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John Hagel on the Big Shift and understanding the Power of Narrative — January 30, 2014

John Hagel on the Big Shift and understanding the Power of Narrative

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John Hagel walks us through how the ‘Big Shift’, driven by digital technology and a rapidly globalizing world, is driving unpredictable change at an ever increasing rate; and how the ‘Power of Narrative’ can help us create movements that let society benefit and thrive from the Shift.

I have been studying and publishing about the Big Shift at Deloitte’s Centre for the Edge since 2007. We brought together a series of metrics around digital foundations and economic freedom; flows of knowledge, capital and people; together with the impact on value for institutions and individuals to measure and describe how things have changed over the last 50 years.

What we are seeing in 2014 is that digital technologies are coming together into global technology infrastructures that straddle the globe and reach an ever-expanding portion of the population. In economic terms, these infrastructures systematically and substantially reduce barriers to entry and barriers to movement on a global scale. One effect of this is to accelerate the pace of change – information flows at a faster and faster pace to more and more nodes, making it possible for all of us to see things faster and to change our actions more quickly than ever before. As anyone who understands complexity theory knows, the more connected we become, the more vulnerable the system becomes to cascades of information and action that can disrupt the system in unexpected ways.

While previous disruptive technologies have tended to stabilize we are not seeing that with digital technology. Our digital technology infrastructure is unprecedented in human history. It is not stabilizing. The core technology components – computing, storage and bandwidth – are continuing to improve in price/performance at accelerating rates and the best scientists and technologists suggest that this exponential pace will not slow down in the foreseeable future. And the power and scope of impact of these technologies is amplified by their interaction with each other and their ability to accelerate the performance improvement of an expanding array of other technologies. The rapid changes in both the digital technologies and the technologies and business models built on them is blurring traditional boundaries between industries and leading to disruptions that may span the economy.

The Shift does have a dark side. As change continues to accelerate, uncertainty within our institutions grows and performance pressure mounts. Instead of harnessing the opportunity, we see too many institutions becoming more risk averse. It is as though Institutions are waiting for stability that may never come.

It is important that institutions rethink their practices and structures to access the resources and talent they need to learn, adapt, and innovate in times of constant change.

A useful resource is the Shift Index, and in this case – the Shift Index in Australia, which was compiled by Peter Evans Greenwood – the author of The New Instability.

The Shift Index for Australia represents the first time the Centre for the Edge has compiled a Shift Index outside the US. While many things are the same, there are also marked differences. In the US we have seen a steady decline in Return on Assets, whereas in Australia we are seeing a steady increase. We are seeing increased competitive intensity in Australia over the long term but it is still a long way from the competitive intensity in the US. Returns to creative talent in Australia are lower than in the US which may have provided some insulation to Australian companies in terms of the financial returns they are able to generate. On a public policy front, Australia has seen ongoing reform over the last three decades such that it is ranked 3rd globally on the Economic Freedom Index.

My second focus is on the Power of Narrative.

As organizations and individuals experience increasing pressures and rapid changes, I believe that what we need is a new narrative: One that isn’t confined to a specific country, race or religion, but that highlights the incredible opportunity created by digital technology infrastructures on a global scale that are evolving at an exponential rate.

One that focuses on the ability of each of us to achieve far more of our potential than we ever would have imagined possible and the opportunity to achieve even more when we come together on a global scale to learn faster than we ever could on our own. One that is clear about the challenges we will face as we seek to address this opportunity, but one that is also compelling about the abundance that will result as we overcome these challenges. One that helps us to find each other as we begin to gather on the edges of existing institutions and gain support from each other across multiple edges in different institutions and different parts of the world as we embark on this amazing quest.

Everyone is captivated by the emotional power and engagement of stories, and it’s true, stories have enormous power. But to understand the much greater power of narrative, I point to the significance of narratives throughout history. Every successful social movement in history has been driven at its core by a narrative that drove people to do amazing things, even give their lives, whether it’s the Christian narrative, the American narrative or the Marxist narrative. Narratives have an extraordinary power of pull.

Narratives are relevant at multiple levels – they can shape our lives, our institutions and the social arenas that surround us. Narratives are far more powerful than stories because they actively call for participation – they are open-ended, with the resolution hinging on the choices and actions that each of us will take in the days and years ahead. The outcome depends on us. What will we choose to do?

Note: Silicon Valley based John will be visiting Melbourne on February 21 to share, explore and discuss how we, as individuals and through roles we may have in Institutions, can make the most of the extraordinary opportunity to turn stress into abundance.

