. On controversial topics it’s not unusual for me to know the opinions of hundreds of employees. People feel they can speak their mind. We’ve come to much better decisions. There are two types of innovation. One is very iterative, where you involve your end users and constantly improve. With the other, you vault your way there, which is what Apple likes to do. At Google we’re a little less self-assured and we like to launch early and often and get user feedback and walk our way there and say, “Okay, we launched. What do you like?”