SXSW10: Charlene Li on Open Leadership

Say goodbye to the bright, shiny object. Social technologies are no longer a foreign land.  "I call it a culture of sharing," says Charlene Li, founder and partner at Altimeter Group.  "It's become frictionless for us to share things with each other." 

The culture of sharing has changed many things in our lives. President Obama did an amazing job of changing the way politics worked. In the old days, the only way to have a relationship with a candidate was to give big money to his or her campaign. Obama was by far the most successful public figure to use social technologies to reach people directly.

Yet a lot hasn't changed. Businesses typically operate within a command-and-control organizational structure, yet information and technology have dramatically changed the way we actually work. And despite urging by the likes of Peter Drucker during the past 40 years, we haven't been able to flatten our organizations to make them more effective. 

Why? "Real relationships," says Charlene, require that you give up control."

But how do we do this?  First, you need to have confidence and humility.  Influence is also critically important.  

But open leadership is a spectrum, and there are many decisions to be made with regard to information sharing and decision-making. It's not black or white; leaders must think clearly about the extent of the openness they are willing to foster.  

So what can you do?  One very basic thing is to be engaged with people who are at the bottom of the "engagement pyramid"; that is, people who watch or share information rather than publishing or curating it.

With Twitter it's so easy to find those people--those who may be venting, complimenting or otherwise discussing your brand--and engage with them. You can save a sale, or just make a transaction easier for a customer. BestBuy's Twelpforce is a great example.  

So what do you do?

1. Align openness with strategic goals. Examine your goals, and pick one where open and social can have an impact.
2. Understand the upside. What is the value? Look at lifetime value? Value of purchase minus cost of acquisition = lifetime value. But how many refer? How big are their networks? These are also elements of value.
3. Support open leadership. These are hard things to change; people tend to be very optimistic or pessimistic about what people will do if they are given more power to change things. The hardest part is to convince the curmudgeon.
4. Manage risk with sandbox covenants. Clearly define the parameters within which people can work.
5. Embrace failure.  Walmart has done an impressive job of this. While it's easy to smirk, they have genuinely learned from past failures and have used what they learned to inform their next strategy. 

"Relationships are hard," Li concludes. They're never perfect, and they require open leadership to thrive. You have to find and support your open leaders. 

Finally, embrace failure, and learn from it.  
  
  
  

Comments

[Myprpro]

I love the quote about control and giving it up being central to real relationships. I wasn't able to make sxsw but am really curious as to what the reaction was to this message in particular at sxsw. And I'm really curious to see what the reaction will be at the World Business Forum where I believe her presentation to executives across the globe will precede that of Al Gore.
Thanks, Susan, for keeping us abreast of SXSW happenings and what Charlene has to say about Open Leadership. It's really fascinating terrain and there's probably no one better suited to guide executives through it than Charlene.

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