Get your tickets to John Hagel’s Melbourne Tour at Deloitte’s Center for The Edge here. Hagel will be joined at the event by Pete Williams and Pete Evans-Greenwood.

About our contributor // John Hagel is an author and former consultant who specializes in the intersection of business strategy and information technology. In 2007, Hagel founded the Deloitte Center for the Edge Innovation. Follow him on Twitter @jhagel.

Interview: Melbourne local, Pete Williams — December 11, 2012

Interview: Melbourne local, Pete Williams

Our prolific ambassador Jacqueline Shields interviews the Chief Edge Officer for the recently-launched Deloitte Centre for the Edge AU, founder @deloittedigital, innovator, speaker, facilitator, provocateur, Adjunct Professor at RMIT, board member of Circus Oz and top end Angry Birds player.

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Photo by Australia Unlimited

Pete, your business card reads ‘Chief Edge Officer for Deloitte Centre for the Edge AU’. Impressive title. What exactly does that mean?

The Centre for the Edge looks at what is happening at the edges of society and business, often driven by technology and helping people understand how things are changing and where the world is moving. As I’m the only person in Australia who is in that group, I decided to call myself the Chief Edge Officer. It resonated well. Research Director doesn’t sound that fancy.

It basically means someone who looks the edges and takes an ecosystem view of the world – at the clouds, crowds, gaming, social media, use of data, how to make information flow and how to get the most out of passionate people. Self-titled.

In your opinion what are some of the emerging opportunities that are at the edge of business and technology?

The main thing we are seeing is that the world is just moving faster and faster with organisations struggling to keep up while their customers and employees aren’t having the same problems. So you have Joe Public who has this wonderful array of gadgets like Blu-ray and Wifi, and is always on and always connected, but they come to the office and it’s like going back to medieval times.

We are saying to these organisations that the pace of change is starting to disrupt you, things have fundamentally changed, but you haven’t. We are seeing this in retail, IT, telcos and the media in particular. So we are asking the question: how are you going to adopt a different model?

Business can look at what is going on at the edges and look into how they would use a crowd or how the gaming world applies to them. It’s not so much building games but using things like levelling up, recognition and reward, badges, achievements, leader boards, kudos, those sorts of things and bringing them into the process to encourage your customers to do what you want to do with them.

What do you say to people when they say ‘I don’t do social media’? In particular those at senior executive level?

My answer to that is that the fact you don’t use it is irrelevant because your customers and employees do.

An organisation that puts the blinkers on is really like an ostrich putting his head in the sand. Social media is not going away. It’s a change in the way that people connect and collaborate these days.

We are seeing social media driving a fundamental change in the web. When the web first started it connected people to information stored on a remote browser. Then we then saw transactional capabilities come in i.e online banking. In the early 2000s we started seeing the rise of the self-publisher. In the old days it was hard to set up a website but it became very easy with tools like WordPress, Blogger and Tumblr and we saw a mass increase in that. We also saw the ability for people to amplify and discover through the likes of Twitter where you can get massive amplification, a huge audience of 40,000 before you blink, and it builds momentum and flows through the network by retweeting. People have become their own media.

Twitter is clearly the greatest source of real-time information ever known to humankind. News that used to break through traditional media now breaks on Twitter. You have people on the spot with any incident taking photos and sharing and seeing what is going on. So you have the ability to tap into what’s happening now without it necessarily being curated, maybe it’s raw, but still if you want to keep up with what is going on, what is happening and what is coming at you, Twitter is the place to do it.

The other thing we are seeing is that applying social media in a business context can add massive value. At Deloitte we use social media to drive our innovation program. We’ve been doing it since 2003 before the words social media even existed. We have an open ideas platform where staff can contribute any time day or night, comment, share and collaborate.

Chief Edge Officer is a far cry from what you studied, chartered accounting. What was it about the digital space back in 1993, when you started working with internet technologies, which saw this as your chosen career path?

I am still a Chartered Accountant, a fellow of the Institute of Chartered Accountants. That’s a qualification that’s useful. However I felt that I wasn’t growing as much as I’d like to with the work I was doing. I saw the web for the first time and after a few minutes got an understanding of what was happening and thought to myself ‘wow this going to change everything, this is going to change humanity’. That’s why I decided to immerse myself in it.

I had that feeling that I was in on the ground floor. There were seven million people on the internet when I first jumped on and I thought that’s on the top 1/10th of the world’s population. And back then the first web browsers appeared in the Mosaic browser. I had used the internet before and it was clunky but suddenly a browser made it easy and my sense was that we were leveraging through a massive telecommunications network, connectivity that people had that was in a way self generated. No real barriers and restrictions to people doing what they wanted to do.

