The Fetch Blog

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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.

Opinion: Who is at the bleeding edge of social in Australia? — January 3, 2013

Opinion: Who is at the bleeding edge of social in Australia?

Jacqueline Shields recently interviewed Pete Williams in a local profile for The Fetch. During question time, she also discovered his thoughts on who is leading social’s edge within Australia.

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Pete Williams, Chief Edge Officer at Deloitte’s Centre for the Edge Australia, helps senior executives understand emerging opportunities on the edge of business and technology for corporate growth. Here, he shares with us his thoughts on companies and industry sectors succeeding at social – those that are adopting different business models in rapidly-changing landscapes.

To offer great customer service there are a few options open to companies. One is to employ more customer service people at a high cost. Another is to off-shore it at a lower cost even though you know that your customers aren’t going to be satisfied. The smartest way is to get the people who know most about your products, the people who use it every day, to help each other. Both Telstra and the Commonwealth Bank do this well.

Examples

  • Telstra’s CrowdSupport Help & Support Community Forum

Rather than Telstra manage all their customer service activities, they have their customers support customers. This model incorporates cloud, social, mobile, crowdsourcing and gamification and it’s been a spectacular success. There are around 60,000 enquires a week dealt through that channel alone and this has resulted in them being very successful in customer support.

  • Commonwealth Bank Pi

The Commonwealth Bank has just launched a platform called Pi. It’s a next generation tablet payments system like a next generation EFTPOST machine. What they have done is opened that up for developers to get involved and create apps. Again instead of the organisation saying, “We will come up with every idea and build it and launch it”, they are acknowledging that there is a smarter model.

This model taps into an explosion of innovation, leveraging clouds and seeing themselves as a platform provider as opposed to needing to be responsible for everything they do. We’ve been seeing that for many years with the web titans – the Amazons, the eBays, the YouTubes and it being popularised through Apple’s and Google’s App Stores.

Theory

Both these examples show how business can look at what is going on at the edges and explore how they could use a crowd or how the gaming world applies to them. It’s not so much building games but using aspects of gaming such as levelling up, reward and recognition, badges, achievements, leader boards, and kudos, and bringing them into the process to encourage your customers to do what you want to do with them.

It’s a bit like an open-source community where you have support forums and that’s an edge that we have been seeing for many years of how these communities share knowledge and knowledge flows at a user-to-user level. Two such communities are the high end World of Warcraft guild and the top end Angry Birds community where you need to be monitoring what new ideas and new strategies you have got. Also what are you learning from your personal dashboards, because the community keeps learning and learning so you have to be able to analyse all that information, then quickly synthesise it in the terms of the way you operate.

These online learning communities with elite people all have one thing in common – a propensity to share, using leaderboards, dashboards and social features. This means that the community drives other users to a new level. So adopting gaming techniques can be very effective for organisations. Although as a Telstra user, I do at times question why I am doing customer support for them! But by the same token if I have a problem it tends to be something exotic so the community has also helped me when I have needed assistance.

What about the politicians?

If we look at who has embraced Facebook as an effective communication tool, it tends to be celebrities, sports people and sports clubs. Interestingly enough, politicians have taken the bull by the horns too. No matter what people say about politicians are smart enough to realise when they can connect and reach a large audience. So they are a very interesting crowd who have adopted it while I don’t see the government agencies that they are theoretically running have adopted it any were near as much.

Malcolm Turnbull is particularly good with social media. So is Julia Gillard and Kevin Rudd. Kevin did a tweet recently of a pic of a leak of an orange pen on his shirt. He tweeted that he’d put it in his pocket with predictable results. He tweets what he doing and what he is seeing but he also tweets personal stuff.

Obama set the tone with the 2008 election and it continued on. That was when politicians realised how much of an effect it could have. There is a group that is seen as potentially conservative but who are smart enough to work out what to do with it.

Retailers

Retailers have enormous numbers of people on Facebook. Coles have a massive following. Supre has always been a standout. And were one of the early starters. They got in early. They tried stuff. They experimented. They got a core audience and now it’s just massive. They do A/B testing i.e. Which skirt do you like? This one or this one? They engage people with simple, easy non-dinky bullshit campaign stuff not just because someone wants a prize. They incorporate it into part of their long-term business strategy.

The luxury brands are massive like Tiffanys, BMW, Mercedes. Those luxury brands that people aspire to tend to have mass followings.

If we look at who is doing Facebook well in the banking sector, the Commonwealth Bank sort of does okay. Ubank does pretty well. But what we see in a lot of those traditional business to consumer relationships is that some organisations think they are above it. But as I say, if you are above it then you are above your customers and employees so probably not a great place to be.

Hall & Wilcox the mid-size legal firm across the road use it well. But we haven’t seen the legal profession really understand how to adopt social media.

Recruitment

We are starting to see mining companies use social media for recruitment.

In terms of the business to business side we tend to see organisations using LinkedIn. Someone who does that really well is Deloite Globally. We’ve done fantastically. We’ve also done really well with Facebook largely in the area of recruitment. The first thing we did with Facebook was not to build a Facebook page but to build a Facebook app for our employees in 2008 called ‘Join me at Deloitte’. ‘Your future at Deloitte’ is the Facebook page. But before we had the Facebook page we had the Facebook app where employees could put it on their Facebook page and people could say they were interested in a job at Deloitte. So again leveraging the networks of our people at a time when we didn’t have a Facebook network ourselves. We use Twitter particularly well for pushing information out there.

The use of enterprise social networking is growing in people to people knowledge type organisations Deloitte won the 2011Forrester Groundswell Award award for Best Collaboration System (Management) through our use of Yammer. Capgemini is a big Yammer user and they use it very well as do NAB and Suncorp Group. So we are seeing organisations who have large bodies of people that want to get better innovation, better collaboration and better learning using enterprise social networking technologies.

But there is a long way to go for most organisations and the key thing to understand is that it isn’t going away even if you want to ignore it.

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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