And I immersed myself into learning everything I could around it and I realised pretty early that there would be people that would be elite programmers and that it was unlikely to be me!

I was intrigued with what you could do with the technology, the art of the possible and the capacity to experiment, prototype and play. That is what drove me. And since 1993 I have never really seen a reason to change.

Even through the Dot-Com crash. On that day I was shitting myself. I knew that it was inevitable. Because what has happened was you had seen a ridiculous bubble where anyone who came up with an idea and put dot.com in front of it seemed to be able to rake in multiple millions of dollars. It was flooded with get quick rich merchants. And all the dot.coms fell through the floor but to some extend it was a good thing because it cleaned out all the fly-by-nighters and it started to establish itself as mainstream.

Are you sure it wasn’t because you saw it as your ticket to wearing t-shirts and jeans to work instead of a suit and tie?

Not particularly. We had a CEO in 1997 who came up with a policy to just wear whatever makes sense for you and your clients, so I had that permission anyway but these days it’s better as a way of getting free clothes. That all started because it so happened that when I wore a client’s t-shirt they were soon a hit.

What are the common mistakes organisations make when they use social and digital media and they find it doesn’t meet their expectations?

Common mistakes are:

  1. They don’t have a clear understanding of what they are trying to do or a strategy
  2. They think that because someone has a Twitter account, uses Facebook and is 19 years old, that they are some sort of guru and entrust what they do with them
  3. Doing dinky stuff – crappy little campaigns that get followers but that don’t create engagement.
  4. Ignoring it
  5. Not monitoring what is going. Before you are on the front page of the Herald Sun, it starts bubbling away on social networks. So you should be being aware of what people are saying, where you stand and if there is someone coming at you
  6. The panic reaction. That if someone says something wrong the sky is going to fall in and we must stop using it
  7. Banning it. Organisations ban it and yet their employee is sitting there with a Smartphone. What we tend to see is that people who are given these tools and start to understand how to use them, not just in their personal context, then apply it in a work context. If you don’t allow staff to use it for work and you ban it, you are stopping information flowing and the capacity to amplify

Who would you put at the top of your list as Australia’s No 1. Digital Influencer?

Me. You look at that list and there was nobody there that was around at the start that is still around now. I look at that list and I see a lot of people who have done some fantastic stuff but not from the get go.

I’d say I am the most influential pioneer.

On a personal note, you have been instrumental in using social media to assist with the slow but steady rebuilding of Flowerdale, the small Victorian town which was devastated by the firestorm that was the 2009 Black Saturday bushfires. Five people died and four of every five houses in the town was demolished. What prompted you to use social media to tell the stories of survivors and to coordinate the rebuilding efforts?

Because the houses of my mother-in-law and my sister-in-law both got burnt down in Black Saturday. And they asked me.

On Black Saturday both the CFA and the DSE’s websites had crashed and the only way you could get information was via Twitter. I saw on Twitter that the fire was pretty close to where my parents-in-law were so I rang them and said get out, it’s just over the hill, and coming at you. The news media was hours behind. The radio even though they knew through the reports on the ground that there were massive fires going through the place couldn’t report them until the CFA had confirmed that there were fires. So the traditional and official communication channels were using out of date methods to get information to people. The only place you could really find out what was going on was through social media.

And the other thing was my sister came down with all these pages of hand written notes from the people of Flowerdale and I saw what wasn’t going on up there – which was any help. I thought, I have to get this message out, and the easiest way to get the message out was to publish it myself. Whack them all on a blog, let people know what is going on and use twitter to amplify it.

And the other thing was that how do we let the community know what is going on? How do we avoid population flight? What about the people who have moved out and don’t know what is going on and aren’t in the community? What about families of the people who are interested in the rebuilding and who want to get involved and help? Social media was the easiest and most appropriate thing to do when you don’t have any money but you have time and sweat.

What do you want for Christmas?

Whatever Amazon tells me what I want. They know me better than I know myself.

About our Ambassador // Jacqueline Shields. Luckily Jacqueline is not a cat. She’d be on her ninth life. Her inquisitive nature sees her say yes to pretty much anything – a  Tough Mudder, an African Safari, sailing down the Nile in a felucca and even a HTML workshop. And each and everything she tries, she takes great joy in writing about. You can connect with Jacqueline on Twitter @hillrepeats.